UPDATE: Parents can soon secure $1,000 for each newborn, thanks to the newly announced “Trump Accounts,” a provision in President Donald Trump’s legislation signed into law last year. Starting July 5, 2026, parents will be able to open these accounts for children born between 2025 and 2028, providing a significant boost to financial security for over 14 million children expected to be born during this period.
The White House emphasizes that Trump Accounts are designed to “give the next generation a jump start on saving” for their future. Parents can open these accounts to receive the initial $1,000 deposit from the U.S. Treasury, which will be invested in a diversified portfolio of low-cost index funds. The funds will be accessible when the child turns 18 years old, allowing for long-term financial growth.
WHO QUALIFIES? Any American child not yet 18 with a valid Social Security number is eligible. For babies born after December 31, 2024 and before January 1, 2029, parents can establish Trump Accounts to receive the government’s initial funding. Children born prior to this window can still benefit from a Trump Account, but will not receive the $1,000 boost.
Additionally, a generous $6.25 billion donation from billionaires Michael and Susan Dell aims to provide $250 in seed money for children born before 2025 in areas with median family incomes of $150,000 or less.
HOW TO CLAIM THE $1,000? Parents can elect to open Trump Accounts while filing their 2025 taxes or through an online portal launching on July 5, 2026, at trumpaccounts.gov. Filers will need to complete Form 4547 to establish the account. After the election, the Treasury will provide additional information to activate the account through authentication.
Once the account is set up, it will automatically receive the initial $1,000 for children born during Trump’s second term. The funds will be managed by financial institutions and invested to maximize returns, with an average fee of 0.1%.
WHAT ABOUT CONTRIBUTIONS? Parents can contribute up to $2,500 annually in pretax income, mirroring retirement account structures. Employers may also contribute up to $2,500 without affecting taxable income. Total contributions can reach a cap of $5,000 annually, excluding government and charitable contributions.
Financial projections suggest that for a baby born in 2026, the account could grow to $5,800 by age 18 without additional investments. With yearly contributions, estimates suggest the account could be worth as much as $303,800 by that time.
TAX IMPLICATIONS: Contributions to Trump Accounts will not qualify for the gift tax annual exclusion, requiring donors to file IRS Form 709 for each contribution. This stipulation may pose challenges, as many popular tax filing platforms do not support this form, potentially creating a “significant tax compliance issue,” according to Amber Waldman, estate and gift senior director at RSM.
In contrast, Trump Accounts differ from 529 plans, which are intended for educational expenses and exempted as completed gifts by Congress.
As these accounts prepare to launch, parents are encouraged to stay informed and ready to take advantage of this unprecedented opportunity to secure their children’s financial futures. The urgency to act will grow as the portal opening date approaches, making this a key moment for families across the nation.
