Confused about 1099-Q and 1098-T in filing

[dmburkha]

My kids are listed as recipient of the 1099Q's (2), and I have their 1098T's. Both are claimed as dependents, both are filing returns of their own, but the money came to us, and we paid their tuition. Who includes the 1099Q and 1098 T on the return? Do we answer the question in TT as if  WE received the 1099Q and paid tuition for US, or does it go on theirs. the answers I found on this are confusing

[JaimeG · Accepted solution]

They are your dependents, in this case only you can claim the Education Credits on your Tax Return. You can enter both the 1098-T and the 1099-Q on your Tax Return.

When you are entering the information from 1099-Q there is one detail that is easy to overlook. You must pay special attention to Box 6 -Recipient is not designated beneficiary-. This is the box that can change the entire nature of the distribution.

• If the 1099-Q has you name on it, you are the recipient so you will check this box
• If the 1099-Q has your son's names on them, you are not the recipient so you will not check this box. 

Once you have entered all of the information, you will have the option to apply a portion of the 1099-Q distribution to the American Opportunity Credit (if you children still qualify). This amount will be taxed with your income but the 10% Additional Tax will be waived. It becomes a simple matter of comparing the benefits of the American Opportunity Credit versus the Extra amount you will pay in Taxes. 

EDITED [04/18/2017 11:44AM PST]

Qualified Education Expenses; for 529 and Coverdell ESA Plans

• Tuition and fees;
• Books, supplies and equipment; Computers and Software
• Room and board expenses for students enrolled at least half-time only to the extent they are not more than the greater of
• The allowance for room and board included in the cost of attendance for federal financial aid purposes, or
• The actual amount charged if the student resides in housing owned or operated by the eligible education institution; and
• Expenses for special needs services required by a special needs beneficiary and incurred in connection with enrollment or attendance.

[dmburkha]

So if the recipient box on the 1099Q says "My Name FBO His or Her Name Ed Savings Acct" and bos 6 is not checked, I answer "no" to the  TT question "were you the beneficiary of a Coverdell ESA?" and "yes" to the following question "did you receive forms 1099Q for distributions..."?

[JaimeG]

Correct. I have also added a list of Qualified Education Expenses for purposes of 529 and Coverdell ESA plans to the previous answer above. There are quite a few more expenses that are allowed with these types of funds.

[dmburkha]

Thank you

[lohmang]

I also have this problem.  So even though the "recipient" of the 1099-Q is my daughter, whom I have claimed as a dependent, I should declare that 1099-Q on my taxes, not hers (she has other income, so is filing her own taxes), along with the 1098-T that documents its use for educational expenses, correct?  She is listed as the recipient of the 529 funds, even though they were sent directly to the college.  If I do this, she should file neither the 1099-Q nor the 1098-T with her taxes, correct?

[MotoHeadMan]

Ok, so I hope my question is not too ignorant . . . this is "TAXING" me!!

My son is in college

I had VA529 distributions to pay for on campus living and a meal program

We had reciprocal benefits - All of his tuition was paid - Thanks to his mom

I have both 1099-Q and 1098-T in hand, both with him being the recipient

Box 6 on 1099Q is NOT checked - so he is indicated as the recipient

He is my dependant . .  

He had no other income last year, so no W2 

I entered BOTH on my return - TT got the education credit for me.

By question now, is what do I file on HIS return?? 

[RobertB4444]

@MotoHeadMan  He had no income.  He has no return.  All of the education credits go to you so it's all done.