Trump Accounts, also known as 530A accounts, are designed to function like individual retirement accounts (IRAs) for children under 18, allowing contributions from various sources including family and employers. The accounts grow tax-deferred, and children born between 2025 and 2028 can receive a one-time $1,000 federal deposit to encourage savings.
Notably, tech CEO Michael Dell has pledged $6.25 billion to provide additional funds for children in lower-income areas. Parents or guardians can open these accounts by submitting IRS Form 4547, and as of July 10, 6.5 million children have already signed up, with nearly $125 million contributed collectively.
Contributions are capped at $5,000 per child per year, with an additional $2,500 allowed from employers, and funds will be invested in exchange-traded funds tracking the S&P 500. The initiative is positioned as a complement to existing savings options like 529 plans, offering families greater flexibility in building wealth for their children’s futures