Are you worried about whether you will be able to help your children or (perhaps) grandchildren with college expenses when the time comes? Start now and be prepared with a Coverdell Education Savings Account (commonly known as an Education IRA.)
Up to $2,000 can be contributed to a Coverdell Account while the child is age 17 or younger. Unfortunately, the contributions aren’t tax deductible; however, they and their earnings can be withdrawn tax-free as long as they are used to pay eligible schooling expenses.
Any adult (parents, grandfolk, godparents or friends) may put money in a child’s Coverdell Account; however, the total put into the account from all sources cannot exceed $2,000 per year. Money to be used for:
- Primary (K-12) education
- Vocational school
- College education
- College tuition
- College room & board
- College books
- College computers and more
Call us for more information at 765-732-3022 or 800-463-7464 today.
Balances in a Coverdell ESA must be disbursed on qualified education expenses by the time the beneficiary is 30 years old or given to another family member below the age of 30 in order to avoid taxes and penalties.