The provisions of this section are intended to meet the requirements
of Internal Revenue Code, §529A.
(1) The Board, to the extent allowed by law, may contract
with another state, including a state or multi-state consortium, that
administers a qualified ABLE program as authorized by Internal Revenue
Code, §529A to act as plan manager, provide certain services
under a contractual arrangement or provide residents of this state
with access to a qualified ABLE program.
(2) A contribution to an ABLE account must be made
in cash or cash equivalent.
(3) The Board will monitor contributions to an ABLE
account so that total contributions to an ABLE account for a designated
beneficiary do not result in an excess contribution as defined in
these rules.
(4) The Board will monitor the balance of an ABLE account
so that an excess contribution as defined in these rules will not
be accepted.
(5) The Board shall provide separate accounting for
each designated beneficiary.
(6) A designated beneficiary is limited to one ABLE
account, and each ABLE account may have only one owner, who will be
the designated beneficiary. Unless the participant is also the designated
beneficiary, the participant may not have and will not acquire a beneficial
interest in the ABLE account, and the participant will administer
the account for the benefit of the designated beneficiary.
(7) A designated beneficiary must be a Texas resident
at the time of establishing and maintaining an active account in the
Texas ABLE Program. The Board may act to accept out-of-state residents
into the Program to the extent allowed by law.
(8) A designated beneficiary may, directly or indirectly,
direct the investment of any contributions to an ABLE account, only
to the extent allowed by Internal Revenue Code, §529A.
(9) The Board shall determine the earnings portion
of each distribution, if any, in accordance with methods that are
consistent with Internal Revenue Code, §529A; any earnings on
contributions included in distributions for qualified disability expenses
shall not be includible in gross income to the extent provided by
Internal Revenue Code, §529A.
(10) The Board shall report distributions of the designated
beneficiary to the Secretary of the United States Treasury, as required
by Internal Revenue Code, §529A.
(11) The participant, designated beneficiary, and any
other contributor, may not use any interest in or portion of an ABLE
account as security for a loan. This paragraph does not prohibit the
use of funds in an ABLE account as down payment for a home or vehicle
to the extent it is a qualified disability expense.
(12) Available funds may be rolled over to the extent
allowed by Internal Revenue Code, §529A and United States Treasury
regulations as described in §7.189 of this title (relating to
Rollovers).
(13) A change in the designated beneficiary of an ABLE
account during a taxable year shall not be treated as a taxable distribution
on Internal Revenue Service Form 1099QA for that taxable year for
purposes of paragraph (9) of this section if the new beneficiary is
an eligible member of the family.
(14) Except as provided by the Secretary of the United
States Treasury, and for the purpose of applying Internal Revenue
Code, §72, all distributions during a taxable year shall be treated
as one distribution and the value of the account shall be computed
and reported on Internal Revenue Service Form 1099QA as of the close
of the calendar year in which the taxable year begins.
(15) The Board shall submit notices, statements, and
reports as required to maintain compliance with Internal Revenue Code, §529A
and any other state and federal requirements.
(16) The Board will make any transfers to state in
compliance with Internal Revenue Code, §529A.
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