New “Trump Accounts” for Children: A Simple Savings Opportunity for Families

A new federal savings vehicle, called a Trump account, was created under IRC §530A as a tax-favored investment account for children. Trump accounts are designed to help families start long-term savings early, with investments generally growing tax-deferred while the child is under age 18.

The IRS and Treasury have issued initial guidance, including Notice 2025-68, proposed regulations under Prop. Reg. §1.530A-1 for opening and operating accounts, and Prop. Reg. §301.6434-1 for the federal $1,000 pilot contribution. The proposed rules generally apply beginning January 1, 2026, and final regulations are expected by January 4, 2027.

Important: Guidance is still evolving, so families should watch for future IRS and Treasury updates before making decisions.

Trump accounts may offer several benefits for families who want to begin saving for a child’s future:

• Early start for long-term savings. Accounts are intended to encourage savings and investment for children before age 18.
• Tax-deferred growth. Investment earnings generally grow tax-deferred while funds remain in the account.
• No earned income requirement for the child. Unlike an IRA, a child does not need wages or other earned income to receive contributions during the account’s growth period.
• No family income phaseout. Eligibility is not based on the parents’ or child’s income.
• Potential $1,000 federal contribution. Under the pilot program in IRC §6434, eligible U.S. citizen children born in 2025 through 2028 may receive a one-time $1,000 federal “seed” contribution.
• Employer contribution opportunity. Under IRC §128, an employer may contribute up to $2,500 to a Trump account for an employee or the employee’s dependent under a qualifying written employer program; this amount may be excluded from the employee’s income, subject to the rules.

A Trump account may generally be opened for a child who:

• Is a U.S. citizen;
• Is under age 18 at the end of the calendar year;
• Has a valid Social Security number issued before the account is opened; and
• Has not already had an initial Trump account opened.

There are no income restrictions, no phaseouts, and no earned-income requirement for the child during the growth period.

For years before the year the child turns 18, annual non-exempt contributions are generally limited to $5,000 per year, indexed for inflation after 2027 under IRC §530A.

The $1,000 federal seed contribution under IRC §6434 does not count against the $5,000 annual contribution limit.

Employer contributions under IRC §128 may be excluded from income up to $2,500, but they generally count toward the overall $5,000 annual contribution cap.

Contributions cannot be made before July 4, 2026. The $1,000 federal pilot contribution for eligible children born from 2025 through 2028 also will not be deposited before July 4, 2026.

For years before the year the child turns 18, contributions generally must be made by December 31 of the contribution year. The normal IRA rule allowing contributions by the tax filing deadline generally does not apply during this period.

Starting January 1 of the year the child turns 18, the Trump account generally transitions into a traditional IRA, and the normal traditional IRA rules begin to apply.

Distributions are generally not allowed before the year the child turns 18, except for certain limited exceptions, such as qualifying rollovers or ABLE account transfers.

Families can begin the account-opening process by making an election for an eligible child. The IRS has indicated that an authorized individual may use Form 4547, Trump Account Election(s), or an online tool/application available through official Trump account resources.

1. Confirm the child is eligible.
   The child generally must be a U.S. citizen, under age 18 at year-end, and have a valid Social Security number.
2. Submit the election.
   Use Form 4547 or the official online election process. The IRS has also stated that taxpayers can submit elections and view election status through their IRS Individual Account.
3. Watch for Treasury activation instructions.
   After the election is processed, Treasury will send information to complete authentication and activate the account.
4. Use the official app or website to activate the account.
   Treasury released the Trump account app on May 28, 2026, and accounts can be activated through the app or at TrumpAccounts.gov.
5. Begin contributions on or after July 4, 2026.
   Family members and certain other contributors may contribute once contributions are permitted.

Families should be alert for scams. Treasury has stated that activation instructions will be sent only by email from no-reply@TrumpAccounts.Treasury.gov.

Treasury will not contact families by phone or text message to activate an account .

Before clicking any link or providing personal information, families should confirm they are using official IRS or Treasury resources.

If you have a child, grandchild, or dependent who may be eligible, consider the following:

• Gather basic information for the child, including full legal name, date of birth, and Social Security number.
• Determine who should make the election to open the account, such as a parent or guardian.
• Use official resources only when submitting Form 4547 or activating the account.
• Check whether the child may qualify for the $1,000 federal seed contribution if born in 2025, 2026, 2027, or 2028.
• Plan contributions carefully because the annual non-exempt contribution limit is generally $5,000, and contributions for years before the child turns 18 must generally be made by December 31.
• Ask your employer whether it plans to offer a Trump account contribution program under IRC §128.
• Stay tuned for additional IRS guidance, including final regulations expected by January 4, 2027.

Trump accounts may give families a new way to start saving early for a child’s future, with tax-deferred growth, no earned-income requirement for the child, and a potential $1,000 federal seed contribution for eligible children born from 2025 through 2028. Because the rules are new and guidance is still developing, families should use official IRS and Treasury resources and consult their tax advisor before contributing.