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gupdikeiii
New Member

I have a 529 distribution of $14,930. Basis is $4,643, earnings are $10,287. Tuition costs after aid of $16,165. Why would $5,761 be taxable income?

 
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Anita01
New Member

I have a 529 distribution of $14,930. Basis is $4,643, earnings are $10,287. Tuition costs after aid of $16,165. Why would $5,761 be taxable income?

When you have entered your 1099--Q, and then are going through the questions after entering your 1098-T, the program asks you how much of the education costs you want to allocate to the education credits.  It doesn't benefit you to enter more than $4,000 and that's enough to maximize your credits and to make your distribution nontaxable.  It sounds like you did not answer or incorrectly answered this question, so go back through the education expenses to correct it. 

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