Is the Education IRA application required for ALL contributions to an Education IRA/Coverdell Education Savings Account? Recent training from Bankers Systems says that it is required for establishing the CESA, but doesn't address additional contributions.

I haven't researched the Education accounts specifically; however, you typically need only one agreement per IRA account. You should document each contribution received. You can do that with a contribution form or a contribution receipt. And, of course, you must follow Reg DD rules to properly disclose each investment.

We allow contributions into existing CDs; therefore, once an IRA account is established, we often only have to document the subsequent contributions (unless, of course, they want an additional CD for a better rate).

NEW IRA - custodial agreement, TISA, rollover review (if applicable)

DEPOSIT TO EXISTING IRA - contribution form, rollover review (if applicable)

DEPOSIT TO EXISTING IRA ACCOUNT, NEW CD- contribution form, rollover review (if applicable), TISA

If the Education IRAs are supposed to be treated differently, I would like to know as well.

In addition to the disclosures, my literature on the CESA states that the contributor and responsible individual receive a copy of the Education IRA Application. We currently use the application to open the account - it indicates who the contributor and responsible individual are.

Anyone can contribute to a CESA. Once the account is established by a contributor who names a responsible individual, can anyone else contribute to the account or, must a new account be opened, requiring a new application? For example, Grandpa A contributes $500 in 2002 for a child. Grandpa B wants to do the same. Can it be deposited into the same account and if so, is another application naming Grandpa B as a contributor required?

I guess what I'm trying to get at, is who is responsible for tracking contributors or does it even matter? There are income restrictions regarding contributors so this must be monitored somehow.

Confused? Now I am!

As I recall, we are still waiting for final word on recent IRA amendments. I think I would establish a separate IRA account for each contributor at this time. We definitely need IRS guidance for the future since the increased contribution limits and expense qualifications may actually make this a viable education product.