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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.

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