If you welcomed a new baby in 2025, or are expecting one soon, you may be eligible for a new federal savings opportunity. Eligible children born between January 1, 2025, and December 31, 2028, may qualify for a one-time $1,000 government contribution through a new investment account known as a Trump Account. While the program is still being implemented, now is a good time for families to understand how it works, who qualifies, and whether it fits into their long-term financial plans.
What Is a Trump Account?
Trump Accounts, established under Internal Revenue Code Section 530A, are investment accounts created to encourage long-term savings for children. Assets are invested in a diversified U.S. stock index fund, giving families another way to begin building wealth over time. As part of the program's initial rollout, eligible children born between January 1, 2025, and December 31, 2028, may receive a one-time $1,000 government-funded contribution once the account is established and all program requirements are met. Even if your child isn't eligible for the government $1,000 contribution, an account can still be opened for any child under 18 years old born before January 1, 2025. These accounts may still be worth considering depending on your family's financial goals.
Who Can Contribute?
Beginning July 4, 2026, parents, grandparents, relatives, and others may collectively contribute up to $5,000 annually to a child's Trump Account. Certain employer contributions may also be permitted under the program and count toward the annual contribution limit. There is no requirement to contribute each year. Families can contribute as their budget and financial priorities allow.
How Do You Open an Account?
Current guidance indicates families will generally be able to establish a Trump Account by:
- Filing IRS Form 4547 with a federal income tax return, or
- Registering through the official enrollment website at trumpaccounts.gov, once available.
Because this is a new program, additional guidance is expected as implementation continues.
Is a Trump Account the Right Choice?
Like any financial decision, a Trump Account should be evaluated alongside your family's overall savings strategy. For some families, it may be an excellent opportunity to take advantage of the government's initial contribution while allowing investments to grow over time. For others, existing options such as 529 education savings plans or custodial investment accounts may continue to be the better fit. There isn't a one-size-fits-all answer. The right approach depends on your family's financial goals, tax situation, and long-term plans.
Planning Ahead
One of the most valuable things families can do is evaluate new opportunities before making decisions. Understanding how a Trump Account works, how it compares with other savings vehicles, and how it fits into your overall financial picture can help you make the most informed choice. As additional guidance becomes available, we'll continue helping clients understand how these accounts fit into their broader tax and financial planning strategies.
Next Steps
If you have a child born between January 1, 2025, and December 31, 2028, now is a good time to learn more about this new program. Our team can help you understand the eligibility requirements, answer your questions, and determine whether a Trump Account makes sense for your family's financial goals. Contact your local Capstone Accounting & Tax office to schedule a conversation with one of our tax advisors. We're here to help you make informed decisions for today and for the future.
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