85-1812 Benefits received; tax consequences. - Nebraska Statutes

85-1812. Benefits received; tax consequences.(1) For federal income tax purposes, the Nebraska educational savings plan trust shall be considered a qualified state tuition program exempt from taxation pursuant to section 529 of the Internal Revenue Code. The trust meets the requirements of section 529(b) of the Internal Revenue Code as follows:(a) Pursuant to section 85-1806, a participant may make contributions to an account which is established for the purpose of meeting the qualified higher education costs of the designated beneficiary of the account;(b) Pursuant to section 85-1806, a maximum contribution level is established;(c) Pursuant to section 85-1807, a separate account is established for each beneficiary;(d) Pursuant to section 85-1807, contributions may only be made in the form of cash;(e) Pursuant to section 85-1807, a participant or beneficiary shall not provide investment direction regarding program contributions or earnings held by the trust;(f) Pursuant to section 85-1808, penalties are provided on refunds of earnings which are not used for qualified higher education costs of the beneficiary, made on account of the death or disability of the designated beneficiary, or made due to scholarship, allowance, or payment receipt as provided in section 529(b)(3) of the Internal Revenue Code; and(g) Pursuant to section 85-1809, a participant shall not pledge any interest in the trust as security for a loan.(2) State income tax treatment of the Nebraska educational savings plan trust shall be as provided in section 77-2716. SourceLaws 2000, LB 1003, § 12.