A Trump Account, or 530A account, is a tax-advantaged custodial investment account designed to help children begin building long-term financial savings at an early age. The account is established in the child’s name and remains under the parent or guardian’s control until the child reaches age 18.
U.S. children born between January 1, 2025 and December 31, 2028 with a valid social security number qualify for a one-time $1,000 government contribution, provided the account election is properly completed. Children outside of those birth years may still be eligible to open an account, but without the federal contribution.
Additional annual contributions up to $5,000 may also be made by parents, grandparents, family members, or employers. Funds are invested for long-term growth and may later be used for qualified purposes such as education expenses, purchasing a home, or other future financial needs.
One of the primary benefits of the account is its potential tax advantages. Contributions to the account are made with after-tax dollars, but investment earnings within the account grow on a tax-deferred basis. This means dividends, interest, and investment gains are not taxed annually while the funds remain in the account, which may allow the account balance to grow more efficiently over time through compounded investment growth.
The account is designed for long-term savings, and funds generally are not accessible before the child reaches age 18. Once the beneficiary reaches age 18, distributions are subject to rules similar to those of a traditional IRA, meaning withdrawals may be taxable as ordinary income and certain distributions taken before age 59½ could incur a 10% early withdrawal penalty. Exceptions to the penalty include qualified expenses such as higher education costs and first-time home purchases. A Trump Account may be rolled into either a Roth or Traditional IRA once the child turns 18. See figure below comparing a Trump Account to other investment accounts.
If you prefer to complete the setup yourself, you may begin the process online by clicking the link below. The process is very straightforward and should only take a couple of minutes to complete.
Trump Accounts Website
General setup steps include:
- Click on the “Get Started” icon.
- Gather your child’s Social Security Number and date of birth.
- Complete and submit Form 4547 (Trump Account Election).
- You will then be contacted by the financial institution that will hold the account and finalize setup.
Our office would be happy to assist you with the setup process and determine whether your child qualifies for the $1,000 federal contribution. If you would like us to help establish the account on your behalf, please reach out to us and we will provide the next steps.