1099-Q funds can be used for the qualified education expenses of tuition, books, and lab fees. Additionally those specific funds can be used tax exempt for the unqualified but allowed expense of room and board, provided that room and board was paid "in direct support" of the education.
So if those funds were used to pay room and board for the summer semester, but the student was not enrolled as a full time student for that semester, then room and board for that period is "NOT" tax free.
Finally, when you have a 1099-Q it is important that you work through the education section the way it is designed and intended to be used. If you do not, then chances are high that you will not be asked for room and board expenses and will therefore be "taxed" on 1099-Q funds that were used for room and board.
