UGMA accounts

[imjulier]

Client swears that they have not claimed the interest on their UGMA account for several years but that they don't receive notices from 1099 matching from IRS. Client is actually an adult and SSN on form is theirs. Doesn't this have to be reported?

Thanks,

Julie

[kcjenkins]

It depends. How much interest are we talking about? Is the client the child or the parent? If the account is in the name and SSN of the child, then it does not have to be reported unless it's enough to require the child to report it, either normally or through kiddie tax, if high enough.

[imjulier]

Thanks KC. I knew the facts you are mentioning but this is a lttle different for me since the client is the "child" on the UGMA account but is also an adult and has significant income. They were given this UGMA account about 25 years ago by an uncle who has since passed away. So, it was set up as an UGMA and they haven't done anything to change that over all these years. Its only $60 so I'll report it for IRS matching purposes.

Julie