How to Open a Blocked Trust Account or Coogan Account For Your Child

By Leslie Bloom - Updated October 10, 2018
Portrait of a girl inserting coins into a piggy bank

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When your child enters the world of acting or modeling, it can be hard to not see dollar signs in your eyes. Landing one big commercial or advertising campaign can make a substantial deposit into your child’s college fund. And while it can also look like money for a house remodel or a business investment, there are strict rules for the use of money earned by kids in the entertainment industry.

Many states require blocked trust accounts for any minors in the entertainment industry to ensure that the money they earn is safeguarded from misuse. That means that any money your child earns through the work they do is theirs, and a portion of it must be held in an account for them until they turn 18.

What Is a Blocked Trust Account?

A blocked trust account, also known as a Coogan Account, is required in several states: California, Louisiana, New York and New Mexico. Since minors have no legal authority over their earnings, blocked trust accounts were established so that their earnings cannot be squandered.

Fifteen percent of everything your child earns working in the entertainment industry must be deposited into a blocked trust account. Your child’s employer must withhold the 15 percent and deposit it into your child’s Coogan Account within 15 days of hiring.

It is your job to open a blocked trust account and provide the account number to your child’s employer.

How to Set up a Coogan Account

The requirements for setting up a Coogan Account depend on the state. Even if you don’t live or work in one of the states where it’s required, you still have to establish a blocked trust account for your child based on the headquarters of the hiring company.

In California, you must open a blocked trust account with a bank, credit union or brokerage firm located in the state. In Louisiana, you can open a blocked trust account with any bank in any state. In New Mexico, you need to establish a Coogan Account only if your child earns more than $1,000 on a job.

In New York, you do not open a true Coogan Account, but a custodial account under the Uniform Gift to Minors Act or the Uniform Transfers to Minors Act. This can be opened with any bank in any state.

To open a Coogan Account, you typically need your child’s Social Security number, birth certificate and proof of your identity. There may also be a fee and deposit required when you open an account. You may be able to establish the account in person, by fax or by mail. The actual requirements depend on the bank, credit union or brokerage firm you choose.

What Banks Have Coogan Accounts

Not all banks offer blocked trust accounts, so you should do a search for banks or other financial institutions near you that offer them. You can open a Wells Fargo blocked trust account or a Coogan trust account at Bank of America, which are two banks with branches nationwide. However, a Coogan Account at Chase is not currently available.

To open a Wells Fargo blocked trust account, your child must be either currently employed or have an offer of employment. Your child cannot just be signed by a talent agent to open a Wells Fargo blocked trust account.

You can apply for a Coogan trust account at Bank of America online. You just need to enter personal information for you and your child, including Social Security numbers and your address. You’ll have to open a Coogan trust account at Bank of America in person if you make a large initial deposit or have limited credit history.

To determine the financial institution where you want to open a Coogan Account, search online for banks or credit unions near you that offer them. Though you can’t currently open a blocked trust account at Chase, that doesn’t mean it won’t change its policy in the future.

Read through the specific requirements and submit everything you need to open the account. Once the application is submitted, you’ll need a letter from the bank stating that you’ve opened a blocked trust account, which you will then submit to your child’s employer.

About the Author

Leslie Bloom earned a J.D. from U.C. Davis’ King Hall, with a focus on public interest law. She is a licensed attorney who has done advocacy work for children and women. She holds a B.S. in print journalism, and has more than 20 years of experience writing for a variety of print and online publications.

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