BizParentz Foundation

Supporting families of children working in the entertainment industry

Trust Accounts



The one thing that most people have heard of in regard to child actors are the laws which are in place to protect their earnings.  In California, it is typically called Coogan’s Law, named after Jackie Coogan.  Other states may refer to it as a Performers Trust Account.

CALIFORNIA (and most major studio contracts, even if they film in others states)  

In order to understand the specifics of the California law, it’s helpful to take a look at a little history.  Prior to 2000, the laws that governed mandatory trust accounts for child performers only effected work that was going to be subject to a court ordered contract.  It didn’t include most commercials, or background work, or even some smaller film and tv roles.  At that time the Coogan Account requirements and deposit information were included in the wording of the contract.  This made it very clear to the employer where the money was to be distributed.

In 2000, there were amendments to the Coogan law that made the mandatory withholdings applicable to ALL work in the entertainment industry (SB1162).   At this point, it began to apply to commercials, background work, modeling and all television and film roles.   While it may seem that it was best to protect ALL child performers earnings, there was a fundamental problem because there was no specific system created (remember, the court ordered contracts were available before).  There were requirements about providing trust account information to employers, but no standardized form or method to do so.  Including more child performers in the requirement also greatly increased the volume of deductions and deposits.  

Also note, the 2000 amendment also made ALL of the earnings of the minor child belong to the child.  The child owns 100% of their earnings.   This is unique to California, and is an exception to the laws in all other states where money earned by a minor belongs to the family.

In 2004, more amendments were required because, not too surprisingly, the Coogan system was not sufficient to handle the volume and various account documents (SB210).  Producers were holding money that they had withheld from child performers, but were unable to locate the account to deposit it.   The amendments in 2004 allow producers to send money that they can’t deposit into individual Coogan accounts to The Actors Fund.  Other changes include the requirement that a Trustee Statement must be attached to a work permit to ensure the child performer has an account, that a parent has the right to receive a receipt that their child’s Coogan information was received, and that employers need to pay the Coogan portion of the child's paycheck concurrently with their rest of their paycheck.   

Moving ahead to 2011 – we still have a system that requires a lot of checking up on the part of the parents.   It’s not too difficult to see why this doesn’t work nearly as well as it should, or nearly well enough to be trusted.

Current requirements:

  • Your trustee statement must be attached to the work permit and it must say “Coogan Trust Account” on it. Section 1308.9 of the Labor Code, (a): “If the Labor Commissioner provides written consent pursuant to Section 1308.5 for the employment of a minor....that consent shall be void after the expiration of 10 business days from the date written consent was granted unless it is attached to a true and correct copy of the trustee’s statement evidencing the establishment on behalf of the minor of a “Coogan Trust Account” pursuant to Chapter 3....If the written consent is attached to a true and accurate copy of that trustee’s statement, the written consent shall be valid for a six month period.   

    In plain language that means permits presented ON SET that were issued more than 10 days prior MUST have a Trustee Statement attached to them to be valid.
      Bizparentz has a sample you can use here:   http://www.bizparentz.org/images/Statement_of_Trustee.pdf

    Parents may provide, for their own purposes, a Receipt that production will sign, showing that they received the child’s trust information.  We have a sample receipt you are welcome to customize and use.  http://bizparentz.org/images/ReceiptofCoogan.doc  
                                                                     
  • The employer only has 15 days to pay you the Coogan money if you did your job correctly. Section 6752 of the Family Code (d)(3): “The minor’s employer shall deposit 15 percent of the minor’s gross earnings pursuant to the contract within 15 days of receiving the trustee’s statement pursuant to Section 6753”. 

    This is an area that employers often do not comply with.  Parents may be able to file a case with the Labor Commissioner for late payment of earnings in the situation that a parent has a receipt to prove they gave information to the employer, and the 15 day deadline is grossly missed.  These are your child's earnings, and they are late.   To date, no one has tried a Labor Commissioner case, but we think it would be very interesting to see if a few of those cases would clean up the employer actions in this area.
  • You have 180 days from the first day you WORKED before the funds can be sent to Actor’s Fund. Section 6752 of the Family Code,(b)(9)(A) “If a parent, guardian, or trustee fails to provide the minor’s employer with a true and accurate photocopy of the trustee’s statement pursuant to Section 6753 within 180 days after the commencement of employment, the employer shall forward to The Actor’s Fund of America 15 percent of the minor’s gross earnings....” 

    This section of the law gives the parent, and employer, approximately 6 months to identify and correct Coogan deposits not made.  It’s important to follow up with missing deposits right away.  Not only is it in your child’s best interest, parents have a fiduciary duty to be certain that their child receives all of the compensation they have earned.
  • Actors Fund must pay imputed interest, but they can also charge reasonable fees. They can’t charge fees for the first year they are holding your money though. Section 6752(g) (1)(2) : “The beneficiary of an account held by The Actors Fund of America pursuant to this section shall be entitled to receive imputed interest....The Actors Fund of America may assess and deduct reasonable management, administrative, and investment expenses...including fees for initial set-up...No fees may be charged to any beneficiary’s account during the first year that the account is held by The Actor’s Fund of America.”  
  • This law creates a private escheat system (no State Unclaimed Funds). Section 6752 (i)“All funds received by The Actors Fund of America pursuant to this section shall be exempt from the application of the Unclaimed Property Law...”


How do you know if a deposit wasn’t made?

Doing some additional recordkeeping is highly suggested, and it is really the only way you will know that your child received all of their earnings.  We have a simple form, we call a Coogan Tracking Sheet – to give you an idea.  You really must know that for each check issued to your child 15% was withheld and that those funds were deposited.   No one else is going to monitor this for you.  It isn’t your manager or agent’s responsibility – it is solely the parent who will have access to the necessary records.  You can find the form here: http://www.bizparentz.org/images/Coogantrackingform.doc



What to do if you don’t see a deposit in your child’s Coogan Account:
If it is a very short period of time since work, you might choose to wait.  Make a note that you are expecting that deposit and see if it shows up.  If it has been a month or so, you should contact the payroll company for the job.  This information should be on the check, or check stub you received detailing original payment.  It may be that your Coogan information has been misplaced, or there may be some other administrative reason for the delay.

By law, if 6 months have passed, the producers (and payroll company) can transfer the funds to The Actors Fund, where it will be placed into the Unclaimed Coogan Account. (See #3 above).  The Actors Fund maintains a website and a list of individuals who they have funds for.  This is similar to the way each state would have an unclaimed funds system.   Keep in mind that the Actors Fund data is only as good as what they were given.  Names are frequently misspelled and inverted (last name first, first name last).  Every working child actor should review the list periodically to see if their name is on it.  Of  course, if you are keeping accurate records you will know , in which case you should check to see if the funds you are looking for have been sent to The Actors Fund.

How to check to see if your child’s earnings have been sent to The Actors Fund:
Check the website   www.unclaimedcoogan.org  for your child’s name (or variation, as outlined above).   If you find their name, follow the detailed instructions on how to claim the money.  In general, a child who is still a minor will have to provide their Trustee Statement, and the funds will be transferred to that Coogan Account.  If the child performer who earned the money is no longer a minor, there are specific documents required to claim the earnings, and upon completing them, the money will be sent directly to the person who earned it.

But I don’t live or work In California… what about other states?
First, know that many child performers fall under the jurisdiction of the California Coogan law without ever working a day in California.  If the corporation employing them is a California corporation (as most major film and television studios are), they will follow the California requirements.   However, as mentioned earlier, there are other states which have Trust account provisions.



NEW YORK
New York does have a Coogan-like system for child performers. This system has a very significant difference from California’s Coogan law—in NY, the funds are not blocked . The NY accounts are simply trust savings accounts (UTMA or UGMA), so the parents can use the money for any expense on behalf of the child. Because of this difference, the NY “Coogan” accounts are not acceptable in California (the money is really not protected). In NY, 15% of the minor’s earnings should be withheld by the employer and deposited into the account set up by the parent. The employer has 30 days from the start of employment to deposit the money into your child's trust account. If the money goes unpaid presumably because the parent did not provide their account information to the employer) then the 15% will go to the State of NY Child Performer 's Holding Fund.
Specific requirements about Trust accounts (aka “NY Coogan” accounts): http://www.labor.state.ny.us/workerprotection/laborstandards/secure/child/cp_trusts.shtm

Contact information for the NY CHild Perforner's Holding Fund is:  Janet Hall   518-486-1255


LOUISIANA
Louisiana has a blocked trust account system, very similar to California’s system. Louisiana “Coogan” accounts are to be set up by the parents—BOTH parents must be listed as trustees—before the execution of the contract. The account may not be charged fees, by law, and parents are charged with investing in a combination of bonds, CDs or savings accounts at the highest possible interest rate without risking the principal. 15% of the minor’s earnings are to be deposited into this blocked account.
Unpaid Coogan: If an account is not set up within 30 days of the last day of employment, the employer may send the funds to the Treasurer of the State of Louisiana who will hold the funds in trust.
 


NEW MEXICO

The Trust requirement in New Mexico applies only to jobs with $1,000 gross earnings or greater.  The account is to be opened in child’s state of residence within 7 days of signing a contract.  The Trustee is to notify employer of the account specifications within 15 days of employment. The employer is to provide the trustee with a receipt upon accepting bank information.  If an employer is unable to complete the transaction, they are to transfer funds to the district court in 90 days. The District Court is to appoint a trustee if they receive funds from an employer.
 

 

BIG PICTURE

The Coogan system, while well-intentioned, does not work very well.  It is our estimation that something goes wrong with the Coogan process in 25-50% of the paychecks.   

 

BizParentz has had some involvement in every child performer trust account bill since 2004, and we have worked hard to make the system work as well as possible.   We are committed to making sure every child actor has their earnings.    Even so, the burden falls on each parent to handle their own child's finances.   We encourage you to take an active role in making this happen:  commit to tracking every single paycheck, balance the child's bank statements, and make sure employers have your child's account information.  No matter what state you are in, check The Actors Fund Unclaimed Coogan website, and check your own state's unclaimed funds (in NY, the Comptroller, for example).  

 

It is our goal to eliminate all "missing Coogan money".  You can help us by checking the lists for other child actors you know and letting them know you "found" money for them.   You can help us by educating other parents about how often this system goes awry, and what they can do to help all children get the money they earned.      

 

Want more info?  See also our article that covers more history:  California Coogan Law