Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Reallyalldone, thanks for the response. A couple of follow up points and questions:

It is legal but if the money created any kind of a trail for this year's tax return, don't be surprised if someone asks where it went.

The way the market has been lately, I'm not going to have a problem with showing year 2000 income from his account, while not having any year-end assets. Also, he will keep the individual gifts below $10,000 to avoid gift tax issues. If someone asks if he had more assets during the year than at the end of the year, I will, of course, tell them the truth. I'm sure lying crosses the threshold between illegal and simply structuring finances in the most favorable way possible.

Also, be careful that you're not playing games only to qualify for loans.

Why? This is exactly what I am doing. I'm just trying to determine if there is anything illegal in the strategy I am proposing.

Also, check your state for the age of majority - quite a few are 21.

I live in Texas and the answer is not obvious (at least to me). Texas switched from UGMA to UTMA in 1995. At that time the age switched from 18 to 21. Since his UGMA account pre-dates the switch, I'm not sure which age applies. The brokerage handling the account says that it is my option, but I'll consult with a pro before I do anything. If it has to be 21, then all bets are off.

Thanks again.

Gary
Print the post  

Announcements

Paying For School Guide
Trying to Tackle Tuition? The Motley Fool's Guide to Paying for School will help you fight those rising education costs.
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.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! 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.