How to Open a Trump Account: A Simple Guide for Families

Trump Accounts are a new type of investment account for children. They are scheduled to become available starting July 4, 2026.

The basic idea is simple: eligible children can receive a $1,000 contribution from the federal government, and families may be able to add more money over time.

Our view is also simple: if your child qualifies for the free $1,000, opening the account will likely make sense. But adding your own money is a separate decision and should be reviewed carefully.

Who Gets the Free $1,000?

The $1,000 federal contribution is generally available for children who:

• Were born from January 1, 2025 through December 31, 2028

• Are U.S. citizens

• Have a valid Social Security number

• Have a Trump Account election made on their behalf
  

This means many newborns and young children may qualify. Older children may still be able to have a Trump Account opened, but they may not qualify for the $1,000 government contribution.

How Much Can Be Added?

The general contribution limit is expected to be $5,000 per year per child, from all sources combined.

Employers may contribute up to $2,500 of that amount, and the employer's portion can be valuable because it may be excluded from the employee's taxable income.

However, employer contributions may not be widely available right away. Many companies have not yet added this to their benefits programs.

Are Parent Contributions Tax-Deductible?

No. This is one of the most important points.

If a parent, grandparent, or other individual contributes personal money to a Trump Account, that contribution is generally not federally tax-deductible.

That does not mean the original contribution should be taxed twice. Personal after-tax contributions are expected to create basis, which generally means the original amount contributed should not be taxed again when withdrawn. But the growth on the money may eventually be taxed as ordinary income.

That is why families should not automatically rush to max out the account.

Why Not Just Add the Full $5,000?

Because the tax benefit is limited.

A Trump Account may allow the money to grow tax-deferred, but it does not appear to offer the same clean tax-free education benefit as a 529 plan.

For college savings, a 529 plan will often be better.

For a child with legitimate earned income, a Roth IRA may often be better.

For families who want flexibility and control, a taxable investment account may sometimes be better.

The Trump Account is useful, but it is not automatically the best place for extra savings.

How Is the Money Invested?

During the child's early years, the money is expected to be invested in low-cost U.S. stock index funds.

That is a good feature. Young children have a long time horizon, and low-cost stock index funds can be a reasonable way to invest for long-term growth.

How Do You Open One?

The process begins with the IRS, not with a normal investment custodian.

Before you start, have your child’s Social Security number, date of birth, and address on hand. Then:

1. Go to IRS.gov/trumpaccounts.

2. Sign in to your IRS Individual Account, or create one, using ID.me.

3. Follow the instructions to complete and submit IRS Form 4547. This form elects your child for a Trump Account and, if eligible, the $1,000 federal contribution.

4. Check the status of your submitted election in your IRS Individual Account.

5. After the election is processed, Treasury or its agent will send activation instructions. You will then complete an authentication process and finish opening the account.

Treasury has designated BNY as financial agent for the initial Trump Accounts program. BNY has partnered with Robinhood, which will serve as brokerage and initial trustee. Families should not start by opening a normal Robinhood account directly.

Watch Out for Scams

Because this is a new federal program, scammers may try to take advantage of confusion.

Families should not respond to random calls, texts, or emails asking for personal information.

Official activation emails are expected to come from:

no-reply@TrumpAccounts.Treasury.gov

Treasury has said it will not call or text families about Trump Account activation. Any phone call or text about activation should be treated as suspicious.

Bottom Line

Trump Accounts are worth understanding, but they should not be overhyped.

For eligible children, opening the account to receive the $1,000 federal contribution will likely make sense.

But adding personal after-tax dollars is a separate decision. In many cases, families may be better served by first funding 529 plans, parent retirement accounts, Roth IRAs for working children, or flexible taxable investment accounts.

The simple rule is this:

Open it for the free money. Be thoughtful before adding your own.

Important Disclosure

Rules for Trump Accounts are still developing, and future Treasury or IRS guidance may change certain eligibility, contribution, tax, gift-tax, investment, and operational details. This article is for informational purposes only and should not be treated as tax, legal, or investment advice. Families should consult their tax advisor before making contributions or withdrawals.