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About Custodial Accounts

Give a gift for the future

Custodial accounts let parents, grandparents, and others transfer and invest money for a minor. The accounts offer potential tax benefits and the flexibility to use funds for educational or non-educational expenses. 

What is a custodial account?

This simple way to transfer property to a minor is called a Uniform Transfer to Minors (UTMA) or Uniform Gift to Minors (UGMA) transfer depending in which state the minor resides.

Eligibility restrictions 

None 

Contribution age limits 

Generally up to age of majority (18 – 21) for your state

Maximum yearly contribution per minor

No limit. Donor can gift up to $15,000 ($30,000 for married couples who file jointly) without incurring gift-tax implications.

Minimum initial investment 

Varies by account from $0 to $100,000

Taxation of earnings and withdrawals

Earnings are taxable to the minor and could be subject to higher tax rates

Qualified withdrawals 

Funds can be used at any time but only for the benefit of the minor.

Penalties for nonqualified withdrawals 

Not applicable 

Ownership of assets (for financial aid)

The assets and any income generated in the custodial account are the student's for financial aid purposes

Commissions and fees 

Vary by account

Need advice? Ready to open a custodial account?
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Compare your options side by side

Custodial accounts, known as Uniform Transfer to Minors (UTMA) or Uniform Gift to Minors (UGMA) are different from college savings accounts. Learn more from our comparison table.

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With this kind of access, you can seamlessly navigate to Wells Fargo Mobile Banking to pay bills and transfer funds.