Student has to pay all taxes on 529 distribution because parent "can" claim his as a dependent?

My 19 year old son took a distribution from his 529 plan this year to pay for college expenses, but TurboTax is not allowing him to deduct any qualified expenses because he selected that someone "can claim his as a dependent".

Here's the details:

• The 1099-Q has his name and his name only as the recipient.
• In the initial interview in TurboTax, he selected "someone CAN claim me as a dependent" (which I think is true) and that no one WILL claim him this year.
• After entering the 1099-Q details, TurboTax takes him to the interview to enter education expenses.
• At this point, TurboTax informs him that since someone CAN claim him as a dependent, he is not allowed to enter any education expenses, and he owes taxes and penalties for the 529 distribution.
• If we go back and change the initial interview answer to "no one can claim me as a dependent", all works as expected and he can enter his education expenses.

So my question is what is the best way to deal with this? Should we just go back and enter that no one CAN claim him as a dependent (and then obviously we won't claim him this year)? Is there a better way to do this?

Appreciate any help.