Form 1099-Q Instructions: Box-by-Box Guide

By Charles Hardy | Last Updated: Oct 09, 2026

Key Insights: Form 1099-Q Instructions

Form 1099-Q reports distributions from qualified tuition programs (QTPs), commonly called 529 plans, and from Coverdell education savings accounts (ESAs).
Every distribution is split into earnings (Box 2) and basis (Box 3), which together must equal the gross distribution (Box 1). Earnings are the only part that can be taxable.
Box 4 identifies transfers. Box 4a covers trustee-to-trustee transfers, including QTP to ABLE account rollovers, and Box 4b covers QTP to Roth IRA transfers.
Filing 10 or more information returns of any type combined makes e-filing mandatory.

Before you start: what you will need

Form 1099-Q reports four categories of information: which program or trustee made the payment, who received it, how much was distributed and how much of it was earnings, and what type of distribution it was. Every box on the form supports one of these four categories.

Have the following ready before filing:

The QTP’s or trustee’s name, address, telephone number, and EIN
Recipient’s name, address, TIN, and account number, if one is assigned
Who received the distribution: the beneficiary, the school, a Roth IRA, or the account owner
The gross distribution, including in-kind amounts such as tuition credits or vouchers
The earnings and basis portions of the distribution, figured using the IRS earnings ratio
Whether the distribution was a transfer, and to what type of account
Earnings statements from any program that transferred funds into the account

For Coverdell ESAs, you may choose not to report earnings and basis on most distributions. In that case, you will need the account’s fair market value as of December 31 instead.

Form 1099-Q box-by-box instructions

Box 1, Gross distribution

Enter the total amount distributed during the year, whether paid in cash or in kind. For a QTP, this includes tuition credits or certificates, payment vouchers, tuition waivers, and similar items. It also includes refunds to the account owner or beneficiary, and payments made upon the beneficiary’s death or disability.

For a Coverdell ESA, Box 1 includes refunds, payments upon death or disability, and withdrawals of excess contributions plus earnings.

Box 2, Earnings

Enter the earnings portion of the Box 1 distribution, figured using the IRS earnings ratio. Enter a loss here only in the final year of distributions from the account. In any other year with a loss or no earnings, enter zero. Box 2 is covered in more detail in the earnings and basis section below.

Box 3, Basis

If you can determine basis, enter the basis included in the Box 1 distribution. Box 3 must equal Box 1 minus Box 2. For Coverdell ESAs, you may rely on Notice 2001-81 to determine basis.

Box 4a, Trustee-to-trustee transfer

Check this box if the distribution went directly from one QTP to another QTP, or from a QTP to an ABLE account. For a Coverdell ESA, check it if the distribution went directly to another Coverdell ESA or to a QTP.

If you have no records showing that a Coverdell ESA distribution was a trustee-to-trustee transfer, leave Box 4a blank.

Box 4b, QTP to Roth IRA

Check this box if the distribution went directly, by trustee-to-trustee transfer, from a QTP to a Roth IRA maintained for the QTP beneficiary.

Boxes 5a to 5c, Distribution is from

Check one box to show the type of account:

Box 5a, Private QTP: a QTP established by one or more private eligible educational institutions
Box 5b, State QTP: a QTP established by a state
Box 5c, Coverdell ESA: any Coverdell education savings account

Box 6, Recipient is not the designated beneficiary

Check this box if the recipient listed on the form is not the designated beneficiary, such as when a QTP distribution is paid to the account owner.

Box 7, Distribution code or FMV

Box 7 appears on the recipient’s copy only. Entering a distribution code here is optional. Codes may be abbreviated, for example, as distr.
code 1.

Code	Use it for
1	Distributions, including transfers and direct payments to a school, other than excess contribution withdrawals
2	Withdrawals of excess Coverdell ESA contributions plus earnings, taxable in the current year
3	Withdrawals of excess Coverdell ESA contributions plus earnings, taxable in the prior year
4	Distributions made after the recipient became disabled
5	Payments to a deceased beneficiary’s beneficiary, including an estate
6	Prohibited transactions

Common Form 1099-Q filing mistakes

Listing the wrong recipient on a QTP distribution. The beneficiary is the recipient only when funds go to the beneficiary, a school for the beneficiary, or the beneficiary’s Roth IRA. Otherwise, list the account owner and check Box 6.
Boxes 2 and 3 do not add up to Box 1. Box 3 must equal Box 1 minus Box 2.
Reporting a loss before the final distribution year. A loss in Box 2 is allowed only in the final year of distributions from the account. Otherwise, enter zero.
Entering zero instead of leaving Boxes 2 and 3 blank. For Coverdell ESAs reported with fair market value, these boxes must be blank, and Box 7 must show the FMV.
Using a single Box 4 checkbox. Since the April 2025 revision, trustee-to-trustee transfers use Box 4a, and QTP to Roth IRA transfers use Box 4b.
Combining returned contributions with other distributions. A Coverdell ESA distribution with a returned contribution plus earnings needs two separate forms.
Filing for a beneficiary change within the family. No Form 1099-Q is needed when the new beneficiary is a family member and, for Coverdell ESAs, under age 30.

Filing your 1099-Q once it is complete

Once all applicable boxes are completed, Form 1099-B can be filed by paper or electronically. With the FIRE system retiring at the end of 2026, e-filing is the more sustainable option regardless of current filing volume.

To e-file with TaxBandits:

Step 1: Create a free account.
Step 2: Select or add the program or trustee filing the return.
Step 3: Enter the required Form 1099-Q details, following the box-by-box instructions above.
Step 4: Review all entries, then transmit to the IRS.

E-File Form 1099-Q Now, starting as low as $0.80/form.

Frequently asked questions

Form 1099-Q is filed by the officer or employee who controls a 529 qualified tuition program established by a state or an eligible educational institution. Trustees of Coverdell education savings accounts also file it for distributions from those accounts.

The designated beneficiary is the recipient when the distribution is paid to the beneficiary, to a school for the beneficiary, or to the beneficiary’s Roth IRA. For any other distribution, the account owner is the recipient, and Box 6 must be checked.

Use the IRS earnings ratio, which applies the account’s proportion of earnings to the distribution. Box 2 shows the earnings portion and Box 3 shows the basis portion, and together they must equal Box 1.

Yes. Report each trustee-to-trustee transfer on a separate Form 1099-Q. Check Box 4a for transfers between education programs or to an ABLE account, and Box 4b for transfers from a QTP to a Roth IRA.

No. Distribution codes in Box 7 are optional. If you use them, codes 1 through 6 identify the type of distribution, such as code 1 for regular distributions and code 4 for disability.

Form 1096 is required only for paper filing. It is not required when filing electronically.

Learn more in our Form 1099-Q Due Date guide and Form 1099-Q Penalty guide, bookmarked below for reference.

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