US based 529 plans and ESA (aka Coverdell account)

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mchuchra
Posts: 5
Joined: Sun Jan 23, 2011 10:50 pm

US based 529 plans and ESA (aka Coverdell account)

Post by mchuchra »

Hello,
Situation 1: 18 year old Canadian resident who will be attending an Ontario University next Fall. US based (non-Canadian) grandparent (the grandfather is the account sponsor) opened a 529 education savings account for the student years ago.
Question: What is the most tax efficient way to withdraw those 529 funds to pay for Canadian university expenses? Are there any "watchouts" or "gotchas" to avoid?

Situation 2: Family that previously lived in the United States opened an ESA (Education Savings Account, also known as a Coverdell account) many years ago on behalf of their child, later moved to Canada but kept the ESA opened. The named beneficiary on that ESA is now an 18 year old Canadian resident who will be attending an Ontario University next Fall. Question: What is the most tax efficient way to withdraw those ESA/Coverdell funds to pay for Canadian university expenses? Are there any "watchouts" or "gotchas" to avoid?

Thanks!

PS -- I did search the forum and could not find much/any info on 529s / ESAs
MCC
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