what is form 1099 q payments from qualified education programs 
form 1099 q payments from qualified education programs is an internal revenue service irs tax form sent to individuals who receive distributions from a coverdell education savings account esa or cesa or a 529 plan these distributions including rollovers may be taxable and you must determine the tax liability of any distribution using other irs information the form is then used by taxpayers to fill out both federal and state tax returns if the distributions received are subject to tax who can file form 1099 q form 1099 q should be filed by officers or employees who have control of a program established by a state or qualified educational institution it can also be filed by anyone who has made a distribution from a 529 plan also known as a qualified tuition program qtp 1cesas and qtps are tax advantaged investment accounts designed to pay for qualified higher education expenses 23 a 1099 q form will identify the amount made from the account in gross distributions over the year being reported these gross distributions are then compared to the educational expenses incurred over the year 4if the gross distributions exceed qualified education expenses then the excess is taxable and must be reported on the taxpayer s tax return if the expenses are greater than the distributions the individual may use the subsequent excess toward an education tax credit 5form 1099 q will be issued to the beneficiary student for example if the 529 distribution was paid to the beneficiary the school or a student loan provider any taxable amount of the distribution will be reported on the beneficiary s income tax return distributions used to pay for nonqualified expenses are subject to income tax and a 10 penalty on the earnings portion of the withdrawal 6there s often confusion about who uses the 1099 q for their tax return the beneficiary student or the owner of the account who may be a parent or other relative the person who receives the funds and whose social security number is on the form has to report the 1099 q on their tax return 7it s likely that the student beneficiary will pay little or no tax on the distributions the same cannot be said if the beneficiary is someone other than the student using the educational savings younger students also often fall below the reporting threshold for a federal income tax return 89