A qualified state tuition program is one established and maintained by a state or an agency or instrumentality of the state. The program must be set up to provide for a student's qualified higher educational expenses at an eligible educational institution. The program must meet certain requirements. Your state government can tell you whether or not they participate in a qualified state tuition program.

Qualified higher educational expenses. These are the tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution (defined below). They also include the reasonable costs of room and board for a beneficiary who is at least a half-time student. The cost of room and board is generally considered reasonable if it is not more than either:

1. The school's posted room and board charge, or
2. $2,500 per year for students living off-campus and not at home.

Beneficiary. The beneficiary is generally the student (or future student) for whom the program is intended to provide benefits. The beneficiary can be changed after participation in the program begins. If a state or local government or certain tax-exempt organizations purchase an interest in a program as part of a scholarship program, the beneficiary is the person who receives the interest as a scholarship.

Eligible educational institution. This is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. The educational institution should be able to tell you if it is an eligible educational institution.

Previous | First | Next

Publication Index | 2000 Tax Help Archives | Tax Help Archives | Home