Trump Accounts for kids: the $1,000, other free money and the tax on withdrawals
A Trump Account (§530A of the tax code) is a traditional IRA a child owns, invested in U.S. stock index funds and locked until 18.
- Who qualifies: Any child with a Social Security number who's 17 or younger on Dec. 31
- Deadline: Open, and claim the $1,000, by Dec. 31 of the year the child turns 17; no activation deadline announced
- The $1,000: For U.S. citizens born 2025–2028, if claimed on Form 4547
- Yearly limit: $5,000 from family, friends and employers together; not deductible
- Money out: None before 18, not even for hardship
- Taxed on withdrawal: Growth, the $1,000 and employer money; not deposits from family or friends
Treasury's rules on opening accounts, the $1,000, employer money and investments are proposed, not final.
Who can have one
Any child with a valid Social Security number can have one if it's opened by December 31 of the year they turn 17. For 2026: born after December 31, 2008.
There's no citizenship requirement or income limit; citizenship matters only for the $1,000. Born before 2025? No $1,000, but gifts such as the Dell $250 reach many older children.
Who can open it, and who manages it
Who may open it (proposed rules): the first available of a legal guardian, a parent, an adult sibling or a grandparent. An adult sibling or grandparent who files swears no one ahead of them was available. To open it and claim the $1,000 together, the filer instead must expect the child to be their qualifying child that year (roughly, a child who lives with them more than half the year and meets the tax code's age and relationship tests). That's usually a parent, sometimes a grandparent who lives with the child.
The filer manages the account and will pick its investments once there's a choice. If two people file, the first to finish activation manages it. A parent can file with an ITIN (the IRS number for people who can't get an SSN); only the child needs an SSN. A state child-welfare agency that is a foster child's guardian can open one, and states may fund it with federal welfare (TANF) money.
The Treasury's $1,000
The Treasury deposits $1,000 once for each U.S. citizen child born 2025 through 2028. It has to be claimed: the filer checks line 7 on Form 4547.
The fine print on the $1,000
It's paid only into the account, never as a check. A careless claim for a child who doesn't qualify, such as one born in 2024 or not a citizen, costs a $500 penalty; a fraudulent one, $1,000.
Free money: donors, a state and employers
The biggest gift is $250 from Michael and Susan Dell, for children born 2016–2024 in ZIP codes with a median family income of $150,000 or less; deposits began the week of Aug. 31, 2026 (check a ZIP code). Donors, Oklahoma and employers have promised other money to some children. Gifts reach only activated accounts, and the app may ask you to claim one.
Local gifts are matched by the county entered on Form 4547, so enter it accurately.
As of September 24, 2026:
| Giver and amount | Which children | Status |
|---|
| U.S. Treasury, $1,000 | U.S. citizens born 2025–2028 | Law; claimed on Form 4547, line 7 |
| Michael and Susan Dell, $250 | Born 2016–2024, where the ZIP code's median family income is $150,000 or less; the first 25 million activated accounts, then older children if money remains | Deposits began the week of Aug. 31, 2026; automatic |
| Brad Gerstner, $250 | Indiana, born 2023 or 2024, same ZIP-code test as Dell | Deposits start the week of Sept. 22, 2026 |
| Ray and Barbara Dalio, $250 | Connecticut, under age 10, ZIP-code median income below $150,000; about 300,000 children | Pledged |
| State of Oklahoma, $250 | Oklahoma children under 18 who are U.S. citizens and have a Trump Account; about 50,000, paid in the order applications are verified | State law; the application isn't out yet |
| Anonymous donor, about $500 | San Francisco births in 2026 | Pledged, $3.5 million in all |
| Micron, $250 | 25 counties near Micron sites in CA, CO, ID, MN, NY, TX and VA | Pledged |
| Gwynne Shotwell and her husband, one SpaceX share each | About 2 million children aged 11–17 in lower-income areas, more near central Texas | Pledged; Treasury accepts donated stock but hasn't said how it becomes index-fund shares |
| Kraken, undisclosed | Wyoming births in 2026 | Pledged |
| Stable Road Foundation, $250 | Hawaii foster children aged 11–17 | Pledged |
Each gift's announcement is in the sources at the end.
Employers. Over 50 had committed by Aug. 11; Franklin Templeton, State Street and Visa match the $1,000. An employer's tax-free limit is $2,500 a year per worker, however many children they have; whatever a child gets counts toward that child's $5,000. The Treasury's account can't take employer money yet.
Employer contributions: the proposed rules
Treasury proposed these rules on Aug. 11, 2026; they aren't final.
- Each working parent's employer has its own limit, so two employers can fund one child, up to the $5,000.
- A cafeteria plan (the plan that handles pre-tax benefits such as health premiums) can let workers redirect pay, before income tax, into a dependent's account.
- It skips income tax, not Social Security and Medicare tax. Any excess is taxable pay.
- Sole proprietors, partners and owners of more than 2% of an S corporation can't use it for their own children.
- It's taxed when the child withdraws it.
Treasury's August list also names Chime, which offers a match, and Vanguard, whose employees can direct $1,500 into an account from 2027; Micron matches employees' deposits up to $1,000 per child.
Donor gifts: the limit and the tax (unsettled)
Gifts the Treasury routes to a whole group don't count toward the limit, and they're taxed when withdrawn. Until Treasury designates smaller areas, IRS guidance lets such a gift target only all children, one or more states, or birth years, with no added tests.
Several gifts add one: ZIP-code income (Dell, Dalio, Gerstner), counties (Micron), a city (San Francisco), area income (Shotwell), foster status (Stable Road) or an application (Oklahoma). No IRS or Treasury document yet says whether those count toward the limit or how they're taxed at withdrawal.
How to open one
File Form 4547, then activate the account from the email Treasury sends. Opening is free.
- File in the Trump Accounts app, at trumpaccount.com, in your IRS online account or with your tax return. Online filing needs a photo ID and a live selfie.
- Wait for the email from no-reply@trumpaccounts.treasury.gov. IRS processing takes 1–3 business days.
- Activate in the app or on the website, matching the form's details.
- To add money, link a bank account or debit card; recurring deposits need a bank account.
Login, support and scams
Log in with the Trump Accounts app or, on a computer, at trumpaccount.com; on a phone the site opens the app. Help: 866-USA-4547 (866-872-4547), phone or chat, 7 AM to 10 PM ET daily except stock market holidays.
- Real sites: trumpaccounts.gov is Treasury's information site; accounts live at trumpaccount.com, with Robinhood as trustee.
- Real messages: the activation email comes only from no-reply@trumpaccounts.treasury.gov; later email comes from @trumpaccount.com, and the IRS emails about the election's status. Treasury may also text or place automated calls; none of them asks for a password or one-time code.
"Unable to process," "can't verify" and other errors
Unable to process, or the child can't be verified: often a mismatch with IRS records in a name, birth date or SSN. In your IRS online account, open My Elections, then Unable to Process, for the notice. Fix it and file a new Form 4547; that won't create a duplicate claim.
You can't be verified: often your own name, SSN or birth date doesn't match IRS records. Fix it in your IRS online account and refile.
The child already has an account: someone else opened one first. Support can't say who, but helps if it wasn't authorized.
Putting money in
Anyone can add money through the year the child turns 17. The limit is $5,000 per child per year from family, friends and employers combined; deposits aren't tax-deductible.
- Cash only: no stock, and no rollovers from a 529 or IRA.
- Calendar year: a January deposit can't count for the prior year.
- Outside the limit: the $1,000 and gifts the Treasury pays to a whole group of children, such as every child in a state.
- Grandparents and friends give through a link the account manager shares, and usually need no gift tax return.
How it's invested
Everything now goes into one fund, State Street's SPYM, an S&P 500 index ETF costing 0.02% a year, with no account fees. Four more are named, but no one can pick them yet.
- Only U.S. stock index funds, costing 0.1% a year or less. No bonds or cash funds.
- It can lose value. The government doesn't guarantee it; SIPC covers a failed broker, not market losses.
The fund list and the proposed investment rules
The four others are iShares Core S&P 500 (IVV), Vanguard Total Stock Market (VTI), SPDR Portfolio S&P 1500 Composite (SPTM) and iShares Core S&P Total U.S. Stock Market (ITOT).
Under rules proposed Aug. 21, 2026, an index would count as U.S. if U.S. companies are at least 90% of its weight. Funds tracking ESG (environmental, social and governance) indexes would be out; actively managed funds already are. All fund costs, including sales charges, would count toward the 0.1%. Trustee fees fall outside that cap; Treasury asked whether to ban them.
At 18: withdrawals and taxes
From the year the child turns 18, the money can come out for any reason. At the Treasury's account, the young adult takes control on their 18th birthday, when the money moves to a traditional IRA they can spend or leave invested. Growth, the $1,000 and employer money are taxed as income when withdrawn, plus 10% before 59½ unless an exception applies.
- Untaxed: deposits from parents, relatives, friends or the child.
- Taxed as income: growth, the $1,000, employer money and gifts the Treasury pays to a whole group. How ZIP-code gifts such as Dell's are taxed is unsettled.
- The mix: each withdrawal is part untaxed, part taxable, in proportion to the whole account.
- Before 59½: a 10% additional tax on the taxable part, unless an exception applies, such as college or a first home.
The months before the 18th birthday
The Treasury's account waits for the 18th birthday and takes no deposits between January 1 and that day; the law itself allows withdrawals from January 1.
Take a child born October 1, 2025. The special rules end December 31, 2042. The law allows withdrawals from January 1, 2043; the Treasury's account, from October 1, 2043.
An account still at $0 at 18 is closed. IRS guidance doesn't address states where adulthood starts at 19 or 21; the Treasury's account hands control over at 18.
How a withdrawal is taxed: an illustration
Say the account holds $20,000: $8,000 deposited by family and friends and $12,000 that's taxable. Each withdrawal is then 40% untaxed and 60% taxable, so taking out $10,000 adds $6,000 to the young adult's income, plus $600 of 10% tax before 59½ unless an exception applies. Once the money is in a regular traditional IRA, the split counts all of the person's traditional IRAs together. Illustration only, not a projection.
The kiddie tax can tax unearned income above $2,700, including the taxable part of a withdrawal, at the parents' rate. That can happen at 18, and from 19 to 23 for a full-time student, when the young adult's own earnings pay for no more than half of their support. New deposits after 18 need earned income and share the regular $7,500 IRA limit.
College, a first home, financial aid
It can pay for college, but only the deposits' share of each withdrawal is tax-free. College costs, and up to $10,000 toward a first home, avoid the 10% additional tax, not the income tax.
Financial aid is unsettled. The 2027–28 FAFSA tells families to leave out retirement accounts, and a Trump Account is legally an IRA, but no Education Department guidance mentions Trump Accounts yet. Money taken out counts as income for the student on the FAFSA that uses that year's tax return.
SSI and Medicaid
For SSI, the account isn't a countable resource before the year the child turns 18; from that January, it is. No guidance on Medicaid was found.
Is it worth opening? What it offers and what it costs
What it offers depends on the child. What it costs is the same for everyone: the money is locked until 18, and everything except deposits from family and friends is taxed when withdrawn.
- Born 2025–2028, U.S. citizen: opening the account and claiming the $1,000 is free and needs no deposit of your own; the $1,000 and its growth are taxed when withdrawn, and some states tax the gains each year.
- Born 2016–2024, or a parent's employer offers a match: the Dell $250 (in qualifying ZIP codes), local gifts and employer money are paid only into this account.
- Saving for college yourself: a 529's growth is tax-free when it pays for school; this account's growth is taxed.
- A teenager: fewer years invested, and the child controls it at 18.
- Trade-offs: locked until 18, growth taxed when withdrawn, one fund for now, rules still proposed.
General information about the account, not a recommendation for any family.
How it compares
A 529 is built for education and a custodial Roth IRA for a working child's long-term savings; what sets the Trump Account apart is the free money. A child can have all three.
- vs a 529: a 529's earnings are tax-free when they pay qualified education costs, and control stays with the account owner, usually a parent. Trump Account vs 529
- vs a custodial Roth IRA: deposits can't exceed the child's earnings or $7,500, but they can come back out at any time, and growth is tax-free after 59½ once the account is five years old. A child with a job can have both. Trump Account vs custodial Roth
- vs a UTMA: any investment, and the custodian can spend it for the child at any time, but its income is taxed yearly and it counts as the child's asset on the FAFSA. All five accounts
State taxes
California follows the federal rules from 2026; Pennsylvania, Wisconsin and Massachusetts don't.
Frequently asked questions
Is a Trump Account tax-free?
No, it's tax-deferred. No federal tax is due while the money stays in, and no yearly tax forms for dividends arrive; some states differ, and Pennsylvania taxes the gains yearly. On withdrawal, growth, the $1,000, employer money and gifts the Treasury pays to a whole group are taxed as income. Deposits from family, friends or the child come out untaxed.
My child turns 17 this year. Is it too late to open one?
Not if Form 4547 is filed by December 31. After that, no account can be opened for that child. Deposits must also land by December 31, and only an activated account takes them, so file early. Those deposits come back out untaxed; growth on them is taxed. Until December 31 it can also take an employer contribution or a gift the child qualifies for; nothing can go in after that until 18.
Is there a deadline to activate, such as June 30?
No activation deadline has been announced, and we found no official source for June 30. Form 4547 must be filed by December 31 of the year the child turns 17, and under proposed rules the $1,000 must be claimed by then too. Some gifts go to the earliest accounts (Dell's to the first 25 million activated), so waiting can cost a gift.
Why hasn't the $1,000 or the $250 arrived?
Check activation first: both go only into activated accounts. Then check the election in your IRS online account: "Processing" means wait; "Unable to process" means a mismatch to fix. The $1,000 also needs its box checked on Form 4547, and the Dell $250 depends on birth year and ZIP code.
How much will a Trump Account be worth at 18?
No one can say. The balance depends on deposits, gifts and the stock market, and it can fall. Calculators assume a steady yearly return; real returns vary, and some years are negative. For the tax when money comes out, see how a withdrawal is taxed.
Can a parent take money out?
No. The account belongs to the child. Until 18, no one can withdraw, not even for hardship; the adult who opened it only manages it. At the Treasury's account, the child takes control at 18 and the manager loses access.
Can my child convert a Trump Account to a Roth IRA?
Yes. The law allows it from January 1 of the year the child turns 18; the Treasury's account holds the money until the 18th birthday. Before then, the only ways out are moving the whole account to another Trump Account, or a rollover to the child's ABLE account (a savings account for people whose disability began before 46) during the year they turn 17. The converted amount, minus the part that came from deposits by family and friends, is added to that year's income, and the kiddie tax can apply to it.
Can grandparents open a Trump Account or add to one?
They can add money through December 31 of the year the child turns 17; opening an account is harder. The adult managing it shares a contribution link, and a grandparent's deposits share the child's $5,000 yearly limit with everyone else's. Under proposed rules, a grandparent may open one only when no legal guardian, parent or adult sibling is available, or, to claim the $1,000, when they expect the child to be their qualifying child that year.
Do grandparents or parents need to file a gift tax return?
Usually not. Under an IRS safe harbor, no Form 709 is needed if, among other conditions, the Trump deposits are cash, the giver's total gifts to each child that year stay within $19,000, and no 709 is required or filed for anything else. Miss one, for example with a five-year 529 election the same year, and all that year's Trump deposits go on a 709 without the annual exclusion. Even then, gift tax is due only once the giver's lifetime taxable gifts pass $15 million.
Divorced parents, both parents, twins: who opens it?
The first person to finish activation manages it. Each child can have only one account. Either parent can open it; to also claim the $1,000, the filer must expect the child to be their qualifying child that year, which for divorced or separated parents generally means the parent the child lives with more than half the year. On a joint return, the primary taxpayer may have to activate; the other spouse can file their own Form 4547 or become a trusted contact. Each Form 4547 covers up to two children; the app takes up to 16 at once. The manager can change later, and the account then gets a new number.
What if we never add money?
The account generally stays open and can still receive the $1,000 and any gifts. They're invested like any deposit. Unused room under the $5,000 doesn't carry into the next year. An account still at $0 at 18 is closed.
Can I contribute pre-tax through work?
Only if your employer offers it. Under proposed rules, an employer's pre-tax benefits plan (a cafeteria plan) can redirect part of your pay, before income tax, into your child's account. It counts toward the employer's $2,500 per-employee limit and the child's $5,000. Social Security and Medicare tax still apply. Deposits you make on your own aren't deductible.
General information, simplified, as of the date on each source. Most of Treasury's Trump Account rules are still proposed. Check with your CPA or financial professional before acting.