topic 529 plan distribution for full year in Education

529 plan distribution for full year

spgmfo — Tue, 04 Jun 2019 00:23:14 GMT

I paid a full years tuition using 529 plan funds. The college 1098T is for only the first semester. The 1099Q shows distribution amounts for the entire years amount. Turbo Tax shows excess taxable income since 1099Q amounts are 2x 1098T amounts. All funds were transferred directly to the school. What can be done?

During the interview, when you enter the 1098T there is a...

maglib — Tue, 04 Jun 2019 00:23:15 GMT

During the interview, when you enter the 1098T there is a place to enter amounts actually paid... Put the acutal amount paid using 529, coverdells, loans, etc in that entry...

Do note the 1098T and 1099Q are not even reportable if you used them for qualified education expenses, so if you are not trying to get a education tax credit, you don't even need to report them.

If the funds were transferred directly to the school, the...

MinhT — Tue, 04 Jun 2019 00:23:17 GMT

If the funds were transferred directly to the school, then the amount of tuition reported on your form 1098-T is clearly wrong.

You can change that amount when entering your 1098-T.

If your box 1 does not show the correct amount paid, when filling out your form 1098-T in TurboTax, leave it blank on the entry screen.

Under box 1, on the 1098-T screen is a blue link: What if this is not what (student name) paid to this school? Click on that and you will be given a chance to enter what was actually paid in 2018 (see attached screenshot).