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Accumulate More In A Coverdell ESA Account Vs A Taxable Account

¿Cúales Son Las Ventajas De Una Coverdell ESA?

El aplazamiento de impuestos puede tener un efecto dramático en el crecimiento de una inversión. Con el nuevo Coverdell ESA (anteriormente conocido como Education IRA), sus contribuciones pueden aumentar con impuestos diferidos y distribuidos libres de impuestos siempre que las distribuciones se utilicen para gastos de educación calificados. Estos costos pueden incluir uniformes escolares, computadoras y transporte para la escuela primaria o secundaria, pública, privada o religiosa.

Se aplica un límite anual de $ 2,000 por año para cualquier persona menor de 18 años. Una vez que el beneficiario alcanza los 18 años, puede tomar el control de la cuenta, pero los fondos deben usarse para cuando el beneficiario cumpla los 30 años o transferirse a un hermano menor.

La capacidad de contribuir a Coverdell ESA se elimina gradualmente para contribuyentes individuales con Ingreso Bruto Ajustado Modificado (MAGI) entre $ 95,000 y $ 110,000 y para contribuyentes conjuntos con MAGI entre $ 190,000 y $ 220,000. La fecha límite de contribución anual es el 15 de abril del año siguiente.

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Coverdell Education Savings Accounts

The Coverdell education savings account (formerly the education IRA) is a tax-advantaged savings plan for post-secondary education. It is modeled on the standard IRA to give tax incentives to persons for saving for education.

Anyone may fund a Coverdell ESA for a single student (beneficiary); however, no more than $2,000 a year may be invested per student regardless of how many separate accounts are created. The contributions can be made until the student's 18th birthday. The contributions are not tax-deductible to the contributor and are subject to phase-out provisions based on the contributor's income; thus, after a certain amount of income, he or she cannot contribute. However, the earnings remain tax-free when they are withdrawn for qualified educational expenses. After the beneficiary attains age 30, withdrawals are no longer tax-free.

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Contribution Rules of Coverdell Education Savings Accounts

Anyone may fund a Coverdell education savings account (formerly education IRA) for a child (beneficiary). The maximum allowed contribution is $2,000 per year in aggregate, up until the beneficiary's 18th birthday, unless the beneficiary is a special-needs beneficiary. The earnings remain tax-free when they are withdrawn and used for qualified educational expenses. All assets must be distributed within 30 days of the beneficiary's attaining age 30, unless the beneficiary is a special-needs beneficiary.

It is important to note that contributions to Coverdell accounts are not tax deductible.

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Penalties on Withdrawals from a Coverdell Education Savings Account

There are tax penalties for non-qualified withdrawals from a Coverdell education savings account. Non-qualified withdrawals are those that are not withdrawn for qualified educational expenses. The IRS will consider any non-qualified withdrawal to be taxable income. All such withdrawals are subject to income tax on their earnings as well as the 10 percent penalty on early distributions. In the event of the death or disability of the beneficiary, the 10 percent penalty will not apply.

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Definitions

  • Annual savings amount The annual amount between $0 and $2000 you will set aside in the Coverdell account.
  • Number of years contributions are madeThe number of years you plan to make contributions to the Coverdell account.
  • Before-tax return on savingsThe return you anticipate to receive on your college savings accounts.
  • Marginal tax bracketUnlike the tax-deferred Coverdell account, enter the tax rate you would pay on any earnings in an alternative taxable college savings account. This rate will be used for comparison purposes.
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Esta información puede ayudarle a analizar sus necesidades financieras. Se basa en la información y las suposiciones que usted proporciona sobre sus objetivos, expectativas y situación financiera. De los cálculos no se deduce que la empresa asuma ninguna obligación fiduciaria. Los cálculos proporcionados no deben interpretarse como asesoramiento financiero, jurídico o fiscal. Además, esta información no debe considerarse como la única fuente de información. Esta información procede de fuentes que consideramos confiables, pero no podemos garantizar su exactitud. Las ilustraciones hipotéticas pueden proporcionar información sobre el rendimiento histórico o actual. Los resultados pasados no garantizan ni indican resultados futuros.
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