New Law: Debit cards OK for custodial accounts

For those who manage a custodial account of a loved one, making purchases and transferring funds will be a little easier.

A new law signed by Gov. Tim Pawlenty April 17 allows the use of a debit or credit card to make payments from custodial trustee accounts. Until now account custodians were permitted to withdraw funds or make payments from the account by check only. This statute is part of the Uniform Custodial Trust Act, adopted in 1990.

Rep. Steve Simon (DFL-St. Louis Park), who sponsors the law with Sen. Ron Latz (DFL-St. Louis Park), said that with fewer retailers willing to accept checks, this “moves us into the 21st century.” Supported by senior advocate groups, this change will also make it harder for others to get away with fraud and theft, Simon said.

The law is effective Aug. 1, 2008.

HF3457/SF3070*/CH201