July 4 is the launch date for 530A Accounts, also known as Trump Accounts.

What should Oregon parents do?

At the April 7 meeting of the Financial Empowerment Advisory Team, Oregon Treasury Chief Program Officer Barry Ford led a discussion about 530A accounts with Ray Boshara from Washington University and The Aspen Institute’s Financial Security Program and Jason Ewas from The Aspen Institute’s Financial Security Program. You can see a copy of their PowerPoint presentation here.

Among the topics: What are these new accounts? What might they accomplish? And who should consider opening them?

Notably, many children may be eligible for financial incentives in the form of free money in 530A accounts. If this includes your children, experts say you should claim an account. Don’t leave money on the table!

Go here to open an account.

These questions and answers are based on that conversation and other sources, and edited for length and clarity.

General information from The Aspen Institute about 530A accounts is available here.

What is a 530A Account?

It is a traditional Individual Retirement Account (IRA) for children starting from birth with special rules until a child turns 18.

The accounts were created by Congress and passed into law in 2025. It is called a 530A account because that is the chapter in the IRS code that authorizes them.

What is the goal?

These accounts are a way to help young people to build assets and are designed to counter the economic headwinds that younger generations are facing to build wealth.

How can 530A accounts help build wealth until the age of 18?

• No withdrawals until age 18. Once the money's in, it's in.
• Parents can contribute as much as $5,000 after-tax a year to the account.
• The funds will be invested in a broad-based index fund that includes shares of many U.S. public companies in the stock market, such as the S&P 500.
• Employers, cities, states, non-profits and philanthropists may also contribute money to these accounts, subject to certain restrictions

Who qualifies for an account?

Any child under 18 with a Social Security number. Each child may have only one account.

What are the current 530A account incentives?

Those children born between Jan. 1, 2025, and Dec. 31, 2028, can receive a $1,000 deposit directly from the government as one-time seed money, provided that child is also a U.S. citizen

In addition, companies, non-profits, cities, states, foundations and individuals can donate money that could go to your child’s account.

For instance, as a result of a donation from computer industry executive Michael Dell, account holders aged 2-10 in most zip codes will receive $250. See investamerica.org to check eligibility for the Dell funds.

If your child is eligible for an incentive, then you should open a 530A account to claim that money.

Alternatively or in addition, you may want to consider other saving options with financial incentives, such as a 529 plan.

How do 530A accounts compare to 529 plans for education savings, such as the Embark savings plan in Oregon?

• 529 plans like Embark are designed to save for a range of education and career training costs, and offer significant benefits including an Oregon refundable tax credit worth as much as $380 every year.
• 530A Accounts are built for retirement savings and can play a supporting role for other saving goals, but are taxable.

How do you open a 530A account?

A child does not receive an account automatically.

Legal guardians, parents, adult siblings, or grandparents (in priority order) can sign up for a 530A account by submitting IRS Form 4547. There is an online portal.

Beginning in May, applicants began proving their identity. Accounts will become active starting on July 4th for people who have completed that process.

What are the tax implications for a 530A account?

• Because 530A Accounts are “traditional IRAs,” taxes must be paid when you withdraw the money or roll them into a different investment; taxes are also paid on the earnings. Withdrawals that do not qualify for an exception are subject to additional 10% tax.
• Prior to age 18, having money in a 530A account does not affect your eligibility for food stamps, Medicaid, Medicare, SSI and other programs. But starting at age 18, those balances and any withdrawals could impact your eligibility.

What are the tax implications for a 529 account?

• Money invested in a 529 account like Embark grows tax free and those gains are not taxed if the money is used for a qualified education expense such as tuition, transportation, apprenticeship program costs, housing or technology. Accounts can be opened by any person over the age of 18.
• Oregonians can benefit from valuable incentives for investing in Embark, such as a $100 bonus if an account is opened in a child’s first year or in kindergarten.
• Each year, every Oregon taxpayer can receive a refundable tax credit of as much as $190 (or up to $380 for those filing jointly) for 529 contributions. That really adds up, over time.
• If the money is used for a non-qualified expense, there would be a penalty on the gains. However, the money can be transferred to another family member without penalty.
• Unused money in a 529 account can be rolled over into a Roth IRA for retirement or other costs such as buying a first home, if not spent for educational costs.