College Savings Trust Account - AML Requirements

[ComplianceAH]

Do contributors to a college savings trust have to be ran through AML or does just the account holder need to be ran?

[dcandmc]

What do you specifically mean by "college savings trust"?

By AML do you mean Anti-Money Laundering rules?

[ComplianceAH]

By "College Savings Trust" I mean a college savings account created by parents for their children, where other people can contribute to the account. Such as grandparents, aunts, friends...etc.

Yes, I am asking in regards to Anti-Money laundering.

[dcandmc]

There are many different kinds of accounts that could be created or opened by parents to serve as a "college savings account" for a child. A regular bank savings account, a 529 account, a Coverdell ESA, a UTMA/UGMA account, a brokerage account, an actual Trust account, etc. I really think that you have to be much more specific about what type of account you are asking about in order to get answers that correctly address your concerns regarding AML rules.

[Brian_Boswell_SFC]

Greetings @ComplianceAH:

529 savings accounts, Coverdell ESAs, Rotha IRAs, and Traditional IRAs are all subject to AML rules and regulations. UGMA/UTMAs are trust accounts, but are typically set up with a bank or brokerage, which would therefore be subject to AML.

I can tell you from my days at Ascensus College Savings that AML is taken very seriously by 529 providers.

Thank you,

Brian Boswell VP, Research & Development

This information does not constitute tax advice and is provided for informational purposes only. Please consult your tax advisor, financial advisor, local taxing authority, and/or plan provider or sponsor for more information.