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Account Owner
The account owner is the person who opens an Arkansas 529 GIFT Plan account and controls the assets held in the account. Anyone age 18 or older who is a U.S. resident or resident aliens with a Social Security number or taxpayer identification number, can open an Arkansas 529 GIFT Plan account. Corporations and certain other entities, including custodial and trust accounts, with a valid taxpayer identification number, also may participate.

Asset Allocation
The process of spreading an investment among various asset classes such as stocks, bonds, and cash.

Recurring Contributions/Automatic Investment Plan
Transfers to an Arkansas 529 GIFT Plan account can be made at a minimum of $10 per month/$30 per quarter from accounts held at a U.S. bank, savings and loan association, or credit union that is a member of the Automated Clearing House (ACH) network.

Contribution
The money that is contributed to an Arkansas 529 GIFT Plan account.

Designated Beneficiary
The beneficiary is the person designated by the account owner on whose behalf higher-education expenses are expected to be paid, in whole or in part, using money from the Arkansas 529 GIFT Plan account. The beneficiary must be a U.S. citizen or resident alien with a valid Social Security or taxpayer identification number, and each account may only have one beneficiary. Anyone, including the account owner, can be a beneficiary.

Earnings
The difference between the current value of an investment, and the cost basis of that investment.

Eligible Educational Institution
Generally, eligible educational institutions include two-year and four-year public and private colleges and universities, graduate and professional programs, and even some vocational programs. The school must be eligible to participate in the federal financial aid programs. A list of eligible educational institutions can be found at www.fafsa.ed.gov.

529 College Savings Plan
A college savings program sponsored by the states (or eligible educational institutions) and established under Internal Revenue Code Section 529.

Maximum Contributions
The Maximum Contribution Limit established for the GIFT Plan currently in effect is $366,000 per designated beneficiary, from all sources (adjusted periodically).

Member of the Family
As defined under Section 529 of the Internal Revenue Code, a member of the family of a designated beneficiary is a person related to the designated beneficiary as follows: (i) son or daughter, or a descendent of either; (ii) stepson or stepdaughter; (iii) a brother, sister, stepbrother or stepsister, half brother or half sister; (iv) the father or mother, or an ancestor of either; (v) a stepfather or stepmother; (vi) a son or daughter of a brother or sister; (vii) a brother or sister of the father or mother; (viii) a son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law or sister-in-law; (ix) the spouse of the designated beneficiary or of any of the foregoing individuals; or (x) a first cousin. For purposes of this definition, a child includes a legally adopted child of an individual and shall be treated as the child of such individual by blood.

Minimum Contribution
The initial contribution to an Arkansas 529 GIFT Plan account is $25. An Automatic Investment Plan can be set up for a minimum of $10 per month/$30 per quarter from accounts held at a U.S. bank, savings and loan association, or credit union that is a member of the Automated Clearing House (ACH) network. However, contributions made through automatic payroll deduction can be as low as $5 per pay period. Note: A periodic investment plan cannot assume a profit or protect against a loss in declining market.

Non-Qualified Withdrawals
Amounts in a 529 account can be withdrawn for purposes other than the payment of the designated beneficiary's qualified higher education expenses at an eligible educational institution. These are called non-qualified withdrawals. Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes.

Qualified Higher Education Expenses
As defined by the Internal Revenue Code, withdrawals from a 529 account are tax-free when they are used to pay for tuition, room and board (with certain limitations), required books, required supplies, required equipment, mandatory fees and special needs services at an Eligible Educational Institution. (See "non-qualified withdrawals" for the implications of a non-qualified withdrawal.)

Withdrawal
Money that you take out of an Arkansas 529 GIFT Plan account. Withdrawals are either Qualified Withdrawals or Non-Qualified Withdrawals.

Qualified Withdrawals
Amounts in a 529 account can be withdrawn for Qualified Education Expenses at Eligible Educational Institutions. All other withdrawals are non-qualified.

This website contains links to other websites as a convenience to users. Neither the Arkansas 529 GIFT Plan, the state of Arkansas, Ascensus Broker Dealer Services, Inc., nor Vanguard endorses or takes any responsibility for any such websites or for any information contained therein.

Ascensus Broker Dealer Services is the distributor of The Arkansas 529 GIFT Plan, Learn more about Ascensus Broker Dealer Services, Inc. on FINRA's BrokerCheck FINRA's BrokerCheck.

For more information about the GIFT College Investing Plan (the "GIFT Plan"), call 1.800.587.7301 or visit www.thegiftplan.com to obtain a Program Description and Participation Agreement, which includes investment objectives, risks, charges, expenses and other information; read and consider it carefully before making an investment or sending money. Ascensus Broker Dealer Services, Inc. ("ABD") is the Distributor of the GIFT Plan.

Please Note: Before investing in any 529 plan, you should consider whether your or the beneficiary's home state offers a 529 plan that provides its taxpayers with state tax or other benefits that are only available through investment in the home state's 529 plan. You should consult your financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to contact directly your home state's 529 college savings plan(s), or any other 529 plan, to learn more about those plans' features, benefits, and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The GIFT Plan is a college tuition savings program sponsored by the State of Arkansas and administered by the Arkansas Section 529 Plan Review Committee ("Committee"). ABD, the Program Manager, and its affiliates have overall responsibility for the day-to-day operations, including investment advisory services, recordkeeping, administrative services and marketing of the GIFT Plan. The GIFT Plan's Portfolios invest in: (i) mutual funds; or (ii) an FDIC-insured omnibus savings account held in trust by the Committee at Sallie Mae Bank. Except for the GIFT Plan Savings Portfolio, investments in the GIFT Plan are not insured by the FDIC. Units of the Portfolios are municipal securities and the value of units will vary with market conditions.

Investment returns will vary depending upon the performance of the GIFT Plan Portfolios you choose. Except to the extent of FDIC insurance available for the GIFT Plan Savings Portfolio, you could lose all or a portion of your money by investing in the GIFT Plan, depending on market conditions. Account Owners assume all investment risks as well as responsibility for any federal and state tax consequences.

Not FDIC-Insured (except for the GIFT Plan Savings Portfolio). No Bank, State or Federal Guarantee. May Lose Value.