Education Savings Accounts (ESAs) allow you to save up to $2,000 per child per year, and your earnings grow tax free if distributions are used to pay for qualified education expenses.
Unlike many state-sponsored Section 529 plans, an ESA can be used to pay for qualified elementary and secondary education expenses at most public, private, and parochial schools.
Seeing a child get a good education is every parent’s dream. But you may be wondering just how you’ll pay for rising elementary, high school, and college education costs.
An Education Savings Account (ESA) along with other tax-favored ways to save may be your answer. As long as you meet the income requirements, anyone including grandparents, aunts, uncles, and family friends may be able to open and contribute to your child’s account.
To learn more about ESAs and other tax-favored ways to save for education, review the following sections: