What about Coverdell Education Accounts

[74Heaven]

From what I have read these education accounts can be used for school curriculum such as driver's ed, internet service (?), school books, tutoring and classes. Why isn't everyone rushing to use these accounts. At the very least, you can put away $2000 a year tax free for college savings.

 

I am just wondering why no one uses these and no one seems to know much about them?

 

Any thoughts?

lj

[Farrar]

I've been curious about this too so I want to hear responses. My understanding was maybe they're being phased out in favor of the more restrictive 529s?

[Brenda in FL]

Unfortunately homeschooling costs are not qualified expenditures. I seem to remember that it may be that school tuition should be for accredited schools? You can read the fine print at the IRS website.

[extendedforecast]

I recently read this on the Clark Howard website regarding Coverdell Accounts:

 

http://clarkhoward.com/liveweb/shownotes/2010/06/15/18627/

[74Heaven]

Unfortunately homeschooling costs are not qualified expenditures. I seem to remember that it may be that school tuition should be for accredited schools? You can read the fine print at the IRS website.

 

it says in my internet printout from my credit union:

"higher education or qualified elementary and secondary expenses, including tuition, fees, books, supplies and equipment".

 

Again from the "fine print from the credit union":

 

"Qualified educational expenses are: expenses for tuition, fees, academic tutoring, books, supplies, equipment and special needs services (f beneficiiary is special needs) incurred in connection with enrollment or attendance of the designated beneficiary as an elementary or secondary school student at a public, private or religious school as determined under state law. Expenses for room/board, uniforms, transportation, and supplementary items and services (e.g. extended day programs) required or provided by a school in connection with enrollment or attendance; and purchase of computer technology or equipment or internet access to be used by the beneficiary and his or her family when the benficiary is in elementary or secondary school, except that this does not include software for sports, games, or hobbies unless the software is predominantly educational"

 

There are additional info for college expenses.....

 

Personally I could see the above including (possibly, at least worth considering) homeschooling in all its forms if the home called itself a school - in our state anyway - and especially when homeschoolers are using online instruction, tutoring - and even sports that a homeschooler is participating in for p.e. credit......

 

In my case, I have a college student and a private school student next year so much applies easily.

 

But it looks to me like this is an avenue where high school homeschoolers could at least get a tax break.

 

I mean it even applies to daycare, as in "extended day programs) for students.

 

Lisaj

 

I will have to look for hte word "accredited". I know for sure somewhere I saw tutoring