Q.Our student also rec'd a Pell Grant ($3448) and a Federal Supp Opportunity grant ($1000). Can either of these amounts be withdrawn from the 529 penalty free?
A. Yes.
Grants are scholarships for ta purposes. When entering the 1099-Q and 1098-T in TurboTax, to claim the penalty exception, enter the amounts as scholarships (it not already included in box 5 of the 1098-T).
