529 College Saving Plans Can Be Used for Registered Apprenticeships

Qualifying educational expenses covered by 529 savings plan have expanded to include registered apprenticeship programs. 

On Dec. 20, 2019, the Setting Every Community Up for Retirement (SECURE) Act was signed into law as part of the federal year-end spending bill. In addition to changes to retirement planning, the new law allows tax-free 529 college savings plan withdrawals to be used to pay for registered apprenticeship programs bringing new flexibility to 529 plans.

State Treasurer Michael Fitzgerald announced in July 2020 updates for College Savings Iowa, including that Iowa taxpayers who are 529 plan account owners can now use funds to pay for qualified apprenticeships.

Iowa has extended the favorable Iowa state tax treatment to qualified withdrawals for apprenticeship expenses and loan repayments from College Savings Iowa accounts. The plan update permits withdrawals from a College Savings Iowa account for fees, books, supplies and equipment required for participation in an apprenticeship program registered and certified with the Secretary of Labor under the National Apprenticeship Act. 

To learn more about the College Savings Iowa changes visit https://www.iowatreasurer.gov/media/cms/SECURE_Act_Fact_Sheet_12_20B8B569CDBAC.pdf

For a list of certified apprenticeships go to https://www.apprenticeship.gov/apprenticeship-finder.

  Jessica - ICAN Ankeny Center