Question: how utma accounts are taxed?
Answer: Because money placed in an UGMA/UTMA account is owned by the child, earnings are generally taxed at the child's—usually lower—tax rate, rather than the parent's rate. ... Up to $1,050 in earnings tax-free. The next $1,050 is taxable at the child's tax rate. Any earnings over $2,100 are taxed at the parent's rate.