Q. Does the student-dependent need to declare anything from the 1099Q or 1098T o his tax return?
A. No. Do not enter them on his return, in Turbotax (TT). It'll just be confusing.
Q. Would he qualify for the educational credits, since I could not claim them?
A. Simple answer: No. He is not eligible for the refundable portion of the credit. If the student actually has a tax liability, there is a provision to allow him to claim a non-refundable credit, but then the parent must forgo claiming the student's dependency and the $500 other dependent credit. In your case, it would also mean you paying some tax on the 529 distribution to free up expenses for his credit. Since the AOC is effectively 60% of the expenses (in this case), it's possible (but unlikely) that it might work out. The only way to know is crunch the numbers.
