Tax documents to arrive this month for account owners
my529 will send you forms related to transactions you made in your my529 account that may help you prepare your 2020 tax returns.
Federal income tax return
If you withdrew or rolled over money to another qualified 529 plan from the accounts you owned in 2020, my529 will issue you an IRS Form 1099-Q (Payments From Qualified Education Programs) by January 31, 2021. If the withdrawal was sent to the account’s beneficiary or to an eligible educational institution, the beneficiary will receive Form 1099-Q.
The 1099-Q reports the total of all withdrawals you made in 2020. You do not need to report the earnings portion on your tax return if you used a withdrawal for qualified higher education expenses or K-12 expenses.
If you used a withdrawal to pay for nonqualified expenses, the earnings portion is subject to federal income tax as ordinary income. An additional 10 percent federal tax penalty on the earnings portion also may apply.
Utah income tax return
If you are a Utah taxpayer who contributed to, withdrew from, or rolled money into or out of your my529 account(s) in 2020, my529 will issue Form TC-675H (my529 Tax Statement for Contributions, Withdrawals and Transfers) to you by January 31, 2021. Use TC-675H to claim Utah state income tax benefits and/or report nonqualified withdrawals, rollovers and transfers on your 2020 Utah state income tax return.
my529 will also send a copy of your TC-675H to the Utah State Tax Commission. You do not need to attach your TC-675H to your Utah state income tax return. Keep your TC-675H to substantiate your claim for a tax credit if the Utah State Tax Commission audits you.
If you do not receive your Form 1099-Q or your TC-675H by January 31, 2021, contact my529. You may also access the forms by logging into your account at my529.org.