My brother is 17 and he is interested in opening a high yield savings account after I told him about mine.
Rather than getting 1% APY from capital one 360, he is interested in an Ally account for 2%. However, I called and they don't have a minor account, just the Uniform Gifts to Minors account. I have an account with both.
With the UGMA, he could give me the money and then I would transfer into the UGMA. He's OK with not having access to the money until he turns 18.
He works about 10 hrs a week at a coffee shop. He will probably put away a few thousand in a year. I'm wondering if there is a downside of using the UGMA like a savings account, as far as taxes for him and for me. I'm thinking he'd be taxed like he was receiving a gift when he turns 18?
Submitted November 23, 2018 at 09:51AM by tinkerfunk https://ift.tt/2QgHOo3
