| (a) A person or entity may purchase tuition units for a beneficiary designated in an existing prepaid tuition contract by paying an amount referred to as a "gift contribution." (b) A gift contribution may purchase additional tuition units or, in the case of a prepaid tuition contract using the installment plan for purchases, the gift contribution may be applied to current or future installment payments covered by the prepaid tuition contract. (c) If the prepaid tuition contract uses an installment plan for purchases, the gift contribution will be applied to the next payment(s) due under the installment plan, unless the plan manager receives other written instructions from the purchaser of the existing prepaid tuition contract. Gift contributions may be used to reduce principal under an installment plan, reduce the amount or number of monthly payments, or to purchase additional lump sum tuition units, at the option of the purchaser. (d) If a gift contribution results in an account balance that exceeds the value equivalent of 600 Type I tuition units or any other limit that might be imposed under Internal Revenue Code, §529, the excess contribution amount will be returned to the contributor. (e) Persons or entities may make gift contributions to an established prepaid tuition account at any time, including outside the enrollment period. (f) The tuition unit price for any lump sum gift contributions will be the tuition unit price in effect for the sales period when the payment is actually received by the plan manager. If the gift contribution is applied to make installment plan purchases that are due under the contract, the gift contribution will be applied at the price established in the prepaid tuition contract for the installment payments. (g) Tuition units purchased by gift contribution and any installment payments made by gift contribution that are credited to an existing prepaid tuition contract account will be owned by, and subject to the direction and control of, the purchaser of the existing prepaid tuition contract. Such tuition units will not be owned by, or under the direction or control of, the person or entity making the gift contribution. (h) A person or entity making a gift contribution and any designated beneficiary may not directly or indirectly direct the investment of any contributions to, or earnings on, the account. |
