What is the Uniform Transfer to Minors Act?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 12 August 2019
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The Uniform Transfer to Minors Act, or UTMA, is a set of laws that are usually enacted at state level in the United States. Designed to protect the best interests of a minor child, the laws set standards and regulations for the distribution of assets that are held in the name of the child. At the same time, the Uniform Transfer to Minors act helps to define perimeters for the administration of those assets until the child reaches the age of majority and may assume control of the assets personally.

Laws that are designed to function within the broader perimeters of the Uniform Transfer to Minors Act will apply to any type of assets that are placed under the name of the minor child. This will include checking accounts that are set up for the child, and any funds that are deposited into the account. In like manner, savings accounts will also be protected under the terms of the act. Any stocks or bonds that are issued to the child will also find protection under these laws. This would include US savings bonds that may be purchased by a parent or relative and presented to the child.


The main purpose of the Uniform Transfer to Minors Act is to ensure that any assets that have been placed under the name of the child will be managed responsibly until the minor reaches legal age and can assume control of the assets personally. Generally, a custodian manages the assets during this interim period. The custodian may be a parent or other close relative. In the event that the minor does not have any close relatives, a legal guardian may be appointed to oversee the assets.

Under the provisions of this Act, the custodian is directly responsible for managing the assets in a manner that will benefit the child. In the context of assets such as checking or savings accounts, the custodian often has the authority to make use of those funds in ways that cover costs directly associated with the minor, such as school fees and tuition, clothing, shelter, or food. When dealing with stocks or bonds, the custodian would be able to buy or sell the instruments based on projections of what types of transactions would help to grow the investment portfolio.

The Uniform Transfer to Minors Act is very similar to another type of law also designed to protect the financial rights and assets of minor children. The Uniform Gift to Minors Act continues to govern this activity in many states, but has been replaced with versions of the Uniform Transfer to Minors format in a number of locations.


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Post 1

In Texas, if you transfer a vehicle title to a minor under the Texas Act, would only the custodian have to provide proof of a current insurance policy for title transfer purposes?

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