They are your dependents, in this case only you can claim the Education Credits on your Tax Return. You can enter both the 1098-T and the 1099-Q on your Tax Return.
When you are entering the information from 1099-Q there is one detail that is easy to overlook. You must pay special attention to Box 6 -Recipient is not designated beneficiary-. This is the box that can change the entire nature of the distribution.
- If the 1099-Q has you name on it, you are the recipient so you will check this box
- If the 1099-Q has your son's names on them, you are not the recipient so you will not check this box.
Once you have entered all of the information, you will have the option to apply a portion of the 1099-Q distribution to the American Opportunity Credit (if you children still qualify). This amount will be taxed with your income but the 10% Additional Tax will be waived. It becomes a simple matter of comparing the benefits of the American Opportunity Credit versus the Extra amount you will pay in Taxes.
EDITED [04/18/2017 11:44AM PST]
Qualified Education Expenses; for 529 and Coverdell ESA Plans
- Tuition and fees;
- Books, supplies and
equipment; Computers and Software
- Room and board
expenses for students enrolled at least half-time only to the extent they are
not more than the greater of
- The allowance for
room and board included in the cost of attendance for federal financial aid
purposes, or
- The actual amount
charged if the student resides in housing owned or operated by the eligible
education institution; and
- Expenses for special
needs services required by a special needs beneficiary and incurred in
connection with enrollment or attendance.
