Just a point of clarification. An important word was left off from Mike's definition quote...
[My interpretation is that an application fee is "required for enrollment or attendance of a designated beneficiary at an eligible educational institution." (PUB 970 for both CESA & 529s)]
it is "any EQUIPMENT required for enrollment or attendance...."
It would be hard to argue that an application fee is equipment. I think the fees portion of the definition is generally interpreted as being the fee assosiated with tuition but as Mike already mentioned you might be able to justify the application fee to the school the student actually enrolls in. Seems like a stretch though imo.
[This message has been edited by hswankler (edited September 28, 2004).]