Trump Accounts are special savings and investment accounts for children under age 18.
They work a lot like a traditional IRA, but with special rules just for kids.
In simple terms:
- An adult opens the account for a child
- Money is invested early, while the child is young
- The account is meant to grow over many years
- When the child becomes an adult, the account turns into a regular traditional IRA
Who is eligible?
A child is eligible if they:
- Are under 18 at the end of the year the account is established
- Have a Social Security number
- Do not need earned income to contribute
To receive the free starting contribution of $1,000 (government seed money), the child must also:
- Be a U.S. citizen
- Be born between January 1, 2025 and December 31, 2028
The $1,000 government contribution (Pilot Program)
Under a temporary federal pilot program, the U.S. Treasury will deposit $1,000 one time:
- Into each eligible child’s Trump Account
- Starting on or after July 4, 2026
- This $1,000 does NOT count toward annual contribution limits
- Parents must elect to receive this deposit (expected via Form 4547 or an online portal).
When do Trump Accounts start?
- Accounts can be established in 2026
- No contributions are allowed before July 4, 2026
- Elections to open an account may be made with a 2025 tax return (Form 4547)or later
Annual contribution limits
During the child’s “growth period” (birth through age 17):
| Contributor | Annual Limit | Tax Treatment |
|---|---|---|
| Parents / family / others | Up to $5,000 total | After‑tax, not deductible |
| Employers | Up to $2,500 | Excluded from employee income |
| Government / charities (qualified programs) | No cap | Tax‑free |
| Federal pilot deposit | $1,000 one‑time | Tax‑free |
All private contributions combined generally count toward the $5,000 annual cap.
Investment Rules for Trump Accounts (Before Age 18)
While the child is under 18, the money in a Trump Account must be invested very simply and safely.
✅ Allowed Investments
The funds must be invested only in:
- Low‑cost mutual funds or ETFs
- Funds that track the overall U.S. stock market, such as the S&P 500
This keeps investing simple, diversified, and low‑risk.
🚫 Not Allowed Before Age 18
During the growth period, the account cannot be used for:
- Individual stocks
- Cryptocurrency
- International (non‑U.S.) funds
- Active or frequent trading
Withdrawal Rules for Trump Accounts
⛔ Before Age 18
- No withdrawals are allowed
- The money must stay in the account until January 1 of the year the child turns 18
This means the funds are locked in while the child is a minor.
✅ At or After Age 18
Once withdrawals are allowed, the account begins to work similar to a traditional IRA, with special tax rules.
💵 Are Withdrawals Taxable?
- Contributions were made with after‑tax dollars
- ✅ Your original contributions are not taxed again
- 💰 Only the earnings (growth) are taxable when withdrawn
- The taxable portion is reported as ordinary income
⚠ Early Withdrawal Penalty
- If the earnings are withdrawn before retirement age, a 10% early‑withdrawal penalty may apply
- Some standard IRA exceptions may remove the penalty (but not always the tax), such as:
- Qualified education expenses
- First‑time home purchase (up to IRS limits)
- Other IRS‑approved IRA exceptions
Employer involvement
Employers can:
- Contribute up to $2,500 per year
- For an employee’s child (or under‑18 employee)
- Contributions are tax‑free to the employee
- Many large companies (banks, tech firms) have announced matching programs How Trump Accounts compare to other accounts
🧭 Program Navigation
🧾 To elect a Trump Account or request the $1,000 deposit
Navigation path:
Federal ➜ Miscellaneous Forms ➜ Trump Account Election(s)
Step‑by‑step:
- 🔐 Log in to TaxSlayer
- 🧭 From the Federal menu, select Miscellaneous Forms
- 📄 Choose Trump Account Election(s)
- 👶 Choose an existing child from your dependents
- or ➕ Add a new dependent if the child is not already listed
- 📍 Confirm the child’s information
- ✅ Check the confirmation box or
- 🏠 Add or update the child’s address if prompted
- ✅ Check the box to:
- Open the Trump Account and
- Request the $1,000 government deposit (if eligible)
- 💾 Continue and save
🚫 If you do nothing
- No form is filed
- Account is not opened using tax return
- $1,000 opening contribution is not deposited into account