Sec. 54.701. DEFINITIONS. In this subchapter:

(1) "Beneficiary" means an individual designated as the individual whose qualified higher education expenses are expected to be paid from the savings trust account.

(2) "Board" means the Prepaid Higher Education Tuition Board.

(3) "Eligible educational institution" has the meaning assigned by Section 529, Internal Revenue Code of 1986, as amended.

(4) "Financial institution" means a bank, trust company, savings and loan association, credit union, broker-dealer, mutual fund, insurance company, or other similar financial institution authorized to transact business in this state.

(5) "Nonqualified withdrawal" means a withdrawal from a savings trust account other than:

(A) a qualified withdrawal;

(B) a withdrawal made as the result of the death or disability of the beneficiary of the account; or

(C) a withdrawal made due to a scholarship or to an allowance or payment described by Section 135(d)(1)(B) or (C), Internal Revenue Code of 1986, as amended, received by the beneficiary to the extent the amount of the withdrawal does not exceed the amount of the scholarship, allowance, or payment, in accordance with federal law.

(6) "Plan" means the higher education savings plan established under this subchapter.

(7) "Plan manager" means a financial institution under contract with the board to serve as plan administrator.

(8) "Qualified higher education expenses" has the meaning assigned by Section 529, Internal Revenue Code of 1986, as amended.

(9) "Qualified withdrawal" means a withdrawal from a savings trust account to pay the qualified higher education expenses of the beneficiary of the account.

(10) "Savings trust account" means an account established through the plan by an individual under this subchapter on behalf of a beneficiary in order to apply distributions from the account toward qualified higher education expenses at eligible educational institutions.

(11) "Savings trust agreement" means the agreement between an individual establishing a savings trust account and the board.

Added by Acts 2001, 77th Leg., ch. 1250, Sec. 1, eff. June 15, 2001.

Amended by:

Acts 2019, 86th Leg., R.S., Ch. 903 (H.B. 3655), Sec. 4, eff. June 10, 2019.