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UTMA accounts

Cape Coral, FL |

can i set up a UTMA account without having the possibility of the investment/growth/interest etc, in it come back into my estate, (if i expire before the UTMA minor i mean )...for estate tax purposes ......example.

1. life insurance is bought /purchased by insured, my wife appoints me as custodian, she sets up a checking account at insurance company under the UTMA name , strictly for the gift/premium, she uses her $13,000 annual gifting to pay premium, deposits the money 40 days in advance...,( plus sending a crummy like notice to custodian ).. of premiums due date into checking account at insurance company then on policies due date insurance company withdraws the money and pays the premium automatically, , then next year the same etc etc etc., Is this ok..

i forgot to point out there is also a successor custodian in place, my grand childs father....

Attorney Answers 2


Under the limited facts provided, this sounds like it would work just fine. If set up properly, the insurance might never be part of the taxable estate for estate tax purposes, (such as in an irrevocable life insurance trust).

It almost goes without saying, but you would want all of this set up by an attorney. This is more complex estate planning to start with. It is too easy to miss something and have your entire intent undone.

James Frederick

*** LEGAL DISCLAIMER I am licensed to practice law in the State of Michigan and have offices in Wayne and Ingham Counties. My practice is focused in the areas of estate planning and probate administration. I am ethically required to state that the above answer does not create an attorney/client relationship. These responses should be considered general legal education and are intended to provide general information about the question asked. Frequently, the question does not include important facts that, if known, could significantly change the answer. Information provided on this site should not be used as a substitute for competent legal advice from a licensed attorney that practices in your state. The law changes frequently and varies from state to state. If I refer to your state's laws, you should not rely on what I say; I just did a quick Internet search and found something that looked relevant that I hoped you would find helpful. You should verify and confirm any information provided with an attorney licensed in your state.

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I agree with attorney Frederick and concur that you definitely need an attorney to help set this up correctly.

The answer given does not imply that an attorney-client relationship has been established and your best course of action is to have legal representation in this matter.

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