topic Re: 1099Q in Deductions & credits

1099Q

sandy613 — Mon, 09 Mar 2026 04:20:19 GMT

I have been using Turbotax for many years and I have always trusted that it would steer me in the right direction. This year I was paying closer attention to how each of my entries effected my taxes. I noticed that when I entered my 1099Q it resulted in my owing a lot of taxes. I read several forums and realized that I should not enter the 1099Q because all of the money on this form was for qualified educational expenses. However, I have entered the 1099Q for the last 4 years trusting that Turbotax would ask me questions to prevent such a simple but sizable error. I don't know if I should amend my past taxes and I don't know how to do it. Please advise.

Re: 1099Q

MinhT1 — Thu, 27 Jan 2022 13:05:17 GMT

On form 1099-Q, instructions to the recipient read: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution.

You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient educational expenses, including room & board (even if he lives at home) to cover the distribution. You would still have to do the math to see if there were enough expenses left over for you to claim the tuition credit. Again, you cannot double dip! When the box 1 amount on form 1099-Q is fully covered by expenses, TurboTax will enter nothing about the 1099-Q on the actual tax forms. But, it will prepare a 1099-Q worksheet for your records, in case of an IRS inquiry.

If necessary, you can amend the last 3 returns.

Please read this TurboTax article on how to amend your return.

Re: 1099Q

Critter-3 — Thu, 27 Jan 2022 13:07:41 GMT

In the education expenses section you should also be adding the expenses against the 1099-Q distribution so that the distribution is not taxable ... maybe this year you looked at the Refund-O-Meter a screen earlier than normal. If you have not yet entered the education expenses keep going.

Re: 1099Q

sandy613 — Thu, 27 Jan 2022 15:03:01 GMT

Thank you! I don't see where you are supposed to enter the educational expenses against the 1099Q. Can you please clarify?

Re: 1099Q

Critter-3 — Thu, 27 Jan 2022 15:10:57 GMT

Enter it in the education section of the Deductions & Credits tab.

Re: 1099Q

sandy613 — Thu, 27 Jan 2022 15:18:07 GMT

I am looking at that section. I see places to input various forms. I don't see any places to list expenses. Are you talking about the 1098T which does not cover all out of the qualified out of pocket expenses?

Re: 1099Q

Critter-3 — Thu, 27 Jan 2022 15:20:51 GMT

Yes ... you may or may not have a 1098-T from the college ... check online for it.

Re: 1099Q

sandy613 — Thu, 27 Jan 2022 15:25:49 GMT

Thanks! I will have that form by next week but it is not comprehensive in terms of my expenses. I really wish that Turbotax had asked a question regarding the 1099Q to determine if all the expenses were qualified. For this year, I can just remove the form. I can amend for 3 years which is a huge pain but doable. For 4 years ago, which was my first year with the 1099Q, I have lost that money. I trusted TurboTax to ask the right questions.

Re: 1099Q

sandy613 — Thu, 27 Jan 2022 15:29:00 GMT

It is true that it is on the 1099Q form but I did not read that. TurboTax says-

Remember, with TurboTax, we'll ask you simple questions about your life and help you fill out all the right tax forms. With TurboTax you can be confident your taxes are done right, from simple to complex tax returns, no matter what your situation.

That is what I read over and over so I did not think that I needed to read the instructions on the 1099Q. I am very disappointed that I have lost a lot of money trusting TurboTax

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 12:25:33 GMT

After doing more research, the 1099Q glitch for Turbotax has been known since 2019. I am amending my last 2 years of returns. I don’t know whether I should remove the 1099Q for the last 2 years or put 0 on the lines on the forms were this information is entered on the 1040, Schedule 1 and Schedule 2. I cannot get answers to these questions from Turbotax without paying them more money. Does anyone know the best way to amend this? I already watched the Turbotax video but it was not specific enough.

Re: 1099Q

Hal_Al — Thu, 24 Mar 2022 11:57:04 GMT

First, verify that you need to amend. For tax year 2018, if any of the 1099-Q was taxable, it will show on line 21 of Schedule 1.

For 2019 and 2020, if any of the 1099-Q was taxable, it will show on line 8 of Schedule 1.

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 12:48:08 GMT

Thanks! I verified that 2018 is ok but 2019 and 2020 is in error. Should I amend by putting 0 where there are inappropriate taxes or is there a better method?

Re: 1099Q

Hal_Al — Fri, 28 Jan 2022 13:13:34 GMT

You put 0 on line 8 ("other income") of Schedule 1. If you are using TurboTax to prepare the 1040X, deleting the 1099-Q should accomplish that.

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 13:15:23 GMT

Thanks! Is one method considered better (deleting 1099Q vs putting a zero?

Re: 1099Q

Critter-3 — Fri, 28 Jan 2022 13:19:21 GMT

Actually the explanation of why you are changing it to a zero is the most important thing ... send proof showing that the 1099-Q distribution covered the qualified education expenses so it should not have been taxed.

Re: 1099Q

Hal_Al — Fri, 28 Jan 2022 13:34:25 GMT

"putting a 0" is the correct method. Deleting the 1099-Q is one way to get TT to do that. It also depends om whether you're using 2021 or 2019/2020 software to do the amended return.

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 13:40:41 GMT

Thanks! I believe TT only allows you to amend using the original tax year (i.e. amend 2020 with 2020 TT). Are you a tax enthusiast or a professional?

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 13:51:07 GMT

Thanks for all of your help!

Re: 1099Q

sandy613 — Fri, 28 Jan 2022 14:02:08 GMT

Now I get it!!!! I just sat down to work on this. TT won’t let you change the numbers on the form, which would be best, so deleting the 1099Q is the next option and it achieves the task.

Re: 1099Q

EPBrent — Thu, 03 Feb 2022 21:49:58 GMT

Sandy, I am in the same boat as you. That 1099Q form is too confusing. The tax software programs don't give you an intuitive place to enter the qualified expenditures. It should be right on that page where you enter the 1099Q. I thought by entering the 1098-T, that would take care of it. I need to amend my 2020 return. So you are thinking the best way to do this is just to delete it and write in the notes: I entered the 1099Q by mistake and it counted it as income when it is all a nontaxable qualified education expense? Then you just print the federal and state, sign, and send in? Then wait 16 weeks and see what happens?