Q. So you are recommending that I answer "no" to the question about whether I have received a 1099-Q, even though I have?
A. Yes, but that assumes two things:
1. You have sufficient expenses to cover the box 1 amount.
2. There is no double dipping. You are not claiming a tuition credit or deduction based on the same expenses and/or those same expenses aren't covered by tax free scholarship. See the longer reply above for details headed Qualified Tuition Plans (QTP 529 Plans)
