ATLANTA — Parents and grandparents, who are using the Path2College 529 Plan to prepare or pay for their loved ones’ college education can now take advantage of new perks.
Last month, Congress passed and the president signed the Protecting Americans from Tax Hikes Act of 2015.
One portion of the legislation deals specifically with 529 college savings plans, making the purchase of laptops, computers and related technology a qualified higher education expense under such plans. Previously, computer and related technological purchases were considered eligible 529 plan expenses only if explicitly required by the college a student attended. Now, a computer qualifies as a qualified withdrawal whether a college requires students to have one or not.
Mitch Seabaugh, the executive director of the Path2College 529 Plan, praised the move.
“This is a common-sense measure that reflects the importance of technology in today’s college classrooms,” Seabaugh said. “Certainly investing in the Path2College is a wise move, as is allowing families to take advantage of their savings to cover the expense of necessary computers and equipment.”
The new rules state that the student — not the family — must be the primary user of the computer. The new rules also allow payments from 529 plans to be used for peripheral equipment, software and Internet access.
The changes in 529 rules are retroactive to Jan. 1, 2015, meaning computer or technology purchases made in 2015 would count as qualified expenses, where applicable.
The PATH Act also allows account owners to redeposit funds back into a 529 plan within 60 days without penalty in the event of a refund of tuition paid.
The Path2College 529 Plan was established in 2002, and through November, more than 28,000 families have withdrawn more than $427 million from the Path2College 529 Plan to pay for education-related expenses. As of Sept. 30, the plan has almost 129,000 beneficiaries with more than $1.7 billion invested.
For more information about the Path2College 529 Plan or to open an account, please visit www.Path 2College529.com.