Parents can soon get $1,000 for their child, thanks to a provision in President Donald Trump’s big bill signed into law last year.
The so-called “Trump Accounts” will receive $1,000 for every baby born between 2025 and 2028, as long as their parents open an account. The seed money will be invested in the stock market by private firms, and the child can access the funds when they turn 18.
The Hill described Trump Accounts as a new type of IRA benefiting more than 14 million children expected to be born during that time period. The White House described the investment accounts as a way to “give the next generation a jump start on saving” money for their future financial well-being.
Who qualifies for Trump Accounts?
Parents or guardians can open Trump Accounts for any American child who has not yet reached age 18 and has a valid Social Security number. For babies born after Dec. 31, 2024, and before Jan. 1, 2029, any account set up in their name will receive an initial $1,000 deposit from the U.S. Treasury.
Older children born before 2025 can still get a Trump Account, but will not receive $1,000 from the government. A $6.25 billion donation by billionaires Michael and Susan Dell will potentially provide $250 in seed money for children 10 and under in ZIP codes with a median family income of $150,000 or less and who were born before 2025.
The account is fully in a child’s name, with parents or guardians serving as custodians of the account.
How do I get $1,000 in my child’s Trump Account?
Parents and guardians can elect to open Trump Accounts for eligible children when they file their 2025 taxes or through an online portal expected to open July 5, 2026, at trumpaccounts.gov.
According to Axios, parents will need to file Form 4547 to make the election establishing a Trump Account for a child. Beginning in May, the Treasury “will send information to the individual who made the election to activate the account through an authentication process and complete the opening of the initial Trump account.”
For children born during the calendar years of Trump’s second term, those accounts will automatically receive $1,000 once established. A financial institution will then invest the money in a diversified portfolio of low-cost index funds, with an average fee of 0.1%, that track the stock market.
How much money can I contribute?
Parents can contribute up to $2,500 annually in pretax income, similar to retirement accounts. Employers may also make an annual contribution of up to $2,500 that will not impact employees’ taxable income.
Yearly contributions are capped at $5,000, but contributions from governments and charities don’t count toward that total.
How much money can Trump Accounts be worth?
For a baby born in 2026, an account with $1,000 no additional investments could be worth $5,800 by age 18, according to the White House’s Council of Economic Advisers (CEA), based on average returns on the stock market. Accounts with additional contributions could be worth as much as $303,800 by age 18, the CEA estimated.
Children won’t be able to access the money until they turn 18, with rare exceptions. The Associated Press notes that disbursements from the accounts will be subject to taxes.
What about taxes?
USA Today reports individual contributions to the accounts will not qualify for the gift tax annual exclusion because they aren’t considered gifts of “present interest” (since they can’t be used until years later). As a result, donors must file a gift tax return, or IRS Form 709, for each contribution whether it’s the $25 minimum or the $5,000 maximum.
Amber Waldman, estate and gift senior director in RSM’s Washington National Tax practice, told the publication that it will create a “significant tax compliance issue,” as most popular tax filing platforms like TurboTax do not provide Form 709.
That’s different from 529 savings plans, intended to be investment accounts for children to spend on college and other education. USA Today notes that 529s were exempted by Congress “as a completed gift to such beneficiary which is not a future interest in property.”
