Room and board expenses

[irulichka]

which Room and board expenses can be claimed under Education Expenses?  my student did not pay for Room and board to the school, he rented an apartment and prepared his own meals.  is that a deductible expense?

thank you

[AamilD]

No, those are personal expenses/non qualifying expenses and are not deductible.

[Carl]

Scholarships - Can only be used for the qualified education expenses of tuition, books, and lab fees. That's it.

Grants - Can only be used for the qualified education expenses of tuition, books, and lab fees. If explicitly stated in the grant letter from the grantor, grant funds can be used for other things such as room and board, provided that room and board is in direct support of the education.

529/Coverdell distributions: Can be used for the qualified education expenses of tuition, books, lab fees *AND* room and board, provided the room and board is in direct support of the education. For example, if the student does not enroll for the summer semester and uses 529 funds to pay room & board for that semester, then that's not tax deductible for those 2-3 months.

Out of Pocket Expenses - The only deductible out of pocket expenses are tuition, books, and lab fees. That's it. Nothing else is deductible as an education expense of any type for out of pocket expenses.

[Hal_Al]

Room and Board (R&B) are not qualified education expenses for a tuition credit (or the old tuition & fees deduction), tax free scholarship or the US Savings Bond interest exclusion.

R&B are qualified expenses for a tax free 529/ESA/QTP plan distribution.  Off campus R&B is limited to the lesser of actual cost or the school's "allowance for attendance" (basically what on campus students pay).

[irulichka]

is Cost of Attendance for a student Living at Home with Parents Pers/Misc as listed by the college's financial aid office eligible 529 expense?

[Hal_Al]

Q. is Cost of Attendance for a student Living at Home with Parents Pers/Misc as listed by the college's financial aid office eligible 529 expense?

A. Yes, but not exactly.

Off campus R&B is limited to the lesser of actual cost or the school's "allowance for attendance" .

Calculating home costs is a little difficult.  if the family pays rent, the student's share is the rent + utilities  divided by the number of occupants. If the Family owns the house, the cost would be actual out of pocket costs (not including mortgage principal) divided by number of occupants. 

Most people would be safe in using the school's allowance amounts.

[AmyC]

Yes. See page 52 for qualified distributions at IRS Publication 970, Tax Benefits for Education.

Please see my 529 example with IRS information here.