1025.000.00 Cash and Securities (OAA and PTD)

1025.015.19 Section 529 Plans, or MOST Accounts

IM-137 December 23, 2021

POMS SI 01140.150

Section 529 plans (also known as Qualified Tuition Programs) are a type of investment account used to save for or provide for education expenses. These accounts are known as MOST accounts in Missouri. Apply this guidance to all Section 529 plans, including 529 plans established in other states.

Funds in MOST accounts can be used to pay for:

  • Qualified higher education expenses such as room and board, tuition, fees, fees, books, supplies and other related expenses or
  • Tuition at a qualified elementary or secondary school.

Parties to a MOST Account

MOST accounts generally consist of two parties:

  • The owner (sometimes known as a donor) has ownership of the account and can direct the investments and use of the funds.
    • Owners can withdraw the funds in a MOST account at any time.
      • In a MO HealthNet resource determination for a MOST account owner, include MOST account funds.

EXAMPLE: Geneva, a MO HealthNet for the Aged, Blind, and Disabled (MHABD) participant, creates and funds a MOST account for her granddaughter. Count the funds in the account for Geneva’s MHABD resource determination.

  • The beneficiary is the person who will benefit from the funds in the account. The beneficiary is usually a student or a future student. A beneficiary and owner can be the same person. Unless the owner and beneficiary are the same person:
    • A beneficiary of a MOST account has no control over the use or distribution of funds in the account.
    • In a MO HealthNet resource determination for a beneficiary, exclude funds in a MOST account.

EXAMPLE: Hilary receives MHABD as a disabled child (MHDC). She is the beneficiary of a MOST account created by her grandmother. Do not count the funds in the MOST account for Hilary’s MHABD resource determination.

Income from a MOST Account

Treat a MOST account distribution as income in the month it is received if the beneficiary does not intend to use the money for educational expenses.

EXAMPLE: Hilary’s grandmother gives her $500 from the MOST account in August. Hilary states her school expenses are already paid so she will use the money for clothes. Count the $500 as income for the month of August.

Exclude from income determinations any interest or dividends earned from a MOST account.

Distributions from a MOST Account

Distributions from MOST accounts are at the discretion of the account owner. Exclude distributions made to the beneficiary for educational expenses for 9 months.

EXAMPLE: Hilary’s grandmother distributes $5,000 from the MOST account in July for Hilary to pay tuition for fall and spring semesters. August is the first month of the 9 month exemption; April is the last month. If Hilary fails to pay for tuition, any portion of the $5000 that remains in May is a countable resource for Hilary.

Count distributions in excess of qualified educational expenses or distributions not used to pay educational expenses as a resource in the month after the funds are received.

EXAMPLE: Hilary’s grandmother gives her a $1500 distribution from the MOST account in August so she can buy school books. Hilary’s books total $1100. Hilary states she’s holding on to the excess money to buy food and pay her cell phone bill. $400 is countable as a resource for Hilary as of September 1.

Missouri Vaccine Incentive Program (MO VIP)

In 2021, MO VIP awarded MOST accounts to children aged 12-17 using a lottery-like drawing. Missouri Department of Health and Senior Services (DHSS) retains ownership and control of these accounts. After the winning child turns 18, DHSS will transfer ownership of the account to the child or the child’s guardian. Until the child reaches age 18 and receives the account:

  • DHSS will not approve of any distributions from the MOST account, even for an allowable education expense.
  • Contributions cannot be made into these accounts.
  • These MOST accounts cannot be combined with another existing MOST account.

Transferring MOST Account Funds to an Achieving a Better Life Experience (ABLE) Account

Funds in a MOST account can be transferred to an ABLE account with the same beneficiary or another family member. For more information on ABLE accounts see 1025.015.17 Achieving a Better Life Experience Account.