Q. I'm confused about how to report the 1099Q info when the 1098T went to him. Is this going to be an issue?
A. No, but there will be a need to do some sharing of information between them, for tax reporting.
I assume you meant Coverdell ESA (not IRA). I also assume her son was the beneficiary of the ESA.
There are three things you can do with your Qualified educational expenses (QEE):
- Allocate then to scholarships (so that the scholarship remains tax free)
- Use them to claim an education credit
- Allocate them to the ESA distribution (1099-Q) so that it will not all be taxable
Provide the following info for more specific help:
- Is the student the parent's dependent.
- Box 1 of the 1098-T
- box 5 of the 1098-T
- Any other scholarships not shown in box 5
- Does box 5 include any of the 529/ESA plan payments (it should not)
- Is any of the Scholarship restricted; i.e. it must be used for tuition
- Box 1 of the 1099-Q
- Box 2 of the 1099-Q
- Who’s name and SS# are on the 1099-Q, parent or student (who’s the “recipient”)?
- Room & board paid. If student lives off campus, what is school's R&B on campus charge. If he lives at home, the school’s R&B “allowance for cost of attendance” for student living with parents.
- Other qualified expenses not included in box 1 of the 1098-T, e.g. books & computers
- How much taxable income does the student have, from what sources
- Is the parent or student trying to claim the tuition credit (are they eligible, income under $90K, $180K Married filing jointly)?
- Is the student an undergrad or grad student?
- Is the student a degree candidate attending school half time or more?
- How many times before has the American Opportunity Credit been claimed on the student's education, in the past
