529s and Med school

seshadri 2009-02-19 22:16:53 UTC #1

My daughter, an undergraduate, is considering going the med school route. The first question we haven't resolved is at what point, and to what extent she takes responsibility for her future. I'd like some advice on the simpler issues like: 1)do 529s apply to med school expenses and 2) if she takes loans, gets part time work, and is significantly independent of us, is it still possible for us to make 529 contributions with her as the beneficiary if we choose to? I'd welcome any opinions on this whole issue, including areas that we haven't even begun to think about.

bwilk 2009-02-20 11:03:26 UTC #2

1. yes, no different than undergrade
2. yes, you can contribute to a 529 for anyone

drew 2009-02-20 15:24:18 UTC #3

1. Anybody contemplating medical school needs to do some crash homework as to the massive potential benefits of joining US military service NOW--some of the benefits are out of this world under the way the system works for folks at the officer level. Yes, I do mean that to join a reserve or guard unit now may make the rules click that much better.

Also, our aid rules provide to extremely liberal postponement of Stafford/Perkins loans and up to 100% debt forgivness of these over short periods of 5 years for certain kids of public service for sums up to about 190,000. (My spouse had a deal which in effect paid more to be a student than to work---and adjusted for tax impact many a new JD would be better off to go work in a public school with Title 1 classification for 5 years than to go seek nonexisting work as a JD or put in 2200 billable hr work years when an academic year is more like 1000 hrs.

rcg 2018-03-20 15:07:06 UTC #4

After the 1st 4 years of medical school, during Internship and Residency and Fellowship years, can 529 distributions be taken to help pay expenses (for room and board costs, for example)?

dcandmc 2018-03-20 18:55:08 UTC #5

Is a medical intern, resident or fellow still considered to be enrolled at or attending an eligible postsecondary school?

In any event, generally a 529 distribution can be taken at any time for anything. The question is whether or not the earnings portion of a distribution will be subject to tax, and possibly a 10% additional tax as well.