Entire 529 distribution appears as part of income. Not clear whether only the earnings are taxed. How to verify 2018 TurboTax Premier CD version.

[sundar-pathy]

As I entered both my children's 1099Q.  The entire amount (both combined) appeared as income in my worksheet.

As I entered the 1098T , it came back and said, it doesn't quality for the tax credit for one of three reasons. (income, etc...)

While that is ok.  what is NOT clear is whether the entire amount of the distribution is taxed, or just the earnings which are detailed in the 1099Q which is taxed.

Where can I find that in the Premier version of the turbotax?  which worksheet?

[Cindy0H]

The form you are looking for is the 1099-Q Payments from Qualified Education Programs. There are also information sheets for the students and for the educational expenses connected to this form.

[sundar-pathy]

Unfortunately, it doesn't answer my question... 1099-Q has all the details... but no clue on what is actually used in the total income calculation.  what shows at the top page of 1040 for income worksheet is the entire amount.

[Cindy0H]

Did you see the section called Computation of Taxable Distribution?

[Cindy0H]

You are looking in the Forms Mode, aren't you?

[sundar-pathy]

Yes... In forms mode... but let me check on the Computation of Taxable Distribution... is it in 1099Q or elsewhere?

[Cindy0H]

Yes, near the bottom.

[sundar-pathy]

Thanks!! for the help.  It did show the right amount, but I found the reason why I was being taxed to begin with, because in the student worksheet, none of the board & room expenses were entered.  once that went in, it removed the amount from income.