Can Homeschoolers Save on Expenses With 529 Plans?
A new so-called 'home school tax break' could change how you save for your child's homeschool education. Find out how.


One of the primary concerns when raising children is their education. While many students attend public or private schools, some parents might choose to homeschool their children for an alternative learning experience.
According to the National Home Education Research Institute (HERI), homeschooling has increased 36% in recent years, with more than 3 million homeschool students currently enrolled in the U.S..
Despite homeschooling being on the rise, the IRS didn't used to consider this method of education a “school.”

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The nonschool status has barred homeschooling educators from claiming popular federal tax breaks, such as 529 plans, which offer tax-advantaged savings for education, for many years.
However, that recently changed with President Donald Trump's "One Big Beautiful Bill" (OBBB). A provision in the mega-tax legislation stipulates that 529 plans can be used for homeschool expenses.
There might be more ways you can save on expenses as a homeschooling educator. Here’s more of what to know.
529 plan for kids: College, public and private school
Current federal law allows tax-advantaged accounts such as Coverdell Education Savings Accounts (ESAs) or 529 Savings plans to help pay for K-12 and higher education (and 529s might even be used for retirement, thanks to the SECURE 2.0 Act).
The benefit of contributing to these accounts is that they allow you to make tax-free withdrawals for qualified expenses, which include any interest the account accrues.
What’s a “qualifying expense?” Some common examples that might be allowed for 529 plans include:
(Note: Coverdells generally cover a broader range of qualified expenses).
- Tuition (up to $10,000 annually for eligible K-12 institutions)
- Books, school fees, supplies and equipment required for enrollment
- Room and board (for students attending at least half time; off-campus rules differ)
- Computers, software and internet access
- Special-needs services and costs for registered apprenticeship programs
Note: The OBBB increased the annual withdrawal threshold to $20,000 for tax year 2026. Additionally, more types of qualified expenses are allowable for K-12 costs in 2025. For more information, check out Kiplinger's report, Money for Your Kids? Three Key Ways Trump's ‘Big Beautiful Bill’ Impacts Your Child's Finances.
Although Coverdells can be used for homeschool expenses, their income limits could exclude many families from using these tax-advantaged savings accounts.
On the other hand, 529 plans have no income limits and can be used for public, private or religious schools. But before the OBBB, federal law didn't allow 529 plan distributions to be used for homeschooled students (state laws may vary).
However, that has now changed under the OBBB.
New homeschooling tax breaks?
Historically, the IRS hadn't provided federal tax breaks for homeschooled education.
While some states, such as Illinois and Minnesota, offer state-level tax credits, there was very little federal tax relief for parents homeschooling their children in most of the U.S..
But a provision in the OBBB tax bill allows tax-exempt distributions from 529 savings plans for “additional educational expenses.” This includes eligible costs for elementary, secondary and homeschooled students.
Qualifying educational expenses for these students include:
- Curriculum materials
- Books and other instructional materials
- Tutoring or educational classes outside the home
- Testing fees and fees for dual enrollment in a higher education institution
- Online education materials
- Educational therapies for students with disabilities
This tax provision is big news for those with K-12 children, especially those who homeschool.
Homeschool can be expensive
The average cost of homeschooling an elementary school student is $1,295 per year, according to a survey conducted by the Home School Legal Defense Association (HSLDA). Middle and high school student costs are even higher, at about $1,636 per year.*
Apart from Coverdell savings accounts, there were few tax breaks to cushion homeschool expenses before the OBBB introduced tax-free withdrawals for homeschooled students.
Although parents of homeschoolers don't send their children to public school, they still pay for public schools through property taxes. This has been a source of contention in the homeschool community for years, particularly because:
- Students who live in rural areas (and might have tougher access to schools) make up 41% of homeschoolers.
- About 15% of parents choose to homeschool due to their child’s physical or mental health challenges, according to the American Institutes for Research, a nonpartisan research organization.
A federal tax break, such as that offered through a 529 plan, provides homeschooling families with tax relief, particularly if the family pays into the public school system and/or homeschools out of necessity.
*The survey conducted by the Home School Legal Defense Association (HSLDA) sampled 4,000 homeschooling families from all 50 states, Washington, D.C., and Puerto Rico. The families who responded had an average of two homeschooled students.
Back-to-school savings for homeschoolers
In addition to 529 plans, here are several ways homeschool parents might save on K-12 education costs for the upcoming school year:
- See if your state offers financial assistance, tax credits or other options to help cover homeschooling expenses. You can visit your state’s Department of Revenue or Department of Education websites for details.
- Enroll your child in city or town-led extracurricular activities if available. Programs sponsored by the local government might be more cost-effective than privately led alternatives.
- Sites such as Easy Peasy Homeschooling offer free curriculum options and printable materials for homeschool educators. These resources might be used in conjunction with lesson plan materials.
- Retailers such as Barnes & Noble and Target sometimes offer promotional codes for homeschooling parents and educators. To use these discounts, you’ll need to sign up for an account and verify your teacher status with a homeschool ID or similar method of verification.
Read More
- New 'Trump Account' for Child Savings
- Three Major Changes for Parents in 'Big Beautiful Bill'
- Family Tax Credits That Can Save You Money
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Kate is a CPA with experience in audit and technology. As a Tax Writer at Kiplinger, Kate believes that tax and finance news should meet people where they are today, across cultural, educational, and disciplinary backgrounds.
-
Stay NJ Could Give You $6,500: The Deadline You Can't Miss
Property Taxes New Jersey has a new property tax relief program for 2025. The application deadline is approaching fast.
-
How the 2025 Child Tax Credit Rules Impact Single Parents
Tax Credits New changes to family tax credits, like the Child Tax Credit, will impact the eligibility of some households.
-
The Fall Garden Tax? What to Plant and How to Prepare
Tax Tips Fall gardening could increase your taxes this season. Here’s what to know while planting in 2025.
-
How Your 2025 Summer Wedding Could Save You Money on Taxes
Tax Breaks There are some wedding expenses that are tax-deductible, and you don’t want to miss out on savings.
-
Texas Sales Tax-Free Weekend 2025
Tax Holiday Here's what you needed to know about the Texas sales tax holiday.
-
Retirees Should Watch These Four Key Tax Changes in 2025
Tax Changes This year brings key tax changes that could affect your retirement taxes and income.
-
The Most Tax-Friendly State for Retirement in 2025: Here It Is
Retirement Tax How do you retire ‘tax-free’? This state doesn’t tax retirement income, has a low median property tax bill, and even offers savings on gas. Are you ready for a move?
-
Tariff Stimulus Checks Coming? New Proposal Seeks Tax Rebates for US Workers
Tax Breaks A new GOP bill proposes to send $600 in tariff rebate checks to eligible taxpayers. Is there a catch?