The Department of the Treasury and the Internal Revenue Service (IRS) today issued proposed regulations concerning eligible investments for Trump Accounts, a new type of traditional IRA established under the Working Families Tax Cuts. These regulations aim to provide clarity for trustees and beneficiaries, encouraging participation in these tax-deferred investment vehicles.
IRS Chief Executive Officer Frank J. Bisignano said, "These proposed regulations will provide clarity for trustees and beneficiaries of Trump Accounts, thus encouraging eligible participants to invest in low-fee mutual funds and ETFs that will grow on a tax-deferred basis potentially over their entire lives." He added that these accounts enable American children to start investing early for future college, retirement, and other needs.
During the "growth period," which lasts until the beneficiary turns age 17, funds in a Trump Account must be invested in eligible investments. These generally include mutual funds or exchange-traded funds (ETFs) that track an equity index of primarily U.S. companies, such as the S&P 500, do not use leverage, and have annual fees and expenses of no more than 0.1 percent. If a beneficiary does not select an eligible investment, the trustee will automatically invest the funds in a pre-selected eligible option. These rules are set to apply to tax years beginning on or after January 1, 2026.
The Treasury and IRS are requesting additional public comments on these proposed regulations by October 20, 2026. Parents, guardians, and authorized individuals can open a Trump Account for a child with a Social Security number using the IRS Individual Online Account and Form 4547. A pilot program offers a $1,000 contribution for U.S. citizens born between 2025 and 2028, selectable on Form 4547.