Can Parents claim their children as dependent if the following conditions apply:
- Child is less than 24 years old
- Child is in college as a full-time student
- 90% of the expenses (tuition, room & board) were paid with distributions from Coverdell ESA
- Distributions were lower than Cost-Of-Attendance
- All of the contributions to Coverdell ESA were made by the parents, with the child as the beneficiary
I would like to know how IRS treats distributions from Coverdell. Are they treated as student owned?
- If so it implies student has contributed more than 50% of the support for the year
- If not it implies parents can claim to have contributed more than 50% of the support for the year
Please advise how to interpret.
Regards,
Ramesh
