What if my child decides not to go to college?

If the beneficiary of a Texas Guaranteed Tuition Plan contract decides not to attend college, the purchaser can receive a refund. This refund is payable within 4 to 6 weeks after a fully completed and notarized cancellation form is received by our office. If the beneficiary is under the age of 18 or has not graduated from high school, the refund value will be the amount paid, less cancellation and administrative fees. If the beneficiary is 18 or older or has graduated from high school, the hours will be refunded based on the hourly rate that would have been paid to the college for the contract type, less fees. The contract may also be transferred to another beneficiary if no benefits have been used. The new beneficiary must meet the requirements of a qualified beneficiary on the date the designation is changed. The new beneficiary must be a member of the family of the original beneficiary as defined by Section 529 of the Internal Revenue Code. Member of the family includes, but is not limited to, a brother, sister, stepbrother, stepsister, or first cousin of the beneficiary.

A qualified beneficiary is defined by the Board's program rules as an individual who is under the age of 18 or who is 18 years of age or older and enrolled in high school at the time the purchaser changes the beneficiary, who has not graduated from high school nor obtained high school equivalency certification, and is either:

  1. a resident of the State of Texas; or
  2. a nonresident who is the child of a purchaser who is a resident of Texas at the time that purchaser changes the beneficiary.

The new beneficiary cannot have more than five years or 160 credit hours of combined TGTP contract benefits.

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