With the 2026 tax season just weeks away, officials are releasing new information about the Trump administration’s much-discussed “Trump accounts.”
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Treasury Secretary Scott Bessent unveiled additional details about the new Trump accounts during a Dec. 17 press conference, clarifying how they can be opened, managed and eventually used by children as they reach adulthood.
How to open a Trump account
Trump accounts can be established either when filing taxes with the new Form 4547 or through the dedicated website, trumpaccounts.gov. A draft version of Form 4547 has already been released for public review.
The account itself is owned by the child, while a qualified guardian or family member acts as the custodian. Only one account can be created per child. According to the official website, parents can elect to open an account for eligible children starting with 2025 tax filings or through the online portal set to launch in summer 2026.
From childhood savings to retirement funds
Once a child reaches 18, the account functions similarly to a traditional IRA.
According to the website, account holders are “free to continue letting it grow, or they can withdraw funds right away to use for things like education or a home — with all the tax advantages of a traditional IRA.”
Withdrawals outside these categories may incur the standard 10% penalty associated with IRAs. Officials are still finalizing rules around withdrawals before the child’s 18th birthday.
During the press conference, Bessent reiterated that children born between 2025 and 2028 will automatically receive a $1,000 federal grant, which does not count toward the $5,000 annual contribution limit. However, accounts can be opened for any minor, regardless of birth year.
Bessent expressed optimism that many young account holders will roll over their funds into retirement accounts once they reach adulthood.
While rollovers into traditional retirement accounts are possible, experts caution that contributions with different tax treatments, such as parental deposits versus the $1,000 grant, will need careful tracking.
Enthusiasm and skepticism build around Trump accounts
Since the program’s announcement in July, companies including BNY Mellon and BlackRock have pledged to match the federal grant for their employees’ children. Wealthy philanthropists Michael Dell and Ray Dalio have also made personal contributions.
Bessent noted that 20 states are considering additional top-ups, which would not count toward the $5,000 annual limit. Bessent indicated that certain grants could be linked to financial literacy courses, though he offered no further details.
The Trump administration plans to “reach out to all the banks to give seminars” on financial literacy, Bessent said. Over time, Bessent argued that Trump accounts will help create “much better consumers of financial products.”
Still, for all the momentum around Trump accounts, not everyone is convinced of their utility.
“The tax code provides for at least 11 tax-advantaged savings vehicles, each with different rules, limitations and regulations,” analysts at the Tax Foundation wrote in July. “The addition of the Trump accounts would further complicate savings for taxpayers who would have to keep track of yet another account.”
