First question from TT when I try to enter info about form 1099-Q: "Who's shown as the recipient on your 1099-Q? Depending on the circumstances of the distribution, the Recipient will be either the account owner or the account beneficiary. Be sure to choose the Recipient as shown on the actual Form 1099-Q."
Pretend I'm John Doe and my daughter is Alice Doe. The 1099-Q form I received from the investment company is titled John Doe FBO (for benefit of) Alice Doe. The form also shows recipient's TIN as my daughter's. Is the correct answer to TT's question, "my daugher, Alice"?
Thanks.
Yes, your daughter.
Since the "recipient" is listed using your daughter's Tax Payer's Identification number, your daughter is listed as having made the distribution.
This is normally the way a 529 savings account should work, a parent is the account owner, but the distributions made for education purposes are issued as having been paid to the student.
IF there is any taxable income relating to the distribution, the income would be claimed by the student. (since in your case since she is listed as the recipient).
If you are claiming your daughter as your dependent, you enter the 1099-Q, 1098-T if applicable, and answer the interview questions for that section into your TurboTax program so that the software may do the math. If income needs to be claimed by the student, YOUR TurboTax program will inform you of that.
If the distribution was used for acceptable education expenses, it would be a tax-free distribution and would not be claimed as income on any return.