There are multiple ways to work around this, but I think it's easy enough to have the software address this correctly if the information is entered as there are times when it is required. I'm having the same issue with the tax being figured incorrectly. In my case, the root cause appears to be the education tax credits and what happens if you don't qualify because of your income. The software appears to first attempt to see if you qualify for a tax credit because it's more beneficial, so far so good. The problem seems to be that once the tax credit is disqualified, turbotax doesn't use the tuition (and it shouldn't if you have a tax credit) in the 1099-Q calculation so it underrepresents your deductions, says you took an excessive distribution from your 529 and therefore owe taxes. This is a very simple code fix, which with any luck turbotax will undertake.
