Coverdell Education Savings Distribution Request Form

REDSA FDIST 04/16
Franklin Templeton
Coverdell Education Savings Account
Distribution Request
If completing by hand, please print clearly in CAPITAL LETTERS using blue or black ink.
1
BENEFICIARY INFORMATION
First name
M.I. Last name
Street address Check here if new address1
Social Security number
City
Date of birth (mm/dd/yyyy)
StateZIP
Name of Responsible Individual (must be parent or legal guardian)
2
TYPE OF DISTRIBUTION
Please read the Coverdell ESA Distribution Guide (“Distribution Guide”) before completing the rest of this form.
Check only one box.
Qualified education expenses: refer to Distribution Guide
Non-qualified expense: account earnings that are withdrawn are subject to a 10% excise tax, as well as income tax
Distribution due to disability of the beneficiary: please see Distribution Guide for certification requirement
Distribution due to death of beneficiary
A beneficiary’s death (a photocopy of the Coverdell ESA beneficiary’s death certificate must be provided.) If a contingent beneficiary has been designated on the
account, complete A; otherwise refer to B.
A. CONTINGENT BENEFICIARY
Please complete information concerning the contingent beneficiary, and then check 1, 2 or 3.
First name
M.I. Last name
Social Security number
If the contingent beneficiary is under age 30, the account must be transferred to a Coverdell ESA in his/her name.
1.
2.
3.
Date of birth (mm/dd/yyyy)
A
Coverdell ESA Application for the contingent beneficiary is attached.
Transfer the balance to contingent beneficiary’s Coverdell ESA number .
The contingent beneficiary is over 30; send proceeds to the address shown above.
(Please provide an Inheritance Tax Waiver if the Coverdell ESA beneficiary resided in a state that requires one.2)
B. BENEFICIARY’S ESTATE (IF NO CONTINGENT BENEFICIARY)
If there is no contingent beneficiary, the assets will go to the beneficiary’s estate. Please provide the following supporting documents:
• A photocopy of the Letters Testamentary or Letters of Administration (must be dated within the last 120 days).
• A valid Tax Identification Number for the estate.
• An Inheritance Tax Waiver if the Coverdell ESA beneficiary resided in a state that requires one.2
Please consult your tax advisor to determine the tax consequences, if any, of this distribution.
3
DISTRIBUTION AMOUNT
Fund name or fund-account number3
Shares
$
OR
% OR
$
OR
% OR
$
OR
% OR
$
OR
% OR
1. Signature Guarantee required for distributions to new address.
2. Please contact the appropriate agency of the state in which the beneficiary resided to determine if an Inheritance Tax Waiver is required.
3. Unless the annual maintenance fee has already been paid, it will be assessed if you are closing a fund-account, even if other fund-accounts remain open within the same account type.
(continued)
Questions? Please call your financial advisor or Franklin Templeton at (800) 818-4030.
page 1 of 5
4
PAYMENT OPTIONS
Make a check payable to the Responsible Individual and mail to the address of record.
Make a check payable to the Beneficiary and mail to the address of record.
Make a check payable to the education institution and mail to the address of record.
Make a check payable to the education institution and mail to the address below.
Name of Institution
c/o
Name/Student ID#/Ref#/Attn:
Address
City
State
Mail a check to an alternate address.4 (
ZIP
Check here if this is your new address of record.)
Name
Address
City
State ZIP
Fund-account number
Deposit to Beneficiary’s/Responsible Individual’s personal Franklin Templeton account number.
Send proceeds directly to the Responsible Individual’s and/or the Beneficiary’s bank via electronic funds transfer.5 Complete Section 5.
5
BANK INFORMATION/ELECTRONIC AUTHORIZATION
BANK ACCOUNT INFORMATION
Please provide your bank account information if you have requested payments to be transferred directly to your bank account.
Checking Account
Bank name
Savings Account
9-digit bank ABA routing number
Bank account number
Check here if the bank instructions should not be retrained on your account.
•If the registration of the Franklin Templeton fund account(s) and the bank account identified above DO NOT include at least one
common owner, all bank account owners must also have their signatures guaranteed; and the responsible individual signing in
Section 6 must also sign here and have his/her signature guaranteed.
•Requests to send proceeds electronically within 15 days of establishing or changing bank instructions must be signature guaranteed.
If your signature is not guaranteed, your proceeds will be sent by check to your address of record until the 15-day period has expired.
Please have each signature separately guaranteed by a bank, savings and loan association, trust company, credit union, broker-dealer,
or any other “eligible guarantor institution” as defined under the rules adopted by the Securities and Exchange Commission. These
institutions often participate in signature guarantee medallion programs such as the Securities Transfer Agent Medallion Program
(STAMP). A notary public cannot provide a signature guarantee.
4. Signature guarantee required for distributions to a new address.
5. Please allow up to three business days to process the request. If the Franklin Templeton fund account(s) identified in Section 3 and the bank account identified in Section 5 ARE NOT identical
registrations, all bank account owners must sign in Section 5 and have their signatures guaranteed; and the Responsible Individual signing in Section 6 must also have their signatures guaranteed.
page 2 of 5
Questions? Please call your financial advisor or Franklin Templeton at (800) 818-4030.
(continued)
5
BANK INFORMATION/ELECTRONIC AUTHORIZATION (cont’d.)
SIGNATURE OF BANK ACCOUNT OWNER
SIGNATURE OF BANK ACCOUNT OWNER
Date
Date
X
X
SIGNATURE GUARANTEE STAMP (if required)
Tape a preprinted, voided
check or preprinted savings
account deposit slip here.
Bank account registration
information (your name and
address) cannot be blank or
handwritten.
J. A. Sample
123 Street
Anywhere, USA 00000
ED
D
I
O
V
,
TED SLIP
N
I
R OSIT
P
E
PR DEP
H
AC K OR
T
T
A HEC
C
Do not staple.
6
SIGNATURE GUARANTEE STAMP (if required)
RESPONSIBLE INDIVIDUAL’S CERTIFICATION
I certify under penalty of perjury that all information contained herein is true and correct. I hereby acknowledge that I have received and read the
Coverdell ESA Distribution Guide regarding this distribution.
Date Daytime phone number
X
Signature of Responsible Individual (must be parent or legal guardian)
( )
*Your signature must be guaranteed if your distribution will be:
• over $100,000
• sent to a new address or any address other than the address of record
• made payable to a third party, other than the beneficiary’s educational institution
• sent electronically within 15 days of establishing or changing bank instructions
• sent electronically to a new bank account and you are not listed as an owner of that bank account
A NOTARY SEAL IS NOT ACCEPTABLE
SIGNATURE GUARANTEE*
S ignatures may be guaranteed by one of the following: (1) national or state banks, savings associations,
savings and loan associations, trust companies, savings banks, industrial loan companies, and credit unions;
(2) national securities exchanges, registered securities associations, and clearing agencies; (3) securities broker/dealers
which are members of a national securities exchange or clearing agency, or which have minimum net capital of
$100,000; or (4) institutions that participate in the Securities Transfer Agent Medallion Program (“STAMP”). A notary
public cannot provide a signature guarantee.
Please mail to
Overnight
(continued)
WEST COAST
EAST COAST
FTIOS
c/o Franklin Templeton Investor Services, LLC
P.O. Box 997153
Sacramento, CA 95899-7153
FTIOS
c/o Franklin Templeton Investor Services, LLC
P.O. Box 33033
St. Petersburg, FL 33733-8033
3344 Quality Drive
Rancho Cordova, CA 95670-7313
100 Fountain Parkway
St. Petersburg, FL 33716-1205
Questions? Please call your financial advisor or Franklin Templeton at (800) 818-4030.
page 3 of 5
Certification of Permanent & Total Disability
One of the following must be provided as proof of the Coverdell Education Savings Account Beneficiary’s Permanent & Total Disability:
Copy of Beneficiary’s valid Social Security Award Certificate
The certification below completed by the Beneficiary’s physician
PHYSICIAN’S CERTIFICATION OF PERMANENT & TOTAL DISABILITY
I hereby certify that the Coverdell ESA Beneficiary named on the reverse side has become unable to engage in any substantial gainful activity by
reason of a medically determined physical or mental impairment that is expected to last at least 12 months, and will be permanent and continuous
during the remainder of his/her lifetime. I understand that this will serve as proof of Permanent and Total Disability of the Beneficiary in order for
his/her distributions to be exempt from the IRS’ 10% early distribution excise tax.
Date
X
Physician’s Signature
Name (please print or type)
Name of Hospital/Clinic
Street address
City
State
ZIP
Date (mm/yyyy)
Certification was previously provided to FTIOS, and I certify that it is still valid.
2 0
Coverdell Education Savings Account Distribution Guide
The term “qualified education expenses,” as defined in Section 530(b)(2) of the Internal Revenue Code (26 USC 530), means:
(a) Qualified elementary and secondary education expenses including the following:
•Tuition, fees, academic tutoring, special needs services in the cases of a special needs beneficiary1, books, supplies, and other equipment
which are incurred in connection with the enrollment or attendance of the designated beneficiary at an eligible educational institution2;
•Room and board, uniforms, transportation, and supplementary items and services (including extended day programs) which are required
in connection with such enrollment or attendance; and
•Expenses for the purchase of any computer technology or equipment or Internet access and related services, if such technology, equipment,
or services are to be used by the beneficiary and the beneficiary’s family during any of the years the beneficiary is in school. (Computer
software designed for sports, games, or hobbies is not considered an expense unless the software is predominately educational in nature.)
(b) Qualified higher education expenses including the following:
•Tuition, fees, books, supplies, and equipment required for the enrollment or attendance of a designated beneficiary at an eligible educational
institution2, as well as special needs services in the case of a special needs beneficiary which are incurred in connection with such enrollment
or attendance; and
•If the beneficiary is at least a half-time student, room and board while attending such institution; however, the expense shall not exceed the
allowance for room and board included in the cost of attendance as determined by the eligible educational institution for such period, or,
if greater, the actual invoice amount the student residing in housing owned or operated by the eligible educational institution is charged by
such institution for room and board costs for such period.
(c) A distribution from a Coverdell ESA may be used to contribute to a qualified tuition plan.
Beginning in 2002, a HOPE or Lifetime Learning tax credit may be claimed in the same taxable year in which the beneficiary takes a tax-free
distribution from a Coverdell ESA, provided the distribution from the Coverdell ESA is not used for the same expenses for which the credit is claimed.
In addition, one can now make contributions to a Coverdell ESA and a qualified tuition program in the same year for the same beneficiary.
DISTRIBUTIONS FROM A COVERDELL ESA ARE TAX-FREE PROVIDED THE FOLLOWING REQUIREMENT IS MET:
•Withdrawals from a Coverdell ESA do not exceed the Beneficiary’s qualified education expenses for the tax year.
DISTRIBUTIONS THAT ARE NOT USED TOWARDS THE BENEFICIARY’S QUALIFIED EDUCATION EXPENSES, OR EXCEED THE BENEFICIARY’S
QUALIFIED EDUCATIONAL EXPENSES, WILL RESULT IN THE FOLLOWING TAX CONSEQUENCES:
•The Beneficiary will be subject to both income tax and an additional 10% federal tax penalty on the portion of the distribution that represents
earnings accumulated in the account. However, the 10% federal tax penalty will not apply if the designated beneficiary is permanently disabled,
dies, or the distribution is made because the beneficiary received a qualified scholarship, an educational assistance allowance, or other payment
excludable from gross income.
•Each distribution is treated as representing a pro-rata share of the principal (i.e., contributions) and accumulated earnings in the account.
EXAMPLE: A Coverdell ESA has a total balance of $2,000, of which $1,500 represents past contributions and $500 represents earnings.
If $1,000 (1⁄2 of the balance) were withdrawn, $250 of the distribution would represent accumulated earnings. Unless the distribution
is used towards a qualifying education expense, the $250 portion will be subject to taxes and (assuming the beneficiary has not died
or become permanently disabled) a 10% federal tax penalty.
page 4 of 5
Questions? Please call your financial advisor or Franklin Templeton at (800) 818-4030.
(continued)
•A withdrawal from a Coverdell ESA may be rolled over tax-free to another Coverdell ESA for the benefit of the same beneficiary or certain
eligible members of the beneficiary’s family within 60 days. Eligible members of the beneficiary’s family include his/her children and their
descendants, stepchildren and their descendants, siblings and their children, parents and grandparents, stepparents, spouses of the foregoing
and first cousins of the beneficiary. The $2,000 annual contribution limit to the Coverdell ESA does not apply to these rollover contributions.
•
The amount remaining in a Coverdell ESA upon the beneficiary’s 30th birthday must be distributed within 30 days. This does not apply to
a special needs beneficiary.
E
XCESS CONTRIBUTION TO A COVERDELL ESA The total Coverdell ESA contributions from ALL sources for the designated beneficiary during the
tax year may not exceed $2,000. Aggregate contributions for the benefit of the beneficiary in excess of $2,000 are treated as excess con­tributions.
If the excess contributions and any earnings attributable to them are not withdrawn before the first day of the sixth month following the taxable
year (June 1st), the excess contributions are subject to a 6% excise tax for each year the excess remains in the Coverdell ESA. The excess contribution
withdrawn is not taxable, but the earnings must be included as income for the tax year the excess was made and may be subject to a 10% premature
penalty tax. The excise tax is imposed on the beneficiary and not the contributor. [IRC §530(d)(4)(C); IRC § 4973(e); IRS Notice 97-60]
NOTE: In the event the Responsible Individual dies or becomes incapacitated, the Beneficiary shall become the Responsible Individual if he or she
has reached the age of majority and is not incapacitated. If the Beneficiary does not satisfy these requirements and the Responsible Individual was
a parent, the other parent shall become the Responsible Individual. If there are no remaining parents, the Beneficiary’s legal guardian will become
the Responsible Individual.
1. A “special needs beneficiary” is one who, because of a physical, mental or emotional condition (including a learning disability) requires additional time to complete his or her education, as determined by
Department of Treasury regulations.
2. An “eligible educational institution” is any school which provides elementary education or secondary education (kindergarten through grade 12), as determined under state law, including a public,
private or religious school; and generally any college, university, or post-secondary vocational institution offering credit towards an associate, bachelor’s, graduate or professional degree, or other
recognized post-secondary credential, that is eligible to participate in a Department of Education student aid program.
Questions? Please call your financial advisor or Franklin Templeton at (800) 818-4030.
REDSA FDIST 04/16