topic Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary? in Get your taxes done using TurboTax

Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary?

crash345u — Tue, 10 Mar 2026 07:16:58 GMT

My dependent has two different Coverdell ESA accounts where she is the beneficiary (we transferred a sibling ESA into her name). We have been using ESA #1 to pay for college expenses thru 2021 and using Online TT to track her cost basis . ESA #1 does not have sufficient funds to pay for 2022 expenses.

Can I take the full distribution from ESA #2 this year without causing a problem with TT calculating cost basis on a second ESA ? Will TT prompt me to enter cost basis info for ESA #2?

I would rather not take a distribution from ESA #1 due to the way the funds are invested, and I would rather get just a single 1099-Q. I also don't want to juggle invesment holdings this late in the trading year, which I would have to do if I took a distribution on ESA #1.

I just want to make sure online TT can handle tracking a second ESA.

Re: Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary?

Anonymous_ — Thu, 22 Dec 2022 18:55:18 GMT

@Hal_Al

Re: Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary?

crash345u — Thu, 22 Dec 2022 19:35:14 GMT

Sorry I see there is a reply here but no content.

Re: Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary?

Hal_Al — Thu, 22 Dec 2022 22:56:46 GMT

tagteam was "flagging" somebody he thought might know the answer. But I don't. I suspect it can't track two separate ESAs. You're just gonna have to try and see.

Re: Can Turbotax Online handle tracking the cost basis of two different Coverdell ESA's for the same Beneficiary?

crash345u — Thu, 22 Dec 2022 23:31:02 GMT

I ended up taking a distribution on just ESA #2 and I will sure find out.

I reviewed last year's work sheet for the 1099-Q and it looks like the program must have prompted me to enter the cost basis of the ESA at the end of the previous tax year, the value of the ESA at the end of the current tax year, and the distribution amount. Evidently that is the info TT needs to figure it all out. Hopefully this year those questions appear as though it's a new ESA - I just can't remember.

I was afraid to start/test the program in TT until I am ready to complete the entire process. I have read in numerous posts that it's important to complete the Education section of TT in the proper order.

I get the feeling TT might have trouble handling two 1099-Q's - I'll be on the lookout for that when I go thru that section since this will be an issue in a future year.