The Education IRA is a nondeductible account that features tax-free withdrawals for a very specific purpose - a child's higher education expenses. Education IRA distributions are penalty-free and tax-free as long as the distribution is used for qualified higher education expenses, such as tuition, fees, books, supplies and equipment required for enrollment or attendance at an eligible higher education institution. These eligible institutions include area vocational schools and universities.
A child is defined as a person under the age of 18. Contributions may be made on behalf of the child until the day before his or her 18th birthday. The contributions are limited to $500 per year, per child.
To open an Education IRA, simply talk to one of our bank customer service representatives and we'll go over the details. It's a great way to start funding your child's college education.