Use your 529 for trade school or a license (2026)

For withdrawals after July 4, 2025, 529 savings can pay for a trade certificate or a license, not just college. The 2025 tax law added “qualified postsecondary credentialing expenses” to what a 529 covers. Source · 26 U.S.C. 529

That includes commercial driver’s license (CDL) school and welding courses, when the program leads to a recognized credential and passes one of four tests, such as being on your state’s job-training list.

What a 529 can pay for now

The law covers tuition, fees, books, supplies and equipment required for a recognized postsecondary credential program. It also covers testing fees when the test is required to get or keep the credential, and continuing education fees when they’re required to keep it. Source · 26 U.S.C. 529(f)

Chase gives examples including certificates and industry certifications in welding and aviation mechanics, licensing exam prep and fees, and commercial driver’s license training. Source · Chase For what those programs pay and how long they take, see our guide to paying for EMT, phlebotomy or CDL training.

The four tests a program can pass

A program counts if it trains for a recognized credential and meets any one of these: Source · 26 U.S.C. 529(f)(2)

1. It’s on your state’s training provider list under the Workforce Innovation and Opportunity Act (WIOA).
2. It’s listed in the Department of Veterans Affairs (VA) WEAMS directory of approved programs, the list the GI Bill uses.
3. The credential needs an exam from a recognized organization, and that organization recognizes the program as preparing people for it.
4. The Treasury Secretary has named it a reputable program.

The credential itself has to be recognized too. That includes state or federal occupational licenses, registered apprenticeship certificates, certifications accredited by bodies such as the American National Standards Institute, and credentials in the Defense Department’s Credentialing Opportunities On-Line (COOL) directory. Source · 26 U.S.C. 529(f)(3)

Check your program in two questions

Two things to check before you withdraw

State taxes. Some states don’t treat every federal 529 expense as qualified for state tax. Chase gives pre-college costs as an example and says to check with a tax professional. Source · Chase Ask your plan whether credential costs count in your state.

No double-dipping. You can’t use the same dollars for a tax-free 529 withdrawal and an education tax credit. Publication 970 says the expenses you count for the 529 must be reduced by any expenses used for a credit. Source · IRS Publication 970

How to use it: four steps

1. Confirm the credential

   Name the license or certification the program leads to.

2. Find the program on a list

   Search your state’s WIOA eligible training provider list, or ask the school which list it’s on.

3. Check your state's tax rules

   Ask your 529 plan whether credential costs are qualified for state tax where you live.

4. Withdraw in the same year you pay

   Publication 970 compares withdrawals with expenses paid during the same year. Source · IRS Publication 970 Keep receipts for tuition, equipment and exam fees with the listing page.

Frequently asked questions

Can a 529 pay for a CDL course?

Yes, if the course leads to the CDLCDL, Commercial driver’s license. The license you need to drive large trucks and buses for work. and passes one of the four program tests, such as being on your state’s WIOAWIOA, Workforce Innovation and Opportunity Act. The federal law behind American Job Centers. Through your local center it can pay for approved job training if you qualify. list. Chase lists CDL training among the examples. Source · Chase

Does it cover the licensing exam itself?

Yes, when the exam is required to get or keep the credential. Source · 26 U.S.C. 529(f)

Can I use a 529 for an apprenticeship?

A registered apprenticeship certificate is a recognized credential under the law. Costs the program requires, such as tools or classroom fees, can count if the program also passes a program test. Source · 26 U.S.C. 529(f)

Your next step

Find the program on your state’s WIOA list before you withdraw. If the 529 won’t cover it all, see whether Workforce Pell can pay for a short program. All our Job Training guides are in one place.