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  #1  
Old 10-16-2008, 01:36 AM
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Minor Gift to Parents

What is the name of your state (only U.S. law)? California

I know you can gift up to $12k in 2008 without reporting to the IRS. In 2007, I opened a brokerage account (which I'm the custodian of) and gave my 2 year old $12k.

Now, I need the money to pay for a downpayment. Can I write a check of $12k as the custodian of my daughter's account payable to give the $12k from the minor back to me in 2008. Do I need to report anything to the IRS?
  #2  
Old 10-16-2008, 03:34 AM
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is this a UGMA/UTMA type account? If so. The money is an irrevocable gift to the child. The child can't give it back and as the custodian you can't take it. Any withdrawals have to be for the benefit of the child.
  #3  
Old 10-16-2008, 10:23 AM
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I agree with the prevous poster. It's not your money any longer. It is the child's. You have a fiduciary duty to the child in regards to the money and you will not be able, under CA law, to give yourself a gift without court approval.
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  #4  
Old 10-16-2008, 01:22 PM
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No, I just opened a Etrade brokerage account under my daughter's name. She's the account holder and I'm the custodian. So, can she write me a check to gift the $12k back to me this year?
  #5  
Old 10-16-2008, 02:54 PM
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What etrade calls a "custodial account" it is a UTMA account in California.
  #6  
Old 10-16-2008, 02:55 PM
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Quote:
Originally Posted by jlcl View Post
No, I just opened a Etrade brokerage account under my daughter's name. She's the account holder and I'm the custodian. So, can she write me a check to gift the $12k back to me this year?
This isn't the appropriate section for this. You're asking a question regarding the legality of your authority to operate your daughters account, which is not a tax question. That notwithstanding, if YOU are writing the check as custodian, I somehow fail to see how SHE is making the gift and from an ethical standpoint I find it absolutely horrific that you would give and then take back money from your child for a down payment.
  #7  
Old 10-16-2008, 04:50 PM
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Well it's loosely appropriate to discuss here. UTMA is pretty much a tax issue. It allows a custodial account with favorable tax treatment
  #8  
Old 10-16-2008, 07:23 PM
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Originally Posted by FlyingRon View Post
Well it's loosely appropriate to discuss here. UTMA is pretty much a tax issue. It allows a custodial account with favorable tax treatment
There is no favorable tax treatment for an UTMA as opposed to a non-UTMA account for a child.
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