1099-Q issued on a rollover

[PDAllen]

TP withdrew funds from VA 529 on SEPT 15. Father is owner, son beneficiary. Check sent to Father. He put the money into daughters' VA 529 (father owner, daughter beneficiary) on NOV 5. He was issued a 1099-Q by the VA 529 program.

As a rollover this does not have to go on his 2015 tax return (I believe), but what should I do about the 1099-Q? Anything?

There are not QHEE expenses to cover it, so I am concerned the IRS will come knocking. Include a note with the return or ignore it?

Sidebar: It's only $70 in earnings, so the IRS penalty would be tiny. Larger concern would be getting flagged by VA to repay the state income tax breaks taken in past years. Do the IRS and states share info to that degree? How would Virginia find out it wasn't spent on QHEE? (Just curious)

[CVTax]

To change beneficiaries on my children's 529 plans, I had to fill out a form and they switched it internally. I was not issued a check.

[Burke]

You have a 60-day rollover period in which to accomplish from a 529 plan. There is no place to report it as such on the tax return. But the receiving plan should be noting it as a rollover. Tell her to check to make sure this is in their records as such.