You do not need to report your 1099-QA (Distributions from ABLE Accounts) on your tax return as long as they were spent on the beneficiary's health, independence, or quality of life (e.g., housing, personal expenses, etc.).
However, if you used some of the money for non-qualified expense (or just want to file for your own records) you do need to enter it.
Enter 1099-QA in TurboTax:
- Open or continue your return.
- Search for "1099-QA" in the Search box.
- Click on the "Jump to 1099-QA" link. This will take you directly to the screen titled "ABLE Account Distributions."
or...
- Select Wages & Income under the Federal tab.
- Scroll down and select Less Common Income.
- Look for Miscellaneous Income, 1099-A, 1099-C.
- Click Start next to Taxable Distributions from an ABLE Account (Form 1099-QA).
- Only enter the "Taxable" portion (the program will ask you for the Gross Distribution (Box 1) and the Earnings (Box 2).
If you spent the money on qualified expenses, TurboTax will calculate that $0 is taxable.
If you don't enter the form, you should still keep the 1099-QA and your receipts for your personal records in case the IRS ever asks for proof that the spending was qualified.
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