Custodial account

Custodial accounts are created for the benefit of minors, or as a product of a gift given to a minor by an adult. Any transfer of property to a custodial account is irrevocable. The minor will come into full ownership of any assets in the accounts whenever they turn 18. Earnings accumulate tax-free and withdrawals remain tax-free if they are used for higher education expenses for the beneficiary (minor). These types of accounts are often used for a child’s education.