1. Let's start with the 1099-Q. First apply all that you can to room and board, even if the student lived at home or off-campus. The college should have guidelines with expected expenses. See 529 for Room and Board.
After subtracting all the room and board, subtract tuition. and other allowed expenses. Is there any 1099-Q left over? Probably not from what you describe. Then, make a note of your calculations and tuck it into the tax folder with the 1099-Q. It does not need to be entered if it went to qualified education expenses. The IRS says not to report tax-free distributions.
2. The program is finnicky with the order in which forms are entered. The 1099-Q must come first, if it needs to be entered.
3. Box 5 scholarships and grants would be used toward any tuition, books, etc not already covered by the 1099-Q. If there is any amount of the scholarships not used up by education expenses, it would be taxable income to the student.
4. It sounds like adding your 1099-Q and box 5 together is less than all of your expenses. You don't need to enter anything.
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