Broad Authority with a Clear Boundary
Under Arizona law, UTMA custodians have significant flexibility. A custodian can buy, sell, invest, and manage custodial property. The custodian acts just as any unmarried adult owner would with their own assets.
There is no need to ask a court before making routine financial decisions. Unlike a formal trust, the custodian's authority is built into the statute itself.
A custodian, acting in a custodial capacity, has all the rights, powers and authority over custodial property that unmarried adult owners have over their own property, but a custodian may exercise those rights, powers and authority in that capacity only.
A.R.S. § 14-7663(A)The key phrase is "in that capacity only." A custodian cannot use the minor's property for personal benefit. The custodian must take every action in the custodial role.
For example, if a custodian sells an investment in a UTMA account, the proceeds belong to the minor. The custodian controls all investment decisions, but the minor receives all the benefits.
Accountability Still Applies
Having broad powers does not mean operating without limits. Arizona law still requires the custodian to follow the duties in the care-of-property statute.
This means the custodian must act prudently and keep property separate. The custodian must also maintain records and manage investments responsibly.
This section does not relieve a custodian from liability for a breach of section 14-7662.
A.R.S. § 14-7663(B)The custodian has freedom to act but remains answerable for those decisions. A custodian who invests recklessly or skips proper records could face liability.
When the minor reaches age 21, the custodian must hand over all custodial accounts and property. Until then, the custodian manages everything under the Arizona UTMA framework.