Yes, you can use a 529 plan for private K-12 tuition, and the rules got considerably more generous in 2025. Starting January 1, 2026, federal law lets you withdraw up to $20,000 per student each year, tax-free, to cover tuition and a broader set of qualified K-12 expenses at public, private, and religious elementary and secondary schools. The important caveat is that roughly a dozen states have not adopted these federal rules, which can leave you owing state tax, losing a prior state deduction, or both.
Which K-12 Expenses Now Qualify
The original 2017 rule covered tuition and nothing else. The One Big Beautiful Bill Act, signed in 2025, widened the definition effective July 5, 2025. Under 26 USC 529(c)(7), qualified K-12 expenses now include:1Office of the Law Revision Counsel. 26 USC 529 – Qualified Tuition Programs
- Tuition at any public, private, or religious K-12 school.
- Curriculum and instructional materials, including textbooks, workbooks, and digital learning tools.
- Books and other instructional materials, as a separate category covering supplemental reading and reference materials.
- Online educational materials, including subscriptions to educational platforms and digital coursework.
- Tutoring or educational classes outside the home, if the tutor is not related to the student and is either a licensed teacher, a current or former teacher at an eligible school, or a subject matter expert.
- Fees for nationally standardized achievement tests, Advanced Placement exams, and college admissions tests such as the SAT and ACT.
- Fees for dual-enrollment college courses taken during high school.
- Educational therapies for students with disabilities, including occupational, behavioral, physical, and speech-language therapies provided by a licensed practitioner.
Several common school-year costs still fall outside the list. Transportation, school uniforms, extracurricular activity fees, and room and board are not qualified K-12 expenses. Paying any of those from your 529 makes the earnings portion of the withdrawal subject to federal income tax and an additional 10% tax.
One note on IRS guidance: the agency’s Q&A page on 529 plans still references the older $10,000 cap and tuition-only language. The statute itself has been updated, and the newer rules control.
The $20,000 Annual Cap
For 2026, the aggregate annual limit on K-12 withdrawals for a single beneficiary is $20,000. This is a per-student cap, not a per-account cap. If a grandparent maintains one 529 for your child and you maintain another, K-12 withdrawals from both accounts combined can’t cross $20,000 in the same tax year.1Office of the Law Revision Counsel. 26 USC 529 – Qualified Tuition Programs
Anything above $20,000 pulled for K-12 in one year is treated as a non-qualified distribution. Ordinary income tax and the 10% additional tax apply to the earnings portion of that excess. If more than one account exists for the same child, coordinate the withdrawals before the year ends.
The $20,000 ceiling applies only to K-12. College withdrawals from the same account for the same student follow their own rules and don’t count toward this cap. A family paying private high school tuition for one child and college tuition for another tracks the two limits separately.
Religious Schools, Homeschooling, and Special Needs
Religious schools are explicitly covered. The statute references expenses tied to “an elementary or secondary public, private, or religious school,” so parochial and other faith-based schools receive the same treatment as any private school.1Office of the Law Revision Counsel. 26 USC 529 – Qualified Tuition Programs
Homeschooling is a harder question. The 2025 expansion added categories (curriculum materials, online educational materials) that overlap heavily with homeschool budgets, but qualified expenses remain tied to “enrollment or attendance at” a school. Whether a homeschool program counts turns on how your state classifies it. Some states treat registered homeschools as a form of private schooling; others don’t. Check your state’s classification before assuming the withdrawal is tax-free.
For students with disabilities, the new therapy category is a meaningful addition. Occupational, behavioral, physical, and speech-language therapies qualify when provided by a licensed or accredited practitioner.
State Tax Treatment Can Undo the Federal Benefit
Federal law and state law don’t always agree here. About a dozen states have not conformed their tax codes to the federal K-12 rules, and living in one of them creates two problems.
The first is recapture. If your state gave you a deduction or credit when you contributed to the 529, and it doesn’t recognize K-12 withdrawals as qualified, it can require you to add the previously deducted amount back into taxable income for the year you withdraw. The state break you already claimed effectively reverses.
The second is state tax on the earnings. In a non-conforming state, the earnings portion of your K-12 withdrawal can be treated as a non-qualified distribution for state purposes even though it’s tax-free federally. Some states pile on their own penalty. California, for example, adds a 2.5% state penalty tax on non-qualified distributions.
States that currently do not conform to the federal K-12 treatment include California, Colorado, Connecticut, Hawaii, Illinois, Michigan, Minnesota, Montana, Nebraska, New Mexico, New York, Oregon, and Vermont. A few other states conform only partially. Iowa, for instance, treats K-12 distributions as qualified only when the school is an Iowa school or accredited under Iowa law. This list shifts as legislatures act, so verify with your state’s Department of Revenue before making a withdrawal.
Your residency controls, not the state that sponsors the plan. A California resident using a Nevada-sponsored 529 still faces California’s rules. Rely on your state’s official tax publication or an administrative notice on Section 529 conformity, not a phone call to the plan.
The Cost of Pulling College Money Out Early
Every dollar you withdraw for K-12 is a dollar that stops compounding tax-free for college. That’s the real trade-off, and it’s easy to miss when the withdrawal itself is legal and the tax savings are visible.
Take a family withdrawing $15,000 a year for four years of high school. That’s $60,000 removed from the account. Left invested at a modest return, that balance would have grown meaningfully by the time college bills arrived. The tax-free growth is the main reason to use a 529 in the first place, and K-12 withdrawals shorten the runway.
Families with tight 529 balances feel this most. If the account will comfortably cover both K-12 and college, the K-12 withdrawal is a straightforward win. If using the money now means borrowing later, run the numbers. The interest on future student loans can outrun the tax savings from today’s distribution.
One workaround: contribute funds specifically earmarked for K-12 and withdraw them quickly, rather than drawing down a long-term college balance. In states that offer a deduction on contributions, you can contribute, claim the deduction, and withdraw for K-12 tuition within the same tax year. Confirm your state has no minimum holding period that would trigger recapture.
How to Take the Withdrawal
You have two options. The plan can pay the school directly, or you can pay the school and reimburse yourself from the 529. Direct payment creates a cleaner paper trail, and most plan administrators support it.
If you reimburse yourself, keep the withdrawal in the same tax year the expense was paid. No IRS rule states this explicitly, but published guidance strongly implies it and tax professionals recommend it uniformly. A January 2027 withdrawal for December 2026 tuition can be treated as non-qualified.
To request a distribution, use your plan’s online portal or submit a withdrawal form. You’ll specify the amount, the beneficiary, and that the funds are for qualified K-12 expenses. The administrator uses that information to code the distribution on Form 1099-QA, which you’ll receive at tax time.
Keep every receipt. You’re responsible for showing the IRS that withdrawals matched qualified expenses and stayed within the $20,000 cap. Save tuition invoices, payment confirmations, receipts for books and materials, and tutoring agreements. Hold these records for at least three years after the tax year of the distribution, which lines up with the standard audit window.2Internal Revenue Service. How Long Should I Keep Records
If your withdrawal exceeds what you actually spent on qualified expenses, the excess is non-qualified. The earnings portion of that excess is taxed as ordinary income and hit with the 10% additional tax. Match the withdrawal to the expense, dollar for dollar, and this doesn’t come up.