Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax
This answer was rated:

What are the rules for a utma account. California. Can i pay…

What are the rules...

What are the rules for a utma account

Accountant's Assistant: Because laws vary from place to place, can you tell me what state this is in?

california

Accountant's Assistant: Has anything been filed or reported?

No

Accountant's Assistant: Anything else you want the lawyer to know before I connect you?

Can i pay her medical bills from this account

Show More
Show Less
Ask Your Own Tax Question
Answered in 3 minutes by:
11/17/2017
Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,372
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA
Verified

Welcome to JustAnswer! My name is ***** ***** I will be able to assist you today

UTMA rules vary for state to state so please give me a moment to look up the specific regulations for California regarding medical bill payments.

Ask Your Own Tax Question
Customer reply replied 3 months ago
ok i will wait
Customer reply replied 3 months ago
are you there?

As you know, but it is important to remember UTMA custodial accounts allow adults to make a financial gift to a minor, and also name someone (including themselves) as the custodian of the account. The important word here is “gift.” The money in these accounts, once given, is the legal property of the minor.

___

There are no IRS penalties on taking money out of a UGMA account.

___

The donor nor the custodian can place any restrictions on the use of the money in the account once the minor becomes an adult. At that time, the child can use the money for whatever purpose they please.

In California, the age limit is 18-25, (depending on if the minor goes to college or not) which means that a UTMA account established in California must end before the minor reaches age 18-25

Ask Your Own Tax Question

The minor can use the money to pay the medical bills if that is what the minor chooses to do with the money

Ask Your Own Tax Question

If the minor is under the age of 18 then the custodian of an UTMA account has the right to collect, hold, manage, invest and reinvest a minor's property. They must act honestly and prudently

Ask Your Own Tax Question

I would be happy to clarify or expand my answer above if you have any additional questions

Ask Your Own Tax Question

At the conclusion of our conversation please take a moment to accept the answer by rating the answer with three stars or more.

A positive rating of five stars is always appreciated. Thank you!
Ask Your Own Tax Question

Do you have any further questions that I may assist you with?

Ask Your Own Tax Question

If you have no further questions please take a moment to accept the answer so I may be compensated for my work.

Thank you!

Ask Your Own Tax Question
Customer reply replied 3 months ago
Thank you - so as a custodian I can or cannot use these funds for her medical expenses?

You can as long as you are acting honestly and prudently as the custodian

Ask Your Own Tax Question
Customer reply replied 3 months ago
Can I use the CUTMA (California) to use for her medical bills - she is 8

Generally, medical bills are the responsibility of the parents of the child who is 8 years old and using the minor's funds in a CUTMA may be perceived as an abuse of a parents/custodians fiduciary duties.

When the minor is under the age of 18, the custodian of the CUTMA account has the right to collect, hold, manage, invest and reinvest.

The funds are from an irrevocable gift to the minor.

If the parents are responsible for the medical bills then it has generally been ruled that the parents must pay the medical bills without using the CUMA funds of the minor

Here is an example in which a man gifted cash from the proceeds of a sale of the family business to his granddaughter, naming his son as custodian.

"The son used some of the money to pay for the daughter's medical and dental bills, among other things. When his daughter sued him for raiding her accounts, he lost because it is considered duty of the parent to pay for those things as a matter of basic child support; not the responsibility of the minor to cover them. He was ordered to pay restitution, plus the amount of investment income the minor would have enjoyed under a reasonable compounding schedule, plus all of her legal fees. Additionally, he was removed as custodian due to his mishandling."

https://www.thebalance.com/spending-childs-utma-money-illegal-358134

Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,372
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA
Verified
Chad EA, CFP ® and 87 other Tax Specialists are ready to help you
Ask your own question now
Ask Chad EA, CFP ® Your Own Question
Chad EA, CFP ®
Chad EA, CFP ®
Chad EA, CFP ®, Enrolled Agent
Category: Tax
Satisfied Customers: 1,372
1,372 Satisfied Customers
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA

Chad EA, CFP ® is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,312 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,362 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

14,120 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,652 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Has the IRS made any ruling on the deduction of state
Has the IRS made any ruling on the deduction of state withholding tax and real estate taxes on Schedule A for 2018. Will there be a requirement to deduct withholding in total before moving to real est… read more
abci168
abci168
Principal
27 satisfied customers
We are selling a property that was half owned by my in laws
We are selling a property that was half owned by my in laws in a trust that was created in Dec. 2016 (now both deceased) and half owned by my husband. The property was acquired in 1985 for $140,000; m… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
Can assisted living expenses be used as medical expense for
Can assisted living expenses be used as medical expense for taxes … read more
Dr. Fiona Chen
Dr. Fiona Chen
President
Ph.D.
736 satisfied customers
Another expert referred me to the State of California online
Another expert referred me to the State of California online resource to file my 2016 State Taxes. Since I had self employment I am unable to file online. Please let me know where I can get the forms … read more
Dr. Fiona Chen
Dr. Fiona Chen
President
Ph.D.
736 satisfied customers
Is Medical Mileage included in the .5% medical deductions or
Is Medical Mileage included in the .5% medical deductions or is a separate deduction … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Do people over 65 add back 2% of medical expenses for in
Do people over 65 add back 2% of medical expenses for AMT in 2018? … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
14,120 satisfied customers
California State Tax We moved to California from August 2016
California State TaxWe moved to California from August 2016 till March 2017. Are we liable for California State Taxes during this time? We have an online business, in which all sales are from Thailand… read more
Carter McBride
Carter McBride
LLM
441 satisfied customers
Looking for tax law advise, California, I owe State and
I owe State and Federal Taxes for 2015 & 2016 and have worked out a monthly payment plan with the State but Federal is asking for a $6,100 lump sum by 1/28/18 before working out a monthly payment plan. If I cannot come up with the lump sum they will file a Notice of Federal Tax Lien that will be reported to the credit agencies. Is there any way to negotiate this? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Are non insurance covered medical expenses deductible? Are
are non insurance covered medical expenses deductible? … read more
abci168
abci168
Principal
27 satisfied customers
Is the deduction for medical expenses on Schedule A repealed
Is the deduction for medical expenses on Schedule A repealed under the new tax law & can health insurance premiums for a Schedule C proprietor still be deducted on page 1 of Form 1040?… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
14,120 satisfied customers
Can I deduct a medical expense in 2017 if paid in 2017 for
Can I deduct a medical expense in 2017 if paid in 2017 for my 2018 medical premiums . In other words, I am paying in advance.… read more
Chad EA, CFP ®
Chad EA, CFP ®
Enrolled Agent
1,372 satisfied customers
Can My Investment properties be taken for payment of medical
Can My Investment properties be taken for payment of medical bills in California? … read more
abci168
abci168
Principal
27 satisfied customers
How is the California state income tax calculated? I have
How is the California state income tax calculated? I have approximately $55,000 of income before deductions. I am married filing jointly.… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,283 satisfied customers
What is the substative regulation pursuant to assessment of
what is the substative regulation pursuant to assessment of income tax, published in the Federal register, according to 26 usc 6323 (1.6323) … read more
Carter McBride
Carter McBride
LLM
441 satisfied customers
Is there a way to carry over medical expenses to subsequent
Is there a way to carry over medical expenses to subsequent years taxes? I know the answer is typically no but we will have very high expenses. Specifically, we will have roughly $1.5 million in medic… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Non grantor trust pays qualified medical expenses for
Non grantor trust pays qualified medical expenses for beneficiary. Since the trust can not deduct, are the expenses deducted on the beneficiary's 1040 as qualified medical expenses? … read more
Dr. Fiona Chen
Dr. Fiona Chen
President
Ph.D.
736 satisfied customers
I had approximately 7000 in medical expenses that weren't
thank you. I had approximately 7000 in medical expenses that weren't paid by my insurance company, deductibles and such. Can I claim them on my taxers … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
14,120 satisfied customers
Turbo tax states we need $8469 in medical expenses. We have
Turbo tax states we need $8469 in medical expenses. We have $10736.00 in medical expenses. Turbo Tax states we do not qualify, why?… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x