I used 529 dollars exclusively for paying for college tuition.
Generally, if the check issued by the 529 plan administrator is made payable to the school, then it's included in box 5 of the 1098-T.
Whereas if the check is made payable to the beneficiary recipient, then it's not in box 5. But here's where it gets sticky sometimes.
Sometimes the plan administrator will make the check payable to the beneficiary recipient, yet mails the check directly to the school. Upon receiving the check, the school calls in the beneficiary recipient to simply endorse the check so the school can deposit it into their account. Schools wil handle this explicit scenario one of two ways, and either way is correct.
- The school will consider the 529 payment as a cash payment directly from the student. Therefore it will *not* be included in box 5 of the 1098-T. In this case, the 1099-Q is entered into the tax return.
- The school will consider the 529 payment as from a third party; from the 529 plan directly. Therefore it *will* be included in box 5 of the 1098-T. In this case, the 1099-Q will not be entered anywhere on any tax return.
