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jeffreyl
New Member

I had excess 529 distributions and TurboTax gave me specific numbers to enter as student income not corresponding to 1099-Q. How do I enter them on student's return?

 
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maglib
Level 10

I had excess 529 distributions and TurboTax gave me specific numbers to enter as student income not corresponding to 1099-Q. How do I enter them on student's return?

Go back throught the education interview.  there is a question about the amount you want to use for education tax credits....  reduce the number from 10k and possibly less will be taxed to the student.  

The reason this number is editable is there are often times when creating a portion taxable, may be beneficial.... it can create an ability for the parent to claim an education tax credit and only enough income to the student where they will owe no taxes or less taxes then the parents can get credited.... you need to play around to get the best bang for the buck.  (Note the earned income for the student is also considered kiddie taxable, it also can qualify to allow the student to open an IRA..., lots of reasons why you may want this number to stay at $10k).

It is up to you to play with taxable to the student vs. tax credits to you and what works best. And yes, the IRS does allow this.

After you edit that number, continue and make sure you check to maximize my education credits.

To enter it as income for the student,  just search for the 1099 and go to that section and fill it out, you may also need dividends and interest the student earned....  They may owe no taxes...

**I don't work for TT. Just trying to help. All the best.
***Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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maglib
Level 10

I had excess 529 distributions and TurboTax gave me specific numbers to enter as student income not corresponding to 1099-Q. How do I enter them on student's return?

Go back throught the education interview.  there is a question about the amount you want to use for education tax credits....  reduce the number from 10k and possibly less will be taxed to the student.  

The reason this number is editable is there are often times when creating a portion taxable, may be beneficial.... it can create an ability for the parent to claim an education tax credit and only enough income to the student where they will owe no taxes or less taxes then the parents can get credited.... you need to play around to get the best bang for the buck.  (Note the earned income for the student is also considered kiddie taxable, it also can qualify to allow the student to open an IRA..., lots of reasons why you may want this number to stay at $10k).

It is up to you to play with taxable to the student vs. tax credits to you and what works best. And yes, the IRS does allow this.

After you edit that number, continue and make sure you check to maximize my education credits.

To enter it as income for the student,  just search for the 1099 and go to that section and fill it out, you may also need dividends and interest the student earned....  They may owe no taxes...

**I don't work for TT. Just trying to help. All the best.
***Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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