1099-Q Non-qualified distribution

[kimhunt34711]

I withdrew an amount from my 529 plan to pay for my daughter's wedding, knowing there would be a tax penalty. How do I enter a Non-qualified distribution in my TurboTax filing?

[Hal_Al · Accepted solution]

In TurboTax (TT), enter at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-Scroll down to:

--Education

  --ESA and 529 Qualified Tuition Programs (1099-Q)

Follow the interview. Since there will be no expenses entered, TT will treat it as  a non qualified distribution including the 10% penalty.  Only the earrings (box 2 of the 1099-Q) will be taxed and subject to the 10% penalty.

There is currently a glitch in TT when entering expenses. But that shouldn't affect you. 

[kimhunt34711]

Thanks so much!