Available in July 2026, Trump accounts are tax-advantaged IRAs that give adults another way to begin saving for children when they're born.
Quick takeaways
Parents, relatives, and loved ones have always had options— from traditional savings accounts to 529 educational savings plans— to put money aside for the kids in their lives. Beginning in 2026, there’s one more to add to the list: a 530A individual retirement account (IRA) known as a Trump account.
Created in 2025 as part of HR1, known as the One Big Beautiful Bill, Trump accounts are specifically for children under age 18 who have a Social Security number and are U.S. citizens.
Trump accounts function as a tax-advantaged IRA; earnings grow tax-free until withdrawal. The accounts, which are owned by the child, are managed by an adult until he or she reaches age 18.
Though a pilot program, the federal government has committed to contributing $1,000 to each Trump account for children born between January 1, 2025, and December 31, 2028. Any adult may also contribute post-tax dollars to these account, up to $5,000 per year. These contributions are not tax deductible.
In addition, employers may choose to contribute up to $2,500 yearly for an employee; that total does not figure in to an employee’s taxable income. Other government entities and charitable organizations may have additional contributions available; if so, those contributions also do not count toward the $5,000 contribution limit.
The U.S. Treasury sets rules for eligible investments for funds in Trump accounts. In general, the Treasury is expected to choose funds that are low cost and track the broad U.S. stock market. That investment mix is expected to help manage risk and focus on long-term growth.
An account owner may not withdraw any funds from a Trump account until he or she reaches the age of 18. Then, the withdrawal rules are the same as those of a traditional IRA.
Money in the account grows tax-deferred, which means you don’t pay taxes each year on investment earnings. Taxes are paid later, when money is withdrawn. When the child turns 18, they may use the funds without penalty for IRS-defined expenses such as education or a first home; they may have to pay income tax on withdrawals . (No tax should be due on any post-tax contributions from others, but account holders should track the source of deposits.)
Those are federal rules; state rules are a different matter. Under some current state laws, those accounts may be taxable, although those regulations may change in the future. Your tax advisor can help.
There is one additional rule that applies to Trump account withdrawals: Account holders who turn 18 and keep the Trump account separate from any other IRAs don’t have to combine it with other IRAs when calculating taxes and penalities on withdrawals. For help, contact your tax advisor.
Trump accounts are expected to launch July 5, 2026. Each child may have only one Trump account.
To open an account, your child must have a Social Security number and be a U.S. citizen under 18 years old on December 31 of the year the account is opened. Legal guardians, parents, adult siblings, or grandparents can open a Trump account for eligible minors by submitting IRA Form 4547 at any time, or by using the online portal.
Early lessons about saving and early investments like those offered by Trump accounts offer yet another way to put money aside early, take advantage of compound growth, and help teach children about money. Each type of investment account—Trump accounts, 529s, to name just two—have specific rules, helping complement and diversify a life of savings options.
Even as you try to help your children save and plan, your own future retirement goals matter, too. How well are you progressing toward your retirement savings goal? Use the Principal personalized
