On a related note, when I enter my 1099-Q into TurboTax, which describes my ESA, it subtracts the basis and the growth from my refund -- even though it says I won't be taxed on it. I created the ESA account, and the distribution was used by my child for college expenses (she is not filing taxes this year). TurboTax seems to act like the ESA came from outside our household, and is considered "income". Why would I get thus penalized, since the ESA was created with post-tax money? Should I not even include it, since she is the actual beneficiary?
Or maybe it was sent to me and should have been sent to her, since my name is on the 1099-Q, just above the FBO {child's name}. If so, can I describe that somewhere, or do I have to have the bank redo it?
I would appreciate any insight...
