IRAs - Wealth Management
Coverdell Education
Savings Account
For more information, contact us.
What is an Educational Savings Account?
An Educational Savings Account can be set up for any child under the age of
18. Parents, guardians, grandparents, or anyone else may contribute up to $2,000
per year until the child reaches the age of 18. Plus, withdrawals are tax-free
if used for educational purposes.
Who is eligible for a Educational Savings Account and how
much can be contributed?
- Any child under the age of 18.
- Each child can receive a total of $2,000 per year in contributions from
all sources.
- Parents, grandparents, other family members, friends or the beneficiary
may contribute (provided that the contributor's adjusted gross income meets
requirements).
- Contributions can be made in a single account or multiple accounts designed
to benefit the same child.
What is a qualified education expense?
- Education expenses for enrollment or attendance of your child at an eligible
educational institution.
- These expenses include: fees, tuition, books and supplies.
- Room and board is considered a qualified expense if the beneficiary is at
least a part-time student.
How many Educational Savings Accounts can a child have?
- There is no limit to the number of Educational Savings Accounts that may
be established for a child. But, the total contributions to all educational
accounts established must not exceed $2,000 per year.
Are my contributions tax-deductible?
- Contributions to Educational Savings Accounts are not tax-deductible.
What happens to the remaining funds after a child finishes
his/her education?
- The funds remaining in the Educational Savings Accounts may be withdrawn
by the beneficiary by the age of 30; however, it will be subject to both income
tax and a 10% penalty.
- The amount remaining can be rolled over into a new Educational Savings Account
for the benefit of a qualified eligible family member.
- Contributions can be made in a single account or multiple accounts designed
to benefit the same child.
What are some other Educational Savings options?
First National offers a wide variety of non-FDIC insured investment
products and services through First
National Investments & Planning.*
- U.S. Treasury Securities
- Municipal Bonds
- Stocks
- Mutual Funds
- Annuities
* Products offered by PrimeVest Financial Services, Inc.,
located at First
National Investments & Planning, at the Bank, are not federally insured by the
FDIC, the Federal Reserve Board, or any other agency; are not deposits
or guaranteed by the Bank or PrimeVest Financial Services, Inc.; are subject
to investment risks, including possible loss of principal invested. Financial
Advisors at First
National Investments & Planning are employees of the Bank and registered representatives
of PrimeVest Financial Services, Inc.
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