Distributions from a 529 plan can be used for several things, including tuition, student fees, books, supplies, and room and board. It can include a laptop (used primarily for school) and even an internet bill. The form 1098-T is not the only source of expenses allowed by the 529 plan.
You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient educational expenses, including room & board (even if he lives at home) to cover the distribution. You just keep the form 1099-Q and your calculation of the expenses covered in your tax records, in case of an IRS inquiry.
On form 1099-Q, instructions to the recipient read: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution."
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