I'm using TurboTax Premier 2023 (desktop/PC version). In the Deductions and Credits section under the Education category, I entered Form 1099-Q values and Form 1098-T values (including Other Education Expenses such as books, room and board etc not reported on 1098-T).
A page titled "Next, We'll See Which Credit Will Save You the Most" appeared and said my return qualifies for the American Opportunity Credit and for Lifetime Learning Credit. But after I clicked the Maximize My Education Tax Break button, the analysis said Maximized Savings would be achieved via the American Opportunity Credit in the amount of $2500.
When I reviewed the TurboTax Student Information Worksheet for my dependent student, in Part VI -Education Expenses it incorrectly assigned $10000 to the "Adjustments: Used For Credit". The amount it should have assigned is $4000 because that is the amount that of expenses that were used to calculate the AOC credit of $2500 for my return. The $10000 amount would have been correct only if the Lifetime Learning Credit was used instead of the American Opportunity Credit.
This TurboTax error is resulting in an extra $6000 of taxable 529 distributions in Part VIII Qualified Tuition Program.
