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IRS Moves to Define Rules for Trump Accounts
On December 2, 2025, the IRS issued Notice 2025-68 outlining proposed regulations for Trump Accounts, a new savings vehicle created under the One Big Beautiful Bill Act. Designed as long-term investment tools – not speculative accounts – Trump Accounts aim to promote early wealth building for children and young adults.
Trump Accounts permit annual contributions of up to $5,000 per beneficiary, indexed for inflation. Contributions may be made by parents, grandparents, other family members, employers, and federal, state, or local governments. Governmental contributions are not subject to the annual cap, and only one account per individual is permitted.
Compared to Section 529 plans, Trump Accounts offer greater flexibility but fewer tax advantages. While qualified 529 distributions are tax-free, distributions from Trump Accounts are generally taxable. However, Trump Accounts allow higher contribution limits, are not restricted to education expenses, and – like IRAs – permit certain rollovers or transfers.
By blending features of retirement accounts with child-focused savings incentives, Trump Accounts introduce a new approach to early-life investing.
Although less tax-advantaged than 529 plans, their higher contribution limits, potential government seed funding, and flexible use of funds may make them an attractive planning tool. Taxpayers and advisors should monitor forthcoming regulations and consider how Trump Accounts fit within broader tax and estate planning strategies.
CGS3 partner Phil Jelsma, chair of our tax practice group, recently examined the details and benefits of Trump Accounts in an article published in The Los Angeles Daily Journal and The Daily Transcript.
The full article can be read here (subscriber only).