Beginning in 2026, taxpayers with children of any age may make a new election on their federal income tax return to establish what is formally known as a Trump account. Created under the One, Big, Beautiful Bill Act (OBBBA) signed into law on July 4, 2025, a Trump account is structured as a traditional individual retirement account (IRA) established by an authorized individual for the exclusive benefit of a child under age 18.
The election is made using IRS Form 4547, which allows eligible taxpayers to establish an initial Trump account for a minor child, provided certain statutory requirements are satisfied.
Eligibility and the “Growth Period”
A child is eligible for a Trump account if:
- The child has not attained age 18 before the close of the calendar year in which the election is made; and
- The child has a valid Social Security number issued prior to the date of the election.
Once established, the child is referred to as the “account beneficiary” during what is known as the growth period.
The growth period begins on the date the Trump account is established and ends on December 31 of the year preceding the year in which the child turns 18. For example, if a child is born October 1, 2025, and turns 18 on October 1, 2043, the growth period ends December 31, 2042.
Special Rules During the Growth Period
During the growth period, Trump accounts are subject to special statutory rules that differ from standard IRAs:
Investment Restrictions
Assets must be invested only in “eligible investments,” such as mutual funds or exchange-traded funds (ETFs) that track an index composed primarily of U.S. companies.
Distribution Limitations
Distributions are generally prohibited during the growth period except for:
- Qualified rollover contributions to another Trump account
- Qualified ABLE rollover contributions at age 17
- Distributions of excess contributions
- Distributions upon death of the account beneficiary
Contribution Limits
During the growth period, contributions may come from only five permissible sources:
- Qualified general contributions for members of a qualified class
- Employer contributions excludable under Section 128
- Qualified rollover contributions
- Contributions from parents, the child, or other individuals
- A pilot program contribution from the Secretary of the Treasury ($1,000)
With certain exceptions (such as pilot program contributions and qualified rollover contributions), annual contributions are limited to $5,000, subject to cost-of-living adjustments after 2027. Importantly, contributions may not be made until after July 4, 2026.
Once the child reaches age 18, most special growth-period rules cease to apply, and the account becomes subject to the standard rules governing traditional IRAs under Section 408 of the Internal Revenue Code.
The Pilot Program: $1,000 Government Deposit
A separate pilot program provides a potential $1,000 Treasury contribution for children who:
- Are born after December 31, 2024, and before January 1, 2029
- Are U.S. citizens
- Have not previously received a pilot program contribution
This government contribution is not subject to the annual $5,000 limit and will not be deposited until after July 4, 2026.
This creates an important distinction:
- Existing minor children may open a Trump account through election but do not receive an automatic government deposit.
- Children born between 2025–2028 may qualify for the $1,000 pilot program contribution.
Who May Make the Election?
If the election is made solely to establish an account (without pilot program funding), an authorized individual is, in order of priority:
- Legal guardian
- Parent
- Adult sibling
- Grandparent
If an election includes a request for the pilot program contribution, the authorized individual must reasonably anticipate that the child will be his or her qualifying child for that tax year.
The authorized individual becomes the “responsible party” for the account, with authority to select investments, initiate rollovers, and designate a successor responsible party.
What Happens After Filing Form 4547?
After making the election, the Treasury Department will provide authentication instructions to activate the account (expected beginning May 2026). Additional information will be available at trumpaccounts.gov.
Estate Planning Considerations
While Trump accounts offer structured, long-term savings opportunities, families should consider:
- When and how the child gains control
- How the account coordinates with existing trust planning
- Potential financial aid and tax implications
For some families, a Trump account may complement existing estate plans. For others, a trust structure may provide greater control and flexibility.
If you would like assistance determining whether filing Form 4547 is appropriate for your family – or if you would like our firm to prepare the election on your behalf – we are happy to guide you through the process and ensure it aligns with your broader estate and financial objectives. Contact us here or by calling 303-245-2100.
