PS 01805.049 Utah

A. PS 02-078 Uniform Gifts

DATE: May 8, 2002

1. SYLLABUS

This opinion addresses two different issues related to the Uniform Gifts to Minors Act for Region VIII. The first issue concerns the age at which a recipient of a gift under the Uniform Gifts to Minors Act has the right to liquidate the gift. The opinion summarizes the law for each State. The second issue addressed is whether the law of the State in which the child currently resides is controlling with respect to the age at which custodial property must be transferred to the minor. As outlined in the opinion, the law of the State in which the child currently resides is not controlling under the current laws of any state in Region VIII.

2. OPINION

You have asked us: (1) whether the age at which a recipient of a gift under the Uniform Gifts to Minors Act has the right to liquidate the gift has changed since April 1992, and (2) whether the law of the State in which the child currently resides is controlling with respect to the age at which custodial property must be transferred to the minor.

We will answer the second question first, as it is the less complicated of the two. Our Opinion of October 12, 1999, “Age of Majority under the Uniform Transfers to Minors Act” is correct and applicable to all of the States in Region VIII. The law of the State in which the child currently resides is not controlling under the current laws of any State in Region VIII. All of the States have adopted a provision of the Uniform Transfers to Minors Act (UTMA) which provides:

This chapter applies to a transfer that refers to this chapter . . . by which the transfer is made if at the time of the transfer, the transferor, the minor, or the custodian is a resident of this state or the custodial property is located in this state. The custodianship so created remains subject to this chapter despite a subsequent change in residence of a transferor, the minor, or the custodian or the removal of custodial property from this state.

See CRSA § 11-50-103, MCA § 72-26-503, NDCC § 47-24.1-02, SDCL § 55-10A-2, UCA § 75-5a-103, WS § 34-13-115. (Emphasis added.) Thus, the law of the state in which the transfer was made now expressly states which law applies.

As to your first question, we have reviewed the provisions and the information set forth in POMS Section “SI R01120.205 DEN B UNIFORM GIFTS TO MINORS ACT,” which you have included with your request and have asked us to update. The Section accurately summarizes the law of South Dakota and Montana. The provisions pertaining to the laws of Colorado, North Dakota, Utah, and Wyoming must be changed.

The UTMA was adopted (and the Uniform Gifts to Minors Act (UGMA) repealed) by Colorado on July 1, 1984; Montana on October 1, 1985; North Dakota on July 1, 1985; South Dakota on July 1, 1986; Utah on July 1, 1990; and Wyoming on May 22, 1987. Custodianships created in those States prior to those dates will continue to terminate at the age prescribed under their respective versions of the UGMA.

The UTMA divides transfers to minors into four categories: (1) transfer by gift or exercise of power of appointment, (2) transfer authorized by will or trust, (3) other transfer by fiduciary, and (4) transfer by obligor. In Colorado and South Dakota, the age at which custodial property must be transferred to the minor is the same for all four types of transfers. In Montana, North Dakota, Utah, and Wyoming, property created by transfers described in (1) and (2) above must be transferred to the minor at age 21, and property created by transfers described in (3) and (4) above must be transferred to the minor at age 18. The applicable UTMA provisions of each State are summarized below.

Colorado

Regardless of the type of transfer by which the property was created, the custodian must transfer property to the minor or the minor's estate upon the earlier of (1) the minor attaining the age of 21, or (2) the minor's death. CRSA §§ 11-59-105, 106, 107, 108, 121.

Montana

The custodian shall transfer custodial property to the minor or the minor's estate upon the earlier of: (1) the minor's attainment of the age of 21, with respect to custodial property transferred by gift, exercise of power of appointment, will, or trust; (2) the minor's attainment of the age of 18 with respect to other transfers by fiduciaries or transfers by obligors; or (3) the minor's death. MCA §§ 72-26-604, 605, 606, 607, 803.

North Dakota

The custodian shall transfer custodial property to the minor or the minor's estate upon the earlier of: (1) the minor's attainment of the age of 21, with respect to custodial property transferred by gift, exercise of power of appointment, will, or trust; (2) the minor's attainment of the age of 18 with respect to other transfers by fiduciaries or transfers by obligors; or (3) the minor's death. NDCC §§ 47-24.1-04, 05