What a Coogan Account Is
A Coogan account is a blocked savings account that holds a portion of a child performer's earnings and prevents the child (or their parents) from spending that money until the child reaches the age of majority. The account is named after child actor Jackie Coogan, whose parents spent his entire $4 million fortune from his silent film career in the 1920s, leaving him with nothing when he turned 18. California passed the first Coogan Law in 1939 to prevent this from happening again.
The account works by requiring that a percentage of a child performer's gross earnings—typically 15 percent in California—be set aside in a blocked trust account. A judge must approve the arrangement, and the money cannot be withdrawn without a court order. When the child reaches 18, they gain full access to the account and can withdraw the funds as they choose.
Coogan accounts are not the same as 529 plans or Coverdell ESAs. They are a legal protection mechanism specific to child performers, not a tax-advantaged education savings vehicle. However, money in a Coogan account can later be moved into a 529 or Coverdell if the child or their guardian chooses to do so.
Key Takeaways
- A Coogan account is a court-ordered blocked savings account that holds 15 percent of a child performer's earnings in California and similar percentages in other states with Coogan laws.
- The money cannot be withdrawn by the child or their parents until the child turns 18, even with parental consent.
- A judge must approve the Coogan account arrangement before the child can legally work as a performer and earn income.
- Coogan laws exist in California, Louisiana, and New York; other states have no such requirement, leaving child performers' earnings unprotected.
- Once a child reaches 18, they own the account outright and can withdraw, spend, or invest the money however they choose.
Which States Require Coogan Accounts
Only three states have Coogan laws on the books: California, Louisiana, and New York. California's law is the oldest and most detailed. Louisiana's law, passed in 1990, mirrors California's structure. New York's law, updated in 2003, applies to child performers in film, television, and theater.
If a child performer works in any other state—or works remotely for a production based elsewhere—no Coogan account is required by law. This means a child actor in Texas, Florida, or Georgia earning $100,000 from a television role has no legal protection preventing their parents from spending every dollar. Some parents voluntarily set aside money in a regular savings account or trust, but this is not legally binding and offers no court protection.
Even in states with Coogan laws, the requirement applies only to performers earning above a certain threshold. In California, the law applies to minors earning more than $6,750 in a single contract (as of 2024, though this amount adjusts annually). Smaller roles or one-off appearances may fall below the threshold.
How the Coogan Account Process Works
Before a child can legally work as a performer in a state with a Coogan law, the production company or talent agency must petition a court for a Coogan order. This is not something a parent initiates on their own; it is part of the work permit process. The petition includes details of the contract, the child's earnings, and the proposed blocked account.
A judge reviews the petition and, if approved, issues an order requiring that a set percentage of the child's gross earnings be deposited into a blocked account at a bank or financial institution. The child's parent or guardian is typically named as the account custodian, but they cannot withdraw money without a court order. The account earns interest, which also becomes part of the protected balance.
The production company deposits the required percentage directly into the blocked account, separate from any money paid to the parent or guardian. Payroll records and bank statements are kept on file, and the court retains oversight. If the parent or production company fails to comply, the child or their representative can file a motion to enforce the order.
What Happens When the Child Turns 18
On the child's 18th birthday, the account is no longer blocked. The young adult can withdraw the full balance, close the account, or leave the money invested. There is no requirement to use the money for education, no tax penalty for withdrawal, and no strings attached. The money is theirs to keep, spend, or invest as they see fit.
Some young performers use the account to pay for college or vocational training. Others use it to buy a home, start a business, or simply have a financial cushion. A few have donated portions to charity. The point of the Coogan law is not to dictate how the money is used, but to ensure it exists and belongs to the child when they reach adulthood.
If a child performer continues working after turning 18, new Coogan protections do not apply—they are an adult and can enter into contracts and manage their own money. However, they may still choose to work with a financial advisor or attorney to protect their earnings.
Coogan Accounts vs. Other Savings Vehicles
A Coogan account is not a tax-advantaged savings plan. It does not offer the tax-free growth of a 529 plan or the tax deduction of a Coverdell ESA. It is a legal holding mechanism, not an investment account. Interest earned in a Coogan account is taxable income to the child in the year it is earned, and the child's parent or guardian must report it on the child's tax return.
However, a Coogan account serves a different purpose than a 529 or Coverdell. Those accounts are designed to help families save for education over time. A Coogan account is designed to protect a child's already-earned income from being spent by parents or others. Once the child turns 18, they could move money from a Coogan account into a 529 or Coverdell if they choose, but the accounts are separate tools.
Some families use both: a Coogan account to protect the child's performance earnings, and a 529 or Coverdell funded by parental contributions to save for education. This gives the child both legal protection and tax-advantaged growth.
Common Gaps in Coogan Protection
The biggest gap is geography. A child actor working on a production filmed in Georgia or shot remotely from their home in Texas has no Coogan protection unless the production is based in California, Louisiana, or New York. Many productions intentionally avoid these states to sidestep the Coogan requirement, leaving child performers and their families unprotected.
Another gap is earnings below the threshold. In California, earnings under $6,750 per contract do not trigger a Coogan account. A child who books multiple small roles, each paying $5,000, may earn $50,000 in a year without any legal protection for that money.
A third gap is enforcement. If a parent or production company fails to set up a Coogan account or deposits money into the wrong account, the child's only recourse is to file a lawsuit. By that time, money may already be spent. Some families hire an entertainment attorney to oversee the process, but this adds cost and is not required by law.
Why Coogan Accounts Matter for Child Performers
Child performers often earn more money in a single year than their parents earn in a decade. Without legal protection, that money can vanish. Stories of child stars who grew up broke—despite earning millions as children—are common in the entertainment industry. Some parents spend the money on family living expenses, bad investments, or their own pursuits. Others face financial pressure or poor judgment.
A Coogan account removes the temptation and the option. The money is legally untouchable until the child is old enough to make their own decisions about it. This has allowed many former child performers to start their adult lives with a financial foundation, whether they continue in entertainment or pursue other paths.
For families in states without Coogan laws, the lesson is to create a similar protection voluntarily. Some families set up a trust, open a custodial account at a brokerage with restricted access, or work with an entertainment attorney to draft a binding agreement. These are not as strong as a court-ordered Coogan account, but they are better than leaving earnings unprotected.
Frequently Asked Questions
Can parents withdraw money from a Coogan account in an emergency?
No. A Coogan account is blocked by court order, and the money cannot be withdrawn without a judge's permission. Even if the family faces a genuine hardship—medical bills, job loss, eviction—the parent cannot simply withdraw the money. They would have to petition the court and explain the emergency, and the judge would decide whether to allow a withdrawal. Most judges are reluctant to grant these requests.
What if a child performer works in a state without a Coogan law?
There is no legal requirement to set aside money. The earnings belong to the child, but the parent has full legal control until the child turns 18. Some families voluntarily set up a trust or custodial account with restrictions, or hire an attorney to draft a protective agreement. Without a court order, however, the protection is only as strong as the parent's willingness to honor it.
Does a Coogan account affect financial aid for college?
Yes. When a child turns 18 and gains access to a Coogan account, that money is considered an asset in their name. It will be counted when calculating financial aid, potentially reducing grants and increasing the expected family contribution. Families should discuss this with a financial aid advisor before the child enrolls in college.
Can a child performer refuse to work if their parents want the money?
A child cannot be forced to work, and child labor laws in all states set limits on hours, types of work, and school attendance. However, a parent can pressure a child to continue performing to generate income. A Coogan account does not prevent this pressure, but it does ensure that if the child does work, a portion of their earnings will be protected and available to them as an adult.
What happens if the production company does not deposit money into the Coogan account?
The child or their representative can file a motion in court to enforce the Coogan order. The production company can be held liable for the unpaid amount plus interest and legal fees. However, this requires the family to hire an attorney and go back to court, which takes time and money. Some families discover the violation only years later when reviewing old contracts.