Current through Register Vol. 35, No. 18, September 24, 2024
A.
Account applications requirements:
(1) each
applicant shall submit an application to the board or any agent or contractor
designated by the board on such forms and with such attachments as the board
may require;
(2) the application
shall contain such information as the board may determine to be necessary or
appropriate to evidence compliance with the federal requirements; and
(3) one person shall be designated as the
beneficiary for each account.
B. College investment agreements:
(1) the board will enter into a college
investment agreement with each account owner;
(2) the college investment agreement may
include such information as the board may determine to be necessary or
appropriate to evidence compliance with the federal requirements; and
(3) applications and college investment
agreements may be submitted, accepted and become binding contracts by
electronic means (including over the internet) as may be set forth in the
program procedures and guidelines.
C. Participation in the college saving
program is available to any individual or legal entity with a valid social
security number or taxpayer identification number for the benefit of any
individual with a valid social security number or tax identification number.
Any contract entered into before the effective date of this regulation that
does not allow for the use of taxpayer identification numbers must provide for
the use of taxpayer identification numbers if renewed upon the expiration of
the contract. Any new contract entered into after the effective date of this
regulation must allow the use of taxpayer identification numbers.
D. Investment of account assets; limitations
on contributions:
(1) no account owner or
beneficiary may directly or indirectly direct the investment of any
contributions or of any other amounts held in an account except as permitted
under the federal requirements; however, at the time an account owner opens an
account, an account owner may choose among any investment options offered by
the board;
(2) contributions may be
made at any time subject to any minimum deposit requirements established by the
board; and
(3) total contributions
to all accounts established under the college savings program which have the
same beneficiary may not exceed the maximum amount as determined by the board
in accordance with program procedures and guidelines and federal
requirements.
E.
Ownership of contributions and earnings; withdrawals:
(1) the account owner shall retain ownership
and control of all contributions made to an account under any college
investment agreement and earnings on those contributions while held in such
account;
(2) only the account owner
for each account may close an account and receive or direct a withdrawal of
amounts contributed (and earnings);
(3) upon receipt of documentation required in
accordance with program procedures and guidelines, the board will make
distributions from an account as expressly directed by the account owner;
and
(4) although the board will
report the earnings portion of all withdrawals from an account, it will solely
be the responsibility of the account owner to calculate, report and pay any
resulting tax liability.
F. Fees and penalties:
(1) each college investment agreement may
provide for payment to the board of an annual administrative fee based on
amounts in the account accrued daily at an annualized rate or as otherwise
calculated and at a level as determined by the board, and such fees may be used
by the board only for costs permitted by the act; and
(2) customary and usual investment costs
(including fees and expenses of any fund in which account assets are invested)
and distribution costs approved by the board may be deducted from an account in
connection with the investment thereof and are not included in the
administrative fee, and any customary and usual account maintenance fees
approved by the board may also be deducted from accounts.
G. Waiver of rule. The board may waive any
requirements of this rule, except to the extent that the requirement is
mandated by the act, in cases where the deviation from the rule is
insubstantial and is not contrary to the purposes of the college savings
program.
