Using 529 Funds for Private Tutoring

Federal laws have changed around the use of 529 funds for tutoring + new in person hours -- what that means for you!

Over the summer, the federal rules surrounding the use of 529 funds changed. This is not financial advice and I strongly suggest you speak with your tax advisor, but I did want to pass along general information for you. Please also make sure you know how your state will treat your 529 as those rules may or may not have changed.

What Qualifies as a 529 Expense for Private Tutoring?

Starting in July 2025, private tutoring counts as a qualified K-12 education expense when certain rules are met. At a high level, the tutor must be unrelated to the student and must meet basic qualifications, such as being a licensed teacher, a current or former school teacher, or a clear subject expert. The aim is to keep funds focused on genuine academic support. More on federal changes to qualified education expenses can be found in the link.

In easier terms: your eighth grader needs help with algebra. You hire a qualified math tutor, you pay them, then you reimburse yourself from your 529 with a tax-free withdrawal. Keep the invoice and proof of payment.

Beyond tutoring, new eligible K-12 expenses in 2025 include:

• Test prep and exam fees, like SAT, ACT, or AP test prep

• Textbooks and required educational materials

• Approved online learning platforms that support coursework

• Educational therapies, such as speech or occupational therapy

• Dual-enrollment course fees for high school students taking college classes

For official background on what a 529 plan covers in general, the IRS provides a helpful overview in 529 Plans: Questions and Answers. That page focuses on long-standing federal rules, while the 2025 updates expand K-12 uses in key ways. Again, however, you should make sure you check in with your tax preparer!

Who Can Be Your Qualifying Tutor?

Qualifications matter. To use 529 funds for tutoring, the tutor should:

• Be unrelated to the student, so no parents, siblings, grandparents, aunts, or uncles

• Be a licensed educator, a current or former K-12 teacher, or a credible subject expert

Examples that fit:

• A certified English teacher who runs weekly writing sessions

• A retired scientist with years of lab experience tutoring biology

• A math specialist who regularly tutors algebra and geometry and can show credentials or a professional track record

Annual Limits and How Much You Can Spend

K-12 withdrawals have yearly caps, and tutoring falls under that umbrella. The cap is per student and includes all K-12 costs you cover with the 529, not just tutoring. Make sure you consult with your tax professional to get accurate numbers and know exactly what you have left.

How Tutoring with 529 Funds Boosts Your Child’s Success

Tutoring makes school feel doable again. Think of a ninth grader stuck on algebra. After four weeks of targeted sessions, their quiz scores climb, and the nightly dread fades. Or a junior polishing essays with a writing coach, then walking into English class ready to participate. When we pair that academic progress with tax-free 529 savings, the impact reaches both your student and your budget.

The structure helps at home too. A consistent schedule, a clear plan, and a tutor who understands your child’s strengths can lower stress for the whole family. Those small wins add up to better habits, stronger skills, and a calmer school year.