Generally, if you are a parent (or a married couple) who lives with your child for the entire year and claims them on your taxes, you can open their account and claim their $1,000 — it’s that simple.

If you live in a multi-generational family, care for your child part of the year, or take care of a child without legally being their parent or guardian, you’ll need to make sure you qualify both to open the account and qualify to receive the $1,000 government contribution. 

To open the account and qualify for the $1,000 contribution: 

The child needs to be what the IRS calls your “qualifying child.” If you can claim your child for the Earned Income Tax Credit or the Child Tax Credit, they are your qualifying child. Primarily, the child (1) needs to live with you for more than six months of the year, and (2) needs to be your biological child, adopted child, foster child, grandchild, nephew/niece, or younger sibling. The qualifying child rules can be complicated. Reach out to our team at 530A@getyourrefund.org if you have questions.

To open a 530A account for a child that does not qualify for the $1,000 contribution: 

The child’s legal guardian should open the account. If there is no available legal guardian, the child’s parent should open the account. If there is no available parent, an adult sibling of the child should open the account. And, if there is no available adult sibling, the child’s grandparent should open the account. So, if you are the child’s parent but someone else is their legal guardian, you must let that person open the account. If you are the child’s grandparent but their parent is available, you must let the parent open the account.

These rules should be taken seriously and there may be penalties if the wrong person opens an account.

These rules are also subject to change, and you should check back for updates.