Ha! Contrary to my expectation, Fidelity fixed the forms 1099-Q.
It is a known system defect. If you make a 529 distribution to the plan beneficiary (the student) via EFT to the beneficiary's bank account, and you enter your request online, Fidelity *will* report the distribution on the participant's (the parent's) 1099-Q.
To fix the problem, you can call Fidelity when you receive the 1099s and ask them to recharacterize the EFT transactions to the beneficiary.
To *prevent* the problem, request your distributions via TELEPHONE CALL instead of online. The agent's screens allow them to characterize the request as student or parent, whereas the online system treats all EFT as distributed to the parent.
