(i) the name, address and social security number, employer
identification number, or individual taxpayer identification number of
the account owner unless a family tuition account that was in effect
prior to the effective date of the chapter of the laws of two thousand
nineteen that amended this subparagraph does not allow for a taxpayer
identification number, in which case a taxpayer identification number
shall be allowed upon the expiration of the contract;
(ii) the designation of a designated beneficiary;
(iii) the name, address, and social security number, employer
identification number, or individual taxpayer identification number of
the designated beneficiary, unless a family tuition account that was in
effect prior to the effective date of the chapter of the laws of two
thousand nineteen that amended this subparagraph does not allow for a
taxpayer identification number, in which case a taxpayer identification
number shall be allowed upon the expiration of the contract; and
(iv) such other information as the program may require.
b. The comptroller and the corporation may establish a nominal fee for
such application.
3. Any person, including the account owner, may make contributions to
the account after the account is opened.
4. Contributions to accounts may be made in cash or may be deposited
by a taxpayer who has elected to contribute all or a portion of a refund
of personal income tax to an account that has been established under
this article.
a. Taxpayer contributions shall be made by direct deposit to the
designated account. The amount elected to be contributed by the taxpayer
must be at least twenty-five dollars and may be applied as a
contribution only for the tax year in which the refund is issued.
b. The election shall be made on a form prescribed by the department
of taxation and finance and filed with the taxpayer's tax return for the
tax year or at such other time and in such other manner as the
department may prescribe. The department shall prescribe the maximum
number of accounts to which a taxpayer may elect to contribute a portion
of the refund.
c. The election to contribute all or a portion of a refund shall not
be revocable.
d. All or a portion of a refund may not be contributed to an account
that has been established under this article if the amount of the
taxpayer's elected refund for such tax year is reduced by any other
sections of the tax law to the amount less than the minimum amount of
contribution authorized under this section.
5. An account owner may withdraw all or part of the balance from an
account on sixty days notice or such shorter period as may be authorized
under rules governing the program. Such rules shall include provisions
that will generally enable the determination as to whether a withdrawal
is a nonqualified withdrawal or a qualified withdrawal.
6. a. An account owner may change the designated beneficiary of an
account to an individual who is a member of the family of the prior
designated beneficiary in accordance with procedures established by the
memorandum of understanding pursuant to the provisions of section six
hundred ninety-five-c of this article.
b. An account owner may transfer all or a portion of an account to
another family tuition account, the subsequent designated beneficiary of
which is a member of the family as defined in section 529 of the
Internal Revenue Code of 1986, as amended.
c. Changes in designated beneficiaries and transfers under this
subdivision shall not be permitted to the extent that they would cause
all accounts for the same beneficiary to exceed the permitted aggregate
maximum account balance.
7. The program shall provide separate accounting for each designated
beneficiary.
8. No account owner or designated beneficiary of any account shall be
permitted to direct the investment of any contributions to an account or
the earnings thereon more than two times in any calendar year.
9. Neither an account owner nor a designated beneficiary may use an
interest in an account as security for a loan. Any pledge of an interest
in an account shall be of no force and effect.
10. The comptroller shall promulgate rules or regulations to prevent
contributions on behalf of a designated beneficiary in excess of an
amount that would cause the aggregate account balance for all accounts
for a designated beneficiary to exceed a maximum account balance, as
established from time to time by the comptroller and the corporation on
the basis of higher education costs in the state, with adequate
safeguards to prevent more contributions than necessary to provide for
the qualified higher education costs of the beneficiary, as required to
maintain the program as a "qualified tuition program" under section 529
of the Internal Revenue Code of 1986, as amended.
11. a. If there is any distribution from an account to any individual
or for the benefit of any individual during a calendar year, such
distribution shall be reported to the Internal Revenue Service and the
account owner, the designated beneficiary, or the distributee to the
extent required by federal law or regulation.
b. Statements shall be provided to each account owner at least once
each year within sixty days after the end of the twelve month period to
which they relate. The statement shall identify the contributions made
during a preceding twelve month period, the total contributions made to
the account through the end of the period, the value of the account at
the end of such period, distributions made during such period and any
other information that the comptroller shall require to be reported to
the account owner.
c. Statements and information relating to accounts shall be prepared
and filed to the extent required by federal and state tax law.
12. a. A local government or organization described in section
501(c)(3) of the Internal Revenue Code of 1986, as amended, may open and
become the account owner of an account to fund scholarships for persons
whose identity will be determined upon disbursement.
b. In the case of any account opened pursuant to paragraph a of this
subdivision the requirement set forth in subdivision two of this section
that a designated beneficiary be designated when an account is opened
shall not apply and each individual who receives an interest in such
account as a scholarship shall be treated as a designated beneficiary
with respect to such interest.
13. An annual fee may be imposed upon the account owner for the
maintenance of the account.
14. The program shall disclose the following information in writing to
each account owner and prospective account owner of a family tuition
account:
a. the terms and conditions for purchasing a family tuition account;
b. any restrictions on the substitution of beneficiaries;
c. the person or entity entitled to terminate the tuition savings
agreement;
d. the period of time during which a beneficiary may receive benefits
under the tuition savings agreement;
e. the terms and conditions under which money may be wholly or
partially withdrawn from the program, including, but not limited to, any
reasonable charges and fees that may be imposed for withdrawal;
f. the probable tax consequences associated with contributions to and
distributions from accounts; and
g. all other rights and obligations pursuant to tuition savings
agreements, and any other terms, conditions, and provisions deemed
necessary and appropriate by the terms of the memorandum of
understanding entered into pursuant to section six hundred ninety-five-c
of this article.
15. Tuition savings agreements shall be subject to section fourteen-c
of the banking law and the "truth-in-savings" regulations promulgated
thereunder.
16. Nothing in this article or in any tuition savings agreement
entered into pursuant to this article shall be construed as a guarantee
by the state or any college that a beneficiary will be admitted to a
college, or, upon admission to a college will be permitted to continue
to attend or will receive a degree from a college.