1099Q

[grandpa11]

I am a grandparent with 529 plans for each of my grandchildren.  I received a 1099Q as the recipient of the distribution but my grandchild is the beneficiary. I give the distribution to the grandchild and it is used 100% for education expenses.  how do I report the 1099Q without having a tax liability which I should not given the use of the distribution for ed exp?

[SusanY1]

If the expenses were not taxable and were used only for qualifying expenses - that is for tuition, fees, room, board, books, and supplies, you are not required to report the information provided on the 1099-Q.  The IRS only requires you to report the information when the income is taxable.  

You can learn more about this form here: Guide to IRS form 1099-Q.

[kobs2019]

Susan,

I had the exact same question for my son. Thank you.  I've heard other chats see that you cannot NOT report it.  This must not be true?

Does my 19 year old son need to report anything?

Thanks for your help!

Best Regards, 

Justin

[SusanY1]

Justin,

That is correct that is not true that you must always include a 1099-Q on your tax return.

On the back of the form, instructions to recipient"reads:"Distributions from Coverdell education savings accounts (CESAs) under section 530 and qualified tuition programs (QTPs) under section 529, including rollovers, may be taxable. Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. [emphasis added] You must determine the taxability of any distribution. See Pub. 970 and the Instructions for Forms 1040 and 1040-SR for more information. Also see Form 5329 and its separate instructions."

@kobs2019

@grandpa11