What are restrictions for withdrawing money from a custodial account?
Money deposited into a custodial account immediately becomes the property of the minor. The assets cannot be taken back or given to someone else. However, withdrawals can be made if the money will be used for benefit of the minor for whom the account was opened.
Examples of eligible expenses include education and childcare.
This differs from 529 and Coverdell plans. In the case of 529 plans, withdrawals can only be made for eligible higher education expenses. In the case of Coverdell plans withdrawals can only be made for K-12 and higher education eligible expenses.
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