§256-1  Definitions.  As used in thischapter, unless the context otherwise requires:

"Account" or "collegeaccount" means an individual savings account established in accordancewith this chapter.

"Account owner" means the individualwho enters into a tuition savings agreement pursuant to this chapter and asdefined under the proposed income tax regulations, sections 1.529-1 to 1.529-6or the final regulations relating to section 529 of the Internal Revenue Codeof 1986, as amended, whichever is applicable, including any amendments orsupplements thereto. "Designated beneficiary" means a designatedbeneficiary as defined in section 529 of the Internal Revenue Code of 1986, asamended, or successor legislation.

"Eligible educational institution"means an institution defined in section 529 of the Internal Revenue Code of1986, as amended, or successor legislation.

"Financial organization" means anorganization authorized to do business in the State of Hawaii that is:

(1)  Certified as an insurer by the insurancecommissioner;

(2)  Licensed or chartered as a financial institutionby the commissioner of financial institutions;

(3)  Chartered by an agency of the federal government;

(4)  Subject to the jurisdiction and regulation of thesecurities and exchange commission of the federal government; or

(5)  Any other entity otherwise authorized to act inthis State as a trustee pursuant to the provisions of the Employee RetirementIncome Security Act of 1974, as may be amended from time to time.

"Management contract" means thecontract executed by the director of finance and a financial organizationselected to act as a depository and manager of the program.

"Member of the family" means a familymember as defined in section 529 of the Internal Revenue Code of 1986, asamended, or successor legislation.

"Nonqualified withdrawal" means awithdrawal from an account that is not:

(1)  Used for qualified higher education expenses ofthe designated beneficiary;

(2)  Made on account of the death or disability of thedesignated beneficiary; or

(3)  Made on the account of a scholarship (orallowance or payment described in section 135(d)(1)(B) or (C) of the InternalRevenue Code of 1986, as amended) received by the designated beneficiary, tothe extent the withdrawal does not exceed the amount of the scholarship,allowance, or payment.

"Program" means the college savingsprogram.

"Program manager" means a financialorganization selected by the director of finance to act as a depository andmanager of the program.

"Qualified higher education expenses"means any qualified higher education expense defined in section 529 of theInternal Revenue Code of 1986, as amended, or successor legislation.

"Qualified withdrawal" meanswithdrawal from an account to pay the qualified higher education expenses ofthe designated beneficiary of the account.

"Tuition savings agreement" means anagreement between the director of finance or a financial organization and theaccount owner. [L 1999, c 81, pt of §2; am L 2000, c 90, §1]