Hi there, hope someone can advise.
My daughter is returning to college next week after dropping out during the pandemic. Since she turned 24 in September, she is now considered an independent student and also is no longer a dependent for tax purposes.
We will be using some funds from her 529 to cover some of her tuition/fees. I am the owner of the 529.
I wonder if anyone can shed light on how this distribution will be taxed when we file 2023 taxes next year? For example, would this be considered untaxed income that my daughter needs to include on her tax return?
Does it make a difference who the distribution check is made out to?
Also, would she need to report the distribution as income when she fills out the 2023-24 FAFSA?
I really hope someone can help, I've been searching online for information but it all seems to be aimed at dependent students...
