Thanks! I think I partially understand you, but I'd like to add some clarifying questions:
First, the involved parties are 1) My mom, who owns the account, 2) My wife and I (the money from my mom's account will be deposited into our account and then we will make monthly tuition payments), and 3) our daughter. Which of these is the owner, the beneficiary, and the recipient?
Second, I'm not clear on the $4,000. Do you mean that we should cover $4,000 of the tuition out of our own pockets, and that this would give us a tax benefit next year?
Third, what does all of this mean regarding my original question: Is the way we're doing this still "safe" for tax purposes, or are there likely to be repercussions from a tax standpoint? Is it better to have the funds directly transferred from my mom's fund to the school, rather than have the funds pass through our bank account?
