My son was in the second semester of college in Feb 2020 when he was involved in an accident that forced him to withdraw from school for the semester. Fortunately, it was early enough that the school gave us a full reimbursement of his tuition - which is good but put us in a weird situation with respect to his ESA.
I'm going to simplify a bit but here is the scenario:
1) We paid tuition in 2019 for Fall 2019 Semester ($12k paid in August 2019) and Spring 2020 Semester ($12k paid in December 2019)
2) We withdrew $24k from his ESA in December 2019 to pay for the 2019 expenses
3) In March of 2020, we received a refund check for $12k to reimburse for tuition.
So, technically, that means we withdrew too much from the ESA but it happened across calendar/tax years.
Do I need to return the money to the ESA? Will there be a penalty? Do I just return it via a contribution? Or is there something else to do?
Thanks for the help!