Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next
Author: Kimbers Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121477  
Subject: Re: UGMA and Taxes? Date: 1/17/2000 8:31 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Thank you ... to be perfectly honest, I hadn't even considered the possibility that someone else might contribute, given the current family monetary capabilities. However, it won't always be that way, I hope.

I intend to keep earned income to a minimum anyway, so informing the parents of that amount doesn't really bother me.

-- Kimberly

<<I too, would be interested in knowing about this. My husband and I are setting up custodial accounts for our nephews. However, we don't want to have to keep the parents fully informed as to how much money is in those accounts.>>

It's not the MONEY in the account that's important...it's the EARNINGS of the accounts (dividends, interest, and capital gains/losses) that are important. And you'll certainly want to make the parents aware of that information.

<<What responsibilities do we have for keeping them informed if the earnings are well below the ~$600 minimum for taxes?>>

But how about if there are 20 other people out there that feel like you do. And each of the 20 other custodial accounts earn only a measly $100? Add 'em all up and a return will be required. And if one isn't filed, the parents will get a lovely surprise in the form of a notice from the IRS (attached to a bill for taxes due). Not a pretty sight.

<<Does the tax return have to filed no matter what the earnings are, or only when tax becomes due?>>

Only when required. But again...what if there are more people out there with custodial accounts for the kid that feel exactly like you do? And nobody talks to anybody? Could be a problem.
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next

Announcements

Disclaimer:
In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Post of the Day:
Macro Economics

Implications of the Ballad of Ted Plotz
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement