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How to report 1099-Q on Tax Return?

How to report 1099-Q on Tax Return?
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10/7/2013
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 16,227
Experience: 15years with H & R Block. Divisional leader, Instructor
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Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
The 1099-Q reports the total of all withdrawals you made during the year; some of this amount may be taxable depending on how you spend the money.
Box 1 reports your annual distributions or withdrawals from the account. Box 2 reports the portion of the distribution that represents the income or earnings of your initial investment. Finally, box 3 reports your basis in the distribution.
If the distribution doesn’t exceed the amount of the student's qualifying expenses, then you don't have to report any of the distribution as income on your tax return. If the distribution exceeds these expenses, then you must report the earnings on the excess as "other income" on your tax return. When you pay a student’s school expenses with these funds, you cannot claim a tuition deduction or either of the educational tax credits for the same expense.

Robin D. :


My goal is to give you excellent service. If you are satisfied, please rate me. If you have follow-up questions on this same topic, use the reply box below. To start a new conversation with me on a new topic request me again.

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Customer reply replied 4 years ago

1. If the distribution didn't excess the expenses, then I don't need to report box 2 earnings, right?


2. If total expenses excess the distribution a lot, can I still apply American Opportunity credit?


 


I also have one question regarding long-term and short-term capital gain/loss. If I have a lot of trading, do I need to record every transaction?


 


Thank you


 

Hi, If the expenses are more or the same as the distribution then you do not report. If the expenses are less then the distribution shown in Box 2 then you are taxed on the difference. If your expenses are more then the Box 1 then you could claim the difference for education credit but you may not use any amount of expenses that were covered by the distribution.

As far as your new question, we are supposed to remind you that is you have questions that are different then your original posting you are required to start a new question.

You may report the additional transactions on an attached statement. The statement must use a similar format and contain all of the information required by Schedules D
and D-1. You would then be allowed to report the totals but be mindfull of possible wash sales when do this.

 

 

 

 

Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 16,227
Experience: 15years with H & R Block. Divisional leader, Instructor
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