Trump Accounts: How to Claim Your Child's $1,000 (2026 Update)

In July 2025, Congress passed the One Big Beautiful Bill Act (OBBBA), which created a new federal savings program for kids — informally called Trump Accounts. The program seeds a $1,000 federal deposit for every eligible American child born between January 1, 2025 and December 31, 2028, and lets parents, family, and employers contribute on top of it.

As of May 2026, the Treasury and IRS have issued the proposed regulations governing the program. Parents now claim the federal match by filing Form 4547 with their 2025 federal income tax return — or through the official consumer portal at trumpaccounts.gov (filing flow at form.trumpaccounts.gov). Private contributions don't begin until July 4, 2026.

Here's what every parent of a 2025-or-later child needs to know — eligibility, the claim mechanism, the contribution rules, how withdrawals are actually taxed, and how Trump Accounts fit alongside the UTMA, 529, and custodial Roth IRA you may already have.

What is a Trump Account?

A Trump Account is a tax-deferred investment account created under Section 530A of the tax code. Think of it as the federal government giving every eligible newborn a $1,000 head start on long-term saving — held in a low-cost index portfolio at an approved custodian, growing tax-deferred until the kid turns 18.

The mechanics, in plain English:

• The Treasury deposits a one-time $1,000 "newborn match" into the account once the parent files the Trump Account election.
• Money is invested in a low-cost, broad-market index option — similar to a target-date or all-stock fund in a 401(k).
• Parents, family, and employers can contribute up to $5,000 per year total (the cap covers everyone combined, not per-contributor).
• Employer contributions up to $2,500/year per employee's child are excluded from the employee's gross income, but count toward the $5,000 annual cap.
• The federal $1,000 newborn match does not count toward the $5,000 cap.
• Investments grow tax-deferred until withdrawal.
• At age 18, the account converts to a traditional IRA in the child's name.
• Withdrawals after that are taxed as ordinary income (just like any traditional IRA).
• The annual contribution cap is indexed to inflation starting after 2027.

Who's eligible for the $1,000 federal match?

To qualify for the $1,000 federal newborn match, your child must:

• Be a U.S. citizen with a valid Social Security number.
• Be born between January 1, 2025 and December 31, 2028 (the pilot program window).
• Have an authorized parent or guardian make the Trump Account election on their behalf.

Children born before January 1, 2025 are not eligible for the federal match. The pilot program is specifically for newborns and young children during the 2025-2028 window. Older kids cannot open a Trump Account at all under the current statute.

How to claim the $1,000 — the actual process

The federal $1,000 newborn match isn't automatic. You have to actively elect it. The official process, per the IRS proposed regulations:

1. File Form 4547 — the one-page Trump Account election — with your 2025 federal income tax return. Or use the official consumer portal at trumpaccounts.gov (direct filing flow at form.trumpaccounts.gov).
2. Pick your own custodian. Form 4547 does not assign you to a financial institution — you select one from the Treasury-approved list. Major brokerages (Fidelity, Schwab, Vanguard, and others) are expected to be approved. The full trustee directory launches with the trumpaccounts.gov portal mid-2026.
3. The trustee contacts you. Once you've submitted Form 4547 and selected a custodian, the trustee reaches out with instructions to finalize the account setup (similar to opening any other brokerage account — verify identity, confirm investment defaults).
4. The Treasury funds the $1,000. Once the account is open at an approved trustee, the federal match is deposited.

When can I actually contribute?

The federal $1,000 match lands as soon as the account is open. But private contributions — your own deposits, grandparent gifts, employer payroll contributions — cannot begin until July 4, 2026.

Between now and then, the account exists as a $1,000 holding pen growing in the default index fund. Once the contribution window opens in July, you can set up a recurring deposit. Even $50/month from age 1 to age 18 — at typical market returns — turns into ~$20,000 on top of the seed money.

How withdrawals are taxed

This is the part a lot of early reporting got wrong — and the part most parents misunderstand.

At age 18, your child's Trump Account converts to a traditional IRA. That means:

• Withdrawals are taxed as ordinary income — not at long-term capital gains rates.
• Pre-59½ withdrawals carry the standard 10% early-withdrawal penalty plus income tax, with the usual exceptions:
  • First-time home purchase: up to $10,000 penalty-free
  • Qualified higher-education expenses: penalty-free
  • Birth or adoption expenses: up to $5,000
  • Permanent disability, certain medical expenses, etc.
• Withdrawals before January 1 of the year the child turns 18 are not allowed at all.
• The account's basis (the after-tax contributions + the $1,000 match) is not taxed again. The growth above basis is what's ordinary income on withdrawal.

So while the federal seed is tax-free money going in, the account's tax treatment on the way out looks much more like a traditional IRA than a Roth IRA or a 529. This is important context when deciding how aggressively to contribute on top of the seed.

Trump Account vs. UTMA vs. 529 vs. Roth IRA

Trump Accounts don't replace the accounts you may already have for your child. They stack alongside them. Here's how they actually compare:

For most families with a 2025+ child, the right answer is not "pick one." It's:

• Open the Trump Account to capture the federal $1,000 match (free money is free money).
• Add a 529 for college savings (state tax deduction).
• Open a custodial Roth IRA the moment your kid has earned income.
• Optionally a UTMA for general gifting from grandparents.

Each one optimizes for a different future. See our 529 vs. Roth IRA deep-dive for the decision framework on the two most common picks.

How MemoryBank tracks it

The painful part of having multiple accounts for one kid is exactly that — they're spread across multiple institutions, each with its own login, statement format, and app. A 529 at Vanguard, a UTMA at Schwab, a Trump Account at Fidelity, a Roth IRA at Schwab. Four logins, four statements. None of it visible to the kid who actually owns the money.

MemoryBank connects to all of them through a single, read-only secure connection (covering most major banks and brokerages) and shows your child their portfolio in one place — Trump Account included as soon as your custodian rolls out connectivity. Live balances, growth charts, age-appropriate stories about what each holding actually is, and savings goals tied to real account values.

Crucially, MemoryBank is display-only. We can never trade, move money, or modify any account. Your custodian still owns the relationship; we just turn the data into something a kid wants to look at.

What to do this week

If your child was born in 2025 or later, here's the practical near-term:

1. Confirm eligibility — U.S. citizen, born between January 1, 2025 and December 31, 2028, with a Social Security number.
2. Make the Trump Account election at the official portal, trumpaccounts.gov. (If you're filing your 2025 return on extension, you can also attach Form 4547 to it.)
3. Watch for Treasury account-opening instructions (rolling out starting May 2026).
4. Pick your custodian when the trustee directory launches mid-2026. Most families land on whatever brokerage they already use.
5. Plan ahead for July 4, 2026 — that's when private contributions open. Set up a small recurring contribution. Even $50/month adds up significantly over 18 years.
6. Connect the account in MemoryBank so your kid can watch it grow alongside their other accounts.

Frequently asked questions

Who is eligible for a Trump Account?

U.S. citizen children with a Social Security number, born between January 1, 2025 and December 31, 2028. The federal government deposits a one-time $1,000 "newborn match" for each eligible child whose parent makes a Trump Account election.

What is the deadline to claim the $1,000 federal seed?

Parents can file the Trump Account election (Form 4547) up to December 31 of the year the child turns 17 — but the longer you wait, the less time the money has to compound. Most parents will file Form 4547 with their 2025 federal income tax return or use the IRS online portal.

When can I start contributing to my child's Trump Account?

Private contributions begin July 4, 2026. The federal $1,000 newborn match is the only money in the account before that date. Treasury opens the account-opening instructions to claimants beginning May 2026.

How much can be contributed to a Trump Account each year?

$5,000 per year total across all contributors in 2026 (indexed to inflation starting after 2027). An employer can contribute up to $2,500 per year to an employee's child's account, which counts toward the same $5,000 cap. The $1,000 federal newborn match does not count toward this limit.

How are Trump Account withdrawals taxed?

At age 18, the Trump Account converts to a traditional IRA. Withdrawals are then taxed as ordinary income — not at long-term capital gains rates. Pre-59½ withdrawals carry the standard 10% IRA early-withdrawal penalty plus income tax, with the usual exceptions for first-time home purchase (up to $10,000) and qualified education expenses.

How does a Trump Account compare to a Roth IRA for kids?

Trump Accounts are tax-deferred (convert to a traditional IRA at 18, withdrawals taxed as ordinary income). Custodial Roth IRAs are tax-free (post-tax contributions, qualified withdrawals tax-free). Roth IRAs require the kid to have earned income; Trump Accounts don't. Many families with a kid earning real income end up running both — the Trump Account for the federal seed and tax-deferred growth, the Roth IRA for tax-free compounding on earned income.

Can children born before 2025 open a Trump Account?

Children born before January 1, 2025 are not eligible for the $1,000 federal newborn match. The pilot program is specifically for children born during the 2025-2028 window.

The bottom line

The Trump Account program is the first time the federal government has seeded a tax-advantaged investment account for every American child at birth. The $1,000 isn't enormous, but compounded over 18 years at typical market returns it's closer to $3,000–$4,000 — and that's before any contributions you add on top.

The deadline isn't as tight as some early reporting made it sound — you have until your child turns 17. But the earlier you claim, the more compound growth you capture. Once you've claimed it, the next job is making sure your kid actually sees it growing, alongside the rest of their accounts. That part is exactly what MemoryBank was built for.

Note: This article reflects the May 2026 IRS proposed regulations and initial guidance. Specific dollar amounts, deadlines, and custodian rules may change as final regulations land. Always verify with trumpaccounts.gov or a licensed financial advisor before making decisions for your family.