The U.S. Treasury Department and Internal Revenue Service unveiled proposed regulations this week governing the mechanics of Trump Accounts, a tax-deferred investment vehicle established for minors. The regulations detail how employer contributions to these accounts may qualify for exclusion from an employee’s taxable income and establish procedures for workers to direct pretax compensation toward their dependent children’s accounts.
Treasury Secretary Scott Bessent announced the framework in a statement, noting that employers can contribute up to $2,500 annually per employee on behalf of their dependents, while workers maintain the option to contribute additional pretax dollars directly. The proposed rules followed a notice of proposed rulemaking released earlier in the week by Treasury and the IRS, outlining procedures for employer account setup. The public will have an opportunity to comment on the proposal, with a hearing scheduled for October before final regulations are issued.
Trump Accounts, formally known as 530A accounts, are available to any U.S. resident under 18 with a Social Security number. Children born between 2025 and 2028 participate in a pilot program offering a one-time $1,000 Treasury deposit to encourage long-term savings, with approximately 7 million children currently enrolled as of late July. Once established, beneficiary accounts can receive contributions of up to $5,000 annually from parents, guardians, grandparents, and other contributors until the year before the account holder turns 18.
As of Tuesday, over 50 companies have indicated they will make Trump Account contributions available to workers, with some pledging to match the government’s initial $1,000 grant. Industry analysts suggest the new regulations will likely expand employer participation. A survey of employers conducted earlier in the year found limited initial adoption plans, though experts expect interest to grow following the Treasury’s guidance, as organizations gain clearer understanding of administrative and compliance requirements.
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