Home  •Annuities  •Bankruptcy  •Day Trading  •Mutual Fund  •IRA  •Roth IRA •IRA  •401 K •Stock OptionsTax

What can UGMA funds

space
GURUS OF INVESTMENT :
Gurus of investment
ANNUITIES :
Effects Of Annuities With Time Value Money
How To Make Money In Annuities 
Who Has The Best Terms On Fixed Annuity Contracts
Bankruptcy :
Chapter 7
Chapter 13
Investing :
Option In Investing Plan
Safe Investing Tips
What Is Equity Investing ?
Investing Tools And Charts
Personal Finance :
Best Ways To Repair Your Credit
How Does Debt Consolidation Work ?
Grants To Pay Off Student Loans
Auto Loans For The Disabled
IRA :
Can I Contribute To Both A 401k And An IRA ?
How Does An Ira Work ?
Can A Non Working Spouse Contribute To A Roth Ira ?
Using A Roth Ira As Your Emergency Fund
Tax :
Child Tax Credit Calculator
How Long Does It Take To Get Tax Refund Back ?
Minimum Income To File Taxes
Places That Do Not Tax Retirement Income
 

What Can UGMA Funds 

          In most states across the U.S., minors are not allowed to have contracts. As a result they cannot own stocks, bonds, mutual funds, annuities and life insurance policies. Parents too cannot transfer assets to minors. However, the good news is that assets can be transferred to a trust and the most popular trust fund for a minor is the UGMA account or Uniform Gift to Minors Act account. Here the child is named the beneficiary while the parent or the guardian is the custodian of the account.

          In the U.S. an UGMA account is seen as a poor man’s trust fund. A UGMA account allows a child to have his own investments which grow faster than any other investment like savings bonds. Though the money is in the name of the child, the custodian has control over the investments.

          The income from a UGMA account has to be reported on the child’s tax return and is taxed according to the child’s rate as per the Kiddie Tax Rule. A parent is responsible for filing income tax returns for the child and no special tax treatment is accorded to a UGMA account. A child of 14 and above has to sign his own tax returns.

          The money from a UGMA account can be used for many things. Neither the donor of the money nor the custodian of the account can restrict the way the UGMA funds are used when the child becomes an adult. The child can use the money for anything without seeking permission from the custodian and though the money is seen as a college trust fund, there is no guarantee that the child would use it for education.

          When it comes to seeking financial aid in a college, UGMA funds are considered as assets of the student and can have an impact on the eligibility criteria for college financial aid.

What Can UGMA Funds

line
 
 
Home   • Personal Finance  • Car Loan • Student Loan  • Credit Repair  • Debt Relief  • Real Esatate  • UGMA Uniform ActContact

© 2007 Gurusofinvestment.com, All Rights Reserved.
( What can UGMA funds )