My ex in-laws have a UTMA for my son. Am I required to report this when I fill out the FAFSA?
Yes, your son is technically the owner of the UTMA assets and will get control upon reaching the age of majority (usually 18 or 21, depending on state law).
His grandfather is telling me that I don’t have to report it on the FAFSA because it is considered a savings account, but everything I’ve read has stated that the UTMA can affect the amount of financial aid.
It can affect the amount of financial aid because it has to be reported.
That’s for question 42, investments, in the student section:
Thanks!
Note that UTMA funds deposited into a student-owned 529 account change the asset for FAFSA reporting purposes from a student asset to a parent asset, thereby decreasing the financial aid impact. If the money was given for college costs anyway and the UTMA funds are in a liquid asset (like a savings account), it’s pretty much a no-brainer to put them in a 529 account, as far as FAFSA is concerned (CSS Profile school treatment may be a different matter, depending on the school). If the UTMA funds are not in a liquid asset, you will have to look at capital gains implications before moving the asset to a 529 account, as 529 accounts can only accept cash contributions.
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