Keeping Assets in a Custodial Account for a Minor

 Minors have no legal capacity to manage property. Thus, transferring property and other assets to minors can be problematic. For example, parents or other adults may wish to convey a small amount of property to a minor without investing the time and expense of establishing a trust.

Another option is to set up a custodianship for the minor. Under a custodianship, the transferring party names a custodian and transfers the property into an account in the minor’s name. The custodian holds and manages the custodial property for the benefit of the minor. A custodial account is irrevocable and belongs to the minor as the owner.

Uniform Transfers to Minors Act (UTMA)

The Uniform Transfers to Minors Act of 1986 (UTMA) was passed in order to eliminate some limitations of the earlier Uniform Gifts to Minors Act (UGMA). All states have adopted some form of the UTMA or UGMA. The UTMA provides a convenient method of allowing the transfer of property to minors without setting up a trust.

In a custodianship, an adult custodian holds and manages property for the benefit of a minor child until that minor is old enough to receive the property. A UTMA transfer is irrevocable, and the custodian must relinquish the property to the minor as soon as they reach the age of majority, which varies by state (usually 18 or 21, sometimes 25)

 

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Parental Liability for Acts of Minor Children

In most states, the age of majority (when a person is recognized by law as an adult), is 18 years of age or older. A "minor" is a person who is under the age of 18. When a minor breaks the law or causes damage or injury to another person, an animal or property, their parents may bear the liability. Many state statutes authorize courts to hold parents financially responsible for the damages caused by their minor children. Some states may even hold parents criminally liable for failing to supervise a child whom they know to be delinquent.
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Grounds to Modify Child Custody

Generally, a couple who divorces or legally separates must make a determination regarding the physical and legal custody of their children and visitation rights, either by mutual agreement or court order. When an established child custody arrangement no longer works or is no longer desired, one or both parents may seek to modify custody. Where a parent is seeking to modify custody through the courts, the parent must generally be able to show that there has been a substantial change in conditions which warrants the modification.

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California Weighs Lesbians' Parental Rights

California's highest court was asked Tuesday to create a legal framework for what constitutes a family as justices weighed parental rights for lesbian couples who broke up after having children.

The state Supreme Court, hearing oral arguments in the cases of three women seeking child custody or support from their former partners, pondered whether children from same-sex households should be treated the same under the law as out-of-wedlock offspring of heterosexuals.

Attorneys for some of the women and the California attorney general argued that children should be given the same protections they would have with two traditional parents, since gays cannot marry and may have legitimate reasons for not registering as domestic partners or formally adopting their children.

They urged the court to apply long-standing laws governing absent fathers to estranged gay and lesbian couples who used reproductive science to conceive, a practice that leaves one partner without a genetic link to the family.

 
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