529 A vs 529 ABLE Act 529 Statute

§ 529 A vs. § 529 ABLE Act 529 Statute Beneficiary Limit (1) per beneficiary Annual Contribution Limit $14, 000 per beneficiary None Maximum Account Balance State limit for Section 529 accounts MD $350, 000 Income Limitations Social Security Income eligibility limit None Beneficiary Change Siblings and step-siblings Blood or Marriage Certification YES. Signed by a doctor NO Distribution Frequency Frequent Less Frequent Recapture (Back to the state) Medicaid recapture requirement NO Reporting ABLE Reporting requirement MSRB Reporting of Account YES NO Monthly Report Monthly electronic report NO 1

§ 529 A vs. § 529 (cont. ) ABLE Act 529 Statute Yearly Eligibility YES Home State Requirement YES or contracting state. NO NO Expenses Qualified Disability Qualified Tuition Tax Penalty on Non-Qualified Expenses 10% Exceptions: Death Contribution growth is returned to the account before the federal tax filing deadline. 10% Exception: Death Disability preventing beneficiary from attending college Verification of Qualified Expenses TBD Taxpayer 2

Qualified Expenses 529 Plans Dictated by IRS Publication 970 Generally: • • Tuition Books and Supplies (as required by the university) Room and Board (student must be enrolled at least half-time) Expenses of a special-needs beneficiary necessary for enrollment at an eligible institution ABLE Accounts • Education • Housing • Assistive technology and personal support services • Transportation • Employment training and support • Health • Prevention and wellness • Financial management and administrative services • Legal fees • Expenses for oversight and monitoring • Funeral and burial expenses • Other expenses approved by the Treasury Secretary 3

ABLE ACT (cont. ) Considerations for locating ABLE with CSPM: Board Currently 10 people/ ABLE would add 10 more How would the Board address the diverse issues governing both plans? Staffing and funding CSPM is funded by the program fees generated from the Plans Start up costs for ABLE? Who would fund them? Who would take on the administrative costs to additional staff ? Contractual Obligations T. Rowe Price Program manager – would they be willing to amend their contract? Future RFP in 2016 What role should Community Development Financial Institutions play? Verification of Disability Who will do it? Who will take on the administrative burden? Medical Information Privacy Issue Increase administrative costs 4