Thank you so much for this very comprehensive reply! I really appreciate you taking the time to do it.
He lived in a rental house that we own and didn't pay rent for the first 7 months of the year, but he didn't live with us. It seems to me from your response that the best way to approach this is to not claim him as a dependent and to have him claim the tuition credit, and neither one of us reports the 529 income since it covered tuition paid in the year plus a small amount (definitely not market) towards his rent and utilities.
Please let me know if I understood that correctly or if he needs to claim the 529 distribution if he also claims the tuition credit.
Thanks again!
