For this tax filing year, a new savings/investment vehicle for US citizen children was created by the USA's federal government. For US citizens living in Japan, how would Japan treat these accounts? It's kind of like the Nisa? This is what I understand about the account so far;
Basic:
It's a 503A account.
Tax deferred growth.
Child must be under the age of 18.
Children automatically receive control of account upon age 18.
Parents who file for this account, Children born between 2025-2028, receive an initial $1,000. Funds will be invested in a diversified portfolio of low-cost index funds designed to maximize long-term growth while minimizing risk.
Children ages 1-9 woud recieve $250.
Children 10 and up, no $1,000 grant or $250.
Families, friends and employers can contribute up to $5,000 per year per child.
Upon age 18, funds can be converted into a traditional IRA.
Funds can be accessed without penalty when the child turns 18 for qualified expenses like education, a first home purchase, or starting a business. Withdrawals may be subject to restrictions and would be taxed at ordinary income rates.
by Pleistarchos