Other definitions and special rules
For purposes of this section—
(1) Designated beneficiary The term “designated beneficiary” means— (A) the individual designated at the commencement of participation in the qualified tuition program as the beneficiary of amounts paid (or to be paid) to the program, (B) in the case of a change in beneficiaries described in subsection (c)(3)(C), the individual who is the new beneficiary, and (C) in the case of an interest in a qualified tuition program purchased by a State or local government (or agency or instrumentality thereof) or an organization described in section 501(c)(3) and exempt from taxation under section 501(a) as part of a scholarship program operated by such government or organization, the individual receiving such interest as a scholarship.
(2) Member of family The term “member of the family” means, with respect to any designated beneficiary— (A) the spouse of such beneficiary; (B) an individual who bears a relationship to such beneficiary which is described in subparagraphs (A) through (G) of section 152(d)(2); (C) the spouse of any individual described in subparagraph (B); and (D) any first cousin of such beneficiary.
(3) Qualified higher education expenses (A) In general The term “qualified higher education expenses” means— (i) tuition, fees, books, supplies, and equipment required for the enrollment or attendance of a designated beneficiary at an eligible educational institution, (ii) expenses for special needs services in the case of a special needs beneficiary which are incurred in connection with such enrollment or attendance, and (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (as defined in section 197(e)(3)(B)), or Internet access and related services, if such equipment, software, or services are to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible educational institution. Clause (iii) shall not include expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature. The amount of cash distributions from all qualified tuition programs described in subsection (b)(1)(A)(ii) with respect to a beneficiary during any taxable year shall, in the aggregate, include not more than $20,000 in expenses described in subsection (c)(7) incurred during the taxable year. (B) Room and board included for students who are at least half-time (i) In general In the case of an individual who is an eligible student (as defined in section 25A(b)(3)) for any academic period, such term shall also include reasonable costs for such period (as determined under the qualified tuition program) incurred by the designated beneficiary for room and board while attending such institution. For purposes of subsection (b)(6), a designated beneficiary shall be treated as meeting the requirements of this clause. (ii) Limitation The amount treated as qualified higher education expenses by reason of clause (i) shall not exceed— (I) the allowance (applicable to the student) for room and board included in the cost of attendance (as defined in section 472 of the Higher Education Act of 1965 ( 20 U.S.C. 1087 ll ), as in effect on the date of the enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001) as determined by the eligible educational institution for such period, or (II) if greater, the actual invoice amount the student residing in housing owned or operated by the eligible educational institution is charged by such institution for room and board costs for such period. (C) Certain postsecondary credentialing expenses The term “qualified higher education expenses” includes qualified postsecondary credentialing expenses (as defined in subsection (f)).
(4) Application of section 514 An interest in a qualified tuition program shall not be treated as debt for purposes of section 514.
(5) Eligible educational institution The term “eligible educational institution” means an institution— (A) which is described in section 481 of the Higher Education Act of 1965 ( 20 U.S.C. 1088 ), as in effect on the date of the enactment of this paragraph, and (B) which is eligible to participate in a program under title IV of such Act.
(1)Designated beneficiary#
The term “designated beneficiary” means—
(A) the individual designated at the commencement of participation in the qualified tuition program as the beneficiary of amounts paid (or to be paid) to the program,
(B) in the case of a change in beneficiaries described in subsection (c)(3)(C), the individual who is the new beneficiary, and
(C) in the case of an interest in a qualified tuition program purchased by a State or local government (or agency or instrumentality thereof) or an organization described in section 501(c)(3) and exempt from taxation under section 501(a) as part of a scholarship program operated by such government or organization, the individual receiving such interest as a scholarship.
(1)(A)#
the individual designated at the commencement of participation in the qualified tuition program as the beneficiary of amounts paid (or to be paid) to the program,
(1)(B)#
in the case of a change in beneficiaries described in subsection (c)(3)(C), the individual who is the new beneficiary, and
(1)(C)#
(2)Member of family#
The term “member of the family” means, with respect to any designated beneficiary—
(A) the spouse of such beneficiary;
(B) an individual who bears a relationship to such beneficiary which is described in subparagraphs (A) through (G) of section 152(d)(2);
(C) the spouse of any individual described in subparagraph (B); and
(D) any first cousin of such beneficiary.
(2)(A)#
the spouse of such beneficiary;
(2)(B)#
an individual who bears a relationship to such beneficiary which is described in subparagraphs (A) through (G) of section 152(d)(2);
(2)(C)#
the spouse of any individual described in subparagraph (B); and
(2)(D)
(3)Qualified higher education expenses#
(A) In general The term “qualified higher education expenses” means— (i) tuition, fees, books, supplies, and equipment required for the enrollment or attendance of a designated beneficiary at an eligible educational institution, (ii) expenses for special needs services in the case of a special needs beneficiary which are incurred in connection with such enrollment or attendance, and (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (as defined in section 197(e)(3)(B)), or Internet access and related services, if such equipment, software, or services are to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible educational institution. Clause (iii) shall not include expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature. The amount of cash distributions from all qualified tuition programs described in subsection (b)(1)(A)(ii) with respect to a beneficiary during any taxable year shall, in the aggregate, include not more than $20,000 in expenses described in subsection (c)(7) incurred during the taxable year.
(B) Room and board included for students who are at least half-time (i) In general In the case of an individual who is an eligible student (as defined in section 25A(b)(3)) for any academic period, such term shall also include reasonable costs for such period (as determined under the qualified tuition program) incurred by the designated beneficiary for room and board while attending such institution. For purposes of subsection (b)(6), a designated beneficiary shall be treated as meeting the requirements of this clause. (ii) Limitation The amount treated as qualified higher education expenses by reason of clause (i) shall not exceed— (I) the allowance (applicable to the student) for room and board included in the cost of attendance (as defined in section 472 of the Higher Education Act of 1965 ( 20 U.S.C. 1087 ll ), as in effect on the date of the enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001) as determined by the eligible educational institution for such period, or (II) if greater, the actual invoice amount the student residing in housing owned or operated by the eligible educational institution is charged by such institution for room and board costs for such period.
(C) Certain postsecondary credentialing expenses The term “qualified higher education expenses” includes qualified postsecondary credentialing expenses (as defined in subsection (f)).
(4)Application of section 514#
An interest in a qualified tuition program shall not be treated as debt for purposes of section 514.
(5)Eligible educational institution#
The term “eligible educational institution” means an institution—
(A) which is described in section 481 of the Higher Education Act of 1965 ( 20 U.S.C. 1088 ), as in effect on the date of the enactment of this paragraph, and
(B) which is eligible to participate in a program under title IV of such Act.
(5)(A)#
which is described in section 481 of the Higher Education Act of 1965 ( 20 U.S.C. 1088 ), as in effect on the date of the enactment of this paragraph, and
(5)(B)#
which is eligible to participate in a program under title IV of such Act.