For preparers advising families on §530A Trump accounts — who qualifies for an account and for the $1,000 pilot deposit, what counts toward the $5,000 annual cap, how contributions are treated for gift tax, and how the account is taxed once the growth period ends in the year the child turns 18.
The §530A account, the Trump account, was created in 2025’s One Big Beautiful Bill Act. And there is a federal windfall attached: $1,000 for qualified babies. Have a baby? File a form and the $1,000 will be deposited into an account in the child’s name. The account is real. The $1,000 is real for children who qualify. Most of the rest of what your clients have heard is a mix of accurate, exaggerated, and wrong. Clients will ask anyway, and this course helps you answer them.
Clients probably won’t use this terminology when they call. They may only know there’s a new account for children, that someone is contributing $1,000, and that they heard about it from a hospital, bank, employer, or online. That is enough to start the discussion. The practitioner can then determine which rules apply, explain what the account does and does not allow, and help the family decide whether additional contributions make sense.
Coverage includes eligibility for an account and for the $1,000 pilot deposit, the Form 4547 election, the $5,000 annual contribution cap, and the growth-period investment and distribution restrictions. The course compares §530A accounts with §529 plans, Roth IRAs, and UGMA/UTMA custodial accounts. It covers the gift-tax treatment of contributions under the Rev. Proc. 2026-25 safe harbor, employer contributions under §128 made directly or through §125 salary reduction, and the taxation of distributions after the growth period, including basis recovery, §72(t) exceptions, and Roth conversion. Two hours of Federal Tax Update credit.
By the end of this course, participants will be able to:
Who may have a §530A account, who qualifies for the $1,000 pilot deposit and the birth-window dates that decide it, and how and when Form 4547 is filed.
The $5,000 annual contribution cap and the sources exempt from it, who may contribute, the investment restrictions during the growth period, the distributions allowed before it ends, and the trustee’s obligations.
Matching the account to what the family is saving for: §530A against §529 for education, and when a Roth IRA, a UGMA/UTMA account, or a direct tuition payment under §2503(e) fits better.
Why the annual exclusion isn’t automatic for §530A contributions, the Rev. Proc. 2026-25 safe harbor, gift splitting under §2513, and contributions from donors who aren’t individuals.
Direct employer contributions and §125 salary reduction under §128, how the $2,500 per-employee exclusion applies, how employer money counts toward the child’s $5,000 cap, coordinating contributions, and spousal stacking.
What changes on January 1 of the year the child turns 18, which contributions create basis and the taxable portion of a distribution under §72, the §72(t) exceptions, distributions for higher education compared with §529, and options for the remaining balance, including Roth conversion.
Jennifer Harris Smith, JD, CPA. Attorney (Texas). CPA (Texas). Member of Texas Bar College. Full bio →