![]() Another special rule allows you to claim the tuition credit even though it was "his" money that paid the tuition. ![]() Since the credit is more generous use as much of the tuition as is needed for the credit and the rest for the interest exclusion. You cannot count the same tuition money, for the tuition credit, that gets him an exclusion from the taxability of the earnings (interest) on the 529 plan. The educational expenses he claims for the 1099-Q should be reduced by the amount of educational expenses you claim for the credit.īut be aware, you can not double dip. You can and should claim the tuition credit before claiming the 529 plan earnings exclusion. You can do this because he is your dependent. ** The recipient's name & SS# will be on the 1099-Q.Įven though the 1099-Q is going on the student's return, the 1098-T should go on the parent's return, so you can claim the education credit. ![]() The 1099-Q gets reported on the recipient's return. The distribution will be reported on IRS form 1099-Q. When the money goes directly from the Qualified Tuition Plan (QTP) to the school, the student is the "recipient". The "recipient" of the distribution can be either the owner or the beneficiary depending on who the money was sent to. Qualified Tuition Plans (QTP 529 Plans) Distributionsįor 529 plans, there is an “owner” (usually the parent), and a “beneficiary” (usually the student dependent). Read on for more, particularly about claiming the tuition credit You may reach that screen sooner.Īnother possibility is that TT allocated some of the expenses to scholarships. When you get to the screen titled “Amount Used to Calculate Education Deduction or Credit”, verify the amount you want to use or change it. Click edit next to “Education Information”. That should take you to a screen “Here’s your Education Summary”. That reduces the amount that can be used to claim the 529 earnings, shown on the 1099-Q, as being totally tax free. Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary". One possibility is that TurboTax allocated some of your dependent's college expenses to the Tuition credit, even if you are not eligible or were otherwise not claiming it.
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