Which of the Following Statements About a Coverdell ESA Is

question 7

Multiple Choice

Which of the following statements about a Coverdell ESA is not correct?

• A) Taxpayers may be phased out from contributing to a Coverdell ESA because of their level of modified adjusted gross income
• B) Assets in a Coverdell ESA accumulate on a tax-deferred basis and earnings are tax-free is used for qualified educational purposes
• C) Coverdell assets can be used for elementary, secondary and higher education
• D) Every contributor can make an annual $2,000 contribution to a Coverdell for the same beneficiary