[Rev. 9/25/2018 1:49:50 PM]

[NAC-353B Revised Date: 9-18]

CHAPTER 353B - COLLEGE SAVINGS PLANS OF NEVADA

GENERAL PROVISIONS

353B.005            “Board” defined.

NEVADA HIGHER EDUCATION PREPAID TUITION PROGRAM

General Provisions

353B.010            Definitions.

353B.020            “Contract” defined.

353B.030            “Contractual plan” defined.

353B.040            “Date of matriculation” defined.

353B.050            “Eligible educational institution” defined.

353B.055            “Master agreement” defined.

353B.060            “Program” defined.

353B.069            “State college” defined.

353B.070            “State community college” defined.

353B.080            “State university” defined.

353B.090            “Tuition” defined.

Enrollment in Program; Administration; Benefits

353B.140            Development of master agreement by Board; review and amendment.

353B.150            Contract provisions: Payment of tuition to institution of higher education for certain number of semester hours of credit.

353B.160            Contract provisions: Restrictions on payment of tuition and other amounts charged for enrollment; payment of tuition for person designated as qualified beneficiary on more than one contract.

353B.170            Eligibility to be purchaser or qualified beneficiary.

353B.180            Application: Contents; fee; late application; copy of contract and master agreement.

353B.190            Designation of legal successor of applicant or purchaser.

353B.200            Board to establish and give public notice of dates for enrollment and of certain rates.

353B.205            Provision of benefits: Annual determination of amount; formula for conversion to semester credit hours; payment directly to eligible educational institution.

353B.210            Provision of benefits: Restrictions; termination of contract and refund.

353B.220            Provision of benefits: Accrual of benefits if tuition rate is less than amount of benefit payment; refund.

Amendment of Contracts

353B.300            Conditions for change in contractual plan.

353B.310            Conditions for change in designation of qualified beneficiary; expiration date of amended contract if any benefits have been paid.

Remittance of Payments

353B.350            Options for method of payment by purchaser.

353B.360            Payment of remaining balance in lump sum.

353B.365            Requirements for matching contribution by employer on behalf of qualified beneficiary.

353B.370            Remittance of payment pursuant to contract; consequences for failure to remit.

Termination of Contracts; Refunds

353B.400            Failure to provide information requested by Board.

353B.410            Fraudulent misrepresentation or omission of information.

353B.420            Death of purchaser.

353B.430            Death or disability of qualified beneficiary.

353B.440            Award of scholarship to qualified beneficiary that duplicates benefits to be provided under contract.

353B.450            Request by purchaser to terminate contract.

Fees and Penalties

353B.500            Fees.

353B.510            Penalties for insufficient funds, delinquent payment or termination of contract.

NEVADA COLLEGE SAVINGS PROGRAM

General Provisions

353B.550            Definitions.

353B.555            “Account owner” defined.

353B.560            “Business day” defined.

353B.565            “Designated beneficiary” defined.

353B.570            “Member of the family” defined.

353B.575            “Participation agreement” defined.

353B.580            “Person” defined.

353B.582            “Plan” defined.

353B.583            “Plan Investment Manager” defined.

353B.585            “Program” defined.

353B.590            “Program Manager” defined.

353B.595            “Qualified higher education expenses” defined.

Administration of Accounts

353B.600            Eligibility to be account owner or designated beneficiary.

353B.605            Designation of successor account owner; change of ownership of account.

353B.610            Change of designated beneficiary.

353B.615            Opening of account; selection of investment option; reassignment of accounts under age-based investment option.

353B.620            Conditions under which Plan Investment Manager may refuse to open account.

353B.625            Participation agreement: Execution.

353B.630            Participation agreement: Required provisions.

353B.635            Maintenance of separate records and accounting for each account; annual reports to account owners.

353B.640            Prohibition on use of interest as security for loan.

Contributions to Accounts

353B.645            Authority to make contributions; matching contribution by employer; minimum amounts; refusal of certain contributions.

353B.650            Form of contributions.

353B.655            Limitation on contributions; maximum aggregate balance for designated beneficiary; return of excess contributions.

353B.660            Rollover distributions from qualified tuition program of another state.

Distributions From and Termination of Accounts

353B.665            Distributions: Procedure; classification; restriction.

353B.670            Distributions: Required notification.

353B.675            Qualified withdrawals.

353B.680            Refund of all or part of qualified distribution.

353B.690            Rollover distributions to account in qualified tuition program of another state or to another account in Program; return of excess money.

353B.695            Termination: Conditions; notice; nonqualified distribution; qualified distribution.

Fees

353B.700            Fees to support continued operation of Program.

353B.705            Other fees.

Miscellaneous Provisions

353B.710            Accounting and expenditure if money provided by private entities for direct expenses and marketing.

353B.715            Review and modification of investment policies by Board.

353B.720            Prohibition on contributor or designated beneficiary to direct investments of Program; exception.

353B.725            Effect of joint decisions and interpretations by Board and Program Manager; claims and appeals by account owners; determination of Board on appeal.

EDUCATION SAVINGS ACCOUNTS

353B.750            Short title.

353B.755            Purposes.

353B.760            Definitions.

353B.765            “Agreement” defined.

353B.770            “School day” defined.

353B.775            “Break in the school year” construed.

353B.780            “Tuition” construed.

353B.785            Application to establish account; open enrollment period; notification of approval or denial; requirements; request for waiver; exemptions.

353B.790            Agreement with State Treasurer; deposit of money into and payments from account; annual list provided to Department; inclusion of certain examinations on list.

353B.795            Committee to Review Payments: Creation; members; duties.

353B.800            Termination of agreement by parent.

353B.805            State Treasurer to freeze account if child no longer resides in State; proof required to remove freeze; termination of agreement and dissolution of account.

353B.810            Audits of accounts; freeze of accounts found to have irregularities; notice of freeze; petition for reconsideration; determination.

353B.815            Quarterly list of terminated accounts; reversion of remaining money to State General Fund.

353B.820            Contract with financial management firm: Criteria; provision allowing termination; maintenance and management of accounts.

353B.825            Application to become participating entity; proof of eligibility; notice of determination; investigation under certain circumstances.

353B.830            Additional requirements of certain participating entities.

 

GENERAL PROVISIONS

     NAC 353B.005  “Board” defined. (NRS 353B.090)  As used in this chapter, unless the context otherwise requires, “Board” has the meaning ascribed to it in NRS 353B.002.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R150-03, eff. 8-25-2004)

NEVADA HIGHER EDUCATION PREPAID TUITION PROGRAM

General Provisions

     NAC 353B.010  Definitions. (NRS 353B.090)  As used in NAC 353B.010 to 353B.510, inclusive, unless the context otherwise requires, the words and terms defined in NRS 353B.030 to 353B.070, inclusive, and NAC 353B.020 to 353B.090, inclusive, have the meanings ascribed to them in those sections.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.020  “Contract” defined. (NRS 353B.090)  “Contract” means a prepaid tuition contract, consisting of the provisions of an application for enrollment in the Program and a schedule for participation and payment provided by the Board.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.030  “Contractual plan” defined. (NRS 353B.090)  “Contractual plan” means an option set forth in NAC 353B.150.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99)

     NAC 353B.040  “Date of matriculation” defined. (NRS 353B.090)  “Date of matriculation” means the year that a qualified beneficiary commences his or her attendance at a postsecondary educational institution.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.050  “Eligible educational institution” defined. (NRS 353B.090, 353B.100)  “Eligible educational institution” means a school described in paragraph (g) of subsection 3 of NRS 353B.100. For the purposes of that paragraph, the Board will construe the term “accredited” to mean that a school has been accredited as a postsecondary educational institution by an accrediting body recognized by the United States Department of Education and is eligible to participate in a program for student financial assistance offered by the United States Department of Education.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.055  “Master agreement” defined. (NRS 353B.090)  “Master agreement” means the agreement developed by the Board pursuant to NAC 353B.140.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R055-09, eff. 10-27-2009)

     NAC 353B.060  “Program” defined. (NRS 353B.090)  “Program” means the Program for the Prepayment of Tuition established pursuant to NRS 353B.010 to 353B.190, inclusive, and NAC 353B.010 to 353B.510, inclusive.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99)

     NAC 353B.069  “State college” defined. (NRS 353B.090)  “State college” means the Nevada State College.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R055-09, eff. 10-27-2009)

     NAC 353B.070  “State community college” defined. (NRS 353B.090)  “State community college” means:

     1.  The College of Southern Nevada;

     2.  Western Nevada College;

     3.  Truckee Meadows Community College; or

     4.  Great Basin College.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.080  “State university” defined. (NRS 353B.090)  “State university” means:

     1.  The University of Nevada, Reno; or

     2.  The University of Nevada, Las Vegas.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99)

     NAC 353B.090  “Tuition” defined. (NRS 353B.090)  “Tuition” means the cost for the enrollment of a full-time student into an eligible educational institution, except for any amounts charged:

     1.  To nonresident students only;

     2.  As fines, application fees, entrance fees, parking fees, technology fees, athletic fees or studio fees, laboratory fees, surcharges or other fees imposed for specific courses, whether or not charged to all students; and

     3.  For books, supplies, room or board, whether or not charged to all students.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

Enrollment in Program; Administration; Benefits

     NAC 353B.140  Development of master agreement by Board; review and amendment. (NRS 353B.090)

     1.  The Board will develop a master agreement for the Program. The master agreement must include, without limitation:

     (a) Information concerning the Program;

     (b) The obligations of the Program to a purchaser and a qualified beneficiary;

     (c) The qualifications of a purchaser and a qualified beneficiary;

     (d) The requirements for enrollment in the Program;

     (e) The methods of payment;

     (f) The method for the distribution and payment of benefits;

     (g) An explanation of the operation of the Trust Fund; and

     (h) General provisions, including, without limitation, provisions concerning:

          (1) The termination of a contract or the master agreement;

          (2) Refunds;

          (3) Conversions of a contract;

          (4) Amendments to a contract or the master agreement;

          (5) Arbitration;

          (6) Limited liability;

          (7) The prohibition on the sale of contracts; and

          (8) Any other provisions as determined by the Board.

     2.  The Board will review and amend the master agreement, as necessary. Any amendment to the master agreement will apply to all contracts which are affected by the amendment. The Board will amend a contract, if necessary, based upon an amendment to the master agreement. If a purchaser does not agree to an amendment to the master agreement or the contract, the purchaser may cancel the contract and receive a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R055-09, eff. 10-27-2009)

     NAC 353B.150  Contract provisions: Payment of tuition to institution of higher education for certain number of semester hours of credit. (NRS 353B.090, 353B.100)

     1.  A contract may provide for payment from the Trust Fund of the amount of tuition required for the enrollment of a qualified beneficiary into:

     (a) A state community college in sufficient classes for a student to earn 60 semester hours of credit;

     (b) A state:

          (1) Community college in sufficient classes for a student to earn 60 semester hours of credit; and

          (2) University in sufficient classes for a student to earn 60 semester hours of credit; or

     (c) A state university in sufficient classes for a student:

          (1) To earn 30 semester hours of credit;

          (2) To earn 60 semester hours of credit; or

          (3) To earn 120 semester hours of credit.

     2.  As used in this section, “classes” means classes pursuant to which a student may earn an associate’s degree in 2 years of study or a bachelor’s degree in 4 years of study.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by R079-00, 10-23-2000; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.160  Contract provisions: Restrictions on payment of tuition and other amounts charged for enrollment; payment of tuition for person designated as qualified beneficiary on more than one contract. (NRS 353B.090, 353B.100)

     1.  Except as otherwise provided in subsection 2, a contract may not authorize the payment of:

     (a) Tuition for:

          (1) More than one qualified beneficiary; or

          (2) A person who is designated as a qualified beneficiary for another contract; or

     (b) Except for the amount of tuition authorized pursuant to NAC 353B.150, any other amounts charged for the enrollment of a qualified beneficiary into an eligible educational institution.

     2.  More than one contract may authorize the payment of tuition for a person who is designated as a qualified beneficiary for the contracts if the contracts are in the amount of tuition described in subparagraphs (1) and (2) of paragraph (c) of subsection 1 of NAC 353B.150.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by R079-00, 10-23-2000; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.170  Eligibility to be purchaser or qualified beneficiary. (NRS 353B.090)

     1.  A purchaser may be any person or legal entity other than the qualified beneficiary designated for the contract.

     2.  At the time of enrollment in the Program, a qualified beneficiary must not yet have:

     (a) Completed the ninth grade of school; or

     (b) Attained the age of 18 years.

     3.  The purchaser or the qualified beneficiary must be a resident of this State at the time of enrollment in the Program, or the purchaser must hold a degree or certificate from a state university, state college or state community college.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.180  Application: Contents; fee; late application; copy of contract and master agreement. (NRS 353B.090)

     1.  A person who desires to enter into a contract must submit to the Board an application for enrollment in the Program, on a form provided by the Board, and a fee of $100 for processing the application. The application must include:

     (a) The expected date of matriculation of the qualified beneficiary;

     (b) The desired contractual plan; and

     (c) Any other relevant information requested by the Board.

     2.  The Board may accept an application for enrollment in the Program which is received after the appropriate dates for enrollment established pursuant to NAC 353B.200, but not later than 60 days before the dates established pursuant to that section for enrollment during the next year, if the purchaser pays, in addition to the fee for processing the application:

     (a) The amount the Board determines would have been due if the application had been submitted on an appropriate date; and

     (b) Any additional sum the Board determines to be necessary to ensure the actuarial soundness of the Trust Fund.

     3.  After processing an application for enrollment in the Program, the Board will send a copy of the contract and the master agreement to the purchaser.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.190  Designation of legal successor of applicant or purchaser. (NRS 353B.090)  An applicant for enrollment in the Program or a purchaser may submit to the Board a written designation of a person to serve as the legal successor of the applicant or purchaser for the purposes of the contract in the event that the applicant or purchaser dies before the contract is discharged. A person so designated:

     1.  Must not be the qualified beneficiary for the contract; and

     2.  May request and receive from the Board any information regarding the contract, but may exercise no other rights regarding the contract during the lifetime of the purchaser.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.200  Board to establish and give public notice of dates for enrollment and of certain rates. (NRS 353B.090, 353B.100)  The Board will annually:

     1.  Establish:

     (a) Guaranteed rates for the prepayment of tuition pursuant to a contract;

     (b) Specific dates for enrollment in the Program;

     (c) A rate of interest for the provision of any refunds pursuant to NAC 353B.010 to 353B.510, inclusive, of payments received during the immediately preceding year, which must be based upon the net return on the investment of money in the Trust Fund during that year;

     (d) For the purpose of imposing a penalty pursuant to paragraph (c) of subsection 2 of NAC 353B.510, the estimated rate of return on investments in the Trust Fund; and

     (e) A rate of discount for the payment of the remaining balance of a contract in a lump sum pursuant to NAC 353B.360; and

     2.  Provide public notice of those rates and dates, either separately or together, by posting a copy of the notice at the principal office of the Board and at not less than three other separate, prominent places within this State.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.205  Provision of benefits: Annual determination of amount; formula for conversion to semester credit hours; payment directly to eligible educational institution. (NRS 353B.090)

     1.  The Board will annually determine the amount of benefits to be paid to an eligible educational institution for a qualified beneficiary pursuant to a contract based upon the tuition charged per semester credit hour at the state universities, state colleges and state community colleges.

     2.  If an eligible educational institution charges students using a method other than semester credit hours, the Board will convert that method into semester credit hours to determine the number of semester credit hours that are eligible for the payment of benefits under the contract in the following manner:

     (a) For an institution that enrolls students in a semester or tri-semester program based upon clock hours, by dividing the total clock hours in the program by 30.

     (b) For an institution that enrolls students in a quarter-hour program based upon clock hours, by dividing the total number of clock hours in the program by 20.

     3.  The payment of benefits pursuant to the contract must be remitted directly to the eligible educational institution in which the qualified beneficiary is enrolled.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R055-09, eff. 10-27-2009)

     NAC 353B.210  Provision of benefits: Restrictions; termination of contract and refund. (NRS 353B.090)

     1.  The Board will not provide any benefits pursuant to a contract:

     (a) Earlier than 3 years after the date the first payment is due from the purchaser pursuant to the contract.

     (b) Until:

          (1) The purchaser has paid the entire amount due pursuant to the contract, including any outstanding fees and penalties; and

          (2) The Board has received:

               (I) The social security number of the qualified beneficiary;

               (II) If the qualified beneficiary enrolls in an eligible educational institution that is not a member of the System, at least 60 days’ notice of that enrollment; and

               (III) Any other information relating to the contract requested by the Board.

     (c) Earlier than the expected date of matriculation of the qualified beneficiary, as specified pursuant to NAC 353B.180 or 353B.310, except that the Board may allow the commencement of those benefits not more than 2 years before that date if the qualified beneficiary is a senior in high school and enrolls into an eligible educational institution before that date.

     (d) Later than 6 years, excluding any period during which the qualified beneficiary is on active duty in the Armed Services of the United States or has been actively serving or participating in a charitable, religious or public service assignment or mission, after the expected date of matriculation of the qualified beneficiary, as specified pursuant to NAC 353B.180 or 353B.310.

     (e) If the provision of benefits does not commence before the qualified beneficiary attains the age of 30 years plus any period during which the qualified beneficiary was on active duty in the Armed Services of the United States or has been actively serving or participating in a charitable, religious or public service assignment or mission.

     2.  If any benefits cannot be provided pursuant to a contract as a result of the provisions of paragraph (d) or (e) of subsection 1, the Board may terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.220  Provision of benefits: Accrual of benefits if tuition rate is less than amount of benefit payment; refund. (NRS 353B.090)  If a qualified beneficiary enrolls in an eligible educational institution that charges tuition at a rate that is less than the amount of the benefit payment determined by the Board pursuant to NAC 353B.205, the Board will remit to the eligible educational institution the actual amount of tuition charged to that qualified beneficiary and accrue any remaining benefit amount. The Board will provide a refund to the purchaser for any such accrued benefits according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R055-09, eff. 10-27-2009)

Amendment of Contracts

     NAC 353B.300  Conditions for change in contractual plan. (NRS 353B.090)  The Board will amend a contract to change the contractual plan if:

     1.  The purchaser requests the change, submits the required fee and pays any additional sum the Board determines to be necessary, as a result of the change, to ensure the actuarial soundness of the Trust Fund;

     2.  No benefits have been paid pursuant to the contract;

     3.  The purchaser is not in default pursuant to NAC 353B.370; and

     4.  The contract has not been terminated.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99)

     NAC 353B.310  Conditions for change in designation of qualified beneficiary; expiration date of amended contract if any benefits have been paid. (NRS 353B.090)

     1.  The Board will amend a contract to change the designation of the qualified beneficiary to a person within the immediate family of the existing qualified beneficiary if:

     (a) The purchaser requests the change and submits to the Board:

          (1) The required fee;

          (2) The name and date of birth of the proposed qualified beneficiary;

          (3) The expected date of matriculation of the proposed qualified beneficiary; and

          (4) Any other relevant information requested by the Board;

     (b) Either:

          (1) The age of the proposed qualified beneficiary is less than the age of the existing qualified beneficiary plus 3 years; or

          (2) The purchaser pays any additional sum the Board determines to be necessary, as a result of the change, to ensure the actuarial soundness of the Trust Fund;

     (c) The purchaser is not in default pursuant to NAC 353B.370; and

     (d) The contract has not been terminated.

     2.  If the Board amends a contract to change the designation of the qualified beneficiary pursuant to subsection 1 and any benefits have been paid pursuant to the contract, any new qualified beneficiary is subject to the original expiration date set forth in the contract.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R118-16, 12-21-2016)

Remittance of Payments

     NAC 353B.350  Options for method of payment by purchaser. (NRS 353B.090, 353B.100)  A contract may provide for payment by the purchaser:

     1.  By:

     (a) Remittance in a lump sum; or

     (b) Remittances on a monthly basis:

          (1) For 60 months;

          (2) For 120 months; or

          (3) From the time of enrollment in the Program until the qualified beneficiary graduates from high school; and

     2.  Pursuant to:

     (a) An invoice;

     (b) Monthly coupons;

     (c) Payroll deductions;

     (d) Automatic deductions from a specified account at a financial institution;

     (e) Gifts, under conditions approved by the Board; or

     (f) Any other method approved by the Board.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009; R118-16, 12-21-2016)

     NAC 353B.360  Payment of remaining balance in lump sum. (NRS 353B.090)  Upon the request of a purchaser and receipt of the required fee, the Board will allow the purchaser to pay in a lump sum the remaining balance, if any, of the total amount due pursuant to a contract that provides for the remittance of payments on a monthly basis, unless:

     1.  The purchaser is in default pursuant to NAC 353B.370; or

     2.  The contract has been terminated.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99)

     NAC 353B.365  Requirements for matching contribution by employer on behalf of qualified beneficiary. (NRS 353B.090)

     1.  An employer may make a matching contribution to the Trust Fund on behalf of a qualified beneficiary on whose behalf a contract is drawn pursuant to NRS 353B.100.

     2.  Before an employer makes a matching contribution to a contract pursuant to subsection 1, the employee must provide to the employer proof of payment on the contract.

     3.  An employer that makes a matching contribution pursuant to this section must submit to the Board the:

     (a) Name of the employee on whose behalf the matching contribution is made;

     (b) The number of the contract; and

     (c) Proof that the employer has made a matching contribution on behalf of the employee.

     (Added to NAC by Bd. of Trustees of College Savings Plans of Nev. by R118-16, eff. 12-21-2016)

     NAC 353B.370  Remittance of payment pursuant to contract; consequences for failure to remit. (NRS 353B.090)

     1.  A purchaser must remit payments pursuant to a contract on the dates and in the amounts set forth in the schedule for participation and payment provided to the purchaser by the Board.

     2.  If a purchaser fails to remit:

     (a) A payment required pursuant to a contract within 30 days after the date the payment is due, the purchaser shall be deemed to be in default.

     (b) The first payment required pursuant to a contract within 90 days after the date the payment is due, the Board may terminate the contract.

     (c) All past due payments required pursuant to a contract within 180 days after the date the purchaser is deemed to be in default pursuant to paragraph (a), the Board may terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

Termination of Contracts; Refunds

     NAC 353B.400  Failure to provide information requested by Board. (NRS 353B.090)  If a purchaser fails to provide any information relating to a contract within a reasonable period after receiving a request from the Board for the provision of that information, the Board may terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.410  Fraudulent misrepresentation or omission of information. (NRS 353B.090)  If the Board determines that a purchaser has fraudulently misrepresented or omitted any information relating to a contract requested by the Board or otherwise required pursuant to NAC 353B.010 to 353B.510, inclusive, the Board will terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.420  Death of purchaser. (NRS 353B.090)  Upon the receipt of a written request signed by a person designated pursuant to NAC 353B.190 or, in the absence of such a designation, by the representative of the estate of the purchaser or the representative of a qualified beneficiary, and such documentation as the Board deems adequate to prove that a purchaser has died, the Board will:

     1.  Terminate the contract and provide to the requester a refund according to the terms of the master agreement;

     2.  If the requester submits the required fee, amend the contract to change the identity of the purchaser; or

     3.  If the purchaser has paid the total amount due on the contract and no legal successor or representative of the estate is identified, automatically transfer the rights and responsibilities of the purchaser to the qualified beneficiary if the qualified beneficiary is not a minor. If the qualified beneficiary is a minor and the Board receives sufficient documentation that a legal guardian may act on behalf of the minor, the Board will transfer the rights and responsibilities of the purchaser to the legal guardian. Upon transfer of the rights and responsibilities to the qualified beneficiary or the legal guardian, as applicable, the Board will act at the direction of the qualified beneficiary or the legal guardian with regard to the contract.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R055-09, 10-27-2009)

     NAC 353B.430  Death or disability of qualified beneficiary. (NRS 353B.090)  Upon the receipt of a written request signed by a purchaser and such documentation as the Board deems adequate to prove that the qualified beneficiary has died or become totally disabled, the Board will:

     1.  Terminate the contract and provide to the purchaser a refund according to the terms of the master agreement; or

     2.  Amend the contract to change the designation of the qualified beneficiary, subject to the provisions of NAC 353B.310.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.440  Award of scholarship to qualified beneficiary that duplicates benefits to be provided under contract. (NRS 353B.090)

     1.  Upon the receipt of a written request signed by a purchaser and such documentation as the Board deems adequate to prove that the qualified beneficiary has been awarded a scholarship to attend an eligible educational institution which duplicates all the benefits to be provided pursuant to the contract, the Board will:

     (a) Amend the contract to change the identity of the qualified beneficiary and waive the required fee for the change; or

     (b) Terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     2.  As used in this section, “scholarship” does not include a loan.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.450  Request by purchaser to terminate contract. (NRS 353B.090)  Upon the receipt of a written request signed by a purchaser to terminate the contract for any reason other than as provided in NAC 353B.430 and 353B.440, the Board will terminate the contract and provide to the purchaser a refund according to the terms of the master agreement.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

Fees and Penalties

     NAC 353B.500  Fees. (NRS 353B.090, 353B.100)  A contract may require the purchaser to pay:

     1.  For a change in:

     (a) The amount, time or method of payment;

     (b) The contractual plan;

     (c) The identity of the purchaser; or

     (d) The designation of the qualified beneficiary,

Ê a fee of $20.

     2.  For the replacement of any lost or destroyed documents, a fee of $7.

     3.  For the payment of tuition to an eligible educational institution other than a state community college, state college or state university, a fee of $25 for the first quarter or semester for which tuition is paid. The fee of $25 must be paid each time a beneficiary transfers to a new eligible educational institution other than a state community college, state college or state university.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

     NAC 353B.510  Penalties for insufficient funds, delinquent payment or termination of contract. (NRS 353B.090, 353B.100)

     1.  A contract must require the purchaser to pay a penalty of $25 if a payment is returned for insufficient funds in accordance with NRS 353C.115 and the regulations adopted pursuant thereto.

     2.  A contract may require the purchaser to pay:

     (a) If a monthly remittance is not received within 15 days after the date due, a penalty of $15.

     (b) If a remittance by a lump sum is not received within:

          (1) Fifteen days after the date due, a penalty of $15; and

          (2) Forty-five days after the date due, a penalty of 1 percent of the total amount due, including the amount of all outstanding fees and penalties imposed pursuant to the contract, for each period of 30 days or portion thereof that passes after the period described in subparagraph (1) until:

               (I) The total amount due is paid; or

               (II) The contract is terminated,

Ê whichever occurs earlier.

     (c) In addition to any other penalties imposed, if a monthly remittance or a remittance by lump sum is not received within 90 days after the due date, a penalty which is calculated by multiplying the total amount of payments due by:

          (1) The estimated annual rate of return established by the Board pursuant to NAC 353B.200 for the year in which the total amount is due; or

          (2) Eight percent,

Ê whichever is less.

     (d) If a contract is terminated pursuant to NAC 353B.370, 353B.400, 353B.410 or 353B.450, a penalty of $100.

     (e) If a contract is terminated pursuant to NAC 353B.440, a penalty, if required, to the Internal Revenue Service pursuant to 26 U.S.C. § 529(c)(6) or any other applicable section of the Internal Revenue Code.

     (Added to NAC by Bd. of Trustees for Higher Educ. Tuition Trust Fund by R009-99, eff. 11-3-99; A by Bd. of Trustees of College Savings Plans of Nev. by R150-03, 8-25-2004; R055-09, 10-27-2009)

NEVADA COLLEGE SAVINGS PROGRAM

General Provisions

     NAC 353B.550  Definitions. (NRS 353B.310)  As used in NAC 353B.550 to 353B.725, inclusive, unless the context otherwise requires, the words and terms defined in NAC 353B.555 to 353B.595, inclusive, have the meanings ascribed to them in those sections.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.555  “Account owner” defined. (NRS 353B.310)  “Account owner” means a person who:

     1.  Is legally able to contract under the laws of this State;

     2.  Meets all federal and state requirements governing the Program and a plan; and

     3.  Establishes an account under a plan.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.560  “Business day” defined. (NRS 353B.310)  “Business day” means any weekday on which the New York Stock Exchange is open.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.565  “Designated beneficiary” defined. (NRS 353B.310)  “Designated beneficiary” has the meaning ascribed to it in 26 U.S.C. § 529.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.570  “Member of the family” defined. (NRS 353B.310)  “Member of the family” has the meaning ascribed to it in 26 U.S.C. § 529.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.575  “Participation agreement” defined. (NRS 353B.310)  “Participation agreement” means a participant agreement and an account application executed by an account owner which:

     1.  Sets forth the terms and conditions governing an account; and

     2.  Is in the form approved by the State Treasurer.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003)

     NAC 353B.580  “Person” defined. (NRS 353B.310)  “Person” has the meaning ascribed to it in 26 U.S.C. § 7701(a).

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.582  “Plan” defined. (NRS 353B.310)  “Plan” means an investment plan that is approved by the Board for inclusion in the Program which is promoted by a private entity and is offered for sale under the management of the Program Manager or through a contract between the Program Manager and a Plan Investment Manager.

     (Added by NAC by St. Treasurer by R054-09, eff. 10-27-2009)

     NAC 353B.583  “Plan Investment Manager” defined. (NRS 353B.310)  “Plan Investment Manager” means a private entity that has contracted with the Program Manager and is approved by the Board to offer plans, to invest accounts opened under a plan and to manage plans within the Program.

     (Added to NAC by St. Treasurer by R054-09, eff. 10-27-2009)

     NAC 353B.585  “Program” defined. (NRS 353B.310)  “Program” means the Nevada College Savings Program, which is a qualified tuition program pursuant to 26 U.S.C. § 529 that may be marketed as “Nevada’s College Savings Plan” or under any other name.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

     NAC 353B.590  “Program Manager” defined. (NRS 353B.310)  “Program Manager” means the private entity that has contracted with the Board to serve as the administrator, marketing agent and investment manager of the Program.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.595  “Qualified higher education expenses” defined. (NRS 353B.310)  “Qualified higher education expenses” has the meaning ascribed to it in 26 U.S.C. § 529.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

Administration of Accounts

     NAC 353B.600  Eligibility to be account owner or designated beneficiary. (NRS 353B.310)

     1.  There are no restrictions on the age of a designated beneficiary or any required relationship between an account owner and the designated beneficiary of the account.

     2.  There may be only one account owner and one designated beneficiary for an account at any time.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003)

     NAC 353B.605  Designation of successor account owner; change of ownership of account. (NRS 353B.310)

     1.  An account owner may designate a successor account owner who becomes the new account owner automatically upon the death of the designating account owner. An account owner, in the account application or at any other time, may make such a designation by submitting to the Plan Investment Manager a written designation of a successor account owner containing the information required by the Plan Investment Manager. A designation of a successor account owner is not effective until received by the Plan Investment Manager and recorded in the records of the Plan Investment Manager.

     2.  If a change in the ownership of an account is required by a court order directing the change of ownership, or by an affidavit or declaration that is recognized under applicable law as requiring the transfer of ownership upon death without a court order, the change of ownership of the account, except as otherwise required by law, is not effective until the Plan Investment Manager receives the court order, affidavit or declaration requiring the change and the change of ownership is recorded in the records of the Plan Investment Manager.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

     NAC 353B.610  Change of designated beneficiary. (NRS 353B.310)  An account owner may change the designated beneficiary of the account if the new designated beneficiary is a member of the family of the current designated beneficiary. A change of designated beneficiary is not effective until the Plan Investment Manager receives a written request containing the information required by the Plan Investment Manager and the change is recorded in the records of the Plan Investment Manager.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.615  Opening of account; selection of investment option; reassignment of accounts under age-based investment option. (NRS 353B.310)

     1.  To open an account, an applicant must submit to the Plan Investment Manager a completed application and:

     (a) An initial contribution; or

     (b) A designation of an alternative method of funding approved by the Plan Investment Manager.

     2.  The acceptance by the Plan Investment Manager for processing of an application and an initial contribution or the designation of an alternate method of funding does not constitute the agreement of the Plan Investment Manager to open an account.

     3.  An applicant must select an investment option in which all contributions to the account will be invested. After an account has been opened, the account owner may not change the investment option for the account, except as permitted by 26 U.S.C. § 529 and any regulations, rulings, announcements or other guidance issued pursuant thereto.

     4.  Under the age-based investment option, reassignment of accounts to different “Years-to-College” portfolios will, with regard to those accounts in which the age of the designated beneficiary makes such reassignment appropriate, occur in accordance with the investment policies of the Program.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

     NAC 353B.620  Conditions under which Plan Investment Manager may refuse to open account. (NRS 353B.310)  The Plan Investment Manager may, without limitation, refuse to open an account if:

     1.  The applicant is not eligible to be an account owner.

     2.  The applicant has not provided all the information required by the participation agreement.

     3.  The total account balance of all accounts for the same designated beneficiary in the Program and the Nevada Higher Education Prepaid Tuition Program is greater than or equal to the maximum aggregate balance for the accounts of a designated beneficiary established by the Board pursuant to NAC 353B.655. If more than one applicant has submitted an application and an initial contribution or selection of contribution method to open an account for the same designated beneficiary, and all contributions, together with the total account balance of all existing accounts for that designated beneficiary, would exceed the maximum aggregate balance for the accounts of a designated beneficiary established by the Board pursuant to NAC 353B.655, the Program Manager will allow a Plan Investment Manager to accept applications to open accounts for the designated beneficiary in the order of their receipt until the maximum limit has been reached.

     4.  The execution of a participation agreement between the Plan Investment Manager and the applicant violates any federal or state law.

     5.  The Board determines that, for any other reason, it would be advisable to limit the number of accounts in the particular plan managed by that Plan Investment Manager.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.625  Participation agreement: Execution. (NRS 353B.310)  An account owner must execute a participation agreement for each account by completing and signing an account application.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003)

     NAC 353B.630  Participation agreement: Required provisions. (NRS 353B.310)  Provisions substantially similar to the following will be included in each participation agreement:

     1.  Any controversy or claim arising out of or relating to this participation agreement, or the breach, termination or validity thereof, must be settled by arbitration administered by the American Arbitration Association in accordance with its rules for commercial arbitration, and judgment on the award rendered in the arbitration may be entered in any court of competent jurisdiction.

     2.  By signing this participation agreement, the parties agree as follows:

     (a) All parties to this agreement are giving up the right to sue each other in court, including the right to a trial by jury, except as provided by the rules of the American Arbitration Association.

     (b) Arbitration awards are generally final and binding, and the ability of a party to have a court reverse or modify an arbitration award is very limited.

     (c) The ability of the parties to obtain documents, witness statements and other discovery is generally more limited in arbitration than in court proceedings.

     (d) The arbitrators do not have to explain the reasons for their award.

     (e) The rules of the American Arbitration Association may impose time limits for bringing a claim in arbitration.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.635  Maintenance of separate records and accounting for each account; annual reports to account owners. (NRS 353B.310)  Separate records and accounting will be maintained for each account established under a plan. Reports will be issued to each account owner at least annually.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.640  Prohibition on use of interest as security for loan. (NRS 353B.310)  No interest in an account may be used as security for a loan.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

Contributions to Accounts

     NAC 353B.645  Authority to make contributions; matching contribution by employer; minimum amounts; refusal of certain contributions. (NRS 353B.310)

     1.  Except as otherwise provided in this section, any person may make a contribution to an existing account.

     2.  An employer may make a contribution to an existing account that matches a contribution made to the account by an employee of the employer.

     3.  The Board will establish the minimum amounts for initial contributions and additional contributions to an account for each plan and will, from time to time, revise those amounts as it determines necessary.

     4.  The Board will refuse contributions that it determines constitute an abuse of the Program.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009; R148-16, 12-21-2016)

     NAC 353B.650  Form of contributions. (NRS 353B.310)

     1.  Contributions may be made in cash only.

     2.  As used in this section, “cash” includes checks, electronic funds transfers, whether through payroll deduction, an automatic contribution plan or otherwise, and such other methods of payment as determined by the Program Manager and as permitted under applicable law. The term does not include securities, property, or charges on debit or credit cards.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003)

     NAC 353B.655  Limitation on contributions; maximum aggregate balance for designated beneficiary; return of excess contributions. (NRS 353B.310)

     1.  A contribution to an account established for a designated beneficiary will not be accepted to the extent the contribution would cause the total account balance of all accounts for the designated beneficiary to exceed the amount necessary to provide for the qualified higher education expenses of the designated beneficiary.

     2.  The Board will establish the maximum aggregate balance for the accounts of a designated beneficiary and will, from time to time, revise the maximum aggregate balance as it determines necessary.

     3.  If any contribution would cause the total account balance of all accounts for a designated beneficiary to exceed the maximum aggregate balance for the accounts of a designated beneficiary established by the Board, the excess money will be rejected and returned to the contributors in order of receipt. The balance in all accounts for that designated beneficiary under the Nevada Higher Education Prepaid Tuition Program will be included in calculating whether the maximum aggregate balance has been exceeded.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003)

     NAC 353B.660  Rollover distributions from qualified tuition program of another state. (NRS 353B.310)

     1.  Except as otherwise provided in subsection 2, if a qualified tuition program of another state allows rollover distributions, an account owner may deposit all or part of the money from an account in such a program to an account in the Nevada College Savings Program for the same designated beneficiary or for a different designated beneficiary who is a member of the family of the designated beneficiary of the account from which the money is transferred.

     2.  A rollover distribution pursuant to subsection 1 for the same designated beneficiary will be permitted only once in any 12-month period or as otherwise permitted by 26 U.S.C. § 529 and any regulations, rulings, announcements or other guidance issued pursuant thereto.

     3.  An account owner who wishes to deposit a rollover distribution pursuant to this section must:

     (a) Submit to the Plan Investment Manager either:

          (1) A rollover distribution form executed by the account owner that authorizes the distribution of money from an account in the qualified tuition program of another state; or

          (2) If the rollover distribution will not be deposited directly into an account in a plan from an account in the qualified tuition program of another state, documentation satisfactory to the Plan Investment Manager that the rollover distribution will be deposited in an account in a plan within 60 days after distribution from an account in the qualified tuition program of another state.

     (b) State the amount of the rollover distribution that constitutes contributions and the amount of the rollover distribution that constitutes earnings and provide verified documentation to support the stated amount.

     4.  The entire amount of a rollover distribution from an account in the qualified tuition program of another state will be counted for purposes of calculating the total account balance of all accounts in the Program for a designated beneficiary. If the rollover distribution that is deposited in an account in the Program causes the total account balance of all accounts for a designated beneficiary to exceed the maximum aggregate balance for the accounts of a designated beneficiary established by the Board pursuant to NAC 353B.655, the excess money will be rejected and returned.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

Distributions From and Termination of Accounts

     NAC 353B.665  Distributions: Procedure; classification; restriction. (NRS 353B.310)

     1.  An account owner may request a distribution of money from the account by submitting to the Plan Investment Manager not less than 3 business days before the date of the requested distribution a completed distribution request form and such other information as required by the Board or a Plan Investment Manager. The Plan Investment Manager will begin processing properly completed distribution request forms upon receipt. A designated beneficiary may not withdraw money from an account.

     2.  A distribution from an account will be classified as a:

     (a) Nonqualified withdrawal;

     (b) Qualified withdrawal;

     (c) Qualified withdrawal because of the death or disability of, or a scholarship awarded to, a beneficiary; or

     (d) Rollover distribution.

     3.  A distribution may only be arranged by the account owner and only in accordance with NAC 353B.665 to 353B.695, inclusive.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.670  Distributions: Required notification. (NRS 353B.310)  When a Plan Investment Manager makes a distribution of money from an account pursuant to NAC 353B.665 to 353B.695, inclusive, the Plan Investment Manager shall notify the account owner:

     1.  Of the portion of the distribution that is attributable to investment gains in the account;

     2.  That a distribution from an account for any reason other than a qualified withdrawal, a qualified withdrawal because of the death or disability of, or a scholarship awarded to, a beneficiary, or a rollover distribution may be subject to federal tax on the portion of the distribution attributable to investment gains in the account; and

     3.  That it is the responsibility of the account owner to determine his or her liability for federal tax, if any, on the distribution.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

     NAC 353B.675  Qualified withdrawals. (NRS 353B.310)

     1.  A qualified withdrawal is a withdrawal of money from an account to pay for the qualified higher education expenses of the designated beneficiary, or because of death, disability or scholarship, as permitted by 26 U.S.C. § 529 or any regulations, rulings, announcements or other guidance issued pursuant thereto. An account owner may request a qualified withdrawal by submitting to the Plan Investment Manager a completed distribution request form.

     2.  When requesting a qualified withdrawal, the account owner, and the designated beneficiary if required by the Plan Investment Manager, must sign the distribution request form and provide such additional information as may be requested by the Plan Investment Manager.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.680  Refund of all or part of qualified distribution. (NRS 353B.310)  A refund of all or part of a qualified distribution that is used to pay for qualified higher education expenses of a designated beneficiary must be paid by the higher education institution to the Plan Investment Manager for credit to the appropriate accounts for that designated beneficiary.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.690  Rollover distributions to account in qualified tuition program of another state or to another account in Program; return of excess money. (NRS 353B.310)

     1.  Except as otherwise provided in subsection 2, if a qualified tuition program of another state allows rollover contributions, an account owner may authorize a direct rollover distribution from an account in the Program to an account in the qualified tuition program of the other state for the same designated beneficiary or for a different designated beneficiary who is a member of the family of the designated beneficiary of the account in the Program out of which the rollover distribution is being made.

     2.  A rollover distribution pursuant to subsection 1 for the same designated beneficiary will be permitted only once in any 12-month period or as otherwise permitted by 26 U.S.C. § 529 and any regulations, rulings, announcements or other guidance issued pursuant thereto.

     3.  An account owner may authorize a direct rollover distribution from an account in the Program to another account in the Program so long as the designated beneficiary of the other account is a member of the family of the designated beneficiary of the account out of which the rollover distribution is being made. If the rollover distribution that is deposited in an account causes the total account balance of all accounts for a designated beneficiary to exceed the maximum aggregate balance for the accounts of a designated beneficiary established by the Board pursuant to NAC 353B.655, the excess money will be rejected and returned.

     4.  When authorizing a rollover distribution, the account owner must complete the forms and make such disclosures of financial information as required by the Plan Investment Manager and the Board.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R041-03, 10-29-2003; R054-09, 10-27-2009)

     NAC 353B.695  Termination: Conditions; notice; nonqualified distribution; qualified distribution. (NRS 353B.310)

     1.  An account may be terminated if the account has a balance of less than $1,000 and no contributions or withdrawals have been made within the preceding 2 calendar years. Before the termination of an account, the account owner will be given such notice as the Board determines adequate and will be given an opportunity to prevent the termination of the account by making an additional contribution or a qualified withdrawal within the period specified by the Plan Investment Manager. Upon the involuntary termination of an account, the account balance will be paid to the account owner as a nonqualified distribution.

     2.  An account owner may request a qualified distribution of the remaining balance of an account upon termination. Such a request will be honored following receipt by the Plan Investment Manager of all information requested by the Plan Investment Manager.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

Fees

     NAC 353B.700  Fees to support continued operation of Program. (NRS 353B.310)  The Board may charge fees based on the total assets and accounts of the Program to support the continued operation of the Program. These fees will accrue daily and must be remitted by the Program Manager and each Plan Investment Manager as directed by the Board.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

     NAC 353B.705  Other fees. (NRS 353B.310)  The Program Manager and each Plan Investment Manager may charge such fees as are agreed to by the Program Manager and the Board.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002; A by R054-09, 10-27-2009)

Miscellaneous Provisions

     NAC 353B.710  Accounting and expenditure if money provided by private entities for direct expenses and marketing. (NRS 353B.310, 353B.360)  If the State Treasurer, pursuant to NRS 353B.360, accepts on behalf of the Nevada College Savings Trust Fund money provided by private entities for direct expenses or marketing, the State Treasurer will account for the money separately in the State Treasury. The State Treasurer will expend the money from time to time for direct expenses or marketing activities related to the Program, including expenses of educational programs in this State that encourage saving for college as part of an overall approach to financial planning.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.715  Review and modification of investment policies by Board. (NRS 353B.310, 353B.370)  The Board will from time to time review the investment policies for the Program and modify those policies if it determines necessary.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.720  Prohibition on contributor or designated beneficiary to direct investments of Program; exception. (NRS 353B.310)  Except as permitted by 26 U.S.C. § 529 or any regulations, rulings, announcements or other guidance issued pursuant thereto, no contributor to or designated beneficiary of the Program may directly or indirectly direct the investment of any contributions to the Program or any earnings thereon.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

     NAC 353B.725  Effect of joint decisions and interpretations by Board and Program Manager; claims and appeals by account owners; determination of Board on appeal. (NRS 353B.310)  All joint decisions and interpretations by the Board and the Program Manager in connection with the operation of the Program are final and binding upon the account owner and the designated beneficiary and all other persons affected thereby. Any claim by an account owner against the State of Nevada, the Board, the Program or any of their respective affiliates, officers, employees or agents pursuant to the participation agreement or the Program must be made solely against the assets of the Program. An account owner who has had a substantial interest affected by a decision of the Board may appeal to the Board in writing. The Board will review the documentation and other submissions and issue a written determination within 60 days after receiving the appeal. The determination of the Board on an appeal is final.

     (Added to NAC by St. Treasurer by R185-01, eff. 4-5-2002)

EDUCATION SAVINGS ACCOUNTS

     NAC 353B.750  Short title. (NRS 353B.820)  The provisions of NAC 353B.750 to 353B.830, inclusive, may be cited as the Education Savings Account Regulations.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5505)

     NAC 353B.755  Purposes. (NRS 353B.820)

     1.  The purposes of NAC 353B.750 to 353B.830, inclusive, are to:

     (a) Award grants of money made available pursuant to NRS 353B.860 on behalf of children who qualify for such grants so that the parents of such children have choices concerning the education of the children; and

     (b) Make the grants of money described in paragraph (a) available to be awarded on behalf of the largest number of children allowable under NRS 353B.700 to 353B.930, inclusive.

     2.  For the accomplishment of these purposes, the provisions of NAC 353B.750 to 353B.830, inclusive, must be broadly and liberally construed.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5513)

     NAC 353B.760  Definitions. (NRS 353B.820)  As used in NAC 353B.750 to 353B.830, inclusive, unless the context otherwise requires, the words and terms defined in NAC 353B.765 and 353B.770 have the meanings ascribed to them in those sections.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5515)

     NAC 353B.765  “Agreement” defined. (NRS 353B.820, 353B.850)  “Agreement” means a written agreement between a parent and the State Treasurer to establish an education savings account entered into pursuant to NRS 353B.850.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5517)

     NAC 353B.770  “School day” defined. (NRS 353B.820, 353B.850)  “School day” means any day, including a partial day, during which a school offers instruction to pupils at the school.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.552)

     NAC 353B.775  “Break in the school year” construed. (NRS 353B.820, 353B.850)  For the purpose of carrying out the provisions of NRS 353B.850, the State Treasurer will construe the term “break in the school year” to mean 15 or more consecutive days that are not school days.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5523)

     NAC 353B.780  “Tuition” construed. (NRS 353B.820, 353B.870)  For the purpose of carrying out the provisions of NRS 353B.700 to 353B.930, inclusive, the State Treasurer will construe the term “tuition” to include only the cost of enrolling a child in a school or program of distance education that is a participating entity, except that the term does not include:

     1.  An application fee, entrance fee, parking fee, technology fee, athletic fee, studio fee, laboratory fee or any fee or surcharge imposed in connection with a specific course, whether or not the fee or surcharge is imposed on all children enrolled in the participating entity or the course; or

     2.  A charge imposed for books, supplies or room and board, whether or not the charge is imposed on all children enrolled in the participating entity.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5525)

     NAC 353B.785  Application to establish account; open enrollment period; notification of approval or denial; requirements; request for waiver; exemptions. (NRS 353B.820, 353B.850)

     1.  A parent who wishes to establish an education savings account on behalf of his or her child must submit an application to the State Treasurer on a form made available by the State Treasurer during the open enrollment period established pursuant to subsection 2.

     2.  At least one time each year, the State Treasurer will establish an open enrollment period during which the State Treasurer will accept applications to establish an education savings account. The State Treasurer will announce the dates of the open enrollment period during the fourth quarter of the calendar year immediately preceding the school year for which the open enrollment period applies.

     3.  The State Treasurer will review each application submitted pursuant to subsection 1 and, not later than 30 days after the date on which the application is received, notify the applicant by certified mail or electronic communication whether the application has been approved or denied. If the application is denied, the notification must include, without limitation, the reason for the denial.

     4.  Except as otherwise provided in subsections 5 and 7, the State Treasurer will approve an application submitted on behalf of a child required by NRS 392.040 to attend public school if the applicant submits proof that the child was enrolled in a public school and in one or more qualifying courses at the public school for the 100 school days immediately preceding the date on which the application is received, including, without limitation, any school day that the child was not required to attend a qualifying course. The State Treasurer will not approve an application submitted on behalf of a child who has participated only in after-school extracurricular activities at a public school.

     5.  Except as otherwise provided in subsections 6 and 7, the State Treasurer will not approve an application submitted on behalf of a child if, during the 100 school days immediately preceding the date on which the application is received, the child was absent from the public school in which the child was enrolled for more than 15 consecutive school days, including, without limitation, any school day that the child was not required to attend a qualifying course.

     6.  An applicant may apply in writing to the State Treasurer for a waiver of the provisions of subsection 5. Upon a showing that an absence of more than 15 consecutive school days was caused by extraordinary circumstances, which may include, without limitation, the death of a family member of the child or a serious medical condition, the State Treasurer may grant the waiver.

     7.  The State Treasurer will not require a child for whom an application is submitted to have been enrolled at a public school for 100 school days immediately preceding the date on which the application is received if:

     (a) The child will be at least 5 years of age and less than 7 years of age on or before September 30 of the school year for which the application is submitted; or

     (b) The parent of the child is a member of the Armed Forces of the United States who is on active duty and stationed at a military installation in this State.

     8.  As used in this section, “qualifying course” means a course that is offered to pupils who are enrolled in the public school for which the pupils may receive credit toward promotion to the next grade or graduation from high school, including, without limitation, a course that is offered as an elective.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5527)

     NAC 353B.790  Agreement with State Treasurer; deposit of money into and payments from account; annual list provided to Department; inclusion of certain examinations on list. (NRS 353B.820, 353B.850, 353B.860, 353B.910)

     1.  If the State Treasurer approves an application submitted pursuant to NAC 353B.785, the State Treasurer will enter into an agreement with the parent who submitted the application. After a parent enters into an agreement with the State Treasurer, the parent may open an education savings account at a financial management firm with which the State Treasurer has entered into a contract pursuant to NAC 353B.820.

     2.  The State Treasurer will:

     (a) Deposit money into each education savings account in equal quarterly installments on the dates on which the Superintendent of Public Instruction apportions the State Distributive School Account in the State General Fund pursuant to NRS 387.124.

     (b) Provide each parent who establishes an education savings account on behalf of his or her child with a memorandum outlining the procedures to follow in making payments from the account.

     (c) Annually provide the Department with a list of children on behalf of whom education savings accounts have been established on the date prescribed by the Department.

     3.  An examination administered to satisfy the requirements of NRS 353B.910 must be included on the list of examinations prescribed by the Department for that purpose.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.553)

REVISER’S NOTE.

      The regulation of the State Treasurer filed with the Secretary of State on December 30, 2015 (LCB File No. R061-15), the source of this section, contains the following provision not included in NAC:

      “Sec. 19.  Notwithstanding the provisions of section 10 of this regulation [NAC 353B.790], the State Treasurer will begin making deposits of money into education savings accounts pursuant to subsection 2 of section 10 of this regulation [NAC 353B.790] on or before May 1, 2016.”

 

     NAC 353B.795  Committee to Review Payments: Creation; members; duties. (NRS 353B.820, 353B.870)

     1.  There is hereby created the Committee to Review Payments consisting of seven members as follows:

     (a) The State Treasurer or his or her designee;

     (b) Two voting members appointed by the State Treasurer who are parents of children on behalf of whom an education savings account has been established and who reside in Clark County;

     (c) One voting member appointed by the State Treasurer who is the parent of a child on behalf of whom an education savings account has been established and who resides in Washoe County;

     (d) One voting member appointed by the State Treasurer who is the parent of a child on behalf of whom an education savings account has been established and who resides in a county other than Clark County or Washoe County; and

     (e) Two nonvoting advisory members appointed by the State Treasurer who are educators or administrators at a participating entity, other than the parent of a child.

     2.  The members of the Committee serve at the pleasure of the State Treasurer. A member of the Committee serves for a term of 1 year and may be reappointed.

     3.  The State Treasurer or his or her designee will serve as the Chair of the Committee and will vote only in the case of a tie.

     4.  The State Treasurer may request the Committee to determine whether an expenditure of money from an education savings account is authorized pursuant to NRS 353B.870.

     5.  The Committee shall:

     (a) Meet at the call of the Chair upon the receipt of a request to determine whether an expenditure of money from an education savings account submitted to the Committee by the State Treasurer pursuant to subsection 4 is authorized pursuant to NRS 353B.870.

     (b) Comply with the provisions of chapter 241 of NRS.

     6.  As used in this section, “administrator” means the person who directs or manages the affairs of a private school, as defined in NRS 394.103.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5533)

     NAC 353B.800  Termination of agreement by parent. (NRS 353B.820, 353B.850)

     1.  The parent of a child on behalf of whom an education savings account has been established may terminate an agreement with the State Treasurer at any time by providing written notice by certified mail to the State Treasurer.

     2.  If an agreement is terminated pursuant to subsection 1, the child on behalf of whom the education savings account was established may enroll in a public school on the first day after the expiration of the quarter for which the last deposit was made into the education savings account of the child.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5535)

     NAC 353B.805  State Treasurer to freeze account if child no longer resides in State; proof required to remove freeze; termination of agreement and dissolution of account. (NRS 353B.820, 353B.850)  If the State Treasurer reasonably believes that a child on behalf of whom an education savings account has been established no longer resides in this State, the State Treasurer will freeze the education savings account and send a written notice by certified mail to the parent of the child requesting the parent to submit proof that the child resides in this State. If the parent:

     1.  Provides satisfactory proof by not later than 15 business days after the date on which the notice is received, the State Treasurer will remove the freeze on the education savings account.

     2.  Fails to provide satisfactory proof by not later than 15 days after the date of the notice, the State Treasurer will terminate the agreement pursuant to which the education savings account was established and dissolve the education savings account.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5537)

     NAC 353B.810  Audits of accounts; freeze of accounts found to have irregularities; notice of freeze; petition for reconsideration; determination. (NRS 353B.820, 353B.880)

     1.  Each calendar year, the State Treasurer will randomly select not fewer than 10 percent of the education savings accounts in existence on January 1 of that year to be audited.

     2.  The State Treasurer will cause an audit to be conducted of each education savings account then in existence if 5 percent or more of the audits conducted pursuant to subsection 1 indicate any of the following irregularities:

     (a) Failure to comply with an agreement pursuant to which an education savings account was established, NRS 353B.700 to 353B.930, inclusive, or NAC 353B.750 to 353B.830, inclusive; or

     (b) A substantial misuse of money in an education savings account.

     3.  If the State Treasurer determines, based on an audit conducted pursuant to subsection 1 or 2, or for any other reason, that an irregularity described in subsection 2 has occurred, the State Treasurer will:

     (a) Freeze the education savings account; and

     (b) Send to the parent of the child on behalf of whom the education savings account was established by certified mail written notice of the reason that the account is frozen and the manner in which to petition for reconsideration as set forth in subsections 4 and 5.

     4.  A parent who receives notice that the State Treasurer has placed a freeze on an education savings account pursuant to subsection 3 may submit a petition for reconsideration by providing to the State Treasurer, not later than 5 business days after receiving the notice, a written explanation of the reasons that the parent believes the determination of the State Treasurer was incorrect. If the State Treasurer does not receive such a petition within that time, the State Treasurer will dissolve the education savings account and terminate the agreement pursuant to which the account was established.

     5.  Upon receipt of a petition pursuant to subsection 4, the State Treasurer will review the written explanation included in the petition and determine whether an irregularity described in subsection 2 occurred. Not later than 5 business days after receiving the petition, the State Treasurer will notify the parent of the determination. If the State Treasurer determines that:

     (a) An irregularity occurred, the State Treasurer will dissolve the education savings account and terminate the agreement pursuant to which the education savings account was established.

     (b) No irregularity occurred, the State Treasurer will remove the freeze on the education savings account.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.554)

     NAC 353B.815  Quarterly list of terminated accounts; reversion of remaining money to State General Fund. (NRS 353B.820, 353B.850, 353B.860)

     1.  Each calendar quarter, the State Treasurer will provide to the Department a list of each child for whom an agreement pursuant to which an education savings account was established has been terminated for any reason.

     2.  If any money remains in an education savings account after the agreement pursuant to which the account was established is terminated or expires, the money in the account reverts and must be transferred to the State General Fund by the State Treasurer by not later than 10 days after the date of the termination or expiration.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5543)

     NAC 353B.820  Contract with financial management firm: Criteria; provision allowing termination; maintenance and management of accounts. (NRS 353B.820, 353B.880)

     1.  The State Treasurer will enter into a contract to manage education savings accounts with one or more financial management firms. Any such firm must:

     (a) Be authorized to accept deposits under the laws of this State or the United States; and

     (b) Insure the accounts that it maintains with the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund or a private insurer approved pursuant to NRS 678.755.

     2.  A contract entered into pursuant to subsection 1 must include a provision allowing the State Treasurer to terminate the contract if:

     (a) The financial management firm fails to comply with applicable law or the provisions of the contract; or

     (b) The State Treasurer determines that the financial management firm is not performing adequately.

     3.  A financial management firm with whom the State Treasurer enters into a contract pursuant to subsection 1 shall maintain and manage education savings accounts in compliance with generally accepted accounting principles.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5545)

     NAC 353B.825  Application to become participating entity; proof of eligibility; notice of determination; investigation under certain circumstances. (NRS 353B.820, 353B.900)

     1.  To become a participating entity, an entity must submit an application to the State Treasurer on a form made available by the State Treasurer.

     2.  Each applicant, other than the parent of a child, must submit proof that the applicant is eligible to become a participating entity pursuant to NRS 353B.900. If an applicant is a tutor or tutoring facility, such proof must include, without limitation, proof that the applicant is accredited by a state, regional or national accrediting agency.

     3.  If the State Treasurer:

     (a) Approves an application submitted pursuant to this section, the State Treasurer will provide notice to the applicant through written or electronic communication to the person designated on the application.

     (b) Does not approve an application submitted pursuant to this section, the State Treasurer will provide notice to the applicant by certified mail to the person designated on the application.

     4.  If the State Treasurer determines, based on the results of the examinations administered pursuant to NRS 353B.910, or for any other reason, that a participating entity that accepts payments from the educational savings account of a child may have failed to provide an educational service required by law to the child, the State Treasurer will conduct an investigation. If, after conducting an investigation, the State Treasurer determines that the participating entity has failed to provide an educational service required by law to the child, the State Treasurer may, after providing notice and the opportunity for a hearing, refuse to allow the entity to continue as a participating entity.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5547)

     NAC 353B.830  Additional requirements of certain participating entities. (NRS 353B.820, 353B.900)

     1.  If the State Treasurer reasonably expects that a participating entity will receive, from payments made from education savings accounts, an amount that exceeds $50,000 for a school year, the State Treasurer will:

     (a) Determine the amount reasonably expected to be paid to such a participating entity from education savings accounts during the school year; and

     (b) Provide notice to the participating entity of the amount determined pursuant to paragraph (a) and the requirements set forth in subsection 2.

     2.  A participating entity that receives a notice pursuant to subsection 1 shall, not more than 10 business days after the next deposit of money into education savings accounts pursuant to NAC 353B.790:

     (a) Post a surety bond in an amount equal to the amount determined by the State Treasurer pursuant to subsection 1; or

     (b) Provide to the State Treasurer documentation of a financial audit demonstrating that the participating entity has unencumbered assets sufficient to pay the State Treasurer an amount equal to the amount determined by the State Treasurer pursuant to subsection 1.

     3.  For the purposes of this section and NRS 353B.900, a participating entity will be deemed by the State Treasurer to be reasonably expected to receive more than $50,000 in a school year from education savings accounts if, at the beginning of the school year, 10 or more agreements authorize the participating entity to receive money from an education savings account.

     (Added to NAC by St. Treasurer by R061-15, eff. 12-30-2015) — (Substituted in revision for NAC 385.5555)