Doing my son's taxes.
He owes $532 in Federal
He is getting his masters degree (graduate)
529 Plan paid for all tuition (we have not filed our taxes yet)
When I enter his 1098-T TurboTax calculates the Lifelong Learning Credit and gives him a REFUND of $1468.00 ( $2000 - $532)
1 - I didn't think you can get a refund with the Lifelong Learning Credit (only the American Opportunity credit allows that)
Do we need to manually adjust the worksheet for that credit so he is not getting a refund, or does he somehow qualify for this?
2 - when we do our taxes, how do we account for any of the Lifelong Learning Credit that he receives?
a) if he doesn't get the full credit, do we need to claim $532 of the 529 plan money as taxable?
b) if he DOES get the full credit (and gets a refund) do we need to claim $2000 of the 529 plan money as taxable
