Education

If you received Form 1099-Q (as the recipient) you need to report it on your tax return. It doesn't mean you are going to pay more taxes. If you don't report it on your return, IRS might treat it (the earnings portion) as unreported income.

If you withdrew from the College Savings account as the recipient and then used the money to pay for your daughter's qualified educational expenses, you are considered as the recipient of the 1099-Q form.  

If you entered the 1099-Q form and answer the questions correctly, you can avoid the income tax and penalty on the earnings as long as the funds were used to pay for your daughter's qualified education expenses, even if she is not a dependent on your tax return.

Follow these steps to enter Form 1099-Q:

1. Open or continue your return
2. Select Federal and then Deductions & Credits
3. Scroll down to the Education section under All tax breaks
4. Select Show more and then select Start or Revisit next to ESA and 529 qualified tuition programs (Form 1099-Q)
5. Follow the screens to enter your info.
6. On the screen that asks Who's the student? Select Someone else not listed here
7. Continue, and Add a New Student on the next screen.

@Rusty Shackleford