New Bill Allows 529 Plan to Pay For VTNE

This summer, Congress passed the Freedom To Invest in Tomorrow’s Workforce Act, which was rolled into the larger One Big Beautiful Bill. The provision calls for an increase in tax-exempt withdrawals from 529 Education Plans, including qualified postsecondary credentialing expenses. We’re excited to announce that these withdrawals can now be used for qualifying expenses related to the Veterinary Technician National Exam (VTNE) offered by the AAVSB.

The bill would shift the paradigm for 529 plans – transforming them from college savings plans to career savings plans.

Jim Penrod, AAVSB CEO

A 529 Plan is a state-operated education savings account. Earnings and withdrawals are tax-free as long as they are used to pay for qualifying college expenses, including tuition, books, housing, supplies, and equipment. Under the previous law, 529 Plan beneficiaries could not use funds to obtain or maintain recognized postsecondary credentials including the VTNE which evaluates the competency of Veterinary Technicians and is a requirement for state licensing.

The new provision, “Allows tax-exempt distributions from 529 savings plans to be used for additional qualified higher education expenses, including qualified postsecondary credentialing expenses” in connection with “recognized postsecondary credential programs” and “recognized postsecondary credentials.” United States House Committee on Ways & Means – The One Big Beautiful Bill.

The AAVSB Letter to Congress

In an effort to champion this legislation, Jim Penrod, Chief Executive Officer of the AAVSB, wrote a letter to Congress on behalf of the AAVSB Board of Directors’. Mr. Penrod wrote in part, “The bill would shift the paradigm for 529 plans – transforming them from college savings plans to career savings plans.” He also expressed the importance of postsecondary skills training, saying, “It [The bill] would also provide valuable tax-advantaged resources for students and workers – with or without a college degree-who pursue career growth, mid-career changes or career pathways that diverge from a typical academic degree.”

This change reflects the growing recognition of the vital role credentialed veterinary technicians play in animal health and welfare. This bill helps remove a financial barrier for those entering the veterinary profession.

Questions?

For more information about 529 Plan tax advantages and distributions for qualified expenses, talk to your tax advisor or contact the 529 Plan in your state.