In this video, Becky walks through a new federal program that provides a $1,000 investment account for babies born between 2025 and the end of 2028.

Becky discusses how the account works, how the initial $1,000 is invested and grows until the child reaches adulthood, and what families need to understand about taxes when the funds are eventually withdrawn. She also explains the 10% penalty that applies to non-qualified uses, along with the important exceptions for things like education expenses, purchasing a first home, and other qualifying situations.

Becky also covers how employers may contribute up to $2,500 per year to these accounts, which could significantly increase the investment’s long-term value. Finally, she explains the application process and what you need to know about filing Form 4547 to set up the account.

If you have questions about how this program might apply to your family or clients, feel free to reach out.