1. a. A participant retains ownership of all payments made under a participation agreement up to the date of utilization for payment of qualified education expenses for the beneficiary.

 b. All income derived from the investment of the payments made by the participant shall be considered to be held in trust for the benefit of the beneficiary.

Terms Used In Iowa Code 12D.6

  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • Beneficiary: means the individual designated by a participation agreement to benefit from advance payments of qualified education expenses on behalf of the beneficiary. See Iowa Code 12D.1
  • Participant: means an individual, individual's legal representative, trust, estate, or an organization described in section 501(c)(3) of the Internal Revenue Code and exempt from taxation under section 501(a) of the Internal Revenue Code, that has entered into a participation agreement under this chapter for the advance payment of qualified education expenses on behalf of a beneficiary. See Iowa Code 12D.1
  • Participation agreement: means an agreement between a participant and the trust entered into under this chapter. See Iowa Code 12D.1
  • person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
  • property: includes personal and real property. See Iowa Code 4.1
  • Qualified education expenses: includes expenses for the participation in an apprenticeship program registered and certified with the United States secretary of labor under section 1 of the National Apprenticeship Act, 29 U. See Iowa Code 12D.1
  • Qualified educational institution: means an institution of higher education, or any elementary or secondary public, private, or religious school described in section 529(c)(7) of the Internal Revenue Code. See Iowa Code 12D.1
  • state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
  • trust: means the trust created under section 12D. See Iowa Code 12D.1
 2. In the event the program is terminated prior to payment of qualified education expenses for the beneficiary, the participant is entitled to a refund of the participant’s account balance.
 3. The qualified educational institution shall obtain ownership of the payments made for the qualified education expenses paid to the institution at the time each payment is made to the institution.
 4. Any amounts which may be paid to any person or persons pursuant to the Iowa educational savings plan trust but which are not listed in this section are owned by the trust.
 5. A participant may transfer ownership rights to another participant, or may transfer funds to another plan under the trust or to an ABLE account as permitted under section 529(c)(3)(C) of the Internal Revenue Code. The transfer shall be made and the property distributed in accordance with rules adopted by the treasurer of state or with the terms of the participation agreement.
 6. A participant shall not be entitled to utilize any interest in the trust as security for a loan.
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