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Get your taxes done using TurboTax
You will want to provide the 1099-Q information to his parents since they are claiming him as a dependent if they claim the education credits- there is a possibility they could inadvertently "double dip" if the 529 funds were used to pay some expenses and they claim credits on the same amount.
From Reporting 529 Plan Withdrawals on Your Federal Tax Return:
529 plan distributions used to pay for non-qualified expenses are subject to income tax and a 10% penalty on the earnings portion of the withdrawal. This includes 529 distributions used to pay for airfare and other travel costs, college application or testing fees, health insurance or room and board costs beyond the college’s cost of attendance (COA) allowance.
If the student’s parent qualifies for the AOTC or LLTC, they must adjust their total qualified higher education expenses to avoid double-dipping. To determine the amount of a qualified 529 plan distribution, any amount used to generate the federal education tax credit must be subtracted from the total qualified expenses.
If the beneficiary receives a tax-free scholarship, fellowship grant, Veteran’s educational assistance, employer-provided assistance or other tax-free educational assistance, the amount of the payment must also be subtracted from the total qualified expenses.
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