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Trump Accounts: What They Are, Who Qualifies, and How to Open One
One of the most talked-about provisions of the One Big Beautiful Bill Act, signed into law on July 4, 2025, is the creation of "Trump Accounts" — a new type of tax-advantaged investment account designed to give American children a financial head start. With more than 4 million children already signed up and over 1 million claiming the $1,000 pilot program contribution, the program is gaining serious momentum. Here's what you need to know.
What Is a Trump Account?
Trump Accounts are a new form of traditional individual retirement account (IRA) created for the benefit of children under One Big Beautiful Bill. They work like individual retirement accounts but have their own rules for contributions, investments, and distributions during the account's "growth period" — which runs from the date the account is established through December 31 of the year before the child turns 18. After that, standard IRA rules apply, and the account can be rolled into a traditional IRA or other eligible retirement plan.
Who Is Eligible?
Any individual under age 18 before the close of the calendar year in which the election is made, who has been issued a Social Security number, is eligible for a Trump Account.
The most lucrative benefit — a $1,000 federal seed contribution — has a narrower eligibility window. The federal government will make a one-time $1,000 pilot program contribution to the Trump Account of each eligible child who is a U.S. citizen born on or after January 1, 2025, through December 31, 2028. Children born before 2025 can still open an account and enjoy the tax advantages, but they are not eligible for the government seed money.
How Do You Open One?
Opening a Trump Account is designed to be straightforward. Parents or other individuals who qualify to make the election can use IRS Form 4547, Trump Account Election(s), to request establishment of a Trump Account and to enroll in the pilot program when filing their tax year 2025 return. Accounts can also be established at qualifying banks and financial institutions, which are expected to be available beginning July 2026. For families wanting to claim the $1,000 government contribution, the process is as simple as checking a box on the form — no complex paperwork required.
What Are the Benefits?
The benefits are both immediate and long-term:
- Government seed money. Assuming historical growth rates continue, a single $1,000 deposit into a Trump Account at birth is estimated to grow to at least half a million dollars by retirement age.
- Private contributions. Other persons are able to make contributions up to an aggregate limit of $5,000 per year, with annual limits indexed to inflation starting after 2027.
- Employer contributions. Employers may make nontaxable contributions of up to $2,500 per employee per year to Trump Accounts of their employees and their employees' dependents through a Trump Account Contribution Program.
- Charitable and institutional contributions. Michael and Susan Dell announced a $6.25 billion donation intended to deposit $250 into the Trump Accounts of children born between 2016 and 2024 living in ZIP codes with median household incomes below $150,000.
- Tax-advantaged growth. Like a traditional IRA, funds invested in a Trump Account grow tax-deferred, and the account must be invested in an index fund during the growth period — keeping costs low and exposure to market growth high.
The Bottom Line
Trump Accounts represent a significant — and bipartisan in concept — shift toward expanding wealth-building opportunities to American families from birth. Whether you're a new parent, an employer considering your benefits package, or a policy professional tracking implementation, the window to act is open now. Families with eligible children born between 2025 and 2028 simply need to check the box on Form 4547 when filing their taxes to stake their claim for the $1,000 contribution.
The earlier the account is opened, the longer the runway for compounding to work its magic.
Meet The Author:
As Vice President for Government Relations and Public Affairs, I work to explain how actions on Capitol Hill can impact the self-employed. I love D.C. and have made my home in Capitol Hill, where I live with my husband and black Labrador, Coltrane. We love playing volleyball and softball on the National Mall.
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