Uniform Transfers to Minors Act (Alabama)

Last Reviewed: May 2023

Please note that this is a specific discussion on UTMA minor accounts. For a general discussion of accounts for minors, please see the Minor Accounts topic.

The Alabama Uniform Transfers to Minors Act, A.C.A. § 35-5A-1, is a law that allows gifts to be made to a minor child without creating a trust for the child. A transfer may be made only for one minor, and only one person may be the custodian. Ala. Code § 35-5A-11. Once the minor turns 21, the child takes control of the money – there are no continued restrictions on how the money can be spent.

Print Summary

Uniform Transfers to Minors Act (Alabama): Summary

A custodian must take control of the custodial property, register/record title to custodial property if appropriate, and collect, hold, manage, invest, and reinvest custodial property. Ala. Code § 35-5A-13. A custodian must hold the funds for the minor child – the donor cannot also be the custodian. Once the minor reaches the age of 21, or dies, the custodian must transfer the custodial property to the minor or the minor’s estate. Ala. Code § 35-5A-21.

Responsibilities of a Third Person

A third person, such as a credit union, acting in good faith, may act on the instructions of or otherwise deal with any person purporting to make a transfer or purporting to act in the capacity of a custodian, and, in the absence of knowledge, is not responsible for determining:

The validity of the purported custodian’s designation;
The propriety of any act of the purported custodian;
The validity of any instrument or instructions given by the person purporting to make a transfer or by the purported custodian; or
The propriety of the application of any property of the minor delivered to the purported custodian. Ala. Code § 35-5A-17.

Print Laws & Regulations