The maximum annual contribution to a Coverdell Education Savings Account is:
a. $2,000
b. $2,500
c. $3,000
d. $4,000
a. $2,000.
Section 529 plans are established by:
a. the IRS
b. the SEC
c. the State
d. FINRA
c. the State.
A 529 plan is set up for a child in State A. The child attends a college in State B. Which statement is TRUE?
a. the funds in the 529 plan are not portable and can't be used to pay for college in state B
b. the funds in the 529 plan are portable and can b
b. the funds in the 529 plan are portable and can be used to pay for college in state B.
All of the following statements are true about Health Savings Accounts EXCEPT:
a. HSAs are only appropriate for those individuals covered by high-deductible health insurance plans
b. HSAs can be set up to include dependents of the covered individual
c. HS
d. HSA contributions are subject to phase-out when an individual's income exceeds $250,000.
ABLE account distributions are tax-free when used to pay for qualifying:
a. lower education expenses
b. higher education expenses
c. medical expenses
d. disability expenses
d. disability expenses.
Which statements are TRUE about coverdell education savings accounts?
I. contributions can continue until the beneficiary reaches age 18
II. contributions can continue until the beneficiary reaches age 30
III. distributions to the beneficiary must be comp
b. I and IV.
Which statements are TRUE about coverdell education savings accounts?
I. contributions are tax deductible
II. contributions are not tax deductible
III. distributions are taxable
IV. distributions are not taxable
a. I and III
b. I and IV
c. II and III
d. I
d. II and IV.
A distribution from a Section 529 Plan would be taxable if the beneficiary:
a. does not go to college
b. gets a full scholarship
c. goes on disability
d. goes to vocational school
a. does not go to college.
A customer that earns $300,000 per year wishes to set aside funds for his 12 year old daughter's future college expenses. Which statements are TRUE?
I. the customer can open a UTMA account for the daughter to deposit the funds
II. the customer cannot open
b. I and IV.
High earning individuals can make contributions to:
I. UGMA accounts
II. Roth IRAs
III. UTMA accounts
IV. Coverdell ESAs
a. I and III
b. I and IV
c. II and III
d. II and IV
a. I and III.
Many years ago, a customer opened a Coverdell ESA for his son, who is now age 16, and a savings account for his daughter, who is now age 18. The 18-year old daughter is entering college and does not have enough money in the savings account to pay for tuit
a. can change the beneficiary on the Coverdell ESA from the son to the daughter.
When comparing section 529 plans to coverdell education savings accounts, which statement is FALSE?
a. the account may be opened by any adult
b. annual contributions are limited to $2,000 per beneficiary
c. earnings build in the account tax deferred
d. di
b. annual contributions are limited to $2,000 per beneficiary.
An uncle opens a Coverdell ESA for his niece and makes deposits over a number of years. When she enters college, the niece withdraws $10,000 from her Coverdell ESA to pay for expenses. The student only uses $9,000 of the funds. The remaining $1,000:
a. mu
b. is taxable at ordinary income tax rates to the niece.
Which statements are TRUE when comparing UTMA Custodian Accounts to Coverdell Education Savings Accounts?
I. contributions to UTMA accounts are limited to $2,000 annually
II. contributions to coverdell education savings accounts are limited to $2,000 annu
c. II and III.
A woman in the highest tax bracket has $105,000 to invest for her teenage child's college education. She wants to make sure that, if he doesn't attend college, that he will not have access to these funds. She should be advised to make the investment in a:
b. 529 plan.