The process for opening a Trump Account changed substantially in September 2026. Treasury has now automatically established Trump Accounts for eligible children rather than requiring families to initiate every account through Form 4547.
On October 1, 2026, the Treasury Department announced that automatic enrollment had been completed for more than 60 million additional eligible children. A parent or guardian still needs to claim the account before managing it and before ordinary family, friend, or employer contributions can be made.
The change makes Trump Accounts easier to establish, but it does not eliminate every election or action required from families. In particular, the separate $1,000 federal pilot contribution is not automatically provided merely because Treasury established an account.
Families evaluating Trump Accounts should consider them as part of broader proactive tax planning, especially when coordinating family savings, employer benefits, gifts, and other tax advantaged accounts.
Treasury Now Automatically Establishes Trump Accounts
Internal Revenue Code Section 530A authorizes Treasury to establish an initial Trump Account for an eligible individual. Treasury initially proposed a system under which a parent, guardian, or other authorized individual would generally make an affirmative election to establish the account.
That approach changed on September 30, 2026.
Treasury Decision 10056 issued temporary regulations under Section 530A that establish an automatic enrollment system. Treasury then announced on October 1 that automatic enrollment had been completed for eligible children who had not already had an account established.
Under the current framework, an eligible child generally must:
- Be under age 18 for purposes of the applicable Section 530A rules, and
- Have a valid Social Security number.
Treasury is also expected to make additional automatic elections periodically for newly eligible children.
The temporary regulations state that these periodic elections are expected to be frequent enough to generally eliminate the need for a parent or other person to separately elect to establish the initial account.
Parents Still Need to Claim the Account
An automatically established account initially remains under Treasury administration.
A parent, guardian, legal custodian, or an account beneficiary who has legal capacity can claim the account through the process made available by Treasury. Treasury currently directs parents and guardians to use the official Trump Accounts application.
The claiming process requires the person claiming the account to verify identity, establish the person's legal authority to act for the child, review the applicable information, and complete the account terms.
After a claim is accepted, the account must also be activated with the applicable trustee before the family can fully manage the claimed Trump Account.
This distinction is important because an unclaimed automatic account operates under more limited rules than a Trump Account that has been claimed and activated by the family.
What an Unclaimed Automatic Account Can Receive
During the growth period, an automatic account generally may receive only certain contributions while Treasury remains the responsible party.
These can include:
- Qualified general contributions funded by eligible governments and Section 501(c)(3) organizations,
- Qualified stock contributions that satisfy the temporary regulations, and
- The $1,000 federal pilot contribution if the separate pilot program election requirements have been satisfied.
Ordinary contributions from parents, grandparents, friends, and employers generally require the account to be claimed and activated.
This makes claiming the account important even though Treasury has already completed the initial establishment process.
The $1,000 Federal Contribution Is Not Automatic
The automatic account enrollment rules should not be confused with the separate Trump Account Contribution Pilot Program under Section 6434.
Section 6434 provides a one time $1,000 Treasury contribution for an eligible child when the required election is made by a qualifying individual.
An eligible child for the pilot contribution generally must:
- Have been born after December 31, 2024 and before January 1, 2029,
- Be a United States citizen,
- Have a valid Social Security number,
- Be expected to be the qualifying child of the individual making the election for that year, and
- Not already have had a pilot program election processed.
Treasury cannot make this Section 6434 pilot election for the family. A qualifying individual must make the election.
Form 4547 remains relevant for this purpose. The IRS also permits taxpayers to submit the election electronically through the IRS Individual Online Account.
Form 4547 Has a Different Role Under Automatic Enrollment
The original Trump Account implementation placed Form 4547 at the center of the account opening process. That is no longer the normal practical sequence for most children after Treasury's automatic enrollment program.
The September 2026 temporary regulations specifically state that Treasury's periodic automatic elections are expected to generally eliminate the need for another person to make an election to establish the initial account.
Form 4547 nevertheless remains relevant in several situations, most importantly for making the separate Section 6434 election for the $1,000 pilot contribution.
Families that previously submitted Form 4547 should also check the status of the account and complete any remaining activation or claiming requirements rather than assuming that filing the form alone completed the entire process.
Family Contributions Are Subject to a $5,000 Annual Limit
During the growth period, Section 530A generally limits nonexempt contributions to $5,000 per calendar year. The amount is subject to inflation adjustments after 2027.
Contributions subject to this limit include amounts contributed by:
- Parents,
- Grandparents,
- Other family members,
- Friends,
- The child, and
- Employers under Section 128.
Certain contributions do not count against the $5,000 limit. These include qualified rollover contributions, qualified general contributions, and the $1,000 contribution provided under Section 6434.
The child does not need compensation or earned income for contributions to be made during the growth period. This differs from the normal contribution rules for traditional and Roth IRAs.
Employer Contributions Can Provide an Additional Tax Benefit
Section 128 allows an employer to make qualifying contributions to a Trump Account for an employee or an employee's dependent through a qualifying Trump Account contribution program.
The statutory exclusion is generally limited to $2,500 per employee per year, with inflation adjustments beginning after 2027.
Qualifying employer contributions are excluded from the employee's gross income, but they count toward the overall $5,000 annual contribution limit under Section 530A.
Treasury and the IRS have issued proposed regulations addressing the administrative requirements for employer Trump Account contribution programs, including written plan requirements and nondiscrimination rules. Because those regulations remain proposed, employers should distinguish between the enacted statutory benefit and the proposed administrative rules.
Qualified General Contributions Can Be Made for Groups of Children
Trump Accounts can also receive qualified general contributions funded by certain governmental entities and Section 501(c)(3) organizations.
These contributions are different from normal gifts made directly by family members. A qualified general contribution is made through Treasury for a defined qualified class of account beneficiaries and generally does not count against the beneficiary's $5,000 annual contribution limit.
The September 2026 temporary regulations also introduced detailed rules for qualified stock contributions. Under those rules, qualifying publicly traded stock can be contributed as part of a qualified general contribution when the regulatory requirements are satisfied.
Qualified stock is generally subject to a minimum holding period that continues until the earlier of five years after the contribution or the end of the beneficiary's growth period, subject to specified exceptions.
Investment Choices Remain Restricted During the Growth Period
Section 530A restricts Trump Account investments while the child is in the growth period.
Eligible investments generally consist of mutual funds or exchange traded funds that:
- Track the S&P 500 or another qualifying equity index consisting primarily of United States companies,
- Do not use leverage, and
- Have annual fees and expenses of no more than 0.1% of the account balance invested in the fund.
Treasury and the IRS issued proposed regulations in August 2026 providing additional rules for determining whether an investment qualifies and for trustee administration of these requirements.
If a beneficiary or responsible party does not select an eligible investment offered by the trustee, the proposed regulations generally contemplate use of an eligible default investment selected by the trustee.
Trump Account Contributions Can Have Gift Tax Consequences
Contributions made by family members can constitute gifts for federal transfer tax purposes.
Revenue Procedure 2026-25 provides a safe harbor for certain individual donors. When its conditions are satisfied, qualifying Trump Account contributions are treated as completed gifts that are not future interests and can qualify for the annual gift tax exclusion.
The safe harbor can also eliminate a Form 709 filing requirement when the donor satisfies the Revenue Procedure's conditions and does not otherwise have a gift tax return filing requirement.
This can be particularly useful when grandparents or other family members want to contribute to a child's Trump Account as part of a broader gifting strategy.
Distributions Remain Highly Restricted Before Age 18
Automatic enrollment did not materially change the restrictions on distributions during the growth period.
In general, distributions are not permitted before the end of the growth period except for specified transactions such as:
- Qualified trustee to trustee rollovers to another Trump Account,
- Certain rollovers to an ABLE account during the calendar year in which the beneficiary turns age 17,
- Corrective distributions involving excess contributions, and
- Distributions following the beneficiary's death.
Beginning January 1 of the calendar year in which the beneficiary turns age 18, most of the special Trump Account growth period restrictions end and traditional IRA rules generally apply.
Distributions can then become taxable under Sections 408 and 72, and the additional tax under Section 72(t) can apply to early distributions unless an exception is available.
Trump Accounts Fit Alongside Other Family Savings Strategies
A Trump Account does not necessarily replace a 529 plan, Roth IRA, custodial account, or other family savings strategy. Each account has different rules governing contributions, tax treatment, investment flexibility, and access to funds.
The appropriate structure depends on the purpose of the savings and the family's broader tax and financial situation.
For additional context on when the major provisions of the recent federal tax law take effect, see my article on OBBBA effective dates.
The Social Security number requirements can also affect mixed status families. My article on tax benefits requiring a Social Security number explains several related provisions.
What Families Should Do Now
The most important change is that families generally no longer need to begin by asking Treasury to establish the Trump Account. Treasury has already created automatic accounts for eligible children and expects to continue automatic enrollment for newly eligible children.
The practical next steps are to:
- Confirm that the child has an automatically established Trump Account,
- Claim and activate the account so the family can manage it,
- Make the separate Section 6434 election if the child qualifies for the $1,000 federal pilot contribution,
- Coordinate family and employer contributions with the $5,000 annual contribution limit,
- Consider the federal gift tax treatment of family contributions, and
- Coordinate the Trump Account with other education, retirement, and family savings vehicles.
The new automatic enrollment structure removes one administrative hurdle, but it does not eliminate the tax and planning decisions that follow once the account exists.
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