1. (a) The following words, terms, and phrases, when used in this subchapter, shall have the following meanings. In addition, definitions set forth in Internal Revenue Code, §529A and Senate Bill 1664, 84th Legislature, 2015 are incorporated in these rules.

   1. (1) ABLE account or "account"--Has the meaning assigned by Internal Revenue Code, §529A and means an account in the Texas ABLE Program.
   2. (2) ABLE Program or "Program"--The Texas Achieving a Better Life Experience Program created under Education Code, Chapter 54, Subchapter J.
   3. (3) Available funds--The balance of funds held in an ABLE account, after deducting any holds, fees or expenses, or pending transactions, including funeral expenses that may be incurred following the death of a designated beneficiary.
   4. (4) Board--Prepaid Higher Education Tuition Board established under Education Code, §54.602.
   5. (5) Contribution--Amounts paid by contributors to an ABLE account.
   6. (6) Contributor--Any person who makes a contribution to an ABLE account.
   7. (7) Designated beneficiary--A resident of this state with a disability who is an eligible individual and named as the beneficiary of an ABLE account. The term may also include out-of-state residents to the extent allowed by law.
   8. (8) Disability certification--With respect to the individual who is the eligible individual, a certification to the satisfaction of the Secretary of the United States Treasury by the individual or the parent or custodian, or other authorized fiduciary of the individual, that certifies that the individual has a medically determinable physical or mental impairment, which results in marked and severe functional limitations, and which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months, or is blind within the meaning of Social Security Act, §1614(a)(2) and such blindness or disability occurred before the date on which the individual attained age 26, subject to any future changes or modifications in eligibility criteria in Internal Revenue Code, §529A.
   9. (9) Distribution--Any amounts paid by the ABLE Program to or on behalf of an eligible individual.

   10. (10) Eligibility affidavit--The participant's self-verification under oath in a format acceptable to the Board or as required by state or federal regulations that the designated beneficiary of the account is currently an eligible individual as defined by Internal Revenue Code, §529A because:

       1. (A) the designated beneficiary of the account is currently entitled to benefits based on blindness or disability under Social Security Act, Title II or XVI and such blindness or disability occurred before the date on which the individual attained age 26, subject to any future changes or modifications in eligibility criteria in Internal Revenue Code, §529A; or
       2. (B) a disability certification with respect to the designated beneficiary that meets the requirements of Internal Revenue Code, §529A(e)(2) has been filed with the Secretary of the United States Treasury for such taxable year.
   11. (11) Eligible individual--A person who meets the requirements of Internal Revenue Code, §529A and is certified by an eligibility affidavit to the Board as eligible to participate in the ABLE Program.
   12. (12) Eligible member of the family--An eligible individual and a member of the family of the former beneficiary to the extent provided by Internal Revenue Code, §529A.

   13. (13) Excess contribution--Contributions that would cause an ABLE account to exceed:

       1. (A) the amount established by the Board in accordance with Internal Revenue Code, Title 26, §529(b)(6); or
       2. (B) the amount in effect under Internal Revenue Code, Title 26, §2503(b) for the calendar year in which the taxable year begins in accordance with Internal Revenue Code, §529A.
   14. (14) Financial institution--A bank, a trust company, a depository trust company, an insurance company, a broker-dealer, a registered investment company or investment manager, the Texas Treasury Safekeeping Trust Company, or another similar financial institution authorized to transact business in this state.
   15. (15) Internal Revenue Code--The Internal Revenue Code of 1986.
   16. (16) Investment options--Investment options offered by the Program for selection by the participant.
   17. (17) Participant--A designated beneficiary or the parent or custodian or other fiduciary of the beneficiary who has entered into a participation agreement.
   18. (18) Participation agreement--A contract between a participant and the Board under this subchapter that conforms to the requirements prescribed by this subchapter and Internal Revenue Code, §529A and includes the application for enrollment submitted in good order.
   19. (19) Plan manager--An entity, including a financial institution, any state or federal agency, contractor or state or multi-state consortium engaged by the Board to carry out certain duties as specified and delegated by the Board for administration of the Program.
   20. (20) Qualified disability expenses--Any expenses related to the eligible individual's blindness or disability that are made for the benefit of the eligible individual who is the designated beneficiary, and includes expenses for education, housing, transportation, employment training and support, assistive technology and personal support services, health, prevention and wellness, financial management and administrative services, legal fees, expenses for oversight and monitoring, funeral and burial expenses, and any other expenses that may be identified from time to time in future guidance published in the Internal Revenue Bulletin or by amendments to Internal Revenue Code, §529A.
   21. (21) Transfer to state--The reimbursement that may be paid to the state Medicaid program upon the designated beneficiary's death. After timely claim submitted in good order, the reimbursement will be made from any available funds and will be calculated according to Internal Revenue Code, §529A(f).
2. (b) In the event of a conflict in the definitions, the Program definitions shall be governed by Internal Revenue Code, §529A, Education Code, Chapter 54, Subchapter J, and these rules, in that order.

Source Note:The provisions of this §7.181 adopted to be effective September 12, 2016, 41 TexReg 7111.