A child engaged in play with a wooden coin bank on a comfortable bed setting.

What to know about the new Trump Accounts

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by

Duane Bolinger
in ,

What is a Trump account? Who is eligible?

  • A Trump account, also known as a 503A account, is a new type of IRA designed to help children build long-term savings.
  • Created under the One Big Beautiful Bill Act.
  • Eligible children must:
    • Have a Social Security number.
    • Be a U.S. citizen.
    • Be under age 18 at year-end when the account is opened.
  • Each child may have only one Trump account.

How do I open a Trump account?

  • Parents or legal guardians open the account.
  • Options include:
    • Filing IRS Form 4547.
    • Using an online portal, www.trumpaccounts.gov, expected to launch in summer 2026.
  • Filing with a 2025 tax return may allow the account to be ready when contributions begin.

When will these accounts be available?

  • Accounts begin in 2026.
  • Contributions cannot be made before July 4, 2026.

What are the contribution rules?

  • Contributions may come from:
    • Parents or family members.
    • Employers.
    • Government or charitable organizations.
  • Annual limit:
    • Individuals and employers combined may contribute up to $5,000 per child per year.
  • Key advantages:
    • No earned income is required.
    • No household income limits.
  • Additional contributions:
    • Government or charitable contributions do not count toward the $5,000 limit.
    • A federal pilot program provides a $1,000 contribution for children born between 2025 and 2028.
  • Contributions to a Trump account do not reduce a working teen’s ability to contribute to a Roth or traditional IRA.

What are the investment rules?

  • Investments are limited to approved, low-cost U.S. stock index funds or ETFs.
  • All investments must meet U.S. Treasury guidelines.

What are the withdrawal and tax rules?

  • No withdrawals are allowed before age 18.
  • Starting at age 18:
    • The account generally follows traditional IRA rules.
  • Taxes:
    • Personal contributions are made after tax; only earnings are taxed when withdrawn.
    • Contributions from other sources are pre-tax and fully taxable when withdrawn.
  • Growth is tax-deferred until funds are taken out.
  • If kept separate from other IRAs, the account may offer added flexibility for future tax planning.

How do Trump accounts fit into family financial planning?

  • Trump accounts are meant to supplement—not replace—other savings options.
  • They can:
    • Help families start investing earlier for children.
    • Benefit from long time horizons and potential government funding.
    • Work alongside 529 plans, Roth IRAs, and other savings strategies.