Coverdell (Education) IRA


A retirement plan and determination will take you where you want to go – traveling, golfing, or relaxing by the lake. Whatever you have in mind for your golden years, a Ouachita Valley individual retirement account (IRA) is a safe harbor for your retirement funds. There are now more IRA types and maturity options at Ouachita Valley than ever.

A savings plan for higher education. Parents and guardians are allowed to make non-deductible contributions to an Education IRA for a child under the age of 18. The funds in an Education IRA can be withdrawn tax free when they are needed for educational purposes.

Key Features of a Coverdell (Education) IRA:

  • Contributions may not be tax deductible

  • Withdrawals to pay qualified expenses may be tax free. Qualified expenses are:

    • Tuition

    • Fees

    • Books

    • Elementary and Secondary School Expenses

    • Computer Technology or Equipment (including online access) that the beneficiary uses while in school

    • Equipment required for enrollment or attendance at nearly any post-secondary school

    • Certain room and board expenses also may apply

  • Contributions not to exceed $2000 per year

  • Contributions allowed until the child reaches 18

  • Child has up until age 30 to use the funds

Your tax situation may vary. Consult with a tax advisor for full details on deductibility of contributions, earnings, and early withdrawal penalties.