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Originally Posted by waynekim I took out distribution from 529 and 3 months later returned the money to plan because my son did get scholarship. I did get 1099Q from plan and they have to issue this when fund is redeposited after 60 days. I have a copy of the check to proof this. How do I do my tax reflecting this event.
Thank you |
You might contact your529 provider & see if anything can be done. you did a withdrawal, and not a loan. And I believe there is also a 60 day limit ,by the fed's, to deposit that money back into the plan. Otherwise taxes are due - federal, state, and there's also a 10% early withdrawal penalty will have to pay a 10% federal penalty tax on the earnings portion of the non-qualified distribution. The principal portion is not subject to tax or penalty. If additional penalties apply,you also may need to complete IRS form 5329.