Transfer to a Minor/More Info

Transfer to a Minor
Additional Information

Often, parents or grandparents want to give cash or property to a child so that he or she can enjoy the benefit of income and appreciation of the property.  This may be property that the parent or grandparent has already decided would be given to the child later in life. Because the child is almost always in a lower income tax bracket than the parent or grandparent, the family's income tax liability is reduced.  Gifts may be motivated by other reasons, too.

Creating a custodial gift to a minor is easy and inexpensive.  Remember that someone will have to assume the responsibility to file an income tax return on behalf of the child.  For more information on this and other aspects of UTMA transfers, see the Home Legal Topic 'Transfers of Property to Minors'.

It is always best to consult with a tax and/or estate planning attorney for counsel on how best to make any transfers to a minor child.