Get your taxes done using TurboTax

Form 1099-Q only needs to be reported on the tax return of the person whose SSN is on the form (it’s either the beneficiary of the account or the account owner) if the withdrawal is more than the tuition paid in Box 1 of the 1098-T plus other adjusted qualified educational expenses.  In that case, the earnings on the excess distribution would be taxable income.  To find out what are qualified educational expenses, please review the Guide to Tax Form 1098-T: Tuition Statement.

First, determine if the Form 1099-Q needs to be reported on the tax return by comparing the withdrawal with the tuition paid on the 1098-T added to other qualified educational expenses.  Please review the TurboTax articles Guide to IRS Form 1099-Q: Payments from Qualified Education Programs  and What is IRS Form 1099-Q? for further details.

Secondly, enter the 1099-Q into TurboTax if the withdrawal exceeds the educational expenses by following the directions below.

If you are using TurboTax Online:

1. Launch TurboTax
2. In the search box type: 1099-Q and select the Jump to link
3. Follow the screens to enter your information.

If you are using TurboTax CD/Download:

1. Launch TurboTax
2. Select Federal Taxes and then select Deductions & Credits
3. Select I'll choose what I work on
4. Scroll down to Education, select Start or Update next to ESA and 529 qualified tuition programs (Form 1099-Q)
5. Follow the screens to enter your information.