If property is left directly to a minor beneficiary through joint ownership, a payable on death account, the laws of intestacy, or an improperly drafted Last Will and Testament or Revocable Living Trust, the minor won't have the legal authority to take control of the property. What will happen to the minor's inheritance depends on the laws of the state where the minor lives when the inheritance is received.
UTMA, UGMA and 529 Accounts
If the value of the property left to the minor is not significant (such as $20,000 or less), then state law may allow an interested adult, such as the minor's grandparent or an aunt or uncle, to request that the minor's inheritance be placed in an account established under the state's Uniform Transfers to Minors Act, or UTMA for short, or Uniform Gifts to Minors Act, or UGMA for short. In addition, some states allow the interested adult to request that property be placed in a 529 account for the benefit of the minor.
Guardianships or Conservatorships
If the value of the assets left to the minor are too high to be placed in a UTMA, UGMA or 529 account, or if the laws of the state where the minor lives don't authorize these types of accounts for inherited assets, then a court-supervised guardianship or conservatorship must be established for the benefit of the minor.
If a probate estate has been opened for the deceased person's estate, then the court appointed personal representative or executor will need to file a petition requesting that a guardian or conservator be appointed on behalf of the minor.
If there isn't a probate estate, such as in the case of the minor being named as the beneficiary of a life insurance policy or retirement account, then an intersted adult, such as the minor's grandparent or an aunt or uncle, will need to file the petition.
A judge will then decide who will be appointed as the minor's guardian or conservator after hearing testimony from all interested persons, including the minor if he or she is over a specific age (such as 12 or 13 - this is determined by state law). After being appointed, the guardian or conservator will take over management and control of the minor's inheritance until the minor becomes an adult, which is 18 or 21 as also determined by state law.