actually, box 4a is not checked and 4b is checked on the 1099-Q which is accurate from the form received from the 529 plan. There is an error in TurboTax that says that an update is coming--it flags during the check of your taxes. Changing this to 4a checked is inaccurate given that the QTP to 529 box is now available. Trustee to trustee worked last year just fine but it is not appropriate for this year. When I go to the worksheet and click on 1a and 3a, then the $7000 rollover is removed from the income and the tax amounts are updated. This is the part of the issue that is STILL waiting on the update from Intuit.
The way the questions are worded in TurboTax are different from the way they are worded on the federal tax worksheet:
Example:
This distribution was solely for a rollover, NO educational expenses involved. They way that Turbotax words the question, implies I should answer Not applicable because there were no educational expenses paid for with this distribution. However, based on the Tax form worksheet I would choose taxpayer.
Question wording and phrasing matters and it appears that Intuit has gotten a bit lazy (or are using AI) in their wording of questions.
Turbotax question--
Tell us the student whose education expenses were paid by the distribution reported on this 1099-Q. Taxpayer, Someone else, Not applicable
Tax form question:
Who was the designated beneficiary of the distribution reported on form 1099-Q?
Taxpayer, spouse, dependent, someone else, not applicable.
