Q. We are unable to claim the Tax Credit (Highlighted in Red). I don't know if that makes any difference in your reply?
A. Yes or maybe. One more reason not to enter the 1099-Q.
Beware that in your son's interview, TurboTax may (usually does) assume that the parents have claimed the tuition credit. You should reach a screen "amount used to claim the education credit". TT will have prepopulated that with $4000, you should change it to 0.
Be advised some people are saying they're not getting the "Amount used to claim the tuition deduction or credit" (or “Education Expenses used for a Tax Credit”) screen on the dependent’s interview. Check the student information work sheet (part VI, line 17) to verify that 0 was use (you can change it on the work sheet (first column).
or
Go through the entire education interview, again, until you reach a screen titled "Your Education Expenses Summary". Click edit next to the student's name. That should take you to a screen “Here’s your Education Summary”. Click edit next to “Education Information”. When you get to the screen titled “Amount Used to Calculate Education Deduction or Credit”or “Education Expenses used for a Tax Credit” , verify the amount you want to use or change it.
