Custodianship (UTMA)
The Uniform Transfers to Minors Act (UTMA)
Advantages of UTMA
The Uniform Transfers to Minors Act (UTMA)
An alternative to children’s trusts is the use of the respective Uniform Transfers to Minors Act (UTMA). The UTMA is a uniform act enacted by most U.S. States including California. It provides a mechanism under which gifts can be made to a minor without requiring the presence of an appointed guardian for the minor. The act allows the donor of a gift to transfer title to a custodian who will manage and invest the property until the minor reaches a certain age. Under Californian state law the maximum age is 25.
Advantages of UTMA
Using the UTMA instead of a children’s Trust can sometimes be preferable, because the UTMA-system has some advantages. For instance the practical handling of the beneficiary’s property can be easier for a nominated custodian, because his powers follow fixed rules every institution (e.g. a bank) is familiar with. In addition there can be some tax advantages regarding the income tax in respect of the asset generated income.
Your local estate planning attorney, for example Rinne Legal in San Francisco, Fairfield, Oakland, Walnut Creek and Sacramento, will advise you an option that is favorable for your specific situation.
Advantages of UTMA
The Uniform Transfers to Minors Act (UTMA)
An alternative to children’s trusts is the use of the respective Uniform Transfers to Minors Act (UTMA). The UTMA is a uniform act enacted by most U.S. States including California. It provides a mechanism under which gifts can be made to a minor without requiring the presence of an appointed guardian for the minor. The act allows the donor of a gift to transfer title to a custodian who will manage and invest the property until the minor reaches a certain age. Under Californian state law the maximum age is 25.
Advantages of UTMA
Using the UTMA instead of a children’s Trust can sometimes be preferable, because the UTMA-system has some advantages. For instance the practical handling of the beneficiary’s property can be easier for a nominated custodian, because his powers follow fixed rules every institution (e.g. a bank) is familiar with. In addition there can be some tax advantages regarding the income tax in respect of the asset generated income.
Your local estate planning attorney, for example Rinne Legal in San Francisco, Fairfield, Oakland, Walnut Creek and Sacramento, will advise you an option that is favorable for your specific situation.
