I am not eligible for a tuition and fees deduction/education credit. Turbotax is deducting $10000 from eligible expenses for 529 plan. Is this for the credit ??

[MarilynG]

If you are not eligible for an Education Credit, and your 1099Q disbursement is equal to or greater than education expenses, don't enter the 1099Q  or education expense in your return; you are not required to: <a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tips/college-and-education/guide-to-irs-form-1099-q-payments-from-qu...>

[cj5]

That's true Maryiln, but there are some benefits to entering it (and TurboTax getting the calculations right). If on some future return (or even the current) you have overdrawn from your education plan and do owe taxes, you want Turbotax to calculate them properly for you. Right now it won't without some manual intervention to fix the issue that has been described here. The other reason to enter 1099Q info is you want Turbotax to carry forward the proper cost basis from year to year so it can properly calculate owed taxes on just the earnings portion of the over withdrawal, not on the entire over withdrawal.

[L-P-]

Thanks both for your help!  I wish I had known I didn't have to report 1099Q.   I had to deal with three additional complexities with reporting 1099Q:
1. Both the 1099Q and 1098T are issued to my son instead of the parents.  I searched online and decided we can enter the forms on our tax return because he is our dependent with no income at all.
2. My son's school issued a 1098T only with fall semester 2018 tuition and fees.  We had our 529 plan sent Spring semester 2019 in Dec 2018.  So the amount listed on 1098T is only half of 1099Q distribution amount (fall 2018 and spring 2019).   I had to enter the 1099Q amount into the box where it says "what if the box1 amount is not correct" when I entered 1098T information.
3. I finally figured out the reason why I still got a tax increase after setting Amount Used to Calculate Education Deduction or Credit" to zero.  My son got some scholarship from his school which I entered into the 1098T info in TT.  TT somehow thinks this amount should have offset the tuition we paid.  However, the school's total tuition is our payment + scholarship.  So I had to adjust the amount again in the 1098T section in TT by adding the scholarship to the total cost of his school tuition and fees.
I finally made TT to not to increase our tax after 1099Q after almost two days.