The distributee reports the taxable amount (if any) of the earnings on Form 1040, line 21 (Other income) and on Form 5329 (if subject to penalty) [§529(c)(3)(A); Prop. Reg. §1.529-1(c)].

The distributee is the person who actually receives the money from the 529 plan. You generally have three options when requesting a distribution from a §529 plan:

  1. a check or ACH made payable to the account owner,
  2. a check or ACH made payable to the student, or 
  3. a payment made directly from the §529 plan to the student's college.

Option 1 means the parent is the distributee; options 2 and 3 means the student is the distributee. The distributee is the one who will receive the 1099-Q and is responsible for reporting any taxable earnings.