$1,000 Trump Investment
Under a new federal program enacted in 2025, the U.S. government will provide $1,000 in seed money into a child’s investment account (called a Trump Account) for eligible kids. Here’s how it works:
The initiative was created as part of the One Big Beautiful Bill Act, signed into law by President Donald Trump. It establishes a tax-advantaged investment account for children, often described as a savings vehicle that can grow over time through investment in stock market index funds.
$1,000 Government Contribution
Families can receive a one-time $1,000 contribution from the federal government into a Trump Account for a child who is:
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A U.S. citizen with a valid Social Security number, and
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Born on or after January 1, 2025 and on or before December 31, 2028
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This $1,000 does not count against the annual private contribution limits.
How the Account Functions
The account is set up by a parent or guardian with the IRS or Treasury. Funds must be invested in approved mutual funds or exchange-traded funds (ETFs) tracking U.S. stock indexes. The account is tax-deferred, meaning earnings are not taxed annually, and it generally converts to a traditional IRA when the child turns 18.
Additional Contributions
Parents, relatives, employers, charities, and others can contribute up to $5,000 per year (indexed for inflation), separate from the government’s $1,000. Employer contributions (e.g., through workplace benefit programs) may also be made under certain rules.
Accessing the Funds
Withdrawals are generally restricted until age 18, and then subject to rules similar to traditional IRAs. After age 18, the account transitions into standard retirement savings, though certain provisions may allow earlier qualified withdrawals.
Important Notes
Automatic enrollment is not guaranteed; parents or guardians must take steps to open the account. The program is intended to help build long-term savings and financial literacy rather than provide immediate cash for everyday expenses.
To open a Trump Account for a child and claim the $1,000 government seed contribution, you don’t go to a bank or financial institution first, you start the process with the Internal Revenue Service (IRS) and the U.S. Treasury. Here are the key steps and where you need to go:
1. File IRS Form 4547
Parents or legal guardians must complete IRS Form 4547 (“Election to Establish an Initial Trump Account and Request for Pilot Program Contribution”). This is the official federal form used to both establish a Trump Account on behalf of a child and to request the $1,000 federal pilot contribution. You can file this form with your income tax return (e-file or paper), or potentially file it separately, depending on guidance and IRS processing timelines.
2. Visit the Official Trump Accounts Website
The IRS and Treasury are expected to operate a dedicated portal at trumpaccounts.gov where parents/guardians will be able to make elections online once the system is live. This portal should provide the digital method to set up the account and submit the election form once available (expected mid-2026).
3. After Submission — Treasury Activation
After the IRS receives your Form 4547 and verifies eligibility (e.g., child has a Social Security number and meets birth date criteria), the Treasury or its agent will send you instructions to activate the account. This will include identity verification and selecting investment options.
4. Do Not Go Directly to a Bank First
Unlike 529 plans or custodial accounts at financial institutions, Trump Accounts are established at the federal level first through the IRS/Treasury process. A Trump Account becomes a type of tax-advantaged investment vehicle (similar to an IRA) once it’s officially created and activated.
