Section 1700-05-04-.03 - ENROLLMENT(1) Requirements. The Account Owner must fully complete the Contract, including all required signatures, and return the signed Contract to the Board to open an Account in the Educational Investment Plan. A Contract shall not become binding upon the Board and the Account Owner unless it is complete and until all of the following occur: (a) Investment Selection. The Account Owner must select at least one investment option. If more than one investment option is chosen, the Account Owner must allocate the contribution among the chosen investment options. The Board may limit the number of investment options that an Account Owner may choose under any one single Contract;(b) Initial Contribution. Receipt by the Board of an initial contribution of at least twenty-five dollars ($25.00). All contributions to an Account hereunder may be made only in cash and not in property. For purposes of these Rules, "cash" means United States dollars in the form of negotiable checks (other than travelers checks, starter checks and credit card convenience checks), and payments made through payroll deductions, automatic bank account deductions or other similar methods acceptable to the Board;(c) Board Acceptance. Acceptance of the signed Contract by the Board; and(d) Social Security Numbers. To enable the Board to comply with the record keeping and reporting requirements of the Internal Revenue Code, disclosure of the Social Security numbers requested in the Contract is mandatory. In the case of newborns who do not yet have a Social Security number, the Board will accept the Contract conditionally for thirty (30) calendar days of receipt of the proposed Contract.(2) Confirmation. Upon acceptance of the Contract, the Board will send a confirmation of acceptance to the Account Owner and will credit the Account of the named Beneficiary with the amount of the initial contribution made.(3) Rejection. If an Account Owner fails to provide all the information required in Paragraph (1) of this Rule within thirty (30) calendar days of the Board's receipt of the proposed Contract, the Board may reject the proposed Contract and refund to the Account Owner all amounts paid thereunder, less any applicable fees. Rejection of a Contract shall not preclude the Account Owner from enrolling in the Program in the future.(4) Fraud. The Board may, at its sole discretion, terminate the Contract if the Beneficiary, the Account Owner, or the Successor Account Owner knowingly makes any false statement, or falsifies or permits to be falsified any record or records of the Program. The amount of the refund to which the Account Owner is entitled under this Paragraph (4) shall be equal to the Redemption Value of the Account at the time the refund is made, minus any applicable fee charged by the Board.(5) Inactivity. If a period of ten (10) consecutive years passes with no contributions having been made to the Beneficiary's Account or with no correspondence from the Beneficiary, Account Owner or the Successor Account Owner, the Board shall report and deliver the amount of any refund payable under the Contract to the State Treasurer pursuant to T.C.A., Title 66, Chapter 29, Part 1. Prior to delivering the refund to the State Treasurer, the Board will make reasonable efforts to locate the Account Owner, Beneficiary, and the Successor Account Owner. The refund shall be equal to the Redemption Value of the Account at the time the refund is delivered, minus any applicable fee charged by the Board. The ten-year period shall not commence any earlier than the year the Beneficiary becomes eighteen (18) years of age, or the year the Account was established, whichever is later. Upon payment of the refund to the State Treasurer, the Board's obligations under the Contract shall cease.(6) Fees. The Board may charge fees to the Account Owner and/or collect fees from each Account for administration of the Program or for transactions under the Educational Investment Plan.(7) Separate Accounting. The Board will maintain a separate individual Account for each Contract, showing the name of the Beneficiary and the Redemption Value of the Account, including any Withdrawals made from the Account.Tenn. Comp. R. & Regs. 1700-05-04-.03
Emergency rule filed December 29, 2011; effective through June 26, 2012. New rule filed December 29, 2011; effective May 30, 2012. Amendments filed March 5, 2018; effective June 3, 2018. Amendments filed September 25, 2018; effective December 24, 2018. Amendments filed November 15, 2022; effective 2/13/2023.Authority: T.C.A. §§ 49-7-802, 49-7-805, 49-7-805(14), 49-7-805(16), 49-7-806, 49-7-808, 49-7-809, and 49-7-812.