The “Big Beautiful Bill” (OBBBA) made significant changes to how families can use 529 plan funds. These updates broaden what counts as a “qualified education expense,” giving families and professionals more flexibility in how they use these savings. Expanded K–12 Expenses Until now, the only K–12 expense eligible for tax-free 529 distributions was up to $10,000 per year for tuition. Starting July 4, 2025, families can also use 529 funds for: Curriculum materials, textbooks, and online education resources Tutoring by qualified, unrelated professionals Standardized test fees (e.g., SAT, ACT, AP exams) Dual enrollment fees for college courses taken during high school Educational therapy costs for students with disabilities (occupational, behavioral, physical, and speech-language therapies) In addition, the annual limit for these expenses will increase to $20,000 per year beginning in 2026. Planning consideration: This change is especially valuable for families with children in private or specialized education settings, or those investing heavily in college prep. In Boulder, where many families aim to send their kids to competitive universities like CU Boulder, the ability to cover test prep and dual enrollment courses with 529 funds could make a meaningful difference. Postsecondary Credential Expenses 529 funds can now also be used for professional credentials and workforce training, including: Tuition, fees, books, and materials required for credential programs Exam fees to obtain or maintain a credential Continuing education costs needed to maintain a license or certification Eligible programs include industry-recognized credentials, apprenticeships registered with the Department of Labor, state or federally recognized licenses, and other programs defined under the Workforce Innovation and Opportunity Act. Planning consideration: Not every student follows a traditional four-year college path. In a community like Boulder, where the economy includes not only CU Boulder graduates but also skilled trades, tech startups, and outdoor recreation businesses this expansion makes 529 plans more adaptable to diverse career goals. Retroactive Application The new rules apply to any distributions made after the law’s enactment, even if the expense happened earlier in the same year. That means families may be able to reimburse qualified 2025 expenses as long as the withdrawal also happens in 2025. Planning consideration: Timing matters. Boulder families who already paid for test prep courses, tutoring, or credential programs earlier in the year may now have an opportunity to reimburse those costs from their 529 savings. The Bottom Line OBBBA makes 529 plans more versatile than ever. With expanded K–12 expenses, higher annual limits, and new options for workforce credentials, families have greater flexibility in how they use their education savings. Whether you’re saving for a future Buff at CU Boulder or helping a child pursue a skilled trade or credential, these changes make 529 plans an even more powerful planning tool.