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IN DISTRIBUTION

Finish Strong for Their Future

Take the time to celebrate this milestone in your child’s education savings journey —whether the path they’ve chosen is college, trade school, or an apprenticeship. As your child takes these next steps in their education, consider how much you need to continue to contribute to meet upcoming costs as you may be just starting to use your savings or have been taking distributions to pay for expenses.

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College savings strategies look different for everyone. Explore our resources to learn how to make the most of your Plan's benefits and to build a strategy that works best for you.

How to Use Your Plan

We’re here to help you use your savings to pay for college or other qualified education programs and expenses.

How to Take an Investment Plan Distribution What if My Child Doesn't Want to Go to College?
Save Here. Go Anywhere.

Whether your child chooses to attend a college, trade school, or an apprenticeship in Maryland or out-of-state, your account is flexible to fit their needs.

What Education Expenses are Qualified vs. Non-Qualified?

It can be confusing to understand what you can pay for with your Maryland College Investment Plan account. For distributions to be federally tax-free, you have to use the funds for qualified education expenses, which are defined in the Internal Revenue Code. For a complete list, view IRS Publication 970. Check out these examples of qualified and non-qualified education expenses.

Qualified Expenses

  • Tuition and fees at any eligible college or university, graduate school, or vocational school
  • Books, supplies, and equipment required for enrollment or attendance at an eligible college or university, plus computer and technology needs
  • Tuition at K–12 public, private, or religious schools (up to $10,000 per year, per beneficiary)1
  • Room and board at an eligible college or university, including meal plans.
  • Expenses related to apprenticeship programs, including books, fees, equipment, and other supplies (programs must be registered with the U.S. Department of Labor)
  • Education Loan Repayment - the principal or interest on a qualified education loan for the beneficiary - there is a $10,000 lifetime maximum per individual

Non-Qualified Expenses

  • Application and testing fees, including SAT or ACT test prep programs
  • Travel to and from school, and transportation while on campus
  • Sports, games, hobbies, clubs, and non-credit courses
  • Cellphones and cellphone plans
  • Insurance expenses - you cannot use your 529 funds to keep your child’s health insurance up to date
  • Dorm room furniture and decorations
  • Other personal or family expenses

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1 While distributions from 529 college savings plans for elementary or secondary education tuition expenses are federally and Maryland State tax-free, state tax treatment in other states will vary and could include state income taxes assessed, the recapture of previously deducted amounts from state taxes, and/or state-level penalties. You should consult with a tax or legal professional for additional information.

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The Maryland Senator Edward J. Kasemeyer College Investment Plan Description provides investment objectives, risks, expenses and costs, fees, and other information you should read and consider carefully before investing. If you or your beneficiary live outside of Maryland, you should compare the Maryland College Investment Plan to any college savings program offered by your home state or your beneficiary’s home state, which may offer state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's 529 plan.

T. Rowe Price Investment Services, Inc., Distributor/Underwriter of the Maryland College Investment Plan.