My kid cannot be claimed as my dependent for 2017 since her income was too high after finishing college in the first quarter of 2017. Not knowing she was below half-time as a student in that quarter, I had withdrawn from the 529 (with her as beneficiary) money to pay for her room and board. After entering the 1099Q for this withdrawal into TubroTax, it treats all her expenses as qualified, even though IRS Form 970 is clear the room and board portion is not. But that's an obvious mistake by TT. If I don't enter the room and board expenses, then TT will increase my tax accordingly (because there's not enough qualified education to offset the withdrawal).
The withdrawal was in a check paid to me (the parent) so the 1099Q shows me as the recipient and has box 6 ("recipient is not the designated beneficiary") checked. But do note if the 1099Q was only used to pay qualified education expenses then it does not need to be reported at all. Only amounts in excess of qualified education payments in 2017 must be reported.
My question: Is there a way to report the 1099Q on my daughter's return? Because her tax rate is much lower.
