Computer for 7 & 10 yr old, is this an eligible expense from UGMA 529?

[fredricjlowe]

New money to start UGMA 529 for two children ages 7 & 10.

I am trying to find out if funds can be used to buy them each a computer for education purposes.

I have only been able to find that this is a gray area and that only tuition can be an eligible expense for K-12.

Is there any guidance anyone can offer to support the use for other expenses as above.

And if it isn't an eligible expense since these are new funds with no earnings, couldn't the custodian (paren) withdraw the funds to buy the computers without a 10% Federal excise penalty since there would not be any earnings?

I also read that some advocate setting up separate 529s for college and K-12. What are your thoughts on this?

[dcandmc]

Computer equipment for a 7 or 10 year old would not be a 529 qualified expense. I don't think it's even close to being in a gray area. For a student of that age, the only qualified expense is tuition "in connection with enrollment or attendance at an eligible elementary or secondary school." Computer equipment is a qualified expense "if it's to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible postsecondary school." Postsecondary school means college. It wouldn't be reasonable to claim that a computer being purchased for a 7 or 10 year old is meant to be used primarily during their college years.

If there are no earnings, a distribution for a non-qualified expense will not incur any tax or additional 10% tax (penalty).