Withdrawal from 529 is same as expenses listed - still impacting taxes

Forum|Forum|5 years ago
March 12, 2021
1 reply
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We have entered the numbers from our 1099-Q, and then offset them with the information from 1098-T, plus other expenses (room and board, etc). The sums are the same, yet it is still increasing my tax owed. My understanding is that if we show college expenses equal to what we withdrew, the net affect on taxes should $0.

AmyC

Employee

Yes. If your 529 was used for room and board, tuition, etc then it is not taxable. In fact, in that case, you are not required to enter the 1099Q at all. You can delete the form. If you want to keep the form, review you room and board expenses entered on same screen as the books. That entry needs to be there for room and board.

If possible, you may be able to move even more into room and board, let the student have some income and you take a credit. I recommend you look at another of my answers for help.

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