The IRS recently announced that more than 4 million children have now been enrolled in tax-favored Trump Accounts, with more than 1 million children covered by elections for the $1,000 pilot program contribution. These figures are based on the number of Form 4547, Trump Account Election(s), submissions received with individual tax returns to date.
Now, tax professionals have another practical update to flag for clients. The online Form 4547 data submission portal is live, allowing parents, guardians and other authorized individuals to submit the information needed for the IRS to prepare and file Form 4547 and begin the Trump Account setup process. Form 4547 may also be filed with a client’s individual tax return.
What the proposed rules say now
On March 9, 2026, the Treasury Department and the IRS released proposed regulations for Trump Accounts, offering a detailed look at how these new tax-favored savings accounts would operate. The proposal, published in the Federal Register, focuses on the administrative and operational rules needed to implement the accounts.
Because the rules are still proposed, they are not final. The Treasury and the IRS are requesting public comments through May 8, 2026. The proposal outlines the structure tax professionals may need to understand if these accounts move forward as planned.
Key points from the proposed regulations
The proposal outlines a detailed framework for how Trump Accounts may operate. Several core features of Trump Accounts:
- Eligibility for children under age 18 with a Social Security number
- A proposed $1,000 federal contribution for certain eligible children
- Annual contributions generally limited to $5,000 from multiple sources
- Investment restrictions focused on diversified index funds
- Distribution limits generally prevent withdrawals before age 18
The Trump Account would be a traditional individual retirement account (IRA) established for a child. Although the account is owned by the child, a responsible party will generally manage it until the child reaches age 18.
Proposed federal seed contribution
One of the most notable provisions addressed in the proposed regulations is a federal contribution pilot program. The intent of the contribution is to create an initial balance that can grow through long-term investment.
The federal government would contribute $1,000 to a Trump Account for eligible children born between Jan. 1, 2025, and Dec. 31, 2028. To qualify, the child must be a U.S. citizen and have been issued a valid Social Security number.
Under these proposed regulations, government contributions would be deposited and administered within the accounts, with the initial pilot program contribution elected on Form 4547, Trump Account Election(s). When processed by the Secretary, the child will receive a $1,000 deposit into their federal Trump Account. The funds will not be issued unless the election has been made and the account has been established.
Who can establish the account?
The proposed regulations specify that an authorized individual must elect to establish the child’s account. Authorized individuals may include:
- Parents
- Legal guardians
- Another eligible family member, such as a grandparent or adult sibling, depending on who is available under the ordering rules
Even though an adult establishes and manages the account, the child is considered the account owner under the proposed rules. The proposal also addresses administrative rules such as transferring accounts between financial institutions through trustee-to-trustee transfers.
Proposed contribution rules
The proposed regulations outline several rules governing contributions to Trump Accounts. In general, the proposal sets an annual contribution limit of $5,000 per child, adjusted for inflation. Contributions may come from multiple sources, including individuals, employers, government entities and tax-exempt organizations.
The proposal also states that §128 employer contributions would be limited to $2,500 per year, adjusted for inflation and would count toward the overall annual contribution limit. Other types of contributions, such as rollover contributions and contributions made through government programs, are also covered in the proposal.
Investment restrictions under the proposal
Under the proposal, funds must generally be invested in low-cost, diversified funds, such as mutual funds or exchange-traded funds that track broad U.S. stock indexes. These restrictions are intended to promote long-term growth while limiting investment risk and administrative costs.
Proposed distribution rules
Funds in a Trump Account generally cannot be distributed during the growth period. The account is intended to function primarily as a long-term savings vehicle. After the growth period ends on Dec. 31 of the calendar year in which the beneficiary attains age 17, the account would transition to broader IRA rules. The proposal is designed to encourage long-term investment during childhood while allowing more flexibility once the beneficiary becomes an adult.