The 1099-Q is greater than the 1098-T by a small amount $2993.12 - $2721.12 = $272 difference. If the student has books, supplies, and other expenses, like room and board of $272, then you do not need to report the 1099-Q. Most colleges have a guideline for off-campus living and I imagine the $272 would be consumed by that. You can look online at the school's list of expected costs to attend.
You want to find expenses to go against the 1099-Q which gives taxable income without qualified expenses. If you can't find room and board, maybe internet is required for some classes, books, etc to equal $272 then I will be surprised and you will have to enter the 1099-Q and subtract out the expenses you were able to find.
The program will do the work for you to determine the taxable income, if any. How do you calculate the taxable portion of a 529 distribution?
To calculate the taxable portion of the 529 plan distribution:
- Divide the AQEE -adjusted qualified education expenses -by the total 529 plan distribution (Form 1099-Q, Box 1)
- Multiply the answer by the earnings portion of the total distribution (Form 1099-Q, Box 2).
- Subtract this amount from the total distributed earnings.
See:
529 for Room and Board
Reporting 529 Plan Withdrawals on Your Federal Tax Return saving for college
Guide to IRS Form 1099-Q: Payments from Qualified Plans.
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