You are correct. While my writeup does mention income, it doesn't go into details. Since your AGI will be over 180K you will still claim the student as your dependent and the student will report all the education stuff on their tax return. The fact a 1099-Q is in your name should not matter, as they would still report it.
For the next tax season, I strongly urge you to change the beneficiary on the 529 account to the student.
Also note that weather you claim the student as your dependent or not, doesn't matter. The fact that you *QUALIFY* to claim the student as your dependent, means that the student has *no choice* and must select the option for "I can be claimed on someone else's return".
The student will get some credits, since they do have earned income. WHile it won't be much, any amount of credit is more than what you the parent would get, because of your AGI being over $180K.
