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1099-Q does not exceed expenses

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    1099-Q does not exceed expenses

    Client receives a 1099-Q (late of course) from a Coverdell. The amount receive does NOT exceed Educational Expenses paid. No problem there.

    However, the expenses paid are also on a 1098-T, and we used them to calculate a Lifetime Earning Credit.

    My question, can we avoid BOTH reporting the distribution as income AND also negating the Lifetime Earning Credit??

    #2
    https://www.irs.gov/credits-deductio...ed-ed-expenses

    Use the Qualified Expenses For LLC first to calculate that, use the rest like room and board, meal plan, computer, books, internet etc for 1099-Q purpose and see if there is any balance remaining. If yes that is income.
    Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

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      #3
      If there is any balance remaining, the income amount is just a prorated portion of the earnings. I like using the formula in TTB.

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