Go to rollover information on the 1099R worksheet (about 2/3 way down) and check box "entire distribution rolled over" As long as it was under $35000

Thanks, but there is NO Form 1099-R from the MD529 Plan.  They received a Form 1099-Q referencing the $7,000 trustee-to-trustee transfer only.

I found that this is considered a qualified educational expense, so at the moment, I have the $7k as an other QEE.  This allows the rollover to NOT be taxable and not subject to the penalty.

I'm wondering if this is the proper reporting in ProSeries and on the tax return???/

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@dsacpa wrote:

 

I'm wondering if this is the proper reporting in ProSeries and on the tax return???/

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Where are you expecting it to show up on the tax return?

Non-taxable distributions from a 529 Plan don't show up anywhere on the tax return, so there is no need to enter anything.

I'm not formally expecting to see it on the return anywhere, but when I entered the 1099-Q info with Gross, Earnings and Basis and the program automatically taxes and penalizes the earnings. But...if you enter some "other QE expenses" then the taxable amount and penalty disappears.

So, I'm just looking for some ProSeries program input assistance.

If it is a 1099Q, for trustee to trustee roll over then you do not need to put on tax return. My first answer was if you received a 1099R. At year end your client should receive 5498 showing the roll over. (not a taxable event)

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@dsacpa wrote:

 

So, I'm just looking for some ProSeries program input assistance.

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Delete the information you entered into ProSeries about the 1098-Q.

I have a similar situation, only not all of mine was rolled over to a Roth. So there needs to be an input section to show the portion that was rolled over and the portion that is taxable. I cannot find out where to do that so I'll be following along in case anyone figures it out.