Thank You Amy C for the reply! I'm not sure what you mean by "confusing payments made the first 3 months of 2025 with classes beginning". I understand that payments in 2024 can apply to spring 2025 tuition, the problem is that the payment I intended to make in 2024 apparently did not arrive until Jan 2025 thus didn't make the cutoff to be on the 2024 1098-T. I did receive a 1099-Q with the 12/23/24 distribution for 2025 spring semester included. The problem is that the college didn't receive (or post) it until 1/6/2025 so wasn't included on the 2024 1098-T. That makes it trigger as a distribution that didn't pay for anything, and that turns (I guess the 529 gains) into income which creates more taxes for my daughter. (My original question was written 1st person for simplicity but the subject is my daughter's 529 and college).
There are scholarships involved, all shown on the 1098-T and from the college. If the 2024 1098-T had included the payment made for spring 2025 tuition all would have come out even: i.e. the combined total of the 1099-Q distribution and the scholarships shown on the 1098-T would equal the payments made in the 1098-T. I have filed for and am eligible for the full AOTC. I don't understand how I "apply" room and board(she's renting a shared apartment and buying food), books, and supplies first and then allocate the rest. Do I do that in turbotax or on my legal pad? All the distributions from the 529 actually did pay tuition, so isn't that lying to allocate them elsewhere? Do I need to have actual receipts for room and board? She is splitting rent 4 ways in a casual agreement and Venmoing one of the mom's who is actually paying the rent, so there are no receipts.
