School is out for the summer, grills are fired up for barbecue season, and summer vacations are in full swing. As you shop for hot dogs and sunscreen, you will likely notice that school supplies are creeping back into stores.

As a parent, it feels like we never really get a break from thinking about our children’s education. I love a good deal on pencils and notebooks for my high schooler, but I am usually not ready to think about returning to the classroom in the fall until at least August.

If you have a college-age student, however, it is the perfect time to start thinking about preparing for withdrawals from your 529 plan. Whether you have a child heading off to college or are planning to use the funds for other qualified educational expenses, it’s essential to have a plan in place now for making back-to-school withdrawals.

Here are some tips for preparing for fall withdrawals from your 529 plan:

1. Review your needs: Before making any withdrawals, review how much you have saved and how much you will have to withdraw. This will help you avoid taking out more than you need.

2. Know the plan rules: Some states differ regarding what are deemed to be qualified education expenses, so be sure to familiarize yourself with your own state’s definition. It’s important to understand what is allowed before making any withdrawals.

3. Plan: If you know you will need to make withdrawals in the fall, it’s a good idea to plan in advance. How soon you get your money can vary depending on the method you choose for withdrawing funds. A check, for example, might take longer to arrive at a school than if you send your withdrawn funds electronically. Know your school’s deadlines. Planning will help ensure you have access to the funds when needed and can avoid any last-minute stress or delays.

4. Keep track of expenses: As you prepare to make withdrawals from your 529 plan, be sure to keep track of all your qualified educational expenses. This will help you stay organized and ensure that you can prove how you used your funds should you face a tax audit.

5. Consider tax implications: When making withdrawals from your 529 plan, it’s important to know the rules on how 529 funds are taxed. While contributions to a 529 plan are made with after-tax dollars, withdrawals are generally tax-free if they are used for qualified educational expenses. However, if you use the funds for nonqualified expenses, you may be subject to taxes and penalties.

Preparing for fall withdrawals from your 529 plan doesn’t have to be stressful. By reviewing your account balance, knowing the rules, planning, and keeping track of expenses, you can ensure a smooth and successful 529 withdrawal process. And remember, if you have any questions or need assistance, don’t hesitate to reach out to your 529 plan for help.

Now, go enjoy summer!

About the Author

Cherie Zajdzinski is a content creator for Utah’s my529 plan. She recently relocated to Utah after spending two decades living in Anchorage, Alaska, and is thrilled to be a part of the mission of helping families save for higher education.