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Returning Member
posted Apr 11, 2022 12:19:49 PM

529 funds used for K-12 special needs school

I took $10k from my daughter's 529 fund to pay a portion of her tuition at a special needs residential treatment center / boarding school for students with autism. It's a qualified expense, but I didn't receive a 1098-T from the facility.

 

How do I enter this so that I'm not charged a penalty? Private K-12 tuition is allowed according to the IRS, but Turbotax only seems to recognize schools for "higher education" or "vocational programs." 

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2 Replies
Expert Alumni
Apr 11, 2022 12:43:24 PM

No, you don't have to do anything. Please see this HELP article and this THREAD.

Level 15
Apr 11, 2022 6:58:36 PM

You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient qualified  expenses,  to cover the distribution. When the box 1 amount on form 1099-Q is fully covered by expenses, TurboTax will enter nothing about the 1099-Q on the actual tax forms. But, it will prepare a 1099-Q worksheet for your records. 

 

On form 1099-Q, instructions to the recipient reads: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution."