(formerly known as an Education IRA)
| How much can you invest? | $2,000 maximum annual contribution per child up to age 18 except for rollover |
| Who controls the account? | Parent or other responsible individual |
| Tax Treatment | Earnings are tax free if used for qualified education expenses You may also contribute to a 529 plan without penalty |
| Restrictions on using the money | Withdrawals must be used for qualified elementary or secondary expenses (K12) or qualified higher education expenses |
| Financial Aid Considerations | Considered the account owner’s Earnings are taxable in years HOPE or Lifetime Learning Credit is used |
| Advantages | Contributions can be made by anyone Can transfer account to another qualifying family members Withdrawals can be used fork12 expenses |
| Disadvantages | Tax and 10% penalty on earnings for nonqualified withdrawals Low contribution limit Not available for taxpayers with Adjusted Gross Incomes over $220,000 (joint) or $110,000 (single) |
Guarantees offered by insurance company and their claims paying ability not Tidewater Financial Group, Bruce F. Williams or Investors Security Company, Inc.
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