Section 81.13. Account termination.

 

(1)  The board shall determine the conditions under which an account may be terminated, including but not limited to the following:

(a) The account balance is below an established minimum.

(b) The account has been inactive for an established amount of time.

(c) Any portion of the account remains unused 10 years after the anticipated academic year of the designated beneficiary's initial enrollment in an eligible educational institution.

(d) The account owner or the designated beneficiary provides false or misleading information to the board, the program manager, or an eligible educational institution.

(2)  Prior to termination, the program manager shall give reasonable notice to the account owner of the proposed termination. The notice shall provide a reasonable period of time, as determined by the board, in which to prevent termination by either making an additional contribution or a qualified distribution as necessary. Upon termination, the account balance shall be paid to the account owner as a nonqualified distribution, subject to applicable federal or state taxes, and any additional fees as determined by the board.

History: CR 02-009 : cr. Register January 2003 No. 565 , eff. 2-1-03.