Coverdell Education Accounts Are in Danger of Becoming Less Useful
Patrick Tyrrell /
Coverdell Education Savings Accounts were created in 2001 to provide parents with more options to pay for their children’s elementary, secondary, and college education. Unless Congress quickly takes action, those accounts will no longer be allowed to fund secondary and elementary school expenses.
President Obama often talks of helping Main Street instead of rewarding Wall Street, and Coverdell accounts are a unique asset for Main Street investors. Parents can squirrel away $2,000 per year per child in Coverdell accounts. They can then invest that money however they like in stocks, bonds, mutual funds, and other investments. The gains are not taxed at all if they use the money on qualified elementary, secondary, or college expenses. These expenses include school supplies like computers and Internet access as well as tuition and room and board at school. (more…)