Education IRA
Formerly known as Education IRAs, Coverdell Education Savings Accounts (CESAs) are nondeductible plans that allow tax-free withdrawals for a child's education expenses from birth to age 30. The total aggregate contribution into a CESA on behalf of a child is $2,000 annually.
Traditional IRAs also permit higher education distributions, but they are only penalty free. The same distribution from a Roth IRA or CESA is both penalty free and federal income tax free.
- Summary
- Favorable interest rates
- NCUA insured up to $250,000
- Experienced advisors
- Flexible distribution options
- More Information
Once you've selected a plan to fit your needs, you decide on the investment:
IRA Supreme
This investment works similar to a regular savings plan, as the funds will be easily accessible and you are not locked into a term. Minimum deposit is $100, unless you perform payroll contributions, in which case there is no minimum. Contributions may also be made via direct deposit.
IRA Certificate
Similar to other certificates offered by your credit union, this investment plan offers a higher interest rate than the IRA Supreme, but requires that you commit your funds for a specified term. Minimum deposit is $500.
IMPORTANT: Because these accounts have many different features and the deposits are based on your personal tax situation, contact your tax or legal professional or the IRS for specific tax information or facts about state or local income taxes. This is intended to provide general information on federal regulations pertaining to Traditional and Roth IRAs. It is not meant to provide legal advice or individual tax recommendations.
