OLR Bill Analysis

sSB 1047

AN ACT CONCERNING THE CONNECTICUT UNIFORM TRANSFERS TO MINORS ACT.

SUMMARY:

The Uniform Transfers to Minors Act allows a person to transfer property to a custodian for the benefit of a minor. The custodian manages the property and can distribute money to or for the benefit of the minor.

Under current law, the custodian must transfer the property to the minor when the minor turns 21. This bill gives the custodian the option to distribute all or part of the property to a trust, at any time before the minor turns 21 and without court order, under certain conditions. The conditions are that:

1. the trust make the minor the sole beneficiary during the minor's life;

2. it meet federal tax provisions that require (a) the trust to authorize the property to be expended by or for the benefit of the minor before age 21 and (b) the property to pass to the minor at age 21 or the minor's estate if he or she dies before age 21, but the minor can extend the trust on turning 21; and

3. if the trust's terms give the minor the right to withdraw the assets at age 21, the trustee give the minor written notice by certified mail or similar means.

Regarding the right to withdrawal, the bill provides that the right does not lapse unless the minor receives notice and the time allowed for withdrawal is at least 30 days after the minor turns 21 or receives notice, whichever is later.

The bill provides that a distribution to a trust in this manner terminates the custodianship for the distributed property.

EFFECTIVE DATE: October 1, 2007

COMMITTEE ACTION

Judiciary Committee

Joint Favorable Substitute

Yea

42

Nay

1

(04/10/2007)