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Coverdell Education Savings Account
The Coverdell Education Savings Account, or CESA, is a nondeductible account that features tax-free withdrawals for a very specific purpose - a child's primary, secondary or post-secondary education expenses.
- Non-deductible account
- Tax-free withdrawals for a child’s primary, secondary or post-secondary education
- Unlike withdrawals from IRAs, distributions from this account are both penalty free and tax free
- 2013 Contributions
- Modified Adjusted Gross Income levels
- Single filers
- $95,000 or less: Full $2,000 contribution
- Between $95,000 and $110,000: Partial contribution
- $110,000 or more: No contribution
- Married, joint filers
- $190,000 or less: Full $2,000 contribution
- Between $190,000 and $220,000: Partial contribution
- $220,000 or more: No contribution
- Contributions are not aggregated with your traditional or Roth IRA contributions
529 Plan/College Savings Plan
College Savings Plans, also called 529 Plans, are investment plans designed by each state to help families save for future college costs in tax-advantaged accounts.
- Benefits
- Funds grow tax-free in the account and if the beneficiary uses the funds for a qualified education expense, the funds are federal tax-free upon withdrawal
- Contributor/owner may be eligible for tax deduction benefits at the state level, depending on the state’s plan.
- Funds are no longer part of the owner’s estate even though the owner retains control of the funds and can change the beneficiary.
- Eligibility
- Anyone can contribute to a College Savings Plan for any beneficiary.
- 2013 Contributions
- Annual gift tax exclusion should be considered when contributing to a 529 plan
- A maximum contribution per beneficiary is imposed currently as high as $350,000
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Trust Representatives
Contact a CornerBank representative below to help secure your trust needs today!
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Gary L. McCutcheon
CFP®, MBA
Senior Vice President,
Asset Management
Winfield |
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Barbara J. Braa
CTFA, MBA
Vice President,
Trust & Investment Officer
Lawrence |
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Brian K. Dutton MBA,
Assistant Vice President, Asset Management
Winfield and Ark City |
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Jeff Wacker
Assistant Vice President,
Asset Management
Winfield, Douglass, and Wellington |
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Gene Heffron
Senior Vice President,
Asset Management
Winfield and Wichita |
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