![]() If the aggregate amount of contributions described in subparagraph (A) during the calendar year by a donor exceeds the limitation for such year under section 2503(b), such aggregate amount shall, at the election of the donor, be taken into account for purposes of such section ratably over the 5-year period beginning with such calendar year. (ii) shall not be treated as a qualified transfer under section 2503(e). ![]() (i) shall be treated as a completed gift to such beneficiary which is not a future interest in property, and (2) Gift tax treatment of contributionsįor purposes of chapters 12 and 13- (A) In generalĪny contribution to a qualified tuition program on behalf of any designated beneficiary. With respect to any distribution or earnings under such program. (B) a contributor to such program on behalf of a designated beneficiary, (A) a designated beneficiary under a qualified tuition program, or (c) Tax treatment of designated beneficiaries and contributors (1) In generalĮxcept as otherwise provided in this subsection, no amount shall be includible in gross income of. (6) Prohibition on excess contributionsĪ program shall not be treated as a qualified tuition program unless it provides adequate safeguards to prevent contributions on behalf of a designated beneficiary in excess of those necessary to provide for the qualified higher education expenses of the beneficiary. (5) No pledging of interest as securityĪ program shall not be treated as a qualified tuition program if it allows any interest in the program or any portion thereof to be used as security for a loan. (4) Limited investment directionĪ program shall not be treated as a qualified tuition program unless it provides that any contributor to, or designated beneficiary under, such program may, directly or indirectly, direct the investment of any contributions to the program (or any earnings thereon) no more than 2 times in any calendar year. (3) Separate accountingĪ program shall not be treated as a qualified tuition program unless it provides separate accounting for each designated beneficiary. (2) Cash contributionsĪ program shall not be treated as a qualified tuition program unless it provides that purchases or contributions may only be made in cash. For purposes of the preceding sentence, the term "qualified trust" means a trust which is created or organized in the United States for the exclusive benefit of designated beneficiaries and with respect to which the requirements of paragraphs (2) and (5) of section 408(a) are met. (B) which meets the other requirements of this subsection.Įxcept to the extent provided in regulations, a program established and maintained by 1 or more eligible educational institutions shall not be treated as a qualified tuition program unless such program provides that amounts are held in a qualified trust and such program has received a ruling or determination that such program meets the applicable requirements for a qualified tuition program. (ii) in the case of a program established and maintained by a State or agency or instrumentality thereof, may make contributions to an account which is established for the purpose of meeting the qualified higher education expenses of the designated beneficiary of the account, and (i) may purchase tuition credits or certificates on behalf of a designated beneficiary which entitle the beneficiary to the waiver or payment of qualified higher education expenses of the beneficiary, or ![]() The term "qualified tuition program" means a program established and maintained by a State or agency or instrumentality thereof or by 1 or more eligible educational institutions. (b) Qualified tuition programįor purposes of this section- (1) In general Notwithstanding the preceding sentence, such program shall be subject to the taxes imposed by section 511 (relating to imposition of tax on unrelated business income of charitable organizations). Qualified tuition programs (a) General ruleĪ qualified tuition program shall be exempt from taxation under this subtitle. Jump To: Source Credit Future Amendments Miscellaneous References In Text Amendments Effective Date §529.
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