A UGMA account allows a donor to give cash or securities to a minor. The minor is the legal account owner, and a custodian is appointed to act as the responsible individual for the minor in financial matters involving this account.
A UTMA account is similar to an UGMA but extends the definition of gift to include real estate, paintings, royalties, and patents.
Qualification for a Uniform Gift to Minors Act or Uniform Transfer to Minors Act account depends upon the investor’s state of residence.
In all cases, there can be only one custodian and one minor on the account. Ownership of property is strictly the minor’s, and the custodian acts as a responsible individual (which is why all UTMA/UGMA accounts are reported under the minor’s Social Security number). Some states will allow the custodian to designate the age (usually between 18 and 25) when the minor can take the assets as their own.