Just don't enter the 1099-Q.
On form 1099-Q, instructions to the recipient reads: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution."
Technically, a 529 distribution must occur in the same year the expenses were paid. This problem, of mismatched year end distributions, is fairly common. Treat it as received and paid in the same year. And hope you can explain it away if you receive an IRS notice. You certainly meet the intent of the 529 rules, if not the strict letter. We haven't seen any reports, in this forum, of how that specific problem has actually worked out.
Do a better job on timing next year
Several users have reported receiving a CP2000 letter, from the IRS, on unreported 529 distributions. They replied that their child was in college and the distributions were used for qualified expenses, which they listed, but they did not provide receipts. Others have reported just sending copies of the school's billing statements. They later received a notices saying they were in the clear. I've noticed a significant drop in users, here, reporting IRS notices about 1099-Qs, in the last two years.
