The Treasury Department and Internal Revenue Service released proposed regulations this week establishing guidelines for employer and employee contributions to Trump Accounts, a tax-deferred investment vehicle designed for children. The regulations detail how employers can structure contributions to these accounts while allowing those contributions to be excluded from employees’ gross income. Employees would also have the option to fund their dependent children’s accounts directly from their pretax paychecks.
Treasury Secretary Scott Bessent announced that the guidance permits employers to contribute up to $2,500 annually per employee for dependent children’s accounts, while enabling workers to contribute pretax dollars to the accounts themselves. The announcement came following a notice of proposed rulemaking released earlier in the week. The regulations will be subject to a public comment period and hearing scheduled for October before being finalized.
Trump Accounts, formally known as 530A accounts, are available to any U.S. child under 18 with a Social Security number. Children born between 2025 and 2028 are eligible to receive a one-time $1,000 deposit from the Treasury Department as part of a pilot initiative to encourage long-term savings. According to Bessent, approximately 7 million children have enrolled in the accounts as of late July. The annual contribution limit is $5,000 total per beneficiary, with employer contributions capped at $2,500 of that amount.
More than 50 companies have already committed to making Trump Account contributions for their employees, with some pledging to match the government’s initial $1,000 seed funding. Industry analysts suggest the Treasury guidance will likely increase employer participation. A poll conducted in April found that only about 4% of employers surveyed planned to implement contribution programs in 2026 or 2027, though many remain undecided about participation.
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