@Hal_AI
Thanks for your thoughtful reply. I believe there is a bug in the way Turbo Tax calculates total qualified education expenses on the 1099-Q which I will expand upon shortly.
To answer your questions:
> 1098-T box 1 ($51920) and box 5 ($10000)
> 1099-Q box 1 ($52,628)
> 1099-Q box 2 ($31,923)
> Other expenses: room and board ($2,000)
> Dad is recipient so Dad's name and SSN are on 1099-Q. Dad pays the college bills through his checking account and is reimbursed by the 529.
> Is your income too high to qualify for the Americana opportunity credit ($90k, 180K married): yes my income is too high but this is not applicable as I am not using the Americana opportunity credit.
My 1098-T box 1 is $51,290 and my student had additional room and board expenses of $2,000 (not included in the 1098-T) so my qualified tuition and related expenses should be $51,290 + $2,000, or $53,290.
If I look at TurboTax's Form 1099-Q on page 3 of the "Qualified Tuition Program Computation of Taxable Distribution Table" I see that line 2c "Adjusted Qualified Higher education Expenses applied" is $43,920. This is exactly $10,000 short of what it should be and exactly matches the student's $10,000 scholarship. In other words, TurboTax is reducing my qualified higher education expenses by the scholarship amount which means TurboTax is reporting that I owe income taxes on that scholarship. That can't be correct.
In addition, I have another student in college who does not have a scholarship. She has a 529 like her brother. TurboTax correctly calculates her total qualified education expenses... because she does NOT have a scholarship.
Add these data points to the reports from other users (posted above) and I can only conclude that TurboTax has a bug related to the calculation of total qualified education expenses on the 1099-Q form.
@Intuit: can you please post a message that you are investigating this?
Thanks.
For a full discussion, see below
