Trump Accounts Are Now Live — How to Claim the $1,000 Baby Bonus in 2026 and Open Your Child’s Account

Trump Accounts officially launched on July 4, 2026 — parents can now open an account at trumpaccounts.gov or by filing IRS Form 4547 (Trump Account Election) with their tax year 2025 return. Babies born from January 1, 2025 through December 31, 2028 qualify for a one-time $1,000 contribution from the U.S. Treasury to kick-start the account.

The response has been immediate: per the IRS, roughly 4 million children have already been signed up, with about 1 million claiming the $1,000 pilot program contribution in the first wave.

These tax-deferred investment accounts were created under Trump’s One Big Beautiful Bill (OBBB) and are designed specifically for children under 18, aiming to put the power of compound growth to work from birth. Below I cover how to enroll, how the money must be invested, the tax rules, and how these accounts stack up against 529s and custodial Roth IRAs.

How to Open a Trump Account and Claim the $1,000

As of the July 4 launch there are three paths:

1. Online: Sign up at trumpaccounts.gov (type the address directly into your browser). You’ll need your child’s Social Security number and your own identity verification.
2. With your tax return: File IRS Form 4547, Trump Account Election(s), to request establishment of an account and enroll in the pilot program — parents can do this with their tax year 2025 return, including on extension.
3. Automatically: The Social Security Administration is launching automated enrollment for newborns when parents request an SSN during birth registration. And if parents take no action at all, the Treasury will automatically create and fund an account when an eligible child is claimed on a tax return.

The $1,000 pilot contribution applies to eligible children born January 1, 2025 through December 31, 2028. Children under 18 who fall outside those birth years can still have a Trump Account opened for them — they just don’t get the federal seed money.

Private banks and brokerages will act as custodians and manage the accounts. For now, all official communication comes via email from [email protected]. Given how fast AI-powered scams are evolving, treat any other “Trump Account” email, text, or call as suspect — always access the account through the official app or by typing TrumpAccounts.gov directly.

Contribution Rules

Beyond the initial federal seeding, the accounts permit additional contributions from parents, guardians, relatives, and friends of up to $5,000 annually (indexed for inflation).

Employers can contribute up to $2,500 per year (indexed) on a tax-free basis to employees’ dependents’ accounts — an emerging fringe benefit worth asking your HR department about. Employer contributions count toward the $5,000 overall cap, and amounts above the $2,500 employer limit are treated as taxable income to the employee.

Nonprofit organizations and governmental entities can also contribute additional amounts that don’t count against the $5,000 annual limit.

Example: Sarah and Mike’s daughter was born in March 2026. They enroll at trumpaccounts.gov and receive the $1,000 Treasury contribution. They add $200/month ($2,400/year) and Mike’s employer contributes $2,500 through its new benefits program. At a 7% average annual return, the account would grow to roughly $170,000 by the time their daughter turns 18 — before she’s earned a paycheck.

This program is brand new and the rules are still being refined by Treasury — I’ll update this page as guidance lands. Subscribe here to get notified.

How the Money Must Be Invested

Investment options are deliberately simple. Funds must be invested in a broadly diversified U.S. stock index fund with an expense ratio of 10 basis points (0.10%) or less. This promotes stable, low-cost growth through proven market indexes.

In practice that means funds like an S&P 500 index fund (e.g. VOO, IVV) or a total U.S. market fund (e.g. VTI) — the exact menu depends on which custodian holds the account. There’s no picking individual stocks, no crypto, and no bond allocation: these are long-horizon equity accounts by design.

Tax Treatment: The Fine Print That Matters

Contributions are made with after-tax dollars and are not federally deductible (unlike some state 529 plan contributions). Growth inside the account is tax-deferred — no annual taxes on gains or dividends.

The tax treatment of withdrawals is the critical distinction:

• Qualified uses — higher education expenses, a first-time home purchase, or small business/farm loans taken by the beneficiary — get capital gains rates on the earnings.
• Non-qualified withdrawals are taxed as ordinary income and can face an additional 10% penalty, particularly for distributions before qualified milestones (generally applying to non-qualified distributions to beneficiaries under age 31).
• Distributions generally can’t be taken before the beneficiary turns 18.

Structurally these work like a traditional IRA (Section 408(a)) with a child-specific overlay — which is why comparing them against other vehicles matters before you commit serious money beyond the free $1,000.

Trump Account vs. 529 vs. Custodial Roth IRA

• 529 plans still win for dedicated college savings: tax-free (not just deferred) withdrawals for qualified education costs, plus state tax deductions in many states.
• Custodial Roth IRAs win once your child has earned income: after-tax contributions but fully tax-free qualified growth.
• Trump Accounts win on the free $1,000 (take it — it’s automatic money), the employer contribution channel, and flexibility for non-college paths like a first home or starting a business.

My take: claim the $1,000 for every eligible child, capture any employer match-style contribution, then weigh additional dollars against a 529 or custodial Roth depending on your goals. If you’re planning for a growing family, I cover the broader math in can you afford to start a family.

Common Issues to Watch Out For

A few gotchas I’m already seeing questions about:

• Assuming you must act to get the $1,000. If your eligible child is claimed on your tax return, Treasury will eventually auto-create the account. Enrolling proactively just gets the money invested sooner.
• Confusing tax-deferred with tax-free. Earnings are taxed on withdrawal — at capital gains rates only if used for qualified purposes. This is not a 529.
• Over-contributing across relatives. The $5,000 annual cap covers combined contributions from family and friends (plus employer amounts). Coordinate with grandparents to avoid excess contributions.
• Phishing. New federal program plus money for babies equals scammer paradise. Official email comes only from [email protected], and no one from the program will call asking for banking details.
• Missing birth-year eligibility edges. The $1,000 applies to births from January 1, 2025 through December 31, 2028. A child born December 2024 can have an account but gets no federal seed.

Looking Ahead: 2027 Outlook

Several things I’m watching as this program matures. Treasury and the IRS are expected to issue further regulations on custodian requirements and the qualified-use definitions — the details on home purchase and small business withdrawals still need fleshing out. The $5,000 and $2,500 contribution limits get their first inflation indexing for 2027 (official figures typically land in the October/November IRS adjustments). And watch whether employers actually adopt the $2,500 dependent benefit at scale — early benefits-industry chatter suggests uptake will be a 2027 open-enrollment story. I’ll update this page as each milestone hits. Related reading:

• Can you afford to start a family? Important financial questions
• How to choose a 529 plan
• Traditional IRA vs. Roth IRA contribution and income limits