BettieG
Employee Tax Expert

Retirement tax questions

Withdrawing your 529 funds for the entire year’s expenses, rather than just the Fall term, would be risky.  In order to be a qualified withdrawal (i.e., not taxed), you must submit your request for the cash in the same calendar year, not the same academic year, you make the payment to the school.  In order be a qualified withdrawal therefore, you must withdraw the money in the same calendar year that you use it to pay qualified expenses.  You should not then take a withdrawal to cover second semester expenses in this calendar year, unless you plan to actually pay the tuition in this calendar year.

 

This article may be helpful to you:  Information on 529 Plans

 

I hope this helps.

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