Uniform Transfers to Minors Act (UTMA) accounts are owned by a minor, even though a parent or other adult acts as custodian. Once the minor reaches the age of majority (18 in most states), the funds belong to him/her. There are no tax penalties for withdrawals for any purpose—before or after the age of majority. However, custodians are subject to legal restrictions on the use of the funds. And financial institutions may impose penalties for early withdrawals from CDs or fees in other situations.
Long-term gain realized on the sale of depreciable realty attributed to depreciation deductions and subject to a 25% capital gain rate.