[Code of Federal Regulations]
[Title 31, Volume 2]
[Revised as of July 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 31CFR363.27]

[Page 485-486]
 
                  TITLE 31--MONEY AND FINANCE: TREASURY
 
         CHAPTER II--FISCAL SERVICE, DEPARTMENT OF THE TREASURY
 
PART 363_REGULATIONS GOVERNING SECURITIES HELD IN TREASURYDIRECT--Table 
of Contents
 
Subpart B_General Provisions Governing Securities Held in TreasuryDirect
 
Sec.  363.27  What do I need to know about accounts for minors who have 
not had a legal guardian appointed by a court?

    (a) We do not permit a minor to purchase securities.
    (b) Opening an account in the name of a minor. (1) A parent or a 
person who provides the chief financial support of a minor may open an 
account for a minor. The person opening the account for a minor is 
referred to as the custodian of the minor's account.
    (2) The custodian is a fiduciary for the minor as to the securities 
held in the minor's account.
    (3) The custodian must have an existing primary 
TreasuryDirect[supreg] account in order to open the minor's account.
    (i) The minor's account is an account that is linked to the 
custodian's primary account.
    (ii) The custodian must use his or her primary TreasuryDirect 
account as a portal to open and access the minor's account.
    (4) Securities contained in the minor's account will be registered 
in the name and SSN of the minor, in either sole owner, owner with 
beneficiary, or primary owner with secondary owner forms of 
registration.
    (c) Procedure for opening an account for a minor. (1) Online 
instructions will be provided for establishing an account for a minor.
    (2) The custodian must certify that all transactions conducted 
through the account will be on the minor's behalf.
    (d) Procedure for conducting transactions in the minor's account. 
The custodian must conduct all transactions in the minor's account on 
behalf of the minor. Access to the minor's account is through the 
custodian's primary account.
    (e) Transactions permitted in the minor's account. (1) The custodian 
may purchase securities for and on behalf of the minor through the 
minor's account.
    (2) The custodian may redeem savings bonds on behalf of the minor 
through the minor's account. We will report the interest earned on the 
security to the name and SSN of the minor.
    (3) The custodian may not purchase gift savings bonds from the 
minor's account.
    (4) The custodian may transfer a security to another TreasuryDirect 
account, provided the account is a linked account bearing the name and 
taxpayer identification number of the minor. The custodian can transfer 
a marketable Treasury security to an account in Legacy Treasury Direct 
or the commercial book-entry system, and may request a Sell Direct 
transaction.

[[Page 486]]

    (5) Securities may be transferred to the minor's account.
    (6) Gift savings bonds may be delivered to the minor's account.
    (7) The custodian may grant rights to view and conduct transactions 
in the security as may be permitted by Sec.  363.22.
    (8) The custodian may purchase a certificate of indebtedness on 
behalf of the minor. The certificate of indebtedness is the property of 
the minor.
    (f) When the minor reaches the age of 18 years. (1) The only 
transactions that the custodian may make in the minor's account after 
the minor attains the age of 18 years are to purchase new securities, 
and to transfer the securities contained in the minor's account to 
another account in the name and SSN of the minor. The receiving account 
in the name and SSN of the minor may be a primary account established by 
the minor, or it may be another minor linked account with the same or a 
different custodian. The custodian may transfer one or more of the 
securities at a time, or the custodian may de-link the account and 
transfer all of the securities contained in the account to the minor's 
previously established primary TreasuryDirect account. The minor must 
establish his or her own primary TreasuryDirect account prior to 
transfer of his or her securities.
    (2) In order to gain control of the securities held in the minor's 
account, the minor must first open his or her own primary account.
    (3) The minor may gain control of the securities held in the minor's 
account by the custodian transferring the securities held in the minor's 
account to the minor's primary account, or the minor may request that 
Public Debt transfer the securities to his or her primary account.
    (4) The minor may gain control of his or her certificate of 
indebtedness by the custodian de-linking the account and transferring 
the certificate of indebtedness to the minor's primary account, or the 
minor may request that Public Debt de-link the account and transfer the 
certificate of indebtedness to his or her primary account.
    (g) Liability. We rely on the certification of the custodian that he 
or she is acting on behalf of the minor. We are not liable to the minor, 
or any other person or party acting on behalf of the minor, for the 
actions of the custodian, nor are we liable for the application of any 
proceeds from the transfer or redemption of securities held in the 
minor's account. The custodian agrees to indemnify and hold harmless the 
United States in the event that we suffer any loss on account of any 
claim relating to a minor account.

[69 FR 2507, Jan. 16, 2004, as amended at 69 FR 50309, Aug. 16, 2004; 70 
FR 57443, Sept. 30, 2005]