I have the exact same question. I took out the amount from our 529 plan to cover the expenses that were incurred and no more. My 1099Q indicated a gross amount, earnings and basis. Since I used everything I took out to cover the eligible out of pocket expenses, then I should not have to pay taxes on any amount as I understand it. When I enter the earnings and basis, I am being taxed again on the amount classified as earnings. What am I doing wrong and what do I need to include and where to indicate the amount I paid out of pocket for college related expenses such as room, board, books, computer. Appreciate any help you can offer.
