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529 refund received on '23 for tuition paid in '22

I paid my daughter's Spring 2023 tuition in 2022 from a 529.  She received a refund in 2023.  This refund was redeposited into the 529.  TurboTax will not allow me to report the redeposited refund on the 2023 return because it exceeds the amount that was withdrawn from the 529 in 2023.

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1 Best answer

Accepted Solutions
Hal_Al
Level 15

529 refund received on '23 for tuition paid in '22

You have nothing to report, just don't enter it in TurboTax. 

 

References:

  1. 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." 
  2. IRS Pub 970 states: “Generally, distributions are tax free if they aren't more than the beneficiary's AQEE for the year. Don't report tax-free distributions (including qualifying rollovers) on your tax return”.

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5 Replies
Hal_Al
Level 15

529 refund received on '23 for tuition paid in '22

You have nothing to report, just don't enter it in TurboTax. 

 

References:

  1. 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." 
  2. IRS Pub 970 states: “Generally, distributions are tax free if they aren't more than the beneficiary's AQEE for the year. Don't report tax-free distributions (including qualifying rollovers) on your tax return”.

529 refund received on '23 for tuition paid in '22

I really don't understand your answer.  Are ypou saying I do not need to report the refund?

Hal_Al
Level 15

529 refund received on '23 for tuition paid in '22

Q.  Are you saying I do not need to report the refund?

A. Yes, because it was re-deposited in the 529 account.

529 refund received on '23 for tuition paid in '22

Turbo tax specifically asks for this information.

Hal_Al
Level 15

529 refund received on '23 for tuition paid in '22

I assumed the re-deposit (rollover) made in 2023 was for 529 funds withdrawn in 2022 and reported on your 2022 tax return.  Since you are now reporting your 2023 1099-Q, that refund has nothing to do with 2023. Entering it is just going to make a mess. TT can't handle this situation, you have to know what you're doing. 

 

The 1099-Q is just an informational document. You do not have to enter it.

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