Author's Note: Coverdell ESA Form Explained
As a parent of three young children, I spend considerable time worrying about how we're going to pay for their college education. I'm grateful that there are savings accounts available — Coverdell ESAs and state-run 529 plans — that allow my wife and I (and our generous parents) to set aside some money that will grow tax-free and be earmarked exclusively for education expenses. I also try to comfort myself with the fact that no one pays full tuition at any college or university, and that financial aid packages are designed to make up the difference between the full bill and what a family can afford to pay.
But I'm also disappointed that my kids will likely enter the "real" world saddled with student loan debt. Who knows, though, but the time my first kid enters college — a decade away, still — the whole system might be replaced by free MOOCS. A poor dad can dream, can't he?
- IRS. "Coverdell Education Savings Accounts (ESA)." Publication 970, Tax Benefits for Education. 2013 (Dec. 12, 2014) http://www.irs.gov/publications/p970/ch07.html
- IRS. "General Instructions for Certain Information Returns" (Dec. 12, 2014) http://www.irs.gov/instructions/i1099gi/ar02.html#d0e1316
- IRS. "Instructions for Form 5498-ESA" (Dec. 12, 2014) http://www.irs.gov/instructions/i5498e/ar02.html
- IRS. "Topic 310: Coverdell Education Savings Accounts" (Dec. 12, 2014) http://www.irs.gov/taxtopics/tc310.html
- National Center for Education Statistics. "Fast Facts: Tuition costs of colleges and universities." 2013 (Dec. 12, 2014) http://nces.ed.gov/fastfacts/display.asp?id=76
- Saving for College. "Compare Savings Options" (Dec. 12, 2014) http://www.savingforcollege.com/compare_savings_options/?assigned_to%5B%5D=0&assigned_to%5B%5D=1&hiddenField=vehicles&mode=Submit