The 1099Q he will get the year following the distribution will show the split between earnings and contributions. The earnings are to be reported as income on the 1040–you can google 1099Q and get specifics. Those earnings are added to income and get hit with With a 10% penalty tax on them. Most states take federal 1040 info and adjust as they see fit, so likely there will be additional state tax too. Depends upon your dad’s tax bracket as to what the dollar amount of the taxes will be. Also how much in earnings, which could depend upon the market value of the accounts when liquidated. So it’s not necessarily an easy estimate of how much of a savings it will be to pay the education expenses from the plan or turn over ownership of the 529 to you. Also, depending upon the rules of that 529, and the timing of when it gets turned over to you could be issues.