Hi - I've read through all the 1099Q/1098T questions, and the information is really helpful, but unfortunately none of the threads seemed to quite capture my issue. If you could please provide any insight on the below it would be much appreciated.
As owner of a 529 for my college student / designated beneficiary son, we correctly have two 1099Qs for two distinct events:
- A distribution in my son's name for the entirety of his tuition for the Fall which was sent directly to the school
- A distribution in my (the owner's) name for a distribution I took mostly for unqualified expenses, except for the qualified expense of a computer for my son for school.
- I also received a 1098T for the total tuition.
When filing, I'm reporting the 1099Q that was in my son's name with his return. I'm fine there.
However, when I try to add the other 1099Q under my return, along with the 1098T, to me it seems like TurboTax is assuming that the *entirety* of 1099Q is applicable to the amount shown in the 1098T, i.e. all qualified expense, when it is not. I only intend for the fraction of the 1099Q which went to the computer purchase to be treated as a qualified expense, not the whole amount. If the 1098T is not present, it treats the *entirety* of the 1099Q as an *unqualified* expense.
I realize there is a place for entering expenses like a computer purchase, which I have been doing from the start, but it seems to have no effect. The same behavior as mentioned above occurs - the whole 1099Q amount is treated as unqualified if the 1098T is not there, and soon as it is added it considers the whole 1099Q as qualified. As an aside - I'm not eligible for Education Credits - and TurboTax correctly lets me know that. I have no concern with that part. I just want for the 1099Q amount to be recognized such that the amount used to purchase the computer is treated as a qualified education expense, with the rest of it treated as unqualified.
If you have any insight on how I would go about this it would be very much appreciated.
