Timing of Taking Qualified Distributions

[user_15345]

1) must the distribution be taken in the same year that the expense was actually incurred (ie. Could I request a distribution for qualified costs incurred last year?
2) let's say Child A has a 529 plan totaling $50,000 where he is the beneficiary. His brother Child B also has a 529 Plan account, but it only has $10,000 in it. In November, I change the beneficiary for $30,000 of Child A's account to Child B thus making Child B's account total $40,000. In December, I request a distribution from Child B'a account for $35,000 for qualified expenses that had been incurred earlier in that same year, but before November. Is this allowed, or does it matter that the Child B costs occurred during months of the year before Child B's balance was high enough to pay them? In a similar vein, what if I did not even create Child B's 529 Plan account until November. Could I take distributions in December for qualified costs incurred earlier that year before the account was created?

[dcandmc]

To be specific, distributions must be taken in the same year that qualified expenses were paid, not when they were incurred.

A 529 account can't have more than one beneficiary at any one time, so in your example, when you say change the beneficiary for part of child A's account to child B, what you would have to do is a partial rollover from child A's account to child B's account. Yes, you can take a distribution for qualified expenses that were billed earlier in the year (and even paid earlier in the year with other funds), even if at the time those expenses were billed (or paid by other funds) there wasn't a big enough balance in the student's 529 account to pay everything.