Naming Minor Children as IRA Beneficiaries

A traditional IRA or a Roth IRA owner can name any adult as their IRA beneficiary. The IRS owner simply names an adult on the IRA beneficiary form. But this is not the case if the IRA owner wants to name a minor as beneficiary. When a minor inherits retirement dollars, the child is not legally able to make decisions with regard to finances. Some type of custodian or guardian will be needed. A potential problem is that not all IRA beneficiary forms allow nomination of a guardian.

Another option is to name a custodial account for the minor on the IRA beneficiary form. Custodial accounts established either the Uniform Gifts to Minor Act (UGMA) or the Uniform Trusts to Minors Act (UTMA) can be used for this purpose. The IRA owner names the custodian of the account on the IRA beneficiary form. Please click HERE to read more.