26 U.S.C. §530(b)(3) · referenced by §25F(c)(4)
Qualified Elementary and Secondary Education Expenses
§25F(c)(4) defines “qualified elementary or secondary education expense” by reference to this Coverdell statute. The list below is therefore the federal definition of expenses ECCA / FSTC scholarships can fund.
Update, October 1, 2026: Treasury’s proposed §25F regulations (not final) lean on this section twice. A qualified expense is one described in paragraph (A) below “and any guidance thereunder” (prop. § 1.25F-1(a)(14)). “School” has the meaning in paragraph (B) below, a K-12 school as determined under state law, and that one definition now governs both which expenses qualify and the rule that an SGO fund 10 or more students who do not all attend the same school (prop. § 1.25F-1(a)(17)). Treasury says it will issue separate §530 guidance on qualified expenses and schools “as soon as possible” and calls it “a high priority”; it has not been released, so questions such as how home schools are treated remain open. The proposal also sets how scholarships pay these expenses: tuition, fees, room and board, and similar charges billed by the school go directly to the school (prop. § 1.25F-3(c)(5)(iii)). The statute text below is unchanged.
(3)Qualified elementary and secondary education expenses
(A)In general
The term “qualified elementary and secondary education expenses” means,
(i)expenses for tuition, fees, academic tutoring, special needs services in the case of a special needs beneficiary, books, supplies, and other equipment which are incurred in connection with the enrollment or attendance of the designated beneficiary of the trust as an elementary or secondary school student at a public, private, or religious school,
(ii)expenses for room and board, uniforms, transportation, and supplementary items and services (including extended day programs) which are required or provided by a public, private, or religious school in connection with such enrollment or attendance, and
(iii)expenses for the purchase of any computer technology or equipment or Internet access and related services, if such technology, equipment, or services are to be used by the beneficiary and the beneficiary’s family during any of the years the beneficiary is in school.
Clause (iii) shall not include expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature.
(B)School
(C)Computer technology or equipment
