Arkansas Administrative Code › Agency 202 - Section 529 Plan Review Committee › Rule 202.00.08-001 - Arkansas Tax-Deferred Tuition Savings Program Amended and Restated Program Rules

Current through Register Vol. 49, No. 6, June, 2024
Section 1.
General
The Arkansas Tax-Deferred Tuition Savings Program (the "Program"), is established pursuant to the Arkansas Tax-Deferred Tuition Savings Program Act, Chapter 84 of Title 6 of the Arkansas Code, as amended, codified as Ark. Code Ann. §
								6-84-101, et seq. (the "Act"). The Program is designed to satisfy the requirements of Section 529 of the Internal Revenue Code of 1986, as amended, and any regulations, rulings, announcements and other guidance issued thereunder (collectively referred to as 'Section 529 "). In accordance with the Act, the Section 529 Plan Review Committee (the "Committee") has established the following rules and regulations governing the operation of the Program. To the extent these rules and regulations are interpreted to be inconsistent with provisions of Section 529, the provisions of Section 529 shall prevail. The Program may be affected by subsequent changes in federal and state legislation. The Committee shall have the right to modify these rules and regulations from time to time to comply with then current federal law and regulations applicable to the Program and for other purposes. Capitalized terms not defined herein shall have the meaning ascribed to them in the Act.
Section 2.
Definitions
A.
Account Application Form
means an application substantially in the form approved by the Committee from time to time.
B.
Age-Based Option
means, a Portfolio the assets of which are invested in a combination of Underlying Investments, currently based on the ages of Designated beneficiaries specified for such Portfolio.
C.
American Arbitration Association
means a non-profit provider of alternative dispute reolution services.
D.
Approved Allocation
means the allocation of assets for a Portfolio as approved by the Committee as may be set forth in the Program Management Agreement.
E.
Approved Allocation Effective Date
means the annual date (July 1) by which the Approved Allocation for a Portfolio is approved, as may be set forth in the Program Management Agreement.
F.
Arkansas Administration Fee
means any fee paid out of a Plan's assets to the Committee pursuant to a Program Management Agreement.
G.
Business Day
means each day on which the New York Stock Exchange is open for trading.
H.
Cash
means U.S. dollars, checks or electronic funds transfers, or any other method deemed appropriate by the Committee.
I.
Code
means the Internal Revenue Code of 1986, as amended.
J.
Contribution Maximum
means the maximum amount that an Account owner can contribute to all Program Accounts for the same Designated beneficiary, as determined from time to time by the Committee based upon a methodology which calculates such maximum amount on an annual basis using the cost of up to seven years of tuition, fees, books, supplies and equipment, and room and board at an Higher educational institution.
K.
Custom Portfolio Option, iShares Asset Allocation Portfolios, or Custom iShares Portfolio
means a Portfolio the assets of which are invested in one or a combination of Underlying Investments, in accordance with a fixed asset allocation that does not change based on the age or years-to-enrollment of a Designated beneficiary.
L.
Designated Beneficiary Change Form
means a change of a Designated beneficiary substantially in the form approved by the Committee, from time to time.
M.
Eligible Participant
means an individual, other person, or legal entity eligible under the Act, under applicable federal tax law and regulations to participate in the Program.
N.
Eligible Scholarship
means a scholarship or other payment qualifying for an exemption from the withdrawal penalty required by Section 529, or any successor provision thereto, of the Code.
O.
GIFT Plan
is the name of a direct-sold Plan established within the Program.
P.
Investment Fund
means the portion of a Plan's assets invested in Underlying Investments (i.e., that portion of the a Plan's assets not held in the Operating Fund).
Q.
iShares 529 Plan
is the name of an advisor-sold Plan established within the Program.
R.
Investment Manager
means the entity employed by the Program Manager to manage the assets of the Portfolios.
S.
Management Fee
means any fee paid out of a Plan's assets to the Program Manager pursuant to a written agreement approved by the Committee.
T.
Matching Grant
means the grant of funds awarded by the Committee under the Aspiring Scholars Matching Grant Program to eligible Account owners on behalf of a Designated beneficiary governed by the terms and conditions of the GIFT Plan Program Description and Participation Agreement and the then current matching grant instructions established by the Committee at the time the grant is awarded.
U.
MSRB
means Municipal Securities Rulemaking Board and any duly established entity which succeeds to the functions thereof.
V.
Net Asset Value
means:
(1) the net asset value per share of the Underlying Investments as of the market close on that Business Day;
(2) adjustments, if any, to the net asset value per share of any Underlying Investments made after the market close;
(3) net purchase orders and net redemption orders received by the Investment Manager from the Program Manager each Business Day;
(4) the deduction and payment of fees and expenses from the Portfolios by the Program Manager, or by the Investment Manager; and
(5) the Investment Manager's reinvestment, into any Underlying Investment it or its affiliate offers and manages, of any income, dividends and/or capital gain distributions paid by Underlying Investments.
W.
NYSE
means the New York Stock Exchange.
X.
Operating Account
means the account established for the purpose of holding the Arkansas Administration Fee.
Y.
Operating Fund
means that portion of the a Plan's assets not held in the Investment Fund.
Z.
Participation Agreement
means an agreement between an Account owner and the Trust substantially in the form approved by the Committee, from time to time, which establishes the Account and the obligations of the Trust and the Account owner.
AA.
Plan
means either (i) the GIFT Plan, (ii) the iShares 529 Plan, or (iii) any other college savings plan established pursuant to the Act and administered by the Committee, collectively, under the Trust.
BB.
Portfolio
means one of the Plan Portfolios established within the Investment Fund to which Contributions may be allocated, and that are invested in Underlying Investments.
CC.
Program Description
means the complete disclosure document or set of documents describing a Plan, including any supplement(s) thereto, each as amended from time-to-time, constituting an "official statement" within the meaning of Rule 15 c2-12 under the Securities Exchange Act of 1934, as amended, and the rules of the MSRB and any successor to the applicable functions thereof.
DD.
Program Distributor
means the program distributor employed by the Committee pursuant to Ark. Code Ann. §
								6-84-105, or any successor provision thereto, and designated as such in the then current Program Description.
EE.
Program Management Agreement
means a written agreement among the Trust, the Committee and the Program Manager.
FF.
Program Manager
means both the program manager and the recordkeeping and servicing agent employed by the Committee pursuant to Ark. Code Ann. §
								6-84-105, or any successor provision thereto, and designated as such in a Program Management Agreement.
GG.
Rollover Contribution
means a Contribution to an Account which is transferred to or deposited in the Account from another program operating as a "qualified tuition program" within the meaning of Section 529, or any successor provision thereto, of the Code.
HH.
Rollover Distribution
means a distribution or transfer from an Account which is transferred to or deposited in another program operating as a "qualified tuition program" within the meaning of Section 529, or any successor provision thereto, of the Code.
II.
Section 529 Plan Review Committee or Committee
means the committee created pursuant to Ark. Code Ann. §
								6-84-105, or any successor provision thereto.
JJ.
Series
means a class of units of a Portfolio.
KK.
State
means the State of Arkansas, acting through its executive, administrative, legislative and judicial branches.
LL.
Trust
means the Arkansas Tax-Deferred Savings Program Trust created under Ark. Code Ann. §
								6-84-104.
MM.
Underlying Investments
means ETFs, securities, separate accounts, registered mutual funds or other investments in which assets of a Portfolio are invested.
NN.
Withdrawal
means a Qualified withdrawal or a Nonqualified withdrawal.
OO.
Withdrawal Request
means a request by an Account owner to effect a Withdrawal substantially in the form or other process approved by the Committee, from time to time.
PP.
Year-of-Enrollment Portfolio
means a Portfolio the assets of which are invested in a combination of Underlying Investments based upon the Designated beneficiary's anticipated year of enrollment as determined by the Account owner.