Invest in America Program: Eligibility, Contributions, and Taxes

Trump Accounts are federally created, tax-advantaged investment accounts for American children, established under the One Big Beautiful Bill Act signed into law on July 4, 2025. Every U.S. citizen child born between January 1, 2025, and December 31, 2028, is eligible for a $1,000 seed deposit from the Treasury, and any child under 18 with a Social Security number can hold an account that parents, relatives, and employers may contribute to. The program officially launched on July 4, 2026, and by mid-June 2026 more than six million children had been signed up.¹

Legally, the account is a special type of traditional IRA under new Section 530A of the Internal Revenue Code. It operates under its own rules during a “growth period” that runs until January 1 of the year the child turns 18, then converts into a standard traditional IRA.²

Who Qualifies

Two different eligibility rules apply, and it’s worth keeping them straight.

Any child under age 18 with a valid Social Security number can hold a Trump Account. There is no income threshold. Each child can have only one account, and it must be opened by a legal guardian, parent, adult sibling, or grandparent.²

The $1,000 federal seed contribution is narrower. To receive it, the child must be a U.S. citizen born between January 1, 2025, and December 31, 2028, and the household must be able to claim the child as a dependent for the child tax credit.³² Children born before 2025 can hold accounts but do not receive the federal deposit. As of mid-June 2026, roughly 1.4 million of the six million enrolled children qualified for the pilot deposit.¹

How to Open an Account

Parents and guardians enroll by filing IRS Form 4547 (Trump Account Election). The form can be submitted with a 2025 tax return or through the online portal at trumpaccounts.gov.⁴ A Trump Accounts app launched on May 28, 2026, on both the Apple and Google app stores and is the primary tool for managing an account going forward.⁵

All initial accounts are created and held through The Bank of New York Mellon, which Treasury designated as the program’s financial agent in April 2026. Robinhood serves as the initial brokerage and trustee.⁶ Once open, an account can be moved to a different financial institution through a trustee-to-trustee transfer.⁷

Official communications come only from no-reply@TrumpAccounts.Treasury.gov. Treasury has warned families to ignore texts, phone calls, or search-engine results claiming to offer Trump Account support, since these may be scams.⁵

Contributions and Limits

The annual contribution limit is $5,000 per child, indexed for inflation starting in 2028. Parents, grandparents, other family members, friends, and employers can all contribute. The $1,000 federal seed deposit does not count toward the cap.⁸

Employers may contribute up to $2,500 per year toward an employee’s dependent child’s account. Those dollars are excluded from the employee’s taxable income but do count toward the overall $5,000 annual limit. Employers can also offer contributions through a cafeteria plan using pre-tax salary reductions.⁹

Contributions from qualifying charitable organizations and from state, local, or tribal governments for all children in a defined “qualified class” (for example, all children born in a given year or all children in a given state) are exempt from the $5,000 cap.²

How the Money Is Invested

Funds must be held in diversified index mutual funds or ETFs that track the S&P 500 or another index composed of at least 90 percent U.S. companies by weighted value. The investments cannot use leverage, and annual fees are capped at 0.1 percent of the account balance.¹⁰ Individual stocks, bonds, and sector-specific index funds are all prohibited during the growth period.²

Taxes and When the Money Comes Out

Personal contributions are made with after-tax dollars and are not deductible. Investment earnings grow tax-deferred. At withdrawal, the portion representing personal after-tax contributions is tax-free. Everything else, meaning employer contributions, government deposits, charitable contributions, and all investment gains, is taxed as ordinary income.²

Withdrawals are generally prohibited during the growth period. The one exception is a direct rollover into an ABLE account for a disabled beneficiary, allowed in the year the child turns 17.²

Once the growth period ends, the account follows standard traditional IRA rules. Withdrawals before age 59½ carry a 10 percent early withdrawal penalty unless an exception applies. Penalty-free exceptions include first-home purchases (up to $10,000), higher education expenses, birth or adoption expenses (up to $5,000), emergency personal expenses (up to $1,000 per year), and certain medical costs.² The account can also be converted to a Roth IRA starting January 1 of the year the child turns 18, though any converted amount counts as taxable income in the year of conversion.¹¹

How They Compare to 529s, UGMA/UTMA, and Roth IRAs

Trump Accounts sit in a different lane from the other common child savings vehicles. Fidelity has summarized the main differences this way:

529 plans are built for education, offering tax-free withdrawals for qualified education expenses; assets are typically counted as the parent’s for financial aid.
UGMA and UTMA custodial accounts offer the most flexibility in how funds are used, but earnings above $2,700 are taxed at the parents’ marginal rate under the kiddie tax.
Roth IRAs for minors require the child to have earned income; contributions can be withdrawn tax-free at any time, and qualified earnings withdrawals after age 59½ are tax-free.
Trump Accounts are designed primarily as long-term retirement vehicles, don’t require the child to have earned income, and are the only account type that receives the $1,000 government seed; withdrawals from anything other than personal contributions are taxable, and funds are locked until age 18.¹¹

Fidelity has suggested that families with eligible newborns claim the $1,000 seed by opening a Trump Account regardless of broader savings goals, and then direct additional savings toward whichever vehicle best fits their specific needs.¹¹

Criticism of the Program’s Design

Policy analysts have raised design concerns worth knowing before you rely heavily on the account. The Urban Institute has argued that Trump Accounts are likely to widen the wealth gap rather than narrow it, because lower-income families are less able to contribute the $5,000 annual maximum and face greater income instability that makes regular contributions impractical.¹²

Researchers from the Urban Institute, the Aspen Institute, and Washington University’s Center for Social Development have also flagged that requiring an IRS form to enroll risks excluding lower-income families who do not file tax returns, and that the program lacks provisions to exempt account balances from public benefit calculations, which could deter participation among families receiving assistance.¹³

Enrollment data offer partial support for both sides of the debate. CNBC reported that 86 percent of early sign-ups came from families earning less than $200,000 annually. Madeline Brown of the Urban Institute noted that higher-income families remain overrepresented relative to their share of the population.¹

1
CNBC. Trump Account Signups Hit 6 Million, Millions More Children Eligible
2
Congressional Research Service. Trump Accounts Overview
3
IRS. Trump Accounts
4
Vanguard. What to Know About New Trump Accounts for Kids
5
U.S. Department of the Treasury. Treasury Press Release on Trump Accounts App
6
U.S. Department of the Treasury. Treasury Designates BNY as Financial Agent for Trump Accounts
7
Chase. Trump Accounts for Kids: Considerations and Key Rules
8
IRS. Treasury, IRS Issue Guidance on Trump Accounts
9
White House. Landmark Dell Gift Supercharges Trump Accounts for America’s Kids
10
IRS. Notice 2025-68
11
Fidelity. Trump Accounts vs 529, UTMA, UGMA, Roth IRA
12
Urban Institute. Without Clear Guidelines, Trump Accounts Would Mostly Benefit Already Wealthy Families
13
Urban Institute. How Trump Accounts Measure Against Evidence on Early Wealth-Building Policy