{"data":{"id":"us-ky/krs-164a.705","jurisdiction":"us-ky","citation":"KRS 164A.705","heading":"Obligations of fund and of purchaser or qualified beneficiary --","body":"Limitation of liability -- Use of tuition account.\n(1) The prepaid tuition contract entered into by the purchaser and the board shall\nconstitute an irrevocable pledge and guarantee by the fund to pay for the tuition of a\nqualified beneficiary upon acceptance and enrollment at an eligible educational\ninstitution in accordance with the tuition plan purchased.\n(2) A board member or any employee of the Tuition Account Program Office o r the\nKentucky Higher Education Assistance Authority shall not be subject to any\npersonal liability by reason of his or her issuance or execution of a prepaid tuition\ncontract under KRS 164A.700 to 164A.709.\n(3) Under a tuition plan for private colleges and universities, tuition shall be paid based\non the same percentage that University of Kentucky tuition is increased from the\nyear the prepaid tuition contract is purchased to the year of payment.\n(4) The purchaser or qualified beneficiary shall pay to the eligible educational\ninstitution the amount of any prepaid tuition academic year conversion shortfall and\nthe amount of any prepaid tuition conversion shortfall.\n(5) A qualified beneficiary attending an eligible educational institution may apply the\nvalue of a prepaid tuition account to a specific academic year at the maximum\ncourse load or maximum number of credit hours generally permitted to full -time\nundergraduates at that institution.\n(6) The value of a prepaid tuition account remaining after tuition is  paid may be used\nfor other qualified educational expenses under administrative regulations\npromulgated by the board in compliance with 26 U.S.C. sec. 529. The board may\npermit the use of the value of a prepaid tuition account for part -time undergraduate\nenrollment or graduate programs at eligible educational institutions.\n(7) During an account's utilization period, the value of the prepaid tuition account shall\nincrease consistent with tuition rates for the applicable tuition plan and academic\nyear. If all  tuition benefits have not been used at the conclusion of this period, no\nadditional value shall be added to the prepaid tuition account, except that, for an\naccount with a utilization period defined in KRS 164A.700(18)(a), the account\nvalue shall increase  at a rate of three percent (3%) per annum or the applicable\ntuition plan value increase, whichever is less, for a period not to exceed two (2)\nadditional years.\n(8) If a qualified beneficiary attends an eligible educational institution for which\npayment of tuition is not guaranteed by the fund in whole or in part, and if the cost\nof tuition exceeds the value of a prepaid tuition account, the fund shall have no\nresponsibility to pay the difference. If the value of a prepaid tuition account exceeds\nthe cost of tuition, the excess may be used for other qualified postsecondary\neducation expenses as directed by the purchaser.\n(9) The value of a prepaid tuition account shall not be used in calculating personal asset\ncontribution for determining eligibility and ne ed for student loan programs, student\ngrant programs, or other student aid programs administered by any agency of the\nCommonwealth, except as otherwise may be provided by federal law.","path":["KRS Chapter 164A"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=48599","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:51:19Z","sha256":"f1c07da71e629800343b799a1a7e0c2414f986b7daa0c3f7adfb9a6cfb3e9db2","source_id":"us-ky","stale":false,"prev":"us-ky/krs-164a.704","next":"us-ky/krs-164a.707"},"notice":"GroundRules: Original legal text. Not legal advice."}