My qualified distributions from my Educational Savings Program (529) are causing my state taxes to increase. From my understanding, qualifed 529 expenses are tax exempt?

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If they are qualified expenses and not taxable, they should not be reported. IRS Publication 970, Tax Benefits for Education states:

Page 45: Don't report tax-free distributions (including qualifying rollovers) on your tax return.

Please remove the form and keep it with your tax files.

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