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Minor's Account - Death of the Custodian

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If a minor account is opened using the child's social security, titled beneficiary (the minor) by custodian, what happens to the funds if the custodian passes away?

If the account was set up in accordance with your state's version of the Uniform Transfers to Minors Act the question is answered in the statute. In the model language, the statute indicates that if a successor custodian was named, the successor takes over. Otherwise, if the child is age 14 or over, the child may appoint an adult family member. Failing both of those, a court appointment is necessary.

If the account is as you actually describe it, there is no mention of the UTMA, it may be necessary for the bank to seek court direction; i.e. sue the decedent's estate and the child and ask the court to decide who owns the money. There are pitfalls to opening accounts where there is no legal source of authority for the title used.

First published on 6/05/06

First published on 06/05/2006

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