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falexa0607
New Member

Took 529 distro to pay for daughter and son college. Got 1 1099q form with me as recipient. Entered 1099q into turbo but only allows 1 beneficiary. What do I do?

 
3 Replies
falexa0607
New Member

Took 529 distro to pay for daughter and son college. Got 1 1099q form with me as recipient. Entered 1099q into turbo but only allows 1 beneficiary. What do I do?

I have 529 acct for each child. When I took distros for each child for legitimate expense, I elected to have the funds paid to me and I paid the colleges. I received 1 1099Q representing combined total distro for both kids rather than one 1099q for each child. TurboTax treats one 1099q as applying to 1 student. I can make turbo tax think I got two 1099q's putting the correct amounts per child but I risk the IRS not understanding it since they only get 1 1099q. Or I guess I can ask 529 for 2 1099qs. . probably what I should do.. . .
Hal_Al
Level 15

Took 529 distro to pay for daughter and son college. Got 1 1099q form with me as recipient. Entered 1099q into turbo but only allows 1 beneficiary. What do I do?

You'll have to split the 1099-Q and enter it as two separate 1099-Qs.
There's no risk with the IRS, for doing so.  The IRS only matches total 1099-S dollars

I would ask the 529 for separate 1099-Qs. If for no other reason to let them know that tax software can't handle a combined 1099-Q and they've done you disservice by doing so.
Hal_Al
Level 15

Took 529 distro to pay for daughter and son college. Got 1 1099q form with me as recipient. Entered 1099q into turbo but only allows 1 beneficiary. What do I do?

A 529 plan can only have one beneficiary. If you use some of the money for your 2nd child, that is a non qualified distribution and subject to tax and penalty.

If you want to use the money for the other child, you first have to open a new 529 account and then rollover some of the money. The 529 plan administrator can show you how to do that. Then, take a distribution.

Yes, it's a bunch of hoops to jump thru, but that's the rules.

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