PROBABLY getting the refund.
If the distribution was used for education purposes, including Room and Board, your Daughter's Grandmother is correct, no one needs to report the 1099-Q.
If the 1098-T ONLY reports 4,000 in Box 1 (Tuition and Fees) and nothing in Box 5 (Scholarship) you might be eligible for an education credit.
The question is if the distribution was used for "dorm costs".
Dorm costs don't show on a 1098-T because dorm costs can't be used towards a credit, HOWEVER they can offset a distribution.
If the distribution was fully used for dorm cost, you enter the 1098-T into your TurboTax program. If Box 1 list 4,000 and there is nothing in Box 5, you would get the education credit (as long as your income is below the limit).
The 1098-T is not entered on the return of the dependent student.
If things are more complicated, you can enter the 1099-Q and 1098-T into your program so that your program can do the math, but the education interview can be tricky and complicated.
IRS PUB 970 goes into detail about both these forms.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
