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FAQ

Coverdell Education

The Coverdell Education Savings Account (CESA), formerly known as an Education IRA, is a trust or account in the name of the student. The CESA can be used to pay for elementary and/or secondary (high school) education or college.

How does a CESA work?
Contributions to a CESA are not tax deductible. However, a CESA offers you the potential for tax free withdrawals, including earnings.

• The maximum contribution is $2,000 per year.
• Contributions must be made before the student’s 18th birthday and distributed before the student’s 30th birthday.
• The contributor gives up ownership of the funds to the student.
• Contributions made are not tax deductible, but will appreciate tax deferred; distributions will be tax free if used for qualified education expenses.

Add a Coverdell Account

If you are currently a First Credit Union member and would like to add a Coverdell account:

•	Visit any branch or call 480-831-2645, toll free 800-732-6986 to receive and complete your Coverdell account application.
•	Provide a $25 opening fee.

How to Join First Credit Union

You may complete an online application or fill out a printed application and take or mail it to the nearest First Credit Union branch. With your application you must:

•	Include a minimum $5 deposit. Provide a copy of your driver's license and a secondary form of identification.
•	You may also open your account by arranging for a payroll deduction, net pay deposit, or a direct deposit through your payroll department.