Trump Accounts: A New Benefit for Your Team?

In July 2025, the government passed a massive bill (“The One Big Beautiful Bill”). The bill made sweeping changes like no tax on overtime and no tax on tips. It also established “Trump Accounts” for children.

So what is a Trump Account, and what does it have to do with employers? 

What are “Trump Accounts?”

A Trump Account is an investment account for children under 18 who have a Social Security number. The government will provide an initial $1,000 deposit for children born after December 31, 2024 and before January 1, 2029. 

Children under 18 not born during this time can still have accounts, but they won’t be eligible for the $1,000 government deposit. 

Parents can contribute after-tax funds to their child’s account, up to a maximum of $5,000 per year, beginning July 4, 2026. The account works similarly to an IRA after the child turns 18. 

Trump Accounts eligibility: Who gets one?

Children are eligible for a Trump Account if they are:

  1. U.S. citizens with a Social Security number
  2. Under 18

Additionally, children born between 2025 and 2028 receive a one-time government deposit of $1,000. 

How much will the account be worth?

The U.S. government estimates that, under a scenario of average returns on the U.S. stock market, an account with only the initial $1,000 contribution will be worth $5,800 by age 18 and $18,100 by age 28

The government estimates that the account will have $303,800 by age 18 and $1,091,900 by age 28 if maximum contributions are made.  

Can employers contribute to an employee’s Trump Account?

Yes, employers can contribute up to $2,500 annually to employees’ Trump Accounts. This $2,500 limit is excludable from the employee’s gross income.

You can contribute to both your employees’ dependents’ accounts and accounts of your employees who are under 18. 

Employer contributions count toward the total $5,000 annual limit. 

Keep in mind that employer contributions are not required. If you decide to contribute to Trump Accounts for your employees, you must:

  • Provide a separate written plan 
  • Ensure the plan doesn’t favor highly compensated employees and pass nondiscrimination testing
  • Notify employees about the available program

The government still needs to provide guidance on how employers will report contributions on Form W-2. 

Should you add Trump Account contributions to benefits?

What do employers think about the possible new employee benefit? According to a recent survey gauging employer interest:

  • 70% do not want to offer the benefit
  • 18% were interested
  • 12% didn’t know it existed

Many employers said the benefit either doesn’t apply to their employees or would be unfair to other employees. Others said there isn’t enough guidance and detailed information yet. 

On the other hand, the benefit could be a good choice for employers looking to add a new pre-tax option to the mix. 

Other benefits you may consider 

Choosing employee benefits can be challenging, especially if funds are tight. Other benefits you may consider include:

Trump Account FAQs

Who qualifies for Trump Accounts?

Children under the age of 18 who have a Social Security number qualify for a Trump Account.

When will Trump Accounts start?

Children born between 2025 and 2028 receive a one-time government deposit of $1,000. Parent contributions begin July 4, 2026. 

How much can be contributed to a Trump Account annually?

Contributors can contribute up to $5,000 annually.

Do all babies get $1,000 from the government?

Only babies born after December 31, 2024 and before January 1, 2029 receive an initial $1,000 contribution from the government. 

Can employers contribute to employees’ Trump Accounts?

Yes, employers can contribute up to $2,500 annually to their employees’ Trump Accounts. The $2,500 counts toward the $5,000 maximum contribution limit.

This is not intended as legal advice; for more information, please click here.

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