The U.S. Treasury Department and Internal Revenue Service released proposed regulations this week establishing how employers and employees can fund Trump Accounts, a newly created tax-deferred investment vehicle designed for children. Under the framework, employers may allow workers to direct pretax income toward their dependent children’s accounts, while employers themselves can contribute up to $2,500 annually per employee on a tax-free basis. Treasury Secretary Scott Bessent characterized the initiative as providing families with a mechanism to accumulate wealth from infancy, emphasizing that the guidance enables both employer contributions and employee payroll deductions.
Trump Accounts, formally designated as 530A accounts, are available to any U.S. resident under age 18 with a Social Security number. The program includes a pilot component offering children born from 2025 through 2028 an initial $1,000 deposit funded by the Treasury Department to encourage sustained savings habits. Annual contribution limits are capped at $5,000 per child, with the employer portion not exceeding $2,500 of that total. According to Bessent, approximately 7 million children have already been enrolled in the accounts as of late July.
The proposed regulations follow a notice of rulemaking issued by Treasury and the IRS on Monday that details implementation procedures for employers establishing Trump Account programs. The regulatory process requires a public comment period and a hearing scheduled for October before final rules can be adopted. Over 50 companies have already pledged to offer Trump Account contributions to their workforce, with some matching the government’s initial seed deposit.
Employer adoption rates remain modest based on recent polling data, with an April survey of approximately 350 U.S. companies indicating that only 4% planned to implement contribution programs in 2026 or 2027, while roughly two-thirds had opted not to participate. However, industry observers anticipate growing interest following the Treasury’s regulatory guidance. Melissa Elbert, a wealth solutions partner at consulting firm Aon, suggested that clarity on administrative and compliance requirements may prompt additional companies to reconsider participation in the initiative.
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