A UTMA account Question

notrichenough
Thu, 31 Mar 2011 11:14:15 +0000

An UTMA is owned by your son. Because it is in an UTMA, you as the trustee can restrict his access until he is 21, but it is his money.

So option B is not really legal, it would be transferring his money back to you (becoming your asset on FA forms), although in all honesty you will never get caught.

You could do either a) or c), although for c), if you pull it out of the UTMA, he can legally get access to it. If he decides to use it to buy a car or whatever, you can’t stop him. If your relationship is strong, this shouldn’t be a problem.

The only tax consequences happen when you sell assets in the UTMA. Any income generated by this belongs to your son and would need to be reported by him on his tax return, if he has to file.