529 Plan Tax Guide: Form 1099-Q Reporting, Qualified Expenses, and Roth Rollovers (2026) скачать в хорошем качестве

529 Plan Tax Guide: Form 1099-Q Reporting, Qualified Expenses, and Roth Rollovers (2026)

We are performing a forensic deconstruction of Internal Revenue Code Section 529 and the reporting mechanics of Form 1099-Q. For tax professionals and high-net-worth families, the 529 plan has evolved from a simple college savings tool into a high-stakes wealth transfer vehicle, requiring a surgical understanding of "Adjusted Qualified Education Expenses" (AQE) and the mandatory allocation rules of the IRS. As The Finance Observer, I analyze the mechanical "Engine" of IRC Section 72, which dictates that every 529 distribution is a proportional mix of earnings and basis. We break down the "Recipient Designation" strategy, revealing how directing payments to the student can leverage lower marginal tax brackets to neutralize non-qualified earnings. We audit the "No Double Dipping" mandate, which forces a dollar-for-dollar reduction of qualified expenses when claiming education tax credits like the AOTC. Finally, we execute the Publication 970 Four-Step Formula for taxable distributions and reveal the strategic "Exit Ramp" created by the Secure 2.0 Act—the $35,000 lifetime rollover to a Roth IRA. FORENSIC BREAKDOWN: [00:50] The Compliance Journey: From statutory foundation to 1040 reporting. [01:21] Statutory Evolution: Tracking Section 529 from 1996 to the Secure 2.0 Act. [02:36] Form 1099-Q: The mandatory trigger for all 529 distribution reporting. [03:16] Recipient Strategy: Auditing the tax impact of Student vs. Account Owner designations. [04:36] Defining AQE: Calculating the net figure after PEL grants and scholarships. [05:23] No Double Dipping: The § 529 conflict with AOTC and Lifetime Learning Credits. [06:04] The Pro-rata Rule: Why IRC Section 72 forbids "Principal-First" withdrawals. [06:57] Publication 970 Audit: A real-world walkthrough of the taxable earnings formula. [08:13] Schedule 1, Line 8Z: The forensic placement of taxable 529 earnings. [08:27] Form 5329: Executing the mandatory 10% additional tax on non-qualified funds. [08:39] Secure 2.0 Gamechanger: The $35,000 Roth IRA rollover "Exit Ramp." THE LAW (Citations): IRC § 529: Qualified tuition programs and tax-exempt distribution rules. IRC § 72: Annuities; certain proceeds of endowment and life insurance contracts (Pro-rata Rule). IRS Publication 970: Tax Benefits for Education. Secure 2.0 Act: Authorization of 529-to-Roth IRA rollovers. Taxpayer First Act 2024: Electronic filing mandates for 1099-Q reporting. Form 1099-Q: Payments From Qualified Education Programs (Under Sections 529 and 530). DISCLAIMER: I am The Finance Observer. This content is for educational purposes only. I am not a CPA, Attorney, or Enrolled Agent. This video breaks down Federal Tax Law and IRC statutes for informational purposes. 529 distributions involve complex pro-rata math and strict coordination with education tax credits. Always consult a qualified tax professional before filing.