Mississippi Administrative Code
Title 23 - Division of Medicaid
Part 103 - Resources
Chapter 4 - Countable Resources
Rule 23-103-4.20 - Uniform Gifts to Minors Act
Universal Citation: MS Code of Rules 23-103-4.20
Current through September 24, 2024
A. General.
1. Most states have adopted the Uniform Gifts
to Minors Act (UGMA) that permits making gifts that are tax free to minors. The
UGMA is sometimes called the Uniform Transfers to Minors Act.
2. Under the UGMA legislation:
a) An individual (donor) makes an irrevocable
gift of money or other property to a minor (the donee);
b) The gift plus any earnings it generates is
under the control of a custodian until the donee reaches the age of majority
established by state law;
c) The
custodian has discretion to provide to the minor or spend for the minor's
support, maintenance, benefit or education as much of the assets as he/she
deems equitable; and
d) The donee
automatically receives control of the assets when he/she reaches the age of
majority established by state law (age 21 in Mississippi).
3. A custodian of UGMA assets cannot legally
use any of the funds for his/her own personal benefit. Therefore, the assets
are not the custodian's resources and additions to, or earnings on the
principal are not income to the custodian who has no right to use them for
his/her own support and maintenance.
4. According to Mississippi state law, gifts
that are valid under the Mississippi Uniform Transfer to Minors Act must
reflect that the gift is being made under this Act. This means the gift(s),
e.g., annuity, CD, property, life insurance, etc., must be assigned in writing
and substantially worded to show the custodian's name, minor's name and the
designation that the gift is authorized under the Uniform Transfer to Minors
Act (in Mississippi, MS Code Ann., Section
91-20-19).
B. Treatment.
1. Additions to principal may be income to
the donor before becoming part of the UGMA principal.
a) Example: If the donor is a deemor who
receives rental income and adds it to a child's UGMA funds, consider the rental
income as income for deeming purposes.
2. Gifts made under the UGMA may involve a
countable transfer of resources to the donor, if applicable.
3. For minor donee, consider as income:
a) Custodian's disbursements to the minor;
and
b) Disbursements on behalf of
the minor used to make certain third party vendor payments.
4. For the minor donee, the
following is not income to the minor: :
a) The
UGMA property; and
b) Any additions
or earnings.
5. For the
donee at age 21, the following is applicable:
a) All UGMA property will become available to
him/her; and
b) All funds in the
UGMA will count as income the month the minor reaches age 21 and is a resource
thereafter.
6. The
document designating a UGMA transfer and ownership assigned in writing and
complying with the requirements of state law must be provided. If there is no
document designating a UGMA transfer, treat as though there is no
UGMA.
Social Security Act §1902 (r) (2); 42 CFR §435.601(b) (Rev 1994).
Disclaimer: These regulations may not be the most recent version. Mississippi may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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