I have been receiving 1099Q’s for distributions for education expenses for over a decade and they have NEVER had an amount for box 2 and 3. In the fall I had to roll one over because my son was turning 30. I researched with Vanguard for hours, and the final answer is they don’t keep track of basis or earnings. All my funds (4 kids) basis’ are calculated on our tax return and forwarded to the next year’s return. The calculation is taken from publication 970 and factors in expenses + taxable amount. There is no way the financial institution would have access to your basis without you annually notifying them. That is why my 1099Q’s box 2 and 3 have always been blank. After rolling over ESA, I had to write a letter to give them my basis from my taxes. Turbo Tax needs to remove the mandatory input for boxes 2 & 3 because I can’t proceed without inputting. I thought I could probably figure out since I’ve been doing my taxes for years, but that’s why I buy Turbo Tax, so they can do the calculations. I’m a little concerned to put in an amount that isn’t on my 1099Q.
