Trump Accounts: The Rules Just Got Specific, and Employers Have a Decision to Make
Trump Accounts have been on paper since the Working Families Tax Cuts passed, but the operating details were thin. In August, Treasury and the IRS filled in two significant gaps: how employers can contribute, and what the money can be invested in.
Both sets of rules are proposed, not final. That matters for how much weight to put on them, and we come back to it below. But they are specific enough to act on in a few concrete ways.
The basics, as they now stand
A Trump Account can be established for a child with a Social Security number. Parents and guardians make the election through their IRS Individual Online Account by completing Form 4547, and the election has to be made before the calendar year in which the child turns 18.
Children who are U.S. citizens born between 2025 and 2028 are eligible for a $1,000 pilot contribution. You elect it by checking the designated box on Form 4547 when you establish the account. If you have a child in that birth window, this is the single most straightforward item in this entire article: open the account, check the box.
What the August 11 rules say about employers
The first set of proposed regulations addresses employer contribution programs. An employer can contribute to Trump Accounts for employees or their dependents, with an annual limit of $2,500.
The structural requirements are the part business owners should read closely. The program must be a separate written plan of an employer for the exclusive benefit of employees, and it must satisfy nondiscrimination requirements, meaning benefits cannot favor highly compensated employees or their dependents.
In plain terms: this is not something you can do informally for three key people. It is a documented benefit plan with the same fairness constraints that apply to other employer-provided benefits. If your instinct was that this would make a nice retention tool for your senior staff, the nondiscrimination rules will reshape that idea considerably.
Whether it is still worth doing depends on your workforce. A firm where most employees have young children is a very different calculation from one where two of twelve do.
What the August 20 rules say about investments
The second set of proposed regulations is narrower than most people expect.
During what the regulations call the growth period, which runs from when the account is established through December 31 of the year the beneficiary turns 17, the money can only go into a mutual fund or ETF that tracks an equity index consisting primarily of U.S. companies, such as the S&P 500. The fund cannot use leverage, and its annual fees and expenses cannot exceed 0.1% of the balance of the investment in the fund, which is to say a fund-level expense ratio of 10 basis points or less.
That expense cap is doing real work. It rules out most actively managed funds and a fair number of index products, leaving a short list of large, low-cost index funds. If the beneficiary does not select an eligible investment, the trustee invests the funds in a compliant option automatically.
Once the growth period ends, the investment restrictions no longer apply.
Reasonable people can disagree about whether a mandatory single-asset-class allocation for up to eighteen years is good design. What is not debatable is that it is simple, cheap, and hard to get wrong, which for an account aimed at broad participation is a defensible trade.
These are proposals, and the comment period is open
This is the caveat that should shape your planning.
For the employer contribution regulations: comments are due September 25, 2026, with a public hearing scheduled for October 15, 2026 and hearing requests due by October 13.
For the eligible investment regulations: comments are due October 20, 2026. Those regulations build on Notice 2025-68, issued in December 2025, and are proposed to apply generally to tax years beginning on or after January 1, 2026.
Proposed regulations change. Sometimes in small ways, occasionally in ways that matter. So the sensible posture is asymmetric: act now on the things that do not depend on the proposals holding, and wait on the things that do.
What that means practically
If you have a child born 2025 through 2028, open the account and elect the $1,000. The pilot contribution is not contingent on how the investment regulations are finalized, and there is no reason to wait.
If you are a business owner considering a contribution program, this is a 2027 planning conversation, not a September one. Model what it would actually cost across your whole employee population, not just the employees you had in mind. Then wait for final regulations before drafting plan documents. Writing a plan against proposed rules means potentially rewriting it.
If you have views on the rules, the comment periods are genuinely open, and the September 25 deadline on employer contributions is close. Practitioners and employers who will have to operate these programs are the people best positioned to point out what will not work.
If you are weighing this against a 529, hold off on a firm conclusion. The two accounts have different purposes, different investment latitude, and different rules on getting money out, and the distribution details here deserve more clarity than the proposals currently offer.
The bottom line
One clear action item, one planning item, and one thing to watch. Open the account if you have a child in the birth window. Model the employer program on paper and revisit it when the rules are final. And treat everything else as provisional until it is.
If you are trying to work out how this fits your business or your family
That is the kind of question Holloway Financial Group handles year-round rather than once a year at filing time. The fastest way to start is our new client application.
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This article describes proposed regulations that may change before they are finalized. It is general information, not advice for your circumstances. Sources: IRS IR-2026-90 (Aug. 11, 2026); IRS IR-2026-96 (Aug. 20, 2026); IRS Notice 2025-68 (December 2025).
