Beginning July 4, 2026, families in the United States will be able to contribute to a savings and investment source known as a “Trump Account.” Created under the One Big Beautiful Bill Act in 2025,  the program aims to help children build wealth over time through investing.

One of the program’s key features is a $1,000 government-funded deposit for eligible children. Families can also make additional contributions to help grow the account over the years.

How Trump Accounts Work

A Trump Account functions in much the same way as a tax-deferred retirement account established for minors. The account is owned by the child, while a parent or guardian serves as the custodian until the child reaches 18 years of age. Contributions to the account are invested in index funds, allowing long-term tax-deferred growth through investment earnings and compounding returns.

The program is designed to provide children with an investment foundation capable of long-term growth driven by compounded earnings.  Contributions may be made by parents, grandparents, employers, relatives, charitable organizations, and more. Annual contributions are capped at $5,000 per child, excluding the government-funded initial deposit.

Who Qualifies for the $1,000 Government Deposit?

To receive the government’s $1,000 contribution, a child must meet all of the following requirements:

• Be born between January 1, 2025, and December 31, 2028.
• Be a U.S. citizen.
• Have a valid Social Security number.
• Have a parent or guardian elect participation by filing IRS Form 4547 with their federal tax return.
  • According to IRS Chief Executive Frank, “The IRS has been working closely with the Treasury Department to make the election process as simple and easy as possible by permitting taxpayers to fill out a one-page form when they file their tax return.”

What If a Child Doesn’t Qualify for the Government Deposit?

Children who do not meet the birth date requirements can still open a Trump Account if they:

• Are age 18 or younger
• Have a valid Social Security number

However, they will not receive the $1,000 government-funded contribution.

Some children born before 2025 may qualify for a separate $250 government contribution if they live in an eligible ZIP code and meet program requirements.

When Can the Money Be Used?

Trump Accounts are designed for long-term investing, not short-term savings.

Funds generally cannot be accessed until the account holder reaches age 18. After that, money may be used for qualified purposes such as:

• Higher education expenses
• Purchasing a first home
• Starting a business

Withdrawals are taxed as ordinary income. Non-qualified withdrawals may be subject to additional taxes or penalties, similar to rules that apply to traditional retirement accounts.

How Much Could the Account Grow

The government’s initial $1,000 contribution may appear minimal, but long-term investment growth can significantly increase its value. The government’s contribution alone is projected to reach over 5x its value when the child turns 18.  Additionally, if family members contributed 1,000 a year until the child reached adulthood, the account could grow to approximately $50,000 or more, depending on investment performance. This can potentially create a meaningful financial asset for education, homeownership, entrepreneurship, or retirement planning.

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