A paper trail is not needed. All that needs to happen is that the student-beneficiary has qualified expenses in the same tax year that the 529 plan withdrawal was made. In fact, unlike claiming a tuition credit, the student-beneficiary does not even have to be a tax dependent of the 529 plan owner/recipient.
For 529 plans, there is an “owner” (usually the parent), and a “beneficiary” (usually the student dependent). The "recipient" of the 1099-Q can be either the owner or the beneficiary depending on where the money was sent. When the money goes directly from the Qualified Tuition Plan (QTP) to the school, the student is the "recipient". If any of the distribution will be taxable, after coordinating with scholarships and tax credits, the owner should consider have the distribution made to the student rather than himself.
