@jlar have we answered the question whether she even had to file a return? and this assumes the 1099Q has HER social security number on it (otherwise, it's your earned income)
The requirement is
1) no federal withholdings (only way to get the money back is to file) AND
2) earned income (and the 529 money is considered earned income) < earned income +350 OR total income < $12,200.
the taxable income is
$24215 - 16650 - 4000 = 3565.
1099Q distribution was 7590 - 3565 = 4025 was not required to cover the expenses. 4025 / 7590 = 53%
4618*53% = 2448 is taxable income and it is EARNED income. how much other income does she have - is she required to file in any event?
why not just post on her return for the 1099Q Box 1: 4618, Box 2 2448 - i wonder if that will do the trick.
