Accounts, Trusts and Structured Settlements for a Child in Arizona

By the FigureMyTax Editorial Team · How we calculate

Arizona's rule does not use the phrase "blocked account." It lists a conservator, a trust, a 529 or ABLE account, a custodian, a payment under A.R.S. 14-5103 and a structured settlement, and lets the court choose.

The court's menu

Under Rule 53(d), after considering the amount and nature of the settlement, the child's age and sophistication, and living arrangements and needs, the court may: appoint a conservator; order a trust, including a special needs trust, under A.R.S. 14-5409(B); authorize a 529 or ABLE account, a pooled special needs trust or a dignity account; order distribution to a custodian under the Uniform Transfers to Minors Act; order distribution under A.R.S. 14-5103; approve a structured settlement; or enter any other authorized order. These options are listed in Rule 53.

A savings account in the child's name

Section 14-5103 lets a payer discharge its duty, up to $10,000 per year, by paying a parent or custodian, a guardian, or a federally insured savings account in the child's sole name with notice to the child. It does not apply if a conservator is appointed or pending. The recipient must protect the money, spend it only for the child's support and education if there is not enough other support, and turn any balance over at majority.

A conservator

A conservator may invest as a trustee would and may deposit estate funds in a federally insured institution without court authorization, but other actions need court approval (A.R.S. 14-5424). It adds supervision and cost, so courts tend to use it for larger amounts.

A trust or a UTMA custodian

A conservator can make an irrevocable transfer to a custodian for the child under A.R.S. 14-7656, but a transfer over $10,000 needs court authorization. Ask the court what the custodian can do and when the child gets control.

A structured settlement

A structured settlement uses an annuity the court approves to pay the child on a schedule, which protects against spending everything at once but is less flexible if needs change. The probate code also authorizes the court to approve entry into an annuity contract as a protective arrangement.

What we could not confirm

We did not find an Arizona rule that sets a single default account type, and local court practice may vary, so ask the judge or the clerk. Before choosing, read why a judge approves the settlement and how fees are reviewed, then see how much is left in the Arizona minor's settlement calculator.

This is general information, not legal advice, and the state comparisons above are illustrative, not an exhaustive survey. Confirm how Arizona's rules apply to your specific case with a licensed Arizona attorney.