Trump Accounts: What Parents Need to Know About the New Tax-Deferred Accounts for Children

Who is eligible for a Trump Account?

A child may be eligible for a Trump Account if they:

• Are under 18 years old; and

• Have a valid U.S. Social Security Number (SSN). An ITIN does not qualify.

Children do not need to live in the United States to be eligible. If your child lives outside the U.S. but has a valid U.S. SSN and meets the age requirement, they may still be eligible for a Trump Account.

What is a Trump Account?

A Trump Account is a new type of tax-advantaged investment account available for eligible U.S. children with valid Social Security Number (not ITIN). These accounts are designed to give children an early start on long-term savings and investing, with certain eligible children receiving a one-time $1,000 contribution from the U.S. Department of the Treasury if the children born between January 1, 2025 and December 31, 2028.

How Can I Open a Trump Account for My Child?

A parent, guardian, or other authorized individual must make an election to establish a Trump Account for an eligible child by completing IRS Form 4547, Trump Account Election(s).

There are two ways to complete and submit Form 4547:

• File Form 4547 with your U.S. individual income tax return. Form 4547 can be submitted with your current-year electronically filed U.S. tax return. For example, it can be electronically filed with your 2025 U.S. individual income tax return.

• Submit Form 4547 through your IRS Individual Online Account. You can complete, sign, and submit Form 4547 electronically through your IRS Individual Online Account. You can also use your online account to check the status of your submitted election.

Activate the Trump account using the official Trump Accounts App:

For IOS:

For Android:

You can use the official Trump Accounts app to activate and manage your child’s Trump Account.

Important: Form 4547 can be filed at any time and does not have to be filed with your U.S. income tax return. If you have already filed your tax return, you do not need to amend your return simply to submit Form 4547.

When completing the election, you will generally need:

• Your identifying and contact information;

• Your child’s name, date of birth, address, and Social Security number; and

• Your Social Security number.

If you use the IRS Individual Online Account, you will need to sign in or create an account and complete the required identity verification.

Who can contribute to a Trump Account - Anyone

• Parent, grandparents, family members, friends, and neighbors (up to $5,000 per year, per child, indexed for inflation for taxable years beginning after 2027); and

• Employers (up to $2,500 per employee per year, count against the $5,000 annual limit for each account).

  
  

How Are Trump Account Funds Invested?

Trump Account funds are intended for long-term investment rather than simply being held as cash.

Contributions are invested in qualifying investments designed to provide broad exposure to U.S. companies. Depending on the account provider, this may include an exchange-traded fund (ETF) that tracks a broad U.S. stock market index, such as the S&P 500.

As with other market-based investments, returns are not guaranteed. The value of the account can increase or decrease depending on investment performance.

You can track your child’s investments, account balance, and investment returns through the Trump Accounts app.

The Potential Impact of Starting Early

One of the most significant features of Trump Accounts is the amount of time investments may have to grow before a child reaches adulthood.

For example, consider a hypothetical account that:

• Starts with the $1,000 Treasury contribution;

• Receives an additional $50 per month;

• Is established when the child is a newborn; and

• Earns an average annual return of 7%.

Under these assumptions, the account could potentially grow to approximately $25,048 after 18 years.

This example is hypothetical and does not guarantee future investment performance. Actual results will depend on investment returns, contributions, fees, inflation, and other factors.

Why Trump Accounts Matters for Families

Trump Accounts introduce another long-term planning opportunity for families with young children. Starting an investment account early gives contributions more time to benefit from potential compound growth.

For eligible children receiving the $1,000 Treasury contribution, families may also have an opportunity to build on the government's initial contribution by making additional eligible contributions over the child's early years.

However, families should consider the account's contribution, investment, withdrawal, and tax rules as part of their broader financial and tax planning.

How Sunstone CPA Can Help

New tax-advantaged accounts can create both opportunities and questions, particularly for families with more complex U.S. or cross-border tax situations.

Sunstone CPA can help you understand how Trump Accounts may fit into your family's overall U.S. tax and financial planning strategy, including potential considerations for U.S. citizens and families living in Canada or abroad.

If you have questions about Trump Accounts or other U.S. tax matters affecting your family, contact us to learn how this can be applied on your tax situation. 

This article is provided for general informational purposes only and should not be considered tax, legal, or investment advice. Eligibility and tax consequences depend on individual circumstances. Investment returns are not guaranteed.