Off-campus qualified 529 "Board" expenses: only groceries, or restaurants, too?

[publickeyes]

My daughter is a full-time undergrad studying abroad.  We've been drawing on a 529 account to help fund her education, and this year we've been scrupulous to keep her Room and Board expenses abroad under the "average" COA figures published by her stateside university.  However, I've been unable to find any official guidance on whether qualified 529 expenditures extend ONLY to groceries, or does it include coffee shops, fast food, etc., as well?  I'd be grateful to receive an answer to this question, but I'd be even more grateful if someone could point me to an official publication that specifically addresses this issue.  Thanks for your help.

[JohnB5677]

Yes,  Room & Board are considered qualified expenses for a 529 plan with some restrictions.

This link may give you some clarity:   529 Qualified Expenses.

[publickeyes]

Thanks, John - I know that Room and Board are qualified expenses.  My question, again, is whether qualified 529 Board expenditures extend ONLY to groceries, or can they include coffee shops, fast food, etc., as well?  

[JamesG1]

529 funds paying 'board' expenses would probably not cover restaurants, coffee shops and fast food at would probably be capped by the school's published 'board' fee rate. 

Please see a lengthly analysis here.

[publickeyes]

Thanks for your reply.  I had read through that answer before submitting this post, and it doesn't answer my question.  I'll try posing it one more time:

My daughter is studying abroad, and is trying to keep her 529 food expenses under the "average" meal plan of her stateside university.  They do not have a meal plan where she is, so we want to know whether non-grocery dining expenses are legitimate 529 expenses in her case.  I'm always grateful for an answer - but if you do have an answer, please link to some official document that substantiates your answer. 

Thank you.

[NCperson]

see IRS publication 970, page 58: 

3. Expenses for room and board must be incurred by students who are enrolled at least half-time (defined
below). The expense for room and board qualifies only to the extent that it isn't more than the greater of the following two amounts.

a. The allowance for room and board, as determined by the school, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement
of the student. 
b. The actual amount charged if the student is residing in housing owned or operated by the school

there is nothing stated about where the 'board' expenses occur (could be a 5 star restaurant, I guess), but can't be anymore than the school states for federal aid purposes. 

[Hal_Al]

@publickeyes  - You're not going to get an official answer to your question.  The reference to Pub 970 is probably it. 

I'm of the opinion that restaurants count.  

From a practical standpoint, "nobody" keeps receipts, they just use the school's posted charges. Your school doesn't have that. I would use the posted amounts from the  nearest school that does have plans

[FlyinHog]

I know this thread is old, but hopefully some one can answer this. 

My daughter lives on campus. The first semester, she had basically the most robust meal plan but could not use it all (mostly because of her celiac she was unable to find as much food as often as she would like).  Second semester, we lowered her meal plan to close to the minimum offered. Are we allowed to use the 529 to supplement her meal plan UP TO the avg cost of attendance so that she can use the difference to go out to eat?

Ex - first semester meal plan $4900. Second semester $4100. Can I use that $800 difference to pay directly to her for dining out even though she lives on campus?

Second question - my daughter is now an executive officer in her sorority for the following year, which REQUIRES them to live in the house. The sororities are affiliated with the university and university supports these rules. Can I use the 529 to pay for the actual room and board costs, equivalent to a person at a college with no on-campus housing or dining?

[Hal_Al]

Q.  Ex - first semester meal plan $4900. Second semester $4100. Can I use that $800 difference to pay directly to her for dining out even though she lives on campus?

A. Simple answer: Yes, as the $4900 is an official school charge.  Technically, it might be necessary to verify that the $4900 meets the school's "cost of attendance" amounts.

Q. My daughter lives in an university affiliated sorority house. Can I use the 529 to pay for the actual room and board costs?

A. No. You are still limited to the lower of actual costs or the school's cost of attendance. Unlike the $4900 meal plan, there are no university published numbers for her living situation.