Form 1099-Q

DEFINITION of 'Form 1099-Q'

An IRS form that an individual who receives distributions from a Coverdell Education Savings Account (ESA) receives from his or her respective investment company. The form is used by the individual to fill out both federal and state tax returns.

BREAKING DOWN 'Form 1099-Q'

Specifically, this form will identify the amount of gross distributions that have been made from the account over the year being reported. The gross distributions that have been made are then compared to the educational expenses that have been incurred over the year. If the gross distributions exceed qualified education expenses then the excess is taxable. However, if the expenses are greater than the distributions, the individual may use the subsequent excess as an additional tax credit.

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RELATED FAQS
  1. What is the best way to save for private school expenses? A 529 plan, a Coverdell ...

    If the goal is to put the money in the plan towards private school expenses, then the Coverdell Education Savings Account ... Read Answer >>
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  3. Can I contribute to both a 529 plan and a Coverdell education savings account?

    You can contribute to both, and when your child is ready to attend college, as colleges do accept payments from both. There ... Read Answer >>
  4. A parent would choose to set up a Coverdell Education Savings Account for a child ...

    A parent would choose to set up a Coverdell Education Savings Account for a child in order to save for college expenses AND: ... Read Answer >>
  5. Do I have to claim the capital gain distribution on my federal return?

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