What Are Trump Accounts and How Can I Get One?

Imagine this: you just had a baby and there's $1,000 (!!!) waiting to be claimed in their name. No catch. That's the reality for millions of American families right now, and most parents aren't taking advantage of it.

Trump Accounts are one of the most significant new financial tools for families since the 529 plan. Created under the One Big Beautiful Bill Act (OBBBA), signed into law in 2025, they give parents, grandparents, and even employers a new way to build tax-advantaged wealth for children from birth. But like any tax-advantaged account, the devil is in the details.

Let's break it down.

What is a Trump Account?

A Trump Account is a new type of individual retirement account for children under 18, established under Internal Revenue Code Section 530A. It's sort of like a hybrid between a traditional IRA and a 529 plan, designed specifically for minors.

The account is owned entirely by the child, but managed by an adult (typically a parent or guardian) until the child turns 18. It grows tax-deferred over time, and once your child reaches adulthood, the account converts to a standard traditional IRA.

Here's a quick snapshot of what it is:

• Tax-deferred growth throughout childhood
• No earned income requirement to contribute (unlike a custodial Roth IRA)
• $5,000 annual contribution limit (indexed for inflation starting in tax year 2028, i.e., for contributions made after December 31, 2027)
• $1,000 government seed contribution for eligible newborns
• Investments limited to low-cost U.S. index funds (expense ratio capped at 0.10%)
• No withdrawals until January 1 of the year the child turns 18

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Who is eligible for a Trump Account?

Any U.S. child under the age of 18 with a valid Social Security number can have a Trump Account. However, there are some important considerations to be aware of:

• ‍$1,000 government deposit: To be eligible for the $1,000, your child must be a U.S. citizen, have a valid Social Security number, and have been born between January 1, 2025, and December 31, 2028. This one-time contribution from the U.S. Treasury does not count against the annual $5,000 contribution limit.‍
• For older children (born before 2025): You can still open a Trump Account for any child under 18, but they will not qualify for the $1,000 federal deposit. That said, they can still benefit from years of tax-deferred growth and family contributions!‍
• If your child is a permanent resident: Permanent resident children can open a Trump Account, but they are not eligible for the federal $1,000 pilot contribution - that benefit is reserved for U.S. citizens only.

How to get the $1,000 government contribution

For parents of children born between January 1, 2025, and December 31, 2028, the $1,000 seed contribution from the U.S. Treasury is free money. Don't forget to claim it! To do so, you simply need to file IRS Form 4547 (Trump Account Election).

Keeper pro tip: The sooner you file Form 4547, the sooner your account is established to receive contributions once they open on July 4, 2026. Filing with your 2025 tax return is your fastest path! When you file your taxes with Keeper, we can help get you set up!

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The $1,000 alone is estimated to grow to approximately $500,000 by your child's retirement age, based on historical S&P 500 growth rates. That's the power of time in the market, so don't miss out!

Beyond the federal deposit, private philanthropy could contribute additional funds if you're eligible. Michael and Susan Dell have pledged $6.25 billion to seed Trump Accounts for up to 25 million children age 10 and under living in ZIP codes with median household incomes below $150,000, with a $250 charitable deposit per qualifying child. These charitable deposits do not count against the $5,000 annual limit!

How to open a Trump Account in 2026

1. File IRS Form 4547: This form is the official election to establish a Trump Account for your child. You can file it alongside your 2025 tax return (due April 15, 2026) or separately via the online portal.
2. Online portal: Starting mid-2026, you can also make your election through trumpaccounts.gov.
3. Rollover later: Once accounts launch, you'll eventually be able to roll the balance to a preferred brokerage (Fidelity, Schwab, Vanguard, etc.) through a trustee-to-trustee rollover.
4. Contributions begin July 4, 2026: Even if you've filed Form 4547 today, no contributions (including the $1,000 government seed) will be deposited until after July 4, 2026.

How much can I contribute?

What happens when my child turns 18?

When your child turns 18, the Trump Account converts to a standard traditional IRA. At this point, standard IRA rules apply:

• Withdrawals are allowed, but taxed as ordinary income
• Withdrawals before age 59½ are subject to a 10% early withdrawal penalty
• You can avoid withdrawal penalties if the funds are used for qualified higher education expenses, first-time home purchase (up to $10,000 lifetime), and disability

Keeper pro tip: A Trump Account is not a tax-free education savings tool like a 529 plan. Withdrawals for qualified education expenses can avoid the 10% penalty, but they're still subject to income tax. For education-specific savings, a 529 plan remains more tax-efficient.

What is the difference between a Trump Account and 529?

• 529 plans offer tax-free withdrawals for qualified education expenses; Trump Accounts do not
• 529 plans are typically held as parental assets for FAFSA purposes (better for financial aid); Trump Accounts are in the child's name
• Trump Accounts are more flexible - funds aren't restricted to education
• 529 plans may offer state income tax deductions on contributions; Trump Accounts do not

FAQs

Can I open a Trump Account for a child born before 2025?

‍Yes. Children born before 2025 are eligible for a Trump Account, but they do not qualify for the $1,000 federal contribution. You can still contribute up to $5,000/year and benefit from tax-deferred growth.

What if I don't contribute anything extra beyond the $1,000 federal contribution?

The $1,000 contribution grows tax-deferred over time, and projections suggest it could reach ~$500K by the time your child retires. But if you can contribute even $100/month, the compounding effect is dramatically greater.

Can my child lose the money?

‍Investments are restricted to low-cost U.S. equity index funds. The market can go down in any given year, but historically, long-term index investing has been a reliable path to growth over decades. The 0.10% expense ratio cap also ensures fees don't eat into returns.

What if my child passes away?

God forbid this is something any parent has to experience, but if this happens, funds in a Trump Account can be distributed upon the death of the account beneficiary.

Can I roll a Trump Account into a Roth IRA?

No — the account doesn't convert to a Roth IRA automatically. On January 1 of the year your child turns 18, the Trump Account converts to a traditional IRA. From there, the now-adult account holder can choose to do a Roth conversion under standard IRA rules, but that's a separate election with its own tax consequences. A CPA can help you evaluate whether a conversion strategy makes sense for your child's situation.

Are there income limits to contribute?

‍No. Unlike Roth IRAs, Trump Accounts have no income-based phase-out rules. Anyone can contribute to a child's account, regardless of how much they earn.