How Do I Transfer Money Left in a Will to a Minor in Georgia?
Full Question:
Answer:
If you don’t wish to create a formal trust, you might set up an account under the Georgia Transfers to Minors Act. The most common trust for a minor is known as a custodial account (an UGMA or UTMA account). To establish a custodial account, the donor must appoint a custodian (trustee) and provide the name and social security number of the minor. The donor irrevocably gifts the money to the trust. The money then belongs to the minor but is controlled by the custodian until the minor reaches the age of trust termination. Custodial accounts are most often established at banks and brokerages.
Any money in custodial accounts for which you are the custodian will be counted as part of your taxable estate if you are the legal guardian of the child and the child has not yet reached the age of trust termination.
Please see the following GA statutes:
44-5-113. (a) A person having the right to designate the recipient of
property. . . .
(a) A person having the right to designate the recipient of property
transferable upon the occurrence of a future event may revocably nominate
a custodian to receive the property for a minor recipient upon the
occurrence of the event by naming the custodian, followed in substance by
the words: "as custodian for ________________(name of minor) under `The
Georgia Transfers to Minors Act.'" The nomination may name one or more
persons as substitute custodians to whom the property must be
transferred, in the order named, if the first nominated custodian dies
before the transfer or is unable, declines, or is ineligible to serve.
The nomination may be made in a will, a trust, a deed, an instrument
exercising a power of appointment, or in a writing designating a
beneficiary of contractual rights which is delivered to the payor,
issuer, or other obligor of the contractual rights.
(b) A custodian nominated under this Code section must be a person to
whom a transfer of property of that kind may be made under subsection (a)
of Code Section 44-5-119.
(c) The nomination of a custodian under this Code section does not
create custodial property until the nominating instrument becomes
irrevocable or a transfer to the nominated custodian is completed under
Code Section 44-5-119. Unless the nomination of a custodian has been
revoked, upon the occurrence of the future event the custodianship
becomes effective and the custodian shall enforce a transfer of the
custodial property pursuant to Code Section 44-5-119.
44-5-115. (a) A personal representative or trustee may make an
irrevocable. . . .
(a) A personal representative or trustee may make an irrevocable
transfer pursuant to Code Section 44-5-119 to a custodian for the
benefit of a minor as authorized in the governing will or trust.
(b) If the testator or settlor has nominated a custodian under
Code Section 44-5-113 to receive the custodial property, the transfer
must be made to that person.
(c) If the testator or settlor has not nominated a custodian under Code
Section 44-5-113, or all persons so nominated as custodian the before the
transfer or are unable, decline, or are ineligible to serve, the personal
representative or the trustee, as the case may be, shall designate the
custodian from among those eligible to serve as custodian for property of
that kind under subsection (a) of Code Section 44-5-119, which
designation may include the personal representative or the trustee.
44-5-116. (a) Subject to subsection (c) of this Code section, a
personal. . . .
(a) Subject to subsection (c) of this Code section, a personal
representative or trustee may make an irrevocable transfer to an adult or
trust company as custodian (which custodian may be the personal
representative or the trustee) for the benefit of a minor pursuant to
Code Section 44-5-119, in the absence of a will or under a will or trust
that does not contain an authorization to do so.
(b) Subject to subsection (c) of this Code section, a guardian may make
an irrevocable transfer to an adult or trust company as custodian (which
custodian may be the guardian) for the benefit of the minor pursuant to
Code Section 44-5-119.
(c) A transfer under subsection (a) or (b) of this Code section may
be made only if:
(1) The personal representative, trustee, or guardian considers the
transfer to be in the best interest of the minor;
(2) The transfer is not prohibited by or inconsistent with provisions
of the applicable will, trust agreement, or other governing instrument;
and
(3) The transfer is authorized by the court as in the best interest of
the minor if such transfer, combined with all prior transfers to the
minor under this Code section, in the aggregate exceeds $10,000.00 in
value.
44-5-119. (a) Custodial property is created and a transfer is made
whenever:
(a) Custodial property is created and a transfer is made whenever:
(1) An uncertificated security or a certificated security in registered
form is either:
(A) Registered in the name of the transferor, an adult other than the
transferor, or a trust company, followed in substance by the words:
"as custodian for _______________ (name of minor)
under `The Georgia Transfers to Minors Act'"; or
(B) Delivered if in certificated form, or any document necessary for
the transfer of an uncertificated security is delivered, together with
any necessary endorsement to an adult other than the transferor or to a
trust company as custodian, accompanied by an instrument in substantially
the form set forth in subsection (b) of this Code section;
(2) Money is paid or delivered to a broker or financial institution
for credit to an account in the name of the transferor, an adult
other than the transferor, or a trust company, followed in substance
by the words: "as custodian for _______________ (name of minor)
under `The Georgia Transfers to Minors Act'";
(3) The ownership of a life or endowment insurance policy or annuity
contract is either:
(A) Registered with the issuer in the name of the transferor, an
adult other than the transferor, or a trust company, followed in
substance by the words: "as custodian for _________________
(name of minor) under `The Georgia Transfers to Minors Act'"; or
(B) Assigned in a writing delivered to an adult other than the
transferor or to a trust company whose name in the assignment is followed
in substance by the words: "as custodian for ___________________ (name of
minor) under `The Georgia Transfers to Minors Act'";
(4) An irrevocable exercise of a power of appointment or an irrevocable
present right to future payment under a contract is the subject of a
written notification delivered to the payor, issuer, or other obligor
that the right is transferred to the transferor, an adult other than the
transferor, or a trust company, whose name in the notification is
followed in substance by the words: "as custodian for ________________
(name of minor) under `The Georgia Transfers to Minors Act'";
(5) An interest in real property is recorded in the name of the
transferor, an adult other than the transferor, or a trust company,
followed in substance by the words: "as custodian for
____________________ (name of minor) under `The Georgia Transfers to
Minors Act'";
(6) A certificate of title issued by a department or agency of a state
or of the United States which evidences title to tangible personal
property is either:
(A) Issued in the name of the transferor, an adult other than the
transferor, or a trust company, followed in substance by the words:
"as custodian for ____________________(name of minor) under
`The Georgia Transfers to Minors Act'"; or
(B) Delivered to an adult other than the transferor or to a trust
company, endorsed to that person, followed in substance by the words:
"as custodian for __________________ (name of minor)
under `The Georgia Transfers to Minors Act'";
(7) An interest in any property not described in paragraphs (1) through
(6) of this subsection is transferred to an adult other than the
transferor or to a trust company by a written instrument in substantially
the form set forth in subsection (b) of this Code section.
(b) An instrument in the following form satisfies the requirements of
subparagraph (B) of paragraph (1) and paragraph (7) of subsection (a)
of this Code section:
"TRANSFER UNDER THE GEORGIA
TRANSFERS TO MINORS ACT
I, ________________ (name of transferor or name and representative
capacity if a fiduciary) transfer to ____________________
(name of custodian), as custodian for ________________ (name of
minor) under `The Georgia Transfers to Minors Act,' the following:
(insert a description of the custodial property sufficient to
identify it).
Dated: ______________________
(Signature)
___________________ (name of custodian) acknowledges receipt of the
property described above as custodian for the minor named above under
`The Georgia Transfers to Minors Act.'
Dated: ______________________
_______________________________
(Signature of Custodian)"
(c) A transferor shall place the custodian in control of the custodial
property as soon as practicable.
44-5-124.
(a) A custodian may deliver or pay to the minor or expend for or apply to the minor´s benefit so much or the whole of the custodial property as the custodian considers advisable for the support, maintenance, education, and general use and benefit of the minor in such manner, at such time or times, and to such extent as the custodian may deem suitable and proper, without court order and without regard to:
(1) The duty or ability of the custodian personally or of any other person to support the minor; or
(2) Any other income or property of the minor which may be applicable or available for that purpose.
(b) On petition of an interested person or the minor if the minor has attained the age of 14 years, the court may order the custodian to deliver or pay to the minor or expend for the minor´s benefit so much of the custodial property as the court considers advisable for the use and benefit of the minor.
(c) A delivery, payment, or expenditure under this Code section is in addition to, not in substitution for, and does not affect any obligation of a person to support the minor.
44-5-130.
The custodian shall transfer in an appropriate manner the custodial property to the minor or to the minor´s estate upon the earliest of:
(1) The minor´s attainment of 21 years of age with respect to custodial property transferred under Code Section 44-5-114 or 44-5-115;
(2) The minor´s attainment of majority under the laws of this state other than this article with respect to custodial property transferred under Code Section 44-5-116 or 44-5-117; or
(3) The minor´s death.