SI SF01120.205 Uniform Gifts to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) – Age of Majority (TN 1 - 02/2008)

A. Background

The Uniform Gift to Minors Act (UGMA) was created to provide a means by which title to property could be passed to minors by use of a custodian. The nature of property which could be transferred under the UGMA was limited to securities, cash or other personal property. The UGMA directed that the minor child would possess legal ownership at the time of the conveyance, but would not possess the right to liquidate the property until the age of majority set by state law is attained.

The Uniform Transfers to Minors Act (UTMA) was introduced as a successor to the UGMA. The UTMA incorporated the provisions of the UGMA and expanded the nature of property which could be gifted or transferred to minors through custodianship. Under the UTMA, any kind of property, real or personal, tangible or intangible can be transferred to a custodian for the benefit of a minor.

All states in Region IX have repealed the UGMA and adopted the UTMA: Arizona effective 09/30/88, California effective 01/01/85, Hawaii effective 07/01/85, and Nevada effective 07/01/85.

B. Definitions

1. Obligor

An individual who is bound by legal obligations.

Example: A person (obligor) owing a settlement judgment to a minor transfers property to a custodian on behalf of the minor.

2. Power of Appointment

A power or authority given by a donor (the property owner) to a donee (the person who holds the power) to appoint the beneficiaries of the donor's property, or any interest therein. The power may be created by deed or will.

Example: A testator's will grants his surviving spouse power of appointment over a piece of property. The surviving spouse deeds the property to a custodian on behalf of a minor.

C. Age of Majority

The age of majority for UTMA purposes for each state in Region IX is:

TYPE OF TRANSFER

AZ

CA

HI

NV

General

21 (1)

18

21

18

By Irrevocable Gift

21

21 (2)

21

21 (2)

By Irrevocable Exercise of Power of Appointment

21

25 (2)

21

25 (2)

Authorized by Governing Will or Trust

21

25 (2)

21

25 (2)

By Personal Representative or Trustee not Authorized by Will or Trust

18

25 (2)

18

18

Transfer by Obligor

18

18

18

18

(1)

The effective date for the change in the general age of majority for Arizona is 9/30/88. The prior age of majority was age 18.

(2)

For CA and NV, the age of majority is 18 unless a delayed time is specified in the transfer document(s) with the following words:

CA – “as custodian for (name of minor) until age (age for delivery of property to minor) under the California Uniform Transfer to Minors Act”.

NV – “as custodian for (name of minor) until he attains the age of (age for delivery of property to minor) years under Nevada's Uniform Transfer to Minors Act”.

EXAMPLE: Under the California UTMA, a grandparent transferred an irrevocable gift of stocks to his/her minor grandchild. The full control of the stocks passes to the minor when he/she attains age 18, unless the document specifies a different age up to the attainment of age 21.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0501120205SF
SI SF01120.205 - Uniform Gifts to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) - Age of Majority (TN 1 - 02/2008) - 02/04/2008
Batch run: 01/27/2009
Rev:02/04/2008