Guardian of the Property of Minor Child (SCPA Article 17)
Countless articles are written about the importance of estate planning for parents and the need for a guardian of the property of minor child(ren). The articles state that it is important to have a Will with a Testamentary Trust for the minor child. In the absence of a testamentary trust, or in the absence of a Will, (and sometimes even if there is a Will with a testamentary trust) a person will need to petition to become the Guardian of the Property of the Minor pursuant to SCPA Article 17.
Why Do I Need to Become a Guardian of the Property of a Minor Child?
When leaving money to a minor, it is important to make sure that there is someone ready, willing and capable of managing the inheritance on behalf of the minor until they reach the age of majority (or older if you so designage) In New York, once someone attains the age of 18, they are considered an adult. As such, at the age of 18 they can manage their own money.
If a child is under the age of 18, they cannot collect the money until they are 18. Therefore, if there is money, life insurance, retirement proceeds, annuities, or any other type of assets left for a minor who is under the age of 18, that minor will not be able to collect the money until they are 18 on their own. In order to collect their assets, they will need to have an SCPA Article 17 Guardian of the Property appointed to act on their behalf.
Once the Guardian is appointed, the Guardian will have to collect and deposit the money into a joint account with the Clerk of the Court. Funds that are jointly deposited with the Clerk of the Court cannot be invested and cannot easily and readily be withdrawn. In fact, they can only be withdrawn with a Court Order.
As we have previously explained, in order to avoid having money deposited jointly with the Clerk of the Court, you may want to engage in estate planning and create a Will with a testamentary trust.
How Do I Become a Guardian of the Property Pursuant to SCPA Article 17?
In order to become Guardian of Property of Minor you will need to fill out some forms. Click here for a link to the forms. We can also help you prepare the forms. In addition to the forms, you will also have to fill out another form, the OCFS 3909. This form will list all of the individuals that live in the home with you and gets sent to the state for processing. The purpose of the form is to ensure that you and the rest of the individuals living with you have a clean background.
After you have filled out the forms, you have to file everything with the Surrogate’s Court in the County where the minor child resides. This may be different from the County in which the minor child may be entitled to receive property. For example, if one of the child’s parents dies in Staten Island but the child then goes to live with the surviving parent in Queens, the Guardian of the Property must be filed in Queens even though the Probate or Administration petition will be filed in Staten Island.
It is also worth noting that even if a Guardian of the Property of the minor child is appointed, the Court in the County where the Probate or Administration petition for the deceased person is pending, may still appoint a Guardian ad Litem.
Can I Avoid Petitioning for Guardianship of the Property?
In certain instances becoming guardian of the property of a minor is not avoidable. For example, if there is a trust where the minor child will be receiving distributions payable directly to them.
There are ways to avoid the need for guardianship of the property. For example, in New York there is the Uniform Gifts to Minors Act (UTMA) which allows a parent to establish a bank account on behalf of his/her child. This type of account can be set up at your local bank. However, as soon as the minor reaches age 18, he can access all of the funds. Another alternative might be to create a living trust to manage assets for your minor beneficiary. This type of trust is similar to a testamentary trust . However it is created during your lifetime and it will not be necessary to wait for court approval through a probate proceeding to manage the funds. You can also create a Will with a Testamentary Trust for the minor child.
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