IRS Releases Initial Guidance on New Trump Accounts

Understanding how Trump Accounts work and who is eligible

The Department of the Treasury and the Internal Revenue Service (IRS) issued notice 2025-68, providing the first set of guidance for Trump Accounts, a new type of individual retirement account (IRA) created through the Working Families Tax Cuts Act. Trump Accounts are intended to help families build long-term savings for eligible children. Once the child reaches 18, the accounts convert to a traditional IRA.  

Eligibility, elections, and contributions

Trump Accounts may be established for U.S. citizens with a valid Social Security number, born between 2025 and 2028. To open the account, parents or guardians must file Form 4547, Trump Account Election(s), and elect into the federal pilot program.  You can elect to open Trump Accounts for your eligible children when you file your 2025 taxes or through an online portal that will be available by summer 2026. 

Contributions to Trump Accounts are scheduled to begin after July 4,2026, and the Federal Government will contribute the initial $1,000 to each eligible child’s account once an election is made on their behalf. Families may contribute up to $5,000 per year to a Trump Account and employers participating in the program may contribute up to $2,500 per year.  

A recent $6.25 billion charitable commitment from the Dell family will provide an additional $250 of funding to the first 25 million American children age 10 and under living in zip codes with median incomes below $150,000.  

Distribution and transfers

Funds must be invested in a qualified mutual fund or EFT. Funds cannot be withdrawn before the beneficiary turns 18, but they are eligible to be transferred to another brokerage in a trustee-to-trustee transfer, giving parents or guardians the flexibility to choose preferred brokerage custodians.  When the child turns 18, the account will generally be treated like a traditional IRA. Funds withdrawn prior to age 59 ½ will be subject to early withdrawal penalties unless an exception applies. Exceptions include qualified education expenses, a first home purchase, or starting a business.

Next steps

The IRS plans to issue proposed regulations and is accepting comments through February 20, 2026. Families, employers, and advisors should begin familiarizing themselves with the new election process, contribution limits, and long-term planning considerations.  

Keiter will continue to monitor updates as additional guidance is released. For questions about incorporating Trump Accounts into your family wealth strategy, contact your Keiter Opportunity Advisor.  

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Sources: 

• IRS Newsroom – Treasury, IRS Issue Guidance on Trump Accounts
• White House Release – Landmark Dell Gift Supercharges Trump Accounts
• Trump Accounts website