Many schools have adopted social distancing guidelines in response to the COVID-19 pandemic, moving classes online or canceling them altogether. As a result, schools are partially or wholly refunding tuition costs for classes.
If you’ve received a refund on tuition paid for with funds from a 529 College Savings Plan, there may be tax implications if the funds are not managed correctly. A 529 plan recontribution is a good way to avoid a taxable event, but there are a few steps you’ll need to take to ensure the refund is recontributed correctly.