Section 6901.313 - Termination and refund(a) Death or disability.--Upon termination of a Tuition Account Program Contract, the account owner or the account owner's designee shall receive the value of the account if the account is terminated upon the happening of any of the following:(1) The death of the beneficiary.(2) The disability of the beneficiary which, in the opinion of the department, would make attendance by the beneficiary at an eligible educational institution impossible or unreasonably burdensome.(b) Refunds for other reasons.--(1) Except as provided in paragraph (3), refunds for Tuition Account Guaranteed Savings Program Contracts for reasons other than those set forth in subsection (a) shall be the sum of the contributions made pursuant to the Tuition Account Guaranteed Savings Program Contract plus 90% of the difference between the tuition credit prices in the years of contribution and the increased value of the tuition credits had they been redeemed in the academic year of termination.(2) Except as provided in paragraph (3), refunds for Tuition Account Investment Program Contracts for reasons other than those set forth in subsection (a) shall be: (i) in the event the value of the account is less than or equal to the sum of the contributions made pursuant to the Tuition Account Investment Program Contract, the value of the account; and(ii) in the event the value of the account is more than the sum of the contributions made pursuant to the Tuition Account Investment Program Contract, the sum of the contributions plus 90% of the difference between the sum of the contributions and the value of the account.(3) The board may alter the refund provisions set forth in paragraphs (1) and (2) so long as such alterations are consistent with the requirements for "qualified State tuition programs" provided in section 529 of the Internal Revenue Code of 1986 ( Public Law 99-514, 26 U.S.C. § 529 ).(4) If a refund is requested under this subsection within the 12 months following the account owner's changing the tuition level designated in a Tuition Account Guaranteed Savings Program Contract, the refund shall be calculated using the value of the tuition credits of the previous or current tuition level, whichever is less.(c) Fees.--The department may impose a fee upon termination of the account for administrative costs and deduct the fee from the amount otherwise payable.(d) Taxation of refunds.--In the event of a refund upon the termination of a Tuition Account Program Contract, to the extent the refund amount an account owner receives exceeds the sum of the contributions, it shall be subject to taxation as income under the laws of this Commonwealth.(e) Change of beneficiary or type of tuition account program.--The substitution of the beneficiary of an account pursuant to section 312(3) or the transfer of contributions, and any increased value thereof, from one type of tuition account program to the other shall not be deemed a termination of the account for purposes of this section.(f) Scholarship.--If a beneficiary is awarded a scholarship, the terms of which cover the benefits included in Tuition Account Program Contracts entered into on behalf of the beneficiary, the account owner may receive a refund. For Tuition Account Guaranteed Savings Program Contracts, the refund shall consist of the value, in the academic award year the scholarship is paid, of the available tuition credits. For Tuition Account Investment Program Contracts, the refund shall consist of the available portion of the value of the account. The refund under this subsection for any one academic award year shall not exceed the scholarship for that year.1992, April 3, P.L. 28, No. 11, § 313, imd. effective. Amended 2000, June 22, P.L. 418, No. 58, § 5, effective in 60 days.