We have received a 1098-T and 1099Q for our dependent son. We do not qualify for the tuition deduction or any education credits due to AGI being too high although we have entered all information from his 1098-T as well as education expenses(computer, etc)on our return. Our son used a 529 to pay for qualified expenses. His funds were sent directly to his school and he is the beneficiary. When completing his return if I answer "Yes" on the 529 question and provide the dollar amount of the distribution tax is being calculated on it. In addition, I am getting a message that although he is claimed by his parents he should enter education expenses to try to offset the distribution. The distribution went completely to qualified education expenses. Should I answer "No" for the 529 even though he had one? Here are some numbers:
1098-T Box 1 $18,346 Box 5(scholarships) $8,000
1099Q Box 1 $6,491; Box 2 $1,841; Box 3 $4,650
