Teen sues her parents for refusing to pay her university fees...

[KatherineB]

In many states, when you open a 529 account or any account with the intention of paying for college for any one of your children, its considered a contract enforceable by law.

Therefore because they told her the fund was for her college, she is entitled to it.

That's where the rub lies. They can not just take the money at this point. If it was put into a regular savings at the start and told her it was for this and that. Then yeah she wouldn't get it but because they specifically told her it was for college, they are pretty much screwed.

Wow! Okay, thanks for clarifying it as that makes rather more sense now. I had no idea of that before. Definitely not something we do in Australia.

[Kheldarson]

Wow! Okay, thanks for clarifying it as that makes rather more sense now. I had no idea of that before. Definitely not something we do in Australia.

It has to do with tax breaks and such, I believe. I think anything the parents put into such an account is non-taxable to an extent, therefore they're getting a break, but they forfeit the right to the money. Or something like that...

[mathnerd]

It has to do with tax breaks and such, I believe. I think anything the parents put into such an account is non-taxable to an extent, therefore they're getting a break, but they forfeit the right to the money. Or something like that...

The money goes into the account pre-tax. Maybe taxguycarl can weigh in, as I'm not an expert, but my understanding is that it works similar to retirement accounts as far as tax breaks and whatnot, and that you *can* take it out early or for other purposes, but there are substantial penalties if you do.

[Titi]

This is a voice mail she sent her mother before the lawsuit.

Here is a shocking phone message Rachel left for her mom: "Hi mom, just to let you know you're a real (blanking) winner aren't you? Anyway, I (blanking) hate you and I’ve written you off so don't talk to me, don't do anything. Have a nice life. Bye mom."

Yet the suit tried to argue that the parents didn't contact her at all. Did she not ask for that?

She also set up a facebook account. https://www.facebook.com/educationforrachel

[taxguykarl]

The money goes into the account pre-tax. Maybe taxguycarl can weigh in, as I'm not an expert, but my understanding is that it works similar to retirement accounts as far as tax breaks and whatnot, and that you *can* take it out early or for other purposes, but there are substantial penalties if you do.

Publication 907, pages 56-60 answer those and other queries. In a nutshell: the money is post-tax; however, some states allow an income adjustment for contributions (Illinois up to $10k, if the contributions are to the state's Bright Start plan). Returns on that investment are not taxable. Yes, it can be pulled for other purposes with a penalty; beneficiaries can be changed without a penalty if they are related to the original beneficiary. FAQ's here.

[eltf177]

http://news.msn.com/us/honor-student...s-returns-home

Well, the lawsuit's been "settled amicably" and she's gone home. Now the family's "asking for privacy."

Why is it I smell a scam and they'll soon be charging mega-bucks to make personal appearances on various TV shows around the country?

[Tama]

Probably so they can beat her ass in peace (figuratively).

Possibly she's realized the error of her ways. Possibly she's gotten lots of YOU SPOILED BRAT INGRATE.

[taxguykarl]

An update of sorts.

[KatherineB]

How long until the father of the friend with whom she was staying and who was apparently paying her legal bills goes after the happily reunited family for his money back? Anyone?

[DGoddessChardonnay]

How long until the father of the friend with whom she was staying and who was apparently paying her legal bills goes after the happily reunited family for his money back? Anyone?

My bet's on six months or less.

Anyone notice how the family has clammed up to the press by asking for "privacy?"

[morgana]

How long until the father of the friend with whom she was staying and who was apparently paying her legal bills goes after the happily reunited family for his money back? Anyone?

He's already trying to get a 'legal guardian' appointed for her. Family needs to sue HIM, I'm thinking.

[Ironclad Alibi]

He's already trying to get a 'legal guardian' appointed for her. Family needs to sue HIM, I'm thinking.

Since she is now 18, I think* he might have to prove she is mentally incompetent to get a legal guardian assigned.




* Usual disclaimers apply. I am not a lawyer, nor do I play one on TV or stage.
(However, I am a member of the bar. Figure that one out. Cookies await.)

[wolfie]

Usual disclaimers apply. I am not a lawyer, nor do I play one on TV or stage.
(However, I am a member of the bar. Figure that one out. Cookies await.)

The bar in question is a private club with a liquor license?

[taxguykarl]

Another update: Seems she finally dropped the suit. Expect her shyster to sue her soon