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@Terry53029 wrote:

the distribution would go on whoever is claiming them as a dependent.  

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Not necessarily.  The rules are quirky.  The 1099-Q is issued to the recipient of the funds.  The account owner (i.e. parent) can take the distribution and then write a check to the school.  Then the 1099-Q goes to mom/dad.  Or the money can go directly from the 529 plan to the school, in which case it is deemed to be paid to the beneficiary, so the student gets the 1099-Q.  Whomever is deemed to have received the funds also gets the taxable income (if any).

I think what a lot of people don't realize is that it's not too difficult to "room and board" the 1099-Q income away.  Or use a computer purchase.  As you mentioned, the definition of "qualified" is different for 529 distributions vs. education credits.

Rick