Turbotax Premier College Expense Entry

[amptax]

I am using the desktop product for the 2025 tax year and I have entered the 1099Q and 1098T information, however I am not getting a screen to enter my other college expenses.  It keeps taking me to the education credit and showing I owe taxes and penalties on my 529 withdrawals.  I have used this version for multiple years with a prior child and have always been prompted to add these costs.  Has something changed in the step by step?

[sanfranwinter]

Exactly what you wrote---there must be a bug in this year's software as there is no screen that I can navigate to in order to enter other (e.g., room & board, required fees, etc) non-book/materials, non-tuition expenses.

[BWest1]

Obviously a bug.  No screen in Step-by-Step, so I entered the expenses directly into Student Information Worksheet using Forms.  However, that info is not saved!  As I continue to use TurboTax, the data is still in the worksheet and shows correctly, even after saving the return several times while entering other info.  However, the next time I open the return, the Student Information Worksheet data that is not auto-populated by 1098-T entry is BLANK again, causing tax to be computed on the 529 withdrawal.  One would think that entering data into Forms would be saved...

[amptax]

I spoke to someone on the Turbotax help line.  After trying to do it themselves and looking through the forms she thinks that functionality is not complete yet and should roll out with an update.  She said to try again in a week and call back if the problem continues.

[Hal_Al]

TT is aware of the glitch and working on it. 

[Hal_Al]

The 1099-Q is  only an informational document. The numbers on it are not required to be entered onto your (or your student's) tax return. The interview is complicated and it's easy to make mistakes. Avoid it if you can and you can. 

You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient educational expenses, including room & board (even if he lives at home) to cover the distribution. When the box 1 amount on form 1099-Q is fully covered by expenses, TurboTax will enter nothing about the 1099-Q on the actual tax forms. But, it will prepare a 1099-Q worksheet for your records (you don’t need it). You would still have to do the math to see if there were enough expenses left over for you to claim the tuition credit. You also cannot count expenses that were paid by tax free scholarships.

References:

1. On form 1099-Q, instructions to the recipient reads: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution." 
2. IRS Pub 970 states: “Generally, distributions are tax free if they aren't more than the beneficiary's AQEE for the year. Don't report tax-free distributions (including qualifying rollovers) on your tax return”.
3. "IRS Publication 970, Tax Benefits for Education states: If the entire 1099-Q went to qualified expenses, room and board, tuition, etc; then, you do not need to enter the form." 

[amptax]

The info on the 1099Q gets reported to the IRS.  Last year the IRS challenged me on what was reported to them vs what I submitted.  I sent them the Turbotax worksheet as proof of expenses and they accepted it.  Also, I have had turbotax maximize my benefit by excluding some of my expanses, paying tax on the excluded amount because the education credit was more.

[afaczan]

I have tried for hours to get this to work and spoken to two experts and a certified CPA in TurboTax.

Everyone tried extremely hard, but no one can figure it out and they don’t seem to know about any update or glitch.

I remain hopeful that an update to the software will fix this issue.

[afaczan]

 Exactly! If we don’t enter a 1099Q or 1098 plus all the expenses We can’t even get that option to show up so I think we might be missing out on a better credit or refund etc

hoping a software gets fixed in the next couple of weeks…

[JFW3]

There is a lot of informational data on various 1099s.  Many of us use TT for the program to decide what needs to be included in taxable income or not.  For example, we enter tax-exempt interest from Form 1099-B, and TT does not add it to taxable income.  I personally think the programming and the reliance on the user to determine taxability, and then not to enter a 1099-Q, is lazy.  That is part of the reason people use TT.  TT could ask questions regarding the circumstances and handle appropriately on the tax forms. 

[sglen]

Click on View and selct Forms (versus Step-by-Step); click on Student Info WK; scroll down worksheet and click on the Room and Board line item and enter your amount; then back to View and change back to Step-by-Step -- that's what I did and it seemed to work including passing federal view check.

[amptax]

A previous responder said it did not save when entered into the form.  Did that save for you?

[BWest1]

As I stated in a previous post, the data entered via forms (the student info worksheet) processes throughout the session correctly, even after saving many times throughout the process.  When I reopen the tax return after exiting TurboTax, all the data I entered is saved WITH THE EXCEPTION of this worksheet.  Even if it passes error checking, any return submitted is questionable because I can't reopen the file to see what was done -- so would the IRS receive the file that is "open" when filed or would they receive the version that is saved?  Printing the return does not equal the saved data file!

Others have stated not to worry about entering my 1099-Q since it was all used for qualified education expenses anyway.  That sounds ok, except that by not entering all qualified expenses other things are impacted -- for example AOTC does not calculate correctly, questions from IRS can't be answered by documentation in the TurboTax return, etc, etc.

There is NO substitution for entering and storing (!!!) education expenses correctly.  After spending over 2 hours online with Intuit support, they finally agreed there "is likely" a problem as they viewed my screens while entering expenses and not seeing those same expenses when reopening the file.  They captured screen shots and I sent a diagnostic file.  They indicated they would take a look at it, offered no indication about resolution.  At least somebody there acknowledged a "likely" error in their code, although this has been several days and the only response I have seen from them to date is a support satisfaction survey....

[amptax]

I received a message from TurboTax yesterday that they fixed the problem and it is being rolled out as an update.  They said it would update the next I launched TurboTax.  I have done so three times over the past day and there has been no update.  I manually checked for updates and the program said I was up to date.  The problem still exists.  Has anyone had an update/fix?

[Hal_Al]

Some people got an email saying it had been fixed.  But that appears to have been a separate issue (entering R&B when reporting scholarship taxable). Reading between the lines, it's gonna be later, not sooner.