SIE practice questionmediumCustodial Accounts and Minor Rights
In a UGMA/UTMA custodial account, which statement is TRUE regarding the minor's rights?
- AThe minor can direct investment decisions at any age.
- BThe minor becomes the legal owner when reaching the age of majority.✓ Correct answer
- CThe custodian is not responsible for the investments.
- DThe account can be closed only with court approval.
Explanation
Why B — The minor becomes the legal owner when reaching the age of majority.
Ownership transfers to the minor at age of majority. Minors can’t direct the account (B). The custodian is responsible for management (C). Court approval isn’t needed to close at majority (D).
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