Trump Accounts Arrive July 4 — What You Need to Know
Written by
John Csiszar
Edited by
Angela Corry
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The child-focused savings vehicles known as “Trump Accounts” are scheduled to begin operating on July 4, per the U.S. Treasury Department. However, many details about how they will operate remain open questions. Here’s what’s known about the Trump Accounts as of late February 2026.
Start Date for Contributions
Contributions to Trump Accounts will not be permitted before the July 4 start date, according to the IRS. However, the accounts can be opened as soon as you file your tax return simply by checking a box on Form 4547, per the Treasury.
Government Funding
Every American child born between Jan. 1, 2025, and Dec. 31, 2028, is eligible to receive a $1,000 contribution from the Treasury Department. This money will be immediately invested in an index fund, according to the U.S. Treasury.
However, parents must check the box on Form 4547 to be eligible for this government funding.
Who Is Eligible
While only newborns are eligible for the $1,000 government seed money, any American under the age of 18 is eligible to open a Trump Account. Accounts are listed in the name of the minor, but parents remain the sole custodian until children turn 18. Contributions are limited to $5,000 per year but are not mandatory.
Withdrawals Rules
Once the owner of a Trump Account turns 18, the account essentially functions as an IRA, per the IRS. Funds cannot be withdrawn without incurring a 10% early distribution penalty until age 59½, with certain exceptions such as education or the first-time purchase of a home.
Distributions from a Trump Account may be a combination of both taxable and tax-free. Per CNBC, the original seed money, along with any company matching contributions, will be taxable upon withdrawal.
However, other contributions, such as from parents, are made on an after-tax basis, meaning those funds can ultimately be withdrawn tax-free. Earnings on contributions of all types will be fully taxable upon distribution, just as with an IRA.
Fees and Investment Constraints
Unlike with IRAs, the investment options within the Trump Accounts will be listed. Information regarding which specific investments will be available remains a bit vague. According to trumpaccounts.gov, the government’s official site regarding the accounts, “Funds will be invested in a diversified portfolio of low-cost index funds designed to maximize long-term growth while minimizing risk.”
As of Feb. 26, specific regarding fees have also not been released.
Are They Worth It?
The $1,000 “free money” offered by the government makes Trump Accounts worthwhile, especially for lower-income households. However, that money is only available to children born between 2025 and 2028. After the initial seed money, other alternatives may be better. Higher-income households, for example, may benefit more from the higher contribution limits on 529 plans.
The best course of action may be to wait until all of the specifics of the Trump Accounts are released, including specific investment options and fees, so you can make a clear, side-by-side comparison of all of the available alternatives.
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