Sec. R6-12-404 - Individual Development Accounts

§ R6-12-404. Individual Development Accounts

A. An individual development account (IDA) is a special savings account which allows a recipient of both CA and Food Stamp Program benefits to accumulate funds to achieve educational or training goals.

B. Financial institutions licensed by the Arizona State Banking Department shall administer IDAs.

1. IDAs shall earn the same interest rate as is offered to other bank customers for like accounts.

2. A financial institution may prescribe such terms and conditions relating to IDAs as are permissible under the laws of this state and federal banking law.

C. A member of an assistance unit that receives both CA and food stamp benefits may establish an IDA.

1. No assistance unit shall hold more than 1 IDA.

2. A person found to have committed an intentional program violation or fraud related to the CA, food stamp, or AHCCCS programs shall not hold an IDA.

D. An assistance unit member who establishes an IDA shall sign a document authorizing the financial institution to release account information to the Department.

E. The following persons can make deposits into an IDA:

1. The account holder;

2. A member of the account holder's assistance unit;

3. A person who is not a member of the account holder's assistance unit; or

4. A non-profit organization with a recognized tax exempt status under 26 U.S.C. 501(c)(3) or A.R.S. § 43-1201. A non-profit organization making deposits into an IDA:

a. Shall designate that such funds are intended solely for educational or training purposes, and

b. May set other terms and conditions regarding the withdrawal or use of the funds.

F. An applicant for assistance shall not place countable income or resources into an IDA for the purpose of qualifying for CA or Food Stamp Program benefits. Any money so deposited counts as a resource.

G. The Department shall exclude from the resource limitation set forth at R6-12-401(B) the balance held in an IDA which at any 1 time is $9,000 or less, except that any cumulative deposits over the life of an IDA which exceed $12,000 shall count against the resource limitation.

H. The Department shall disregard as countable income:

1. Fifty percent of any earned income of the assistance unit which is deposited into an IDA, except that the Department shall not disregard more than $100 per month of earned income; and

2. All interest earned on an IDA.

I. An assistance unit which holds an IDA shall:

1. Report to the Department all income which is deposited into an IDA or withdrawn from an IDA; and

2. Submit account statements to the Department at each eligibility redetermination.

J. A recipient of both CA and food stamp benefits may withdraw funds from an IDA for:

1. Educational costs at an accredited institution of higher education; or

2. Training costs for an accredited, licensed, or certified training program.

K. As used in subsection (J), above:

1. Educational and training costs are limited to:

a. Tuition and other mandatory fees charged to all students, or to all students within a certain curriculum;

b. Books;

c. Transportation; and

d. Miscellaneous personal expenses necessary to pursue education or training.

2. An institution of higher education means a public or private educational institution defined at A.R.S. § 23-618.02.

3. A training program means a course of study offered by a vocational, technical, or recognized proprietary school which will result in a diploma or certificate for a job skill which is directly related to obtaining useful employment in a recognized occupation.

L. Withdrawals from an IDA for purposes other than those described in subsection (K) shall count as income to the assistance unit in the month of withdrawal, unless the money was previously counted as income to the assistance unit at the time of receipt.

M. If there is a break in CA or food stamp benefits of at least 1 full month, upon reapplication the Department shall consider any remaining monies in an IDA as countable resources and shall not disregard any future deposits into an IDA.

N. The Department's Office of Special Investigations shall investigate allegations of fraud or abuse involving IDAs, including situations where there is evidence or reason to believe that a deposit to an IDA was made from:

1. Income which was available to the assistance unit but was not reported to the Department;

2. Individual contributions which should have been counted as income or child support; or

3. Proceeds from illegal activities.

O. The Department shall not disregard as income or resources any deposit made into an IDA from income sources described in subsection (N), or any deposit which is otherwise contrary to the provisions of this Section. The Department shall establish any resulting overpayment.

(Adopted effective November 9, 1995 (Supp. 95-4). Amended effective July 31, 1997, under an exemption from the provisions of A.R.S. Title 41, Chapter 6 (Supp. 97-3).)

The following Section was amended under an exemption from the provisions of A.R.S. Title 41, Chapter 6, pursuant to Laws 1997, Ch. 300, § 74 (A). Exemption from A.R.S. Title 41, Chapter 6 means the Department did not submit notice of proposed rulemaking to the Secretary of State for publication in the Arizona Administrative Register; the Department did not submit these rules to the Governor's Regulatory Review Council for review and approval; and the Department was not required to hold public hearings on this Section.

The following state regulations pages link to this page.