I have received 1099-Q for distribution of $30,000 from 529 program (MESP). My daughter paid tuition of $31,944 and received 1098-T for that amount. All $30,000 were spent for qualified educational expense.
However, TurboTax reported additional income on Schedule 1, line 9 for $2,259. The description is: "Taxable income from 1099-Q, qualified tuition program distribution". Therefore this $2,259 are included in total taxble income.
I don't know how this $2,259 is calculated or why whole $30,000 are not tax-free. What should I do?
