529 funds may be used tax- and penalty-free for Qualified Education Expenses at an Eligible Educational Institution. The IRS defines Eligible Educational Institution thusly:
Eligible educational institution. For purposes of a QTP, this is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. The educational institution should be able to tell you if it is an eligible educational institution.
See IRS Pub. 970, Chapter 8.