When new legislation becomes law, it often raises a number of unanswered questions.
That’s the case with the “Trump Accounts.”
The One Big Beautiful Bill Act (OBBBA) in July 2025 introduced the new tax-advantaged savings account for children born between 2025 and 2028. The IRS has provided some initial guidance but is working on a more comprehensive report.
So, if you’re wondering what Trump Accounts are, who qualifies, and how they work, here’s what is known so far.
“He put another parable before them, saying, ‘The kingdom of heaven is like a grain of mustard seed that a man took and sowed in his field. It is the smallest of all seeds, but when it has grown it is larger than all the garden plants and becomes a tree, so that the birds of the air come and make nests in its branches.’ ” Matthew 13:31-32
Always | Sometimes | Never |
|---|---|---|
Driver’s license | Medical card | Social Security card |
Credit card | Dental card | Passwords |
Debit card | Gift cards | Birth certificate |
Cash | Passport card | |
House key |
What, When, and How1,2
- Trump Accounts are custodial-style traditional IRA for minors—owned by the child but administered by an adult.
- Trump Accounts are slated to be available July 4, 2026, for newborns born between January 1, 2025, and December 31, 2028.
- The Treasury will set up and administer the accounts. Rollovers to financial institutions may be available after their launch.
- A one-time $1,000 government contribution is offered for American children who have a Social Security number. Additional contributions can come from individuals, employers, and charities.
- No withdrawals are allowed before age 18. After that, traditional IRA rules apply.
More Answers
- Where can I find more information? The IRS has provided its initial guidance in Notice 2025-68. The OBBBA requires that someone accepts the federal government’s $1,000 on behalf of the child. The Notice also gives some basic instructions, including an additional form (Form 4547) that would be filed with your federal tax return.
- Can I convert the account to a Roth IRA when the child turns 18? The initial guidance in Notice 2025-68 says that Trump Account funds can be converted to a Roth IRA starting in the year the individual turns age 18. Once the Roth IRA is open, the new account could have decades of tax-free growth from the money that was originally placed in the account.
- What about required minimum distributions (RMDs)? Yes, RMDs would be required according to the notice. That may add to the appeal of a Roth conversion. The original Roth IRA owner is not required to take minimum annual withdrawals. Plus, Roth distributions must meet a five-year holding period and occur after age 59½ to qualify for the tax-free and penalty-free withdrawal of earnings. In other circumstances, tax-free and penalty-free withdrawal can also be taken, such as following the owner’s death.
A Trump account may not be right for everyone, but it’s worth considering if you have a newborn. We can help you evaluate the role an account can play in your overall family finances, including how it may complement your current approach regarding saving for college.
If you’re concerned about filing your federal taxes, check with your tax, legal, or accounting professional. Or, if you would like, we can put you in touch with cfd Tax Preparation & Bookkeeping. Our team of tax professionals includes certified public accountants and other specialists who are dedicated to helping people manage their taxes with confidence.
- IRAHelp.com, December 15, 2025
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Fidelity.com, January 9, 2026
