I am well aware of what a 529 can be used for and how it must be used for education expenses to not be taxable. Also aware of scholarships influence on all that. I also understand the double dipping thing about education credit or tax. I follow the TT through the questions and it NEVER handles this correctly. If I take an education credit it taxes some of the 529 distribution. If I tell it to not take an education credit on the forms themselves it STILL taxes the 529 distribution. Expenses are equal to or greater than distribution.
My questions is: if I know that expenses are greater than distribution, even with taking an education credit, do I have to put the 1099-Q on the tax return? Will the IRS be looking for this on the return?
