Parents Should Be Able to Save for Kids College
Dr. Dan Benishek, candidate for Congress in Michigan's 1st District, today said that the federal tax law "should encourage -- not discourage -- parents from saving for their children's college education."
Benishek said, "Unless Congress takes action, starting January 1st the annual contribution limit will be $500, down from $2,000. That is simply bad news for families struggling to save for the future."
Coverdell Education Savings Accounts -- formally known as Education IRAs -- are trusts that can be used to cover qualified education expenses for a designated beneficiary. Currently, the maximum contribution allowed for a Coverdell is $2,000 per year, per beneficiary and can be made until the beneficiary is 18 years old. This allowance is slated to change at the end of the year, however, with the expiration of a 2001 tax law. The contribution limit will fall to $500 a year, unless Congress acts to extend the benefit.
"In my view, it simply makes no sense to tinker with the limits now, especially as parents are making sacrifices for their kids' future educational needs," added the Iron Mountain surgeon.
"I strongly believe that we need lower taxes across the board, and that starts with an extension of the tax cuts passed in 2001 and 2003. Cutting taxes is an essential first step to bringing jobs back to Northern Michigan," Dr. Benishek added.
The lifelong Northern Michigan resident added, "Failing to extend 2001 and 2003 tax cuts would constitute the largest tax increase in American history. Where is Gary McDowell on this issue? Mr. McDowell has been a consistent vote for higher taxes while in Lansing, and I think voters deserve to know where he stands on this coming tax increase."
 "College Finance: See What You Know," Wall Street Journal, R-10, September 20, 2010.