Tax Planning
Planning for Trump Accounts: What Parents and Guardians Need to Know
A closer look at the new Trump Accounts pilot under the One, Big, Beautiful Bill—how eligibility works, what contributions you can expect, and action steps now.
By NomadicTax Research Team • 5-8 min read • April 17, 2026
## What Are Trump Accounts?
Under the _One, Big, Beautiful Bill Act_ (Public Law 119-21), a **Trump Account** is a new type of retirement-style account for children born in 2025-2028. It functions like a traditional IRA, but with special rules for the period until the child turns 18. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
During that growth period, the account benefits from expanded contributor sources—governments and nonprofits, for example—and there’s a **$1,000 government contribution** per eligible child under a pilot program. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
## Who Is Eligible and When
- Must be a U.S. citizen born in **2025, 2026, 2027, or 2028**, with a Social Security number; must not have previously had a request processed under the pilot program. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
- The **growth period** is from account establishment until December 31 of the calendar year in which the child turns **17**. After that, standard IRA rules take over. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
## Contributions and Limits
- Contributions count toward—but do *not* reduce—the standard annual IRA limit ($5,000 for 2025/2026 unless adjusted) for the child. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
- The $1,000 government pilot program contribution is **above the standard limit**. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
- Individuals or entities (including government and nonprofits) may make contributions. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
## How to Take Action Now
1. **Decide whether you’ll make a pilot election** for your child’s Trump Account under § 6434. Watch for IRS guidance and forms (e.g. Form 4547) that will facilitate this. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
2. **Open a Trump Account** for your child if you haven't already—but understand growth period constraints. Check IRA custodians whether they support Trump Accounts.
3. **Coordinate contributions**. Because the pilot contribution doesn’t count toward the $5,000-limit, you still have space for additional contributions without risking over-contribution penalties.
4. **Track any upcoming proposed regulations**. IRS has proposed rules for electronic statements, contribution procedures, and other implementation details under § 6434. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
## Example
Imagine Jane has a daughter born in 2026. She opens a Trump Account for her daughter and makes a $3,000 contribution from her household. Meanwhile, the pilot program contributes $1,000. For that tax year, her daughter’s total contributions reach $4,000—within the $5,000 IRA limit—and includes the extra government amount. Jane should ensure that her custodian accounts for the special growth period rules until her daughter’s 17th birthday.
## Key Risks and Considerations
- **Custodian choice matters**: Not all financial institutions may support the special election or the pilot program properly.
- **Documentation and elections**: Missing the pilot program election window means missing the $1,000 contribution.
- **Phase-in complexity**: Rules change once the child turns 18; future earnings taxation and withdrawal rules may differ.
## Takeaway Summary
*For parents or guardians with children born in 2025-2028, **Trump Accounts** with the $1,000 pilot contribution represent a valuable opportunity. Start early: open the account, make contributions, and file the required election. The window is limited, and guidance is still rolling out.*