How a Custodian under the Uniform Transfers to Minors Act Manages Real Property for a Minor

1. Detailed Answer

When you leave real property to a minor in a will, North Carolina law generally requires creation of a trust or appointment of a guardian to manage that property until the child reaches legal age. If your will lacks proper trust language, the court may appoint a guardian of the minor’s estate under Chapter 35A of the North Carolina General Statutes. Guardianship involves court supervision, bond requirements and ongoing accounting and can prove costly and time-consuming.

Instead, you can use the Uniform Transfers to Minors Act (UTMA) to appoint a custodian in your will. Under Article 4 of Chapter 36A of the North Carolina General Statutes, a UTMA custodianship allows you to transfer real estate or other assets directly to a minor while designating an adult custodian to hold and manage those assets until the minor reaches the appropriate age. This process avoids formal guardianship and simplifies administration.

Key Features under North Carolina’s UTMA

• Custodian Appointment: Your will names the custodian who manages property solely for the minor’s benefit.
• Age of Distribution: By default, distribution occurs when the minor turns 21. You may specify an age up to 25. See N.C. Gen. Stat. § 36A-51(2).
• Powers of the Custodian: In addition to holding title, the custodian may sell, rent, mortgage, invest and reinvest real property if those powers appear in the will. See N.C. Gen. Stat. § 36A-49.
• Minimal Court Involvement: UTMA removes the need for annual accounting and court-ordered bonds unless the court finds cause.
• Flexible Distribution: You control timing and conditions of final distribution in your will without creating a formal trust document.

By including a UTMA provision in your will, you ensure seamless management of real estate for a minor. The custodian acts under state statute, not under trust law, so your property remains protected and used only for the child’s benefit until distribution.

2. Practical Tips for Using UTMA in Your Will

• Clearly identify the minor and custodian by name and relationship.
• Describe the real property with legal description and parcel number.
• Grant the custodian specific powers to manage, lease or sell property as needed.
• State the distribution age (between 18 and 25) and any conditions for early distribution.
• Review your will regularly to confirm the custodian remains willing and able to serve.

Call to Action

Leaving real property to a young beneficiary without proper planning can trigger costly guardianship or leave your intent unclear. A UTMA custodianship provides an efficient, court-approved path to manage assets for a minor under North Carolina law. At Pierce Law Group, our attorneys guide you through every step of will preparation and probate administration. Contact us today by emailing intake@piercelaw.com or calling (919) 341-7055 to protect your legacy and your loved one’s future.