<p>Child goes to community college. 1099Q has distributions of $756 of which $127 are earnings. 1098T shows qualified tuition of $776 with a scholarship of $1,000. So I figure $224 of the scholarship is taxable, but where do the earnings or distribution from the 529 come in? Does it mean that if $756 are used for the tuition then only $20 of the scholarship was used for qualified tuition and $980 is taxable? Turbo tax no help at all</p>
<p>Remember qualified education expenses for 529 distributions include tuition and fees, books, room and board. Even if your child is not living on campus you can use 529 account money for room and board expenses up to the amount included in the school’s COA for room and board. You may have to ask the school what this is if it is not easily locatable on the school web site (I have one kid who’s school has the information readily available on their web site by doing a search for COA - the other kid, who is the one we were taking a distribution for, it was like pulling teeth to get the information).</p>
<p>Qualified educational expenses for scholarships include tuition and fees, and required books. The books will not be shown on the 1098T so dig your receipts out as support for the expense.</p>
<p>Turbotax is not very thorough with education tax benefits in my opinion. It is a good idea to read through IRS970 to see which benefits may apply to you so that you use the most beneficial to you.</p>
<p><a href=“http://www.irs.gov/pub/irs-pdf/p970.pdf[/url]”>http://www.irs.gov/pub/irs-pdf/p970.pdf</a></p>