Need assistance entering 1098-t for my non-dependent son, already enterred 1099-Q

Forum|Forum|4 years ago
February 15, 2022
1 reply
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I am filing my sons return but when click on the 1098-t section it doesn't even allow me to enter the information. It just says "you cant claim an education tax break for 3 possible reasons.
-I am not claiming him as a dependent
-He does have taxable income (about $3K0
-He has qualified education expenses

TurboTax Online

DianeW777

The key in your question is that your son is not your dependent. Here is the reason you cannot utilize your son's education expense from his Form 1098-T in 2021.

Claiming someone as a dependent or allowing them to claim themselves is not a choice or an option. The rules for claiming a dependent can be reviewed at the link below. Only the taxpayer who is eligible is allowed and even if the parent doesn't claim a child, the child is not allowed to claim themselves unless they qualify.

Rules for claiming a dependent on your tax return

Who can claim the education credit?

There are additional rules for each credit, but you must meet all three of the following for either credit:

You, your dependent or a third party pays qualified education expenses for higher education.
An eligible student must be enrolled at an eligible educational institution.
The eligible student is yourself, your spouse or a dependent you list on your tax return.
- Use the link above to review more information about the education credit.

Details about the Form 1099-Q for college savings can be viewed at this link: What is IRS Form 1099-Q?

The distribution is claimed on the persons return whose social security number (SSN) is shown on the Form 1099-Q that should have been received.
Where do I report Form 1099-Q?
When the money goes directly from the Qualified Tuition Plan (QTP) to the school, the student is the "recipient".

The 1099-Q gets reported on the recipient's return if the recipient's name & SSN are on the 1099-Q.

Once you compare your situation to the information you will be able to proceed with your tax return. Please update here if you need further assistance.

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Hal_Al

Employee

It's not clear what you are trying to do; just balance the 1099-Q against expenses or have the student claim a tuition credit.

With only $3K of income, he has (most likely) no tax liability to claim a tuition credit for. There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A full time unmarried student, under age 24, even if you don't qualify as a dependent, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working. You cannot be supporting yourself on parental support, 529 plans or student loans & grants. You usually must have actually paid tuition, not had it paid by scholarships & grants. It is usually best if the parent claims that credit.

You cannot claim a credit if you are, or can be, claimed as a dependent by someone else.

Reference: Line 7 instructions for form 8863. https://www.irs.gov/instructions/i8863

You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient educational expenses, including room & board (even if he lives at home) to cover the distribution. When the box 1 amount on form 1099-Q is fully covered by expenses, TurboTax will enter nothing about the 1099-Q on the actual tax forms. But, it will prepare a 1099-Q worksheet for your records.

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."