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Financial Planning / Tax Strategies


Subject:  Re: College funding questions Date:  7/23/2012  3:24 PM
Author:  TMFPMarti Number:  116441 of 131089

When you graduate and need to start paying (plus incurring interest), then you might want to consider hitting your retirement accounts to pay the loans off.

The tax cost of doing that is that repayment of loans isn't a "qualified" expense that avoids the premature distribution penalty, so unless you did it in the tax year you paid tuition you'd get hit for the penalty.

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