Latest / The College Savings Podcast with Fexingo: 529 Plans, Education Funding, and Student Costs / How 529 Plans Cover Your Childs Horse-riding School Tuition
Transcript
- Lucas: Luna, I want to start with a question that may sound a little out of left field: did you ever take horseback riding lessons as a kid? Luna: Actually, no — but I had a friend in high school who was obsessed with dressage. Her parents spent a fortune on it. Lucas: Right, and that fortune might have been eligible for a 529 plan. I'm talking about using your child's 529 savings to pay for tuition at a certified riding school — not just weekend hobby lessons, but a formal equestrian program that leads to a credential. Luna: Wait, so a 529 can cover horse riding? I thought those plans were for college, trade schools, maybe some K-12 private school tuition. Lucas: That's the common understanding, but the SECURE Act of 2022 expanded the definition of qualified educational institutions to include any school that's eligible to participate in federal student aid programs. And there are riding academies that meet that bar — like the Stoneleigh Riding Academy in Virginia, which is certified to offer an equestrian studies diploma. Luna: So if a riding school is eligible for federal aid, then its tuition is a qualified expense under a 529 plan — just like a university? Lucas: Exactly. The key is that the school must have a valid federal school code, which you can verify through the Department of Education's database. If it does, then 529 funds can be used tuition, fees, and even room and board if the student lives on campus — though most riding schools are commuter programs. Luna: That's huge for families whose kid is serious about competitive riding. But what about the line between a hobby and an actual program? The IRS can be touchy about that. Lucas: Great question. The IRS looks at whether the program is primarily educational and leads to a recognized credential — like a diploma, certificate, or degree. A summer camp that teaches riding fundamentals? Probably not eligible. But a year-long program that combines riding theory, veterinary science, and stable management with graded assessments? That passes the test. Luna: So the parent would need to confirm the school has that federal code, and then keep documentation showing the program's curriculum and the student's enrollment status. Lucas: Exactly. And one more thing: the funds have to be used for the beneficiary — your child — not for another family member. So if your 13-year-old is enrolled in a qualifying riding academy, you can pay tuition directly from the 529 plan. Just make sure the withdrawal is coded as a qualified education expense when you file taxes. Luna: What about the cost of the horse itself? Or riding gear? That feels like a common cost parents might try to include. Lucas: That's a hard no from the IRS. Equipment like saddles, helmets, and the horse's purchase or lease are not qualified expenses. Only tuition, fees, and if applicable, room and board. So the board for the horse at the school's stable? Not covered. But the student's own housing if the school requires on-site living? That could qualify. Luna: So the line is drawn around direct educational costs — not the tools of the trade. Lucas: Right. And this is where I think a lot of families trip up. They assume that because the program is expensive, everything related is fair game. But the IRS is pretty strict: if it's not listed in Publication 970 as a qualified expense, it's a non-qualified withdrawal — subject to income tax plus a 10 percent penalty on the earnings portion. Luna: Which can really eat into the savings. So the safe play is to pay the school directly from the 529 plan for tuition only, and use other funds for the extras. Lucas: Exactly. And one more nuance: the riding school must be an 'eligible educational institution' as defined by the Higher Education Act. That's the same standard for colleges and universities. So a mom and pop riding stable that isn't federally certified won't work, even if they offer a great program. Luna: How many riding schools actually have that certification? I can't imagine it's common. Lucas: It's not. But the number is growing. The Equestrian Land Conservation Alliance and some state equine councils have been helping academies get certified. As of 2026, there are roughly 40 accredited equestrian degree programs in the U.S., many at community colleges or technical schools that happen to focus on equine studies. Luna: So a parent might find that their local community college has an equine science certificate, and that would definitely be eligible — and then they can also pay for riding lessons that are part of the curriculum. Lucas: Precisely. And that's actually a more common path: enroll your child in a community college's equine program, and the riding instruction is baked into the tuition. That way, you're using 529 funds for a clearly qualified expense, and the child gets both academic credit and riding time. Luna: I love that workaround. It's cleaner from a tax standpoint and still supports the kid's passion. Lucas: Let me give you a concrete example. Say your daughter is enrolled in the two-year equine management program at North Dakota State College of Science. That's a public two-year college with a federal school code. Her tuition is $8,000 a year, plus $3,000 for course-required riding lab fees. All of that is a qualified expense under her 529 plan. No ambiguity. Luna: And if she lives in the dorms, that's covered too — within reason. Lucas: Right, up to the school's official cost of attendance for room and board. So you could potentially cover $15,000 to $20,000 a year per child from a 529 plan without any tax issues. Luna: That's a pretty strong argument for using a 529 even if your child isn't on a traditional college track. Lucas: Absolutely. And it's not just riding schools. The same logic applies to flight schools, culinary institutes, trade schools — pretty much any postsecondary program that's federally recognized. The equestrian angle is just a fun example of how broad the definition has become. Luna: You know, Lucas, this conversation reminds me why I appreciate the show. We dig into these specific use cases that parents actually face, and it helps them make smarter decisions with their savings. Lucas: I feel the same way. And if today's episode saved you a headache or gave you a new idea, honestly, if it was worth a coffee to you, that's the link — buy me a coffee dot com slash fexingo. It's a small way to keep the show ad-free and focused on exactly these real-world angles. Luna: Yeah, listener support is what lets us do deep dives like this without worrying about sponsors. So if you've gotten value from any episode, that link is there. Lucas: Okay, back to the riding school topic. One more important detail: if your child is using a 529 plan for a program that doesn't culminate in a degree — like a one-year certificate at a riding academy — the same qualified expense rules apply. No difference. Luna: So it's not just about colleges. It's about any certified program. That's the key takeaway. Lucas: Exactly. And I'd add that parents should also check if the riding school offers the option to pay tuition in installments. Some 529 plans have minimum withdrawal amounts, so you don't want to accidentally over-withdraw. Luna: Good point. Also, if the child later decides to switch to a traditional college, the 529 can be rolled over without penalty as long as the beneficiary stays the same. Lucas: Right. So there's no downside to using a 529 for a riding program if it's truly qualified. Worst case, you change your mind and the money is still available for college. Luna: And if you're using a 529 from a state with a state income tax deduction on contributions, you get that benefit regardless of where the child eventually studies. Lucas: Exactly. So to sum up: riding school tuition is a qualified 529 expense if the school has a federal school code and the program leads to a recognized credential. Equipment and horse costs are not covered. Document everything, pay the school directly, and you're golden. Luna: And if your child's dream is the Olympics, well, you might need a bigger 529 plan. Lucas: Or a very understanding sponsor. But the tax-advantaged part is a great start. Thanks for the conversation, Luna. Luna: Always a pleasure, Lucas. Until next time.