Trump Accounts: New Tax-Advantaged Savings Accounts for Children

By Michael E. Helton, CPA and Haley Turner

The “One Big Beautiful Bill” (H.R. 1), signed into legislation on July 4, 2025, introduced a new type of retirement account for eligible minors. These new tax-advantaged retirement accounts, called Trump Accounts, are designed for eligible children under the age of 18 to help create long-term financial security. Trump Accounts introduce a new pilot program which allows for eligible minors, born between 2025 and 2028, who are U.S. citizens to receive a one-time $1,000 (one thousand dollar) contribution to their account.

The summary below explains what Trump Accounts are, their benefits, and how to open an account.

What are Trump Accounts?

A Trump Account is a type of traditional individual retirement account (IRA) designed for children to build financial wealth over time.

The account is managed by an authorized individual who opens the account, until the child reaches the age of 18. Authorized individuals are prioritized in the following order: legal guardians, parents, adult siblings, and grandparents.

If there is no legal guardian, either parent may make the election to open an initial Trump Account (subject to the priority rules described in the Form 4547 instructions)

Once the child reaches the start of the calendar year in which they turn 18, most special growth-period rules no longer apply and the account is treated as a Traditional Individual Retirement Account (IRA), and traditional IRA rules generally apply.

The child who owns the account, is the account beneficiary and will not need to report contributions to their account as income.

Contributions may be made by eligible individuals, such as parents, grandparents, family members, friends, companies, government entities, and philanthropic organizations. Additionally, once a child starts earning income they may contribute to their own account.

The funds in the accounts can be invested in approved mutual funds or exchange-traded funds (ETFs) which track an index of primarily U.S. companies and meet other eligible-investment requirements.

The Benefits of Trump Accounts

Starting July 4, 2026, eligible individuals may start making contributions to Trump Accounts.

A special pilot program is available only for children born between January 1, 2025, and December 31, 2028.

Children also enrolled in the pilot program will receive a one-time $1,000 (one thousand dollar) contribution from the U.S. Department of Treasury, which will be deposited beginning July 4, 2026, or after the account is initially set up, whichever occurs later.

Each account has an annual contribution limit of $5,000 (five thousand dollars) per child for the total of contributions subject to the annual limit. Other contributions, such as pilot funding, rollovers and qualified general contributions from the US or other forms of government and non-profits are not subject to this limit.

Employer contributions, which are deductible, are limited to $2,500 (two thousand five hundred dollars) annually per employee which will be tax-free, with adjustments to the annual limit beginning after 2027 to adjust for inflation.

The funds in the accounts are intended to grow securely and generally cannot be withdrawn from the account before the child turns 18.

After the child turns 18, the account will operate similarly to a Traditional IRA, allowing withdrawals for qualified purchases or withdrawals for other purposes which may be subject to a 10% penalty. Personal contributions are not tax deductible.

An associated mobile app will allow authorized individuals to monitor account activity and manage investments, while also providing an opportunity to introduce children to financial literacy and investing.

Who Qualifies for a Trump Account?

To qualify for a Trump Account, the child must be under the age of 18 at the end of the calendar year, have a valid Social Security number issued before the election is made, and must not have had a prior Trump Account election filed on their behalf.

Generally, only one initial Trump Account election may be processed for a child, but the rules allow a subsequent rollover Trump Account funded by a trustee-to-trustee transfer of the child’s existing Trump Account.

For the pilot program specifically, the child must be anticipated to be the qualifying child of the authorized individual for the year in which the election is made. This requirement does not apply to a standard Trump Account.

How to Open a Trump Account

To open a Trump Account, an authorized individual must file Form 4547, known as the Trump Account Election(s), either with a Federal Tax Return or through the official Trump Accounts website.

Online elections are now available at trumpaccounts.gov.

It is pertinent that the Form 4547 clearly indicates if the election is only for the Trump Account or for both the Trump Account and the pilot program, if the child qualifies.

If filing Form 4547 with a 2025 income tax return, the authorized individual does not have to have claimed the child on the 2025 return.

To complete Form 4547, the authorized individual must provide their full legal name, current address, date of birth, contact information, and valid Social Security number. Information for the child must include their full legal name, current address, relationship to the authorized individual, date of birth, and valid Social Security number.

Once an election has been processed for a child, the authorized individual will receive instructions from the U.S. Department of Treasury or its agents on how to activate the account.

After the account has been properly established and the first contribution has been made, individuals are encouraged to begin investing in their child’s long-term financial security.

Planning for Your Child’s Financial Future

If you have questions about how Trump Accounts may fit into your family’s long-term financial planning strategy, the team at Rivero, Gordimer & Company is available to help. As new rules and guidance continue to emerge, working with a trusted tax advisor can help you better understand eligibility requirements, contribution rules, and how these accounts may align with your broader financial goals.

Frequently Asked Questions

What is a Trump Account?

A Trump Account is a new type of tax-advantaged savings account created for eligible children under age 18. The accounts are designed to help families build long-term financial security for children through contributions and investment growth over time.

Who qualifies for a Trump Account?

Generally, children under the age of 18 who have a valid Social Security number and meet the eligibility requirements may qualify for a Trump Account. Additional eligibility requirements apply for children participating in the pilot program for children born between 2025 and 2028.

How do I open a Trump Account for my child?

An authorized individual, such as a parent, legal guardian, grandparent, or adult sibling, can open a Trump Account by filing Form 4547 or by using the official Trump Accounts website. Once the election is processed, instructions will be provided for activating the account.

Can parents and grandparents contribute to a Trump Account?

Yes. Contributions may be made by eligible individuals, including parents, grandparents, family members, friends, employers, nonprofit organizations, and government entities. Once the child has earned income, they may also contribute to their own account.

What can the money in a Trump Account be invested in?

Funds in a Trump Account may generally be invested in approved mutual funds or exchange-traded funds (ETFs) that track indexes made up primarily of U.S. companies and meet other investment requirements established under the program.

Can money be withdrawn from a Trump Account before age 18?

In general, funds in a Trump Account are intended to remain invested until the child reaches age 18. After that point, the account begins operating similarly to a Traditional IRA, and certain withdrawals may be subject to taxes or penalties.

Are Trump Account contributions tax deductible?

Personal contributions to Trump Accounts are not tax deductible. However, certain employer contributions may qualify for favorable tax treatment, subject to annual contribution limits and applicable rules.

Is there a limit to how much can be contributed to a Trump Account each year?

Trump Accounts currently have an annual contribution limit of $5,000 per child for contributions subject to the annual cap. Certain other contribution types, such as pilot funding or qualifying government contributions, are not included in that limit.

When can contributions start being made to Trump Accounts?

According to the legislation, contributions to Trump Accounts may begin on July 4, 2026.