529 Distribution not used for educadtion

Forum|Forum|3 years ago
March 4, 2023
1 reply
0 views

My grandson cleaned out his 529 account to pay for a car and apartment furnishings. Since there is no 1099-Q or 1099-T for this distribution, who is responsible for the taxes, and how is it reported?

529 Plan

Hal_Al

Employee

If you didn't get a 1099-Q, you enter at the 1099-Q place in TT. But, there is always a 1099-Q, when there is a 529 distribution. You need to ask the plan administrator for a copy. You can usually get a copy from the plan's web site. You don't need a 1098-T, in your situation.

For 529 plans, there is an “owner” (usually the parent but could be a grandparent), and a “beneficiary” . The "recipient" of the distribution can be either the owner or the beneficiary depending on who the money was sent to. The distribution will be reported on IRS form 1099-Q.
The 1099-Q gets reported on the recipient's return, if any of it is taxable. The recipient's name & SS# will be on the 1099-Q.