I recently realized I need to pay taxes on a portion of my 529 withdrawals for my daughter that are unqualified. Unfortunately, i had them paid to my bank account (even though I transferred them to her immediately afterwards) so they go against by taxes, not hers. Since the amount is less than her scholarship amount, we don't owe the 10% penalty. Two questions: do the earnings count as additonal gross income (e.g. taxed at my tax rate) or capital gains? I had assumed capital gains? Second, how do I enter into Turbotax amendment so I don't pay the 10% fee?
last updated September 16, 2023 6:19 AM
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