We received a tuition refund because financial aid was not determined at the time of billing. We paid tuition with 529 money. Can I deposit the refund back into the 529?

[bmccrobie98]

The refund is for overpaid tuition because the financial aid award was not determined before tuition was due. I withdrew money from the 529 to pay tuition in Aug 2017. I just received the refund check at the beginning of Dec 2017.

[Hal_Al]

Yes. Thanks to new regulations established by the Protecting Americans from Tax Hikes (PATH) Act in 2015, you can recontribute those funds to your  529 account (check with the administrator of you plan for details) There are some guidelines to follow including: 1) The refunded amount must re-deposited within 60 days of the issuance of the refund; and 2) it must be deposited into a qualified 529 account. As the account owner, you must keep track of all the records showing the date of the refund from the eligible educational institution and then its re-contribution into the 529 plan. Additionally, you will need to maintain all documentation linking the re-contribution to the refund from the eligible educational institution. You are responsible to make sure this transaction meets the Internal Revenue Service (IRS) requirements and is in good order.

References: https://www.collegeadvantage.com/blog/blog-detail/posts/2016/10/05/want-to-make-529-re-contribution-...!

http://www.savingforcollege.com/articles/i-withdrew-too-much-529-money-now-what-1016