10 Jan At what age can an IRA beneficiary get control of the account?

Q. Someone I know is the beneficiary of an inherited IRA. He inherited it when he was 16. He’s now 19. The decedent lived in New Jersey. A custodian currently controls the IRA. At what age is the custodian supposed to surrender control to the beneficiary? The custodian believes it’s 21. I believe it’s 18.
— Confused

A. It’s a great question.

The age of majority can be confusing.

The age at which the custodian must surrender control to the beneficiary is determined by the state where the beneficiary resides, not where the decedent resided, said Howard Milove, a wealth advisor with Access Wealth in East Hanover.

“So if the beneficiary resided in New Jersey when the account was established, the age at which the custodial account must be turned over to the beneficiary is age 21,” he said.

But the correct age to consider can be confusing.

That’s because the age of majority is 18 in New Jersey for things like opening a new bank account, brokerage account or retirement account, as well as consenting to medical treatment without permission from a parent, Milove said.

“So based on this, if someone has a brokerage account that was opened when they were 15, and for which a custodial parent is named, they would have to wait until age 21 to gain full control,” he said. “But, upon turning 18, they can open their own brokerage account and take full control of their investments.”

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This story was originally published in January 2024.

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