IRS issues guidance on Trump Accounts

The Treasury Department and the Internal Revenue Service have given a general overview of how Trump Accounts work and addressed certain initial questions about creating initial and rollover accounts, which are a new type of IRAs.

Notice 2025-68 covers the $1,000 pilot program contribution, other contributions — including qualified general contributions and Section 128 employer contributions — eligible investments, distributions, reporting and coordination with the rules applicable to other types of IRAs.

The release of the guidance coincided with Dell Technologies founder and CEO Michael Dell and his wife Susan helping to kickstart the program with a $6.25 billion donation slated to give 25 million children $250 each for an investment account.

The One Big Beautiful Bill Act provides for establishing a Trump Account for every eligible child for whom an election is made and who has not turned 18 before the end of the calendar year in which the election is made. Contributions to Trump Accounts cannot be made before next July 4.

The federal government will make a one-time $1,000 pilot program contribution to the Trump Account of each eligible child for whom an election is made, who is a U.S. citizen and who is born on or after last Jan. 1 through Dec. 31, 2028.

Certain governmental entities and charities may also make qualified general contributions to Trump Accounts; other persons are able to make contributions up to an aggregate limit of $5,000 per year.

Furthermore, an employer may contribute to a Trump Account of an employee or the employee’s dependent up to $2,500 per year (which counts against the $5,000 annual limit) under an employer’s Trump Account contribution program (the contribution will not count toward the employee’s taxable income). The annual contribution limits are indexed to inflation and will adjust starting after 2027.

The funds in Trump Accounts must be invested in certain mutual funds or ETFs that track the S&P 500 or another index of primarily American equities. Amounts generally cannot be withdrawn before Jan. 1 of the calendar year in which the child turns 18. After that point, the account generally is treated as a traditional IRA and is subject to the same rules as other traditional IRAs.

The notice requests comments on numerous issues related to the accounts.

The IRS is posting a draft Form 4547, “Trump Account Election(s),” to the agency’s draft tax forms. When final, the new form can be used to establish a Trump Account and to enroll in the pilot program.