About a year ago, my mother very graciously gifted my children money into a UTMA account with Edward Jones. The obvious and stated use of the money was for higher education. I don't believe my mother would have known the various types of accounts she could have used. I'm interested in why the Financial Advisor didn't suggest a 529.
Now, for various reasons, she's asking me to take over as custodian of the account. At this point, I'm not real sure how difficult it is to change custodians of a UTMA.
My Questions:
What are the tax implications for me? It seems like I would be paying taxes on the gains of the UTMA.
Are their benefits associated to keeping these UTMA accounts rather than transferring them to a 529?
Any other comments regarding UTMA vs. 529?
Being a fan of using Vanguard index funds, my initial thought when she asked me to take control of the accounts was to move the money out of the Edward Jones managed mutual fund and get it into VTSAX.
We're talking about two separate accounts, both currently around $24k. My kids are 3 and 5.
TIA
Now, for various reasons, she's asking me to take over as custodian of the account. At this point, I'm not real sure how difficult it is to change custodians of a UTMA.
My Questions:
What are the tax implications for me? It seems like I would be paying taxes on the gains of the UTMA.
Are their benefits associated to keeping these UTMA accounts rather than transferring them to a 529?
Any other comments regarding UTMA vs. 529?
Being a fan of using Vanguard index funds, my initial thought when she asked me to take control of the accounts was to move the money out of the Edward Jones managed mutual fund and get it into VTSAX.
We're talking about two separate accounts, both currently around $24k. My kids are 3 and 5.
TIA