Under Maryland law, a child under the age of eighteen cannot inherit property in his or her own name. An adult must be designated to manage the assets inherited. Depending on how the inheritance occurs it will impact the manner in which it is managed on the child’s behalf.
A will that leaves an inheritance to a minor typically does so by creating a testamentary trust naming a person to serve as trustee. If the child inherits through a trust, the trustee will manage the property in accordance with the terms of the trust.
If a child inherits by way of a will that does not include trust language or via Maryland’s laws of intestate succession because the decedent died without a will, then the court will appoint a guardian of the estate to manage assets in the best interests of the minor beneficiary. This is a fiduciary role requiring the guardian to submit formal annual accountings.
Occasionally, a will may be drafted to leave money to a minor under the Maryland Uniform Transfers to Minors Act and designate who should serve as custodian. The custodian can collect and manage the assets which can be used only for the minor’s benefit.
A brief recap of the differences between inheritances managed by:
Custodians: (Under the Maryland Transfers to Minors Act)
Trustees:
Court-Appointed Guardians:
If your estate planning includes leaving assets to minors or if a loved one has passed away and a minor beneficiary is involved, please set up a consultation with Stouffer Legal at 443-470-3599 in the Greater Baltimore area to discuss the matters with an experienced estate planning or probate attorney.
