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Closing an UTMA: Beneficiary is of age
Answer by John Burnett, BOL Guru
Guru BIOS
Question: We have a savings account that is an UTMA. The minor is now of age and wants sole possesion of the all the funds. What is the best way to achieve this? Should the account be closed, if so by whom, or can we just transfer it to the beneficiary?
Answer: There are two right ways to do this, and one wrong way.
The wrong way would be to give the funds to the beneficiary on your own. The beneficiary is not your customer, and you should not transact business in this account for the beneficiary.
The best way for the transfer to take place is for the custodian to close the account and transfer the funds to the beneficiary. The custodian controls the account until it's closed.
The difficult way, if the custodian isn't cooperative (or can't be), is for the beneficiary to petition the court to order the transfer. If the bank is named and directed by the court to surrender the funds, it should do so. But not without the court order.
First published on BankersOnline.com 10/03/05
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