529 withdrawal for student loan payment - NY State return

Forum|Forum|2 years ago
February 28, 2024
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I had a withdrawal taken from my child's 529, payable to the child, for payment of her federal student loan. We are working her NYS return now - she is no longer my dependent so it's her own return. TT is asking for all the contributions from 1998 to 2023.

1) why are they asking? she made NO contributions, only I did.

2) there were several rollover contributions after a divorce, after we no longer lived in NY.

3) there were Upromise contributions - none of which were reported on any NY tax returns thus received no NY state tax benefit.

4) should we enter 0, or just the total of the contributions made while we were living in NY?

Thanks!

KrisD15

Making a distribution to pay the student's student loans is considered a non-qualifying distribution for New York state.

You should report all the contributions made to that account no matter who made them.

Roll-overs would count if the roll-over did not include earnings and had not been adjusted by any tax credit/subtractions.

New York will tax this distribution UNLESS the distribution is a return of your contribution only and does not include Earnings or tax adjustments/modifications.

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