In December 2025, the U.S. Department of the Treasury and the Internal Revenue Service released Notice 2025-68, offering long-awaited guidance on 530A accounts, commonly referred to as “Trump Accounts.” These new tax-advantaged savings accounts for children were created under the One Big Beautiful Bill Act and are designed to help families build long-term savings for education, housing, and other future needs.
Below is a clear, parent-friendly breakdown of how 530A accounts work, who qualifies, and what to consider before opening one.
A 530A account is a special type of individual retirement account (IRA) established for the exclusive benefit of a child. While it follows many IRA-style rules after age 18, it operates very differently during childhood.
To be eligible, the child must:
Unlike traditional IRAs, earned income is not required to fund these accounts during childhood.
The growth period begins when the 530A account is opened and ends on December 31 of the year before the child turns 18.
Example:
If a child is born in 2025 and turns 18 in 2043, the growth period ends on December 31, 2042.
During this phase, 530A accounts differ significantly from traditional IRAs:
A parent, guardian, or authorized representative may open a 530A account by:
Once the election is processed, the Treasury Department (or its agent) will provide instructions to authenticate and activate the account.
One of the most notable features of Trump Accounts is a federal pilot contribution:
For each eligible child, the Treasury Department will deposit a one-time $1,000 contribution once the account is opened and confirmed.
Key details:
In addition to the federal seed money, 530A accounts may receive contributions from multiple sources during the growth period:
Important rules to know:
Investment options are intentionally narrow to emphasize long-term, low-cost growth.
Funds may only be invested in:
Cash and money market funds are generally not permitted, except temporarily during reinvestment or settlement periods.
Distributions are not allowed, except for:
Hardship withdrawals are not permitted.
Once the child turns 18, distributions generally follow traditional IRA rules, including:
However, 530A accounts remain separately tracked and cannot be aggregated with other IRAs for certain calculations.
During the growth phase, 530A accounts are subject to enhanced reporting requirements, including:
After age 18, standard IRA reporting rules apply.
While 530A (Trump) Accounts can be a powerful tool for long-term savings, their eligibility rules, contribution limits, investment restrictions, and reporting requirements make careful planning important. How these accounts fit alongside education funding, tax planning, and broader family wealth goals will differ for each household.
Families considering a 530A account may benefit from working with a fiduciary advisor to ensure the strategy is implemented correctly and coordinated with their overall financial plan. To explore whether a Trump Account makes sense for your family, you may wish to schedule a consultation with Samalin Wealth to discuss your options and next steps.
For additional technical guidance, visit IRS.gov.
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