La. Admin. Code tit. 28 § VI-309

Current through Register Vol. 50, No. 11, November 20, 2024

Section VI-309 - Disbursement of Account Funds for Payment of Qualified Higher Education Expenses of a Beneficiary

A. Request for Disbursement

1. For each term the account owner intends to fund the beneficiary's qualified higher education expenses, the account owner shall submit a request for disbursement.

2. The request for disbursement must include:

a. the START account number;

b. the account owner's name, address, and signature (may be electronic);

c. the beneficiary's name and address;

d. the amount to be disbursed and to whom;

e. the name and address of the eligible educational institution.

3. In the event funds are invested in more than one investment option, the disbursement shall be made proportionally from each investment option in the account.

4. If there is more than one account with the same beneficiary, each account owner requesting a disbursement must complete a request for disbursement and the disbursements shall be made from each account, in turn, in the order the disbursement requests were received.

5. Disbursements from all accounts with the same beneficiary shall not exceed the qualified higher education expenses of the beneficiary for the school attended.

6. Disbursements may be made to the eligible educational institution, account owner, and/or beneficiary. If all of the disbursement is made to the account owner and/or the beneficiary and LOSFA determines that the beneficiary is not enrolled in an eligible educational institution during the semester or term for which the disbursement was intended, LOSFA shall notify the account owner that the disbursement will constitute a refund for state and federal income tax purposes unless returned to the START account. If the disbursement is not returned to the account within 60 days of the original notice, LOSFA shall recover the amount of the EEs and interest thereon included in the disbursement from any principal and interest remaining in the account, and, in the authoritys sole discretion, may refund any balance remaining thereafter and close the account.

7. Disbursements from investment options with variable earnings shall be assigned a trade date of one business day after the business day of receipt of the transfer request.

B. Rate of Expenditure

1. As authorized by the account owner, the amount to be disbursed from an account shall be drawn from deposits (including earnings on deposits) and EEs (including earnings on EEs) in the same ratio as these funds bear to the total value of the account as of the date of the disbursement.

2. The account owner may not withdraw an amount in excess of the beneficiary's qualified higher education expenses for a specific term of enrollment or the value of the account, whichever is less.

C. Payments to Eligible Educational Institutions

1. Upon the beneficiary's enrollment and the institution's receipt of a START disbursement, the institution may credit the student's account. Should the amount received exceed the amount owed to the institution, the institution shall disburse the balance to the beneficiary, unless the beneficiary directs otherwise.

2. If the designated beneficiary of an ESA account enrolls, but fails to attend or withdraws from the institution prior to the end of the educational term and disbursements from the ESA were made to the eligible educational institution to pay all or part of his qualified higher education expenses for that educational term, an institutional refund to the ESA may be required.

3. If any refund is due the beneficiary from the eligible educational institution, a pro rata share of any refund of qualified higher education expenses equal to that portion of the qualified higher education expenses paid by disbursements from the ESA shall be made by the eligible educational institution to the LATTA.

4. The LATTA will credit any refunded amount to the appropriate ESA.

D. Advance Enrollment. A beneficiary may enroll in an eligible educational institution prior to his scheduled date of first-enrollment (see §107) and utilize ESA funds; however, a beneficiary may not utilize funds from an ESA prior to one year from the date the beneficiary made the first deposit opening the account.

E. Part-Time Attendance and Nonconsecutive Enrollment. A beneficiary may utilize funds in an ESA for enrollments which are nonconsecutive and for part-time attendance at an eligible educational institution, including enrollment in college classes while still in high school. Room and board is only a qualified higher education expense for students who are enrolled at least half time; however, room and board is not a qualified higher education expense for students who are enrolled in college classes while still in high school.

La. Admin. Code tit. 28, § VI-309

Promulgated by the Tuition Trust Authority, Office of Student Financial Assistance, LR 23:716 (June 1997), amended LR 24:1272 (July 1998), LR 24:2238 (December 1998), LR 26:2265 (October 2000), LR 27:1881 (November 2001), LR 30:789 (April 2004), LR 30:1169 (June 2004), LR 32:1433 (August 2006), LR 33:444 (March 2007), LR 35:236 (February 2009), Amended LR 421079 (7/1/2016), Amended LR 451177 (9/1/2019).

AUTHORITY NOTE: Promulgated in accordance with R.S. 17:3091-3099.2.