<p>I was curious about this as well, so I called the FAFSA help line. The person who answered wasn’t very sure of herself, put me on hold and went to check if 529 distributions needed to be reported on FAFSA. She came back with the answer that since the asset is in her grandparents’ name it would not be reported, as many times as I told her I was asking about the distributions, not the asset. so who knows? I don’t think it is income, it is not income for Federal purposes, and it doesn’t fall under any of the tax-free income that I see listed.</p>