treatment of designated beneficiaries and contributors (1) In general Except as otherwise provided in this subsection, no amount shall be includible in gross income of— (A) a designated beneficiary under a qualified down payment savings program, or (B) a contributor to such program on behalf of a designated beneficiary, with respect to any distribution or earnings under such program. (2) Gift tax treatment of contributions For purposes of chapters 12 and 13— (A) In general Any contribution to a qualified down payment savings program on behalf of any designated beneficiary shall be treated as a completed gift to such beneficiary which is not a future interest in property. (B) Treatment of excess contributions If the aggregate amount of contributions described in subparagraph (A) during the calendar year by a donor exceeds the limitation for such year under section 2503(b), such aggregate amount shall, at the election of the donor, be taken into account for purposes of such section ratably over the 5-year period beginning with such calendar year. (3) Distributions (A) In general Any distribution under a qualified down payment savings program shall be includible in the gross income of the distributee in the manner as provided under section 72 to the extent not excluded from gross income under any other provision of this chapter. (B) Distributions for qualified down payment expenses For purposes of this paragraph, if distributions from a qualified down payment savings program— (i) do not exceed the qualified down payment expenses, no amount shall be includible in gross income, and (ii) in any other case, the amount otherwise includible in gross income shall be reduced by an amount which bears the same ratio to such amount as such expenses bear to such distributions. (C) Rollovers (i) In general Subparagraph (A) shall not apply to that portion of any distribution which, within 60 days of such distribution, is transferred to another qualified down payment savings account for the benefit of the designated beneficiary.