Remember, for 529 distributions, room and board charges are qualified expenses. So are expenses for required books and course supplies, as well as certain mandatory fees. Add up all the 529 qualified expenses that the student has, subtract the amount paid by other tax-advantaged funds (this includes tax-free grants and scholarships), and what you have left is the adjusted qualified higher educational expenses for your 529. As long as your 529 distributions for the same tax year are equal to or less than this amount, there are no tax implications.