What Are Trump Accounts?
Trump Accounts are a new type of tax-advantaged investment account for children, created under the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025. Sometimes referred to as 530A accounts, they function somewhat like a hybrid between a traditional IRA and a 529 college savings plan, held in a child’s name with a parent or guardian serving as custodian.
Who Is Eligible
Any child under 18 with a Social Security number may have a Trump Account opened on their behalf. Children born between January 1, 2025, and December 31, 2028, who are U.S. citizens qualify for a one-time $1,000 federal seed deposit under the program’s pilot phase. Only one Trump Account is permitted per child.
How Contributions Work
Contributions to Trump Accounts officially began on July 4, 2026. Parents, grandparents, friends, or the child themselves can contribute up to $5,000 per year (indexed for inflation after 2027), while employers can contribute up to $2,500 per year on an employee’s behalf — though employer contributions count toward the same overall $5,000 annual limit. Excess contributions above the limit can trigger a 6% IRS penalty until corrected.
How Funds Are Invested and Accessed
Account funds are invested in diversified, low-cost index fund portfolios, including options tracking the S&P 500, with investment gains growing tax-deferred. Withdrawals are restricted until the calendar year the child turns 18, at which point funds can be used for purposes like a home down payment, college costs, starting a business, or simply left to continue growing for retirement.
How to Open an Account
Parents or guardians can open a Trump Account by completing IRS Form 4547, either during tax filing or electronically through their IRS Individual Account. An online government portal at TrumpAccounts.gov also supports account opening and management, and by mid-2026, the IRS reported more than 4 million children had already been signed up.
Final Thoughts
Trump Accounts represent a significant new option for families looking to build long-term, tax-advantaged savings for children, combining a modest but meaningful government seed contribution with flexible ongoing contributions from family and employers. As with any new financial product, families should weigh how it fits alongside existing savings vehicles like 529 plans based on their specific goals.