Q. Where does 1098T go...on my return or daughter's? I don't qualify for any education credits as income is above cut-off.
A. Student's. But I'm gonna recommend the workaround, again.
Q. For 1099Q, do I just ignore the rollover to Roth? That is what I have done so far.
A. Yes, particularly if it was on a separate 1099-Q from the other $46,087.
"Paid direct to school: $13,681" is meaningless unless you identify the expenses it paid; as is "Scholarship distribution: 14,661."
The usable numbers are:
- Box 1 $19,695
- Box 5 $16,500
- Room/board paid to offset daughter's expenses: $17,745
- Add any other identifiable expenses (books and a computer?)
Using the workaround, enter the 1099-Q, on the student's return. When asked who the student is answer: someone else not listed here (lying to TurboTax to get it to do what you want does not constitute lying to the IRS). Enter the student's name when asked. A few screens later, you'll get one simple screen to enter expenses. Press Done at the 1099-Q summary screen, to get there. Enter the tuition ($19685), room & board (17745). Also enter the amount of the scholarship (16500) in the box "Tax-free assistance". This reports the earnings as taxable and claims the scholarship exception. You do not have to deal with the complicated “Educational expenses and Scholarships” (1098-T) section later (don't enter the 1098-T). TT will prepare form 5329 to claim the penalty exception. Based on your numbers, you only get a partial exception, the $46,087 distribution is more than your $37,440 expenses (19695 +17745).
