Apartment Living BlogOff-campus Living › Can I Use My 529 Plan for Off-Campus Housing?

What is a 529 Plan?

A 529 plan is a great account that many parents take advantage of when saving for the future. With this plan, money is invested in the account that can later be withdrawn tax-free to pay for college. Many states offer tax benefits for 529 plans, but the catch is that the money can only be used for a particular beneficiary, and only for college expenses. These expenses include tuition, education supplies, and room and board.

These can be tricky terms, however. What qualifies as a college expense? Is rent a college expense if it’s off campus? Are my utilities included in “room and board,” or does it only include rent? What exactly qualifies as education supplies? Here, we clear up the confusion.


No matter where you go to college, you’ll need a crash pad. This can be your parents’ house, the college dorms, or an apartment somewhere close to but outside of the college. Many people prefer off-campus apartments and need to cover that as much as they would on-campus rent. A 529 plan does include off-campus rent as long as you’re going to college half-time for that semester – but it only includes rent and utilities up to the amount specified by the college as a room-and-board allowance.

For example, if your college estimates $800 per month for rent, your 529 dollars can be used for up to $800, including utilities, but any more than that will be taxed under normal federal income tax. With that in mind, a healthy dose of research will be needed before your move. You can find places in that price range close to your college by using a website like ForRentUniversity.com, which helps with location-based apartment hunting.

Most colleges list their room and board allowance on their website, but if you’re not sure, call the college and ask about it. You can never be too careful!

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Of course, food is also a requirement for living and many who live off-campus decline their campus meal plan so their diet is more convenient. Therefore, it’s included in 529 college expenses in a way similar to off-campus rent. Food expenses are frequently calculated with regards to the college food plan; as an example, if the meal plan for the year is $2,000, then you will have $2,000 from the 529 to spend on food that year if they don’t have a specific number for average food expenses. Be sure to keep a running total! It can be easy to overspend on food if you’re not careful with the numbers.

First time grocery shopping on your own? Learn more about meal prepping

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Books, Supplies, and Equipment

This is one of the most complicated parts of the 529 plan. What, exactly, qualifies as school equipment? If there’s a computer in the campus library, can I buy my own as an expense? If it’s important, but not essential, for my college coursework, will it be covered?

For the most part, if it’s used primarily for your education, it counts as a college expense. Textbooks, for example, are a college expense. When it comes to things that can be used for more than one purpose, though, it gets a little vaguer. Computers and Internet access are a great example. After all, if you’re living on campus, you can just use the college Wi-Fi and library computers!

At one point, a 529 plan didn’t cover personal computers unless it was a specified requirement for the college in question. However, Congress recently passed legislation stating that, in this increasingly digital age, it’s important to have a computer for all college education, so 529 plans now cover them. The requirements are that the equipment and software must be primarily used by the beneficiary for educational purposes. In essence, that means things like Word software and medical programs are covered… but the newest Call of Duty video game is not.


As the beneficiary of a 529, many of your expenses end up being covered. It relieves a great deal of the stress that generally comes from being a college student, and it’s easy for your parents and other family and friends to build the fund up in the 18 or so years that you’re working toward college. Still, the tax laws surrounding a 529 plan can get confusing, and no matter what you’ve decided are your expenses, you should always keep receipts and records. Audits are rare, but they still happen. Use this information wisely to make sure you don’t get convicted of tax fraud on a technicality! 

Check out these other tips to consider before deciding to live off campus

About :

Rafael (Raf) is the Targeted Content Writer & Strategist for ForRent.com, CorporateHousing.com, After55.com, and ForRentUniversity.com. He helps create, edit, and plan content that connects current and potential renters with apartment and property managers and owners. When Raf isn’t busy writing, he spends a great deal of his time performing sketch and improv comedy, hanging out at the beach, and looking at memes on the Internet.

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