Yes, a minor can have a bank account, but not on their own. Because people under 18 cannot sign an enforceable contract in most states, and a bank account agreement is a contract, banks require a parent or legal guardian to be on the account as either a joint owner or a custodian. No federal law bars a child from having an account; the barrier is state contract law, which is why the workaround is universal across the industry.1U.S. Department of the Treasury. Guidance to Encourage Financial Institutions Youth Savings Programs and Address Related Frequently Asked Questions A few states set the age of majority at 19 or 21, but the principle holds everywhere: an adult signs the paperwork, and the adult is who the bank looks to if something goes wrong.
Joint Account or Custodial Account
Banks offer two structures for children, and the choice matters more than most parents realize. Ownership, access, tax treatment, and financial aid all turn on which one you pick.
Joint Accounts
A joint account makes the adult and the minor co-owners with equal access. Either can deposit, withdraw, or spend with a linked debit card. The parent has full visibility and, depending on the bank, can set spending limits or transaction alerts. This is the common setup for everyday teen checking or savings, and it works well for teaching a child to manage money with a parent watching in real time.
The catch is shared liability. The adult is on the hook for any negative balance the child creates, and because both names are on the account, a creditor pursuing the adult may be able to levy funds the child deposited. More on that below.
Custodial Accounts Under the UTMA
Custodial accounts follow the Uniform Transfers to Minors Act, which most states have adopted. The child is the legal owner of the money for tax purposes, but a designated custodian manages the account and controls every transaction until the child reaches the age set by state law. The child has no direct access. No debit card, no independent withdrawals.
The custodian has a fiduciary duty to manage the money in the child’s interest, not for the custodian’s benefit. When the child reaches the termination age, which ranges from 18 to 25 depending on the state, ownership and control transfer automatically and irrevocably.2Legal Information Institute. Uniform Transfers to Minors Act There is no way to delay that handover beyond what state law allows, and no way to pull the money back once the account is funded.
Custodial accounts avoid the overdraft and spending problems that come with a joint account, but they lock the parent out of ever recovering the funds. For a child learning to spend responsibly, a joint account is usually the fit. For long-term savings the child should not touch, custodial fits better.
What to Bring to Open the Account
Federal banking rules require every institution to collect four pieces of identifying information from each customer: name, date of birth, address, and a taxpayer identification number.3eCFR. 31 CFR 1020.220 – Customer Identification Program Requirements for Banks That applies to both the child and the adult. In practice, plan to bring:
- For the minor: Social Security number (or ITIN), plus a birth certificate or passport to verify name and date of birth.
- For the adult: Social Security number, a government-issued photo ID such as a driver’s license or passport, and proof of address like a utility bill or mortgage statement.
The taxpayer identification number is how the bank reports interest income to the IRS. For U.S. citizens and residents that is a Social Security number. If the child does not have one, many banks accept an ITIN, and some accept a passport number with country of issuance or an alien identification card number.4Consumer Financial Protection Bureau. Can I Get a Checking Account Without a Social Security Number or Drivers License
One thing that surprises parents: the bank runs the adult’s information through ChexSystems, which tracks banking history the way credit bureaus track borrowing. If the adult has an unresolved negative item, such as an old account closed with a balance owed, the application can be denied even though the account is for a child. Credit unions and banks that offer second-chance accounts tend to be more flexible on this.
How the Opening Process Works
You can open most youth accounts in a branch or online, though some banks still require an in-person visit because both the adult and the child may need to sign a signature card. Online applications walk you through uploading ID photos and end with a confirmation once verification clears.
Many youth savings accounts require no minimum deposit. Some ask for anywhere from $5 to $100 at opening. Ask upfront so you are not scrambling at the counter. Once the account is funded, the debit card typically arrives within a week or two, and online or mobile banking access is usually available right away. After the card arrives, you activate it through the bank’s app, website, or phone line. Most banks let you set alerts for transactions above a chosen dollar amount, which is a useful safeguard for a first account.
Tax on the Interest the Account Earns
Interest a child earns is taxable income. For most children with ordinary savings balances, the amounts are small enough that no one owes anything extra. But the rules get sharper as the balance grows.
A dependent child whose only income is unearned, which includes bank interest, does not need to file a return if that income stays at or below $1,350 for the 2026 tax year.5Internal Revenue Service. Publication 501 – Dependents, Standard Deduction, and Filing Information At current savings rates, a child would need a balance well into the five figures before interest alone crosses that line.
Above $2,700 in unearned income, the “kiddie tax” kicks in. The portion above that threshold is taxed at the parent’s marginal rate rather than the child’s. It applies to children under 19, or under 24 if a full-time student, and requires the child to file their own return with Form 8615 attached.6Internal Revenue Service. Tax on a Childs Investment and Other Unearned Income (Kiddie Tax)7Internal Revenue Service. Instructions for Form 8615 A plain savings account rarely generates that much interest on its own, but if you also have a UTMA holding stocks, bonds, or mutual funds, the interest and dividends combine when measured against the limit.
If the child’s only income is interest and dividends totaling less than $13,500, you can elect to report it on your own return using Form 8814 instead of filing separately for the child.8Internal Revenue Service. Instructions for Form 8814 Convenient, but not always cheaper. The first $1,350 reported this way is tax-free, and the next $1,350 is taxed at your rate, which may be higher than what the child would owe filing alone. Run the numbers both ways.
How the Account Affects Financial Aid Later
Where the money sits changes what the FAFSA does with it. Money in a UTMA counts as the student’s asset because the child is the legal owner, and student assets are assessed at 20 percent. Every $10,000 in a custodial account reduces aid eligibility by roughly $2,000. Parent-owned assets are assessed at only 5.64 percent, so the same $10,000 in a parent’s account reduces aid by about $564.9Federal Student Aid. Filling Out the FAFSA Form
A joint bank account with the parent as primary owner is generally reported as a parent asset and gets the lower rate. That is one of the less obvious reasons families expecting to apply for aid tend to prefer joint accounts over custodial ones. Once money is in a UTMA, you cannot simply move it back to a parent account without gift tax and legal complications, so this decision is easier to get right at the start than to fix later.
Risks for the Adult on a Joint Account
Putting your name on a joint account puts it there for every purpose, not just the ones you had in mind.
In most states, co-owners are presumed to have equal rights to the full balance. If a creditor gets a judgment against the adult, the creditor can typically levy the joint account, including money the child deposited. Some states cap the garnishment at half; others allow the whole balance. The burden falls on the non-debtor to prove which deposits were theirs, which is hard once funds are commingled over time.
Federal benefit payments like Social Security or disability keep their protected status in a joint account, and the bank must shield those funds from garnishment regardless of which owner is the debtor.10eCFR. 31 CFR Part 212 – Garnishment of Accounts Containing Federal Benefit Payments Money from a teenager’s part-time job or birthday gifts has no such protection.
The adult is also fully liable for any overdraft the child creates. If overdraft protection is linked to one of the adult’s other accounts, a teenager’s overspending can drain the backup too. If your child is new to spending, consider a joint savings account without a debit card, or a custodial account, until habits settle.
What Happens When the Child Turns 18
The transition is not automatic at every bank, and it depends on the account type. For joint accounts, many banks convert the youth account to a standard adult account, or prompt the new adult to open their own. The parent may need to formally ask to be removed, or the young adult can open a fresh account and close the old one. Either way, the bank treats the 18-year-old as a new customer for disclosure purposes and issues new agreements and fee schedules.
UTMA accounts work differently. When the child reaches the termination age set by state law, the custodian must transfer the assets to the young adult. The account does not convert; the custodian writes a check or initiates a transfer to a new account in the young adult’s name alone, and the custodial account closes. From that point on, the former minor has complete, unrestricted control of the money.
Either way, the switch from a fee-free youth account to a standard adult account often brings monthly maintenance fees, minimum balance requirements, and different overdraft policies. Shop around at the changeover rather than accepting the bank’s default adult account.