2019 check from 529 was lost in mail, stopped and reissued in 2020. Vanguard will not change the 1099-Q so now I owe taxes.

Forum|Forum|5 years ago
May 9, 2020
1 reply
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My problem is related to a recent question. My 1099-Q reflects a 529 disbursement in early December that got lost in the mail, and Vanguard had to stop the check and reissue a new check in January. The college received the new check in 2020. I have contemporaneous proof that the check was lost, stopped and reissued, so can I change my 1099-Q amount to zero and add it to my 2020-1099 Q next year? Many thanks for anyone's insight!

Hal_Al

Employee

If I understand the problem: you have a 1099-Q for 2019 but no 1098-T to match, since the school didn't get the money until 2020.

Just don't report the 1099-Q (don't enter it in Turbotax at all).

On form 1099-Q, instructions to the recipient reads: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution."

You're on solid ground and have clear documentation if questioned by the IRS. You have clearly met the intent of the rules. The distribution matches the year of payment.