Question
When comparing a Section 529 savings plan with a Coverdell Education Savings Account, which statement is not correct? Question 7 options: 1. Contributions to a
When comparing a Section 529 savings plan with a Coverdell Education Savings Account, which statement is not correct?
Question 7 options:
1. Contributions to a Section 529 plan may be state tax deductible if permitted by a state but contributions to Coverdell ESAs cannot be deducted from state income taxes.
2. Distributions from both Coverdell ESAs and Section 529 plans can be used to pay for qualified private high school educational expenses and post-secondary educational expenses. 3. The maximum Coverdell ESA contribution is $2,000 per beneficiary and maximum contribution limits to Section 529 plans are based on gift-tax annual exclusion amounts. 4.Contributions can be made to a Section 529 plan and a Coverdell ESA in the same year for the same beneficiary as long as a contributor's AGI does not exceed the Coverdell ESA phase-out thresholds.
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