Why not put the domain in your nephews name in the domain registration...
Sort of like "Your Name c/o Nephews Name" in the reg, admin and technical fields...
Also, write up a basic contract that states that your nephew is the legal owner of the domain, but that you will be managing the domain for him until his 18th birthday... Get his parents to sign it and get it notarized.
That may be a bit much, but it'd definitely be a nice piece of evidence to admit if the need ever arose, because it clearly shows your intent, is notarized and dated, and refutes any claims of bad faith.