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DLS reviews proposed 2026 updates to Uniform Transfers to Minors Act
Summary
The 2026 UTMA revisions modernize definitions, add electronic‑record accommodations, align custodial investment duties with the prudent investor standard, and let states set custodianship termination between ages 21–25; DLS staff noted Virginia already adopted some earlier updates.
Ryan Sims summarized proposed 2026 updates to the Uniform Transfers to Minors Act, describing stylistic modernizations (electronic records and formatting), new definitions (agent, guardian, minor with disability), and substantive changes enabling safer transfers to 529/ABLE and special‑needs accounts without terminating custodianship.
The draft adopts a ‘prudent custodian’ standard consistent with modern trust law and clarifies custodial authority over retained assets. It proposes bracketed thresholds for fiduciary transfers (the model shows $50,000 as a suggested bracket) and gives states discretion to set custodianship termination between ages 21 and 25 (the uniform draft uses 25 as a default). Virginia has previously updated its code (2014 and 2025 changes) and may already reflect or differ on some of the proposed bracketed amounts.
Commissioners noted the draft’s goal of simplification and modernization rather than radical overhaul; some states have adopted joint custodianship forms, but the model declines to make joint custodianship a default to avoid litigation between co‑custodians.
