Leaving money or property to a teenager can create an immediate concern: Who will protect the inheritance until the child is ready to manage it? In Nevada, the answer depends on the instructions in your will or trust and on whom you name to receive accounts or insurance benefits.
How a custodian manages the inheritance
Under Nevada’s Uniform Transfers to Minors Act, you can name an adult or trust company to manage the teenager’s property. This person or company is called the custodian. The teenager owns the property, but the custodian controls and manages it while the child is a minor. The custodian may:
- Keep the property separate from personal assets.
- Manage and invest the assets.
- Use funds for the teenager’s support, education or other needs.
- Keep records of money received, spent or invested.
In Nevada, a teenager becomes a legal adult at age 18, and the custodian generally transfers the property at that age. However, when an inheritance passes under a will, trust or other document that properly names a custodian, the document may allow the custodian to manage the property until a stated age, but no later than 25.
When another arrangement may control the assets
A trust gives you more control over when and how your teenager receives an inheritance. You can name a person or institution, called a trustee, to manage the property and give money or assets to your teenager according to your instructions.
If your will or trust allows this arrangement but does not name a custodian, the person handling the estate or trust may select one. In other situations, a court may appoint someone to manage the child’s property. This person is called a guardian of the estate and does not necessarily have responsibility for raising the child. The court supervises the guardian, who must submit financial records and may need court approval for certain decisions involving the property.
Match the plan to your teenager’s needs
The right arrangement may depend on your teenager’s age, maturity and the value of the property involved. Consider how much guidance your child may need and when they should take full control of the assets. Addressing those questions in your estate plan can give the person managing the property clear instructions and help your family avoid uncertainty later.
