Which of the following is TRUE concerning the beneficiary of a Coverdell ESA?

In the context of a Coverdell Education Savings Account (ESA), it is true that contributions must be used by age 30. This is a critical rule that governs how the funds in the account can be utilized. If the money is not used for qualified education expenses by the time the beneficiary reaches the age of 30, it must be withdrawn, or else it could be subject to taxes and penalties. This stipulation encourages the utilization of the funds within a defined time frame, ensuring that they are directed toward the educational goals for which the account was established.

The other options do not accurately reflect the regulations surrounding the Coverdell ESA. Contributions to the account indeed cannot be made after the beneficiary turns 18, as the allowable contribution age is limited to minors. Additionally, while the accounts may remain open beyond the age of 30, they do not allow for any new contributions after that age, which diverges from the claims made in the other choices regarding rollover policies. Understanding these key rules assists in proper planning for educational expenses using a Coverdell ESA.