IRS Proposes First Operational Rules for ‘Trump Accounts’

The Treasury Department and the Internal Revenue Service have issued the first proposed regulations implementing the new “Trump accounts” program created by the 2025 tax law. The two proposed rules don’t yet answer every substantive question raised by new Code §530A, §128, and §6434. REG–117270–25, T.D. 91 Fed. Reg. 11194 (Mar. 9, 2026) (Trump accounts); REG-117002-25, 91 Fed. Reg. 11203 (Mar. 9, 2026) (Trump accounts contribution pilot program).

They do, however, establish the basic mechanics for opening an initial Trump account, identify who may act for a minor beneficiary, and explain how Treasury intends to deliver the program’s one-time $1,000 pilot contribution for eligible children.

At a practical level, this is launch guidance. The rules focus on account-opening elections, “responsible party” authority, pilot-program eligibility, and filing procedures through Form 4547 and an online portal. They leave for later guidance several of the issues that employers, trustees, and tax advisers are likely to view as the most consequential over time, including fuller treatment of §128 employer contributions and broader post-launch operating rules during and after the account’s “growth period.” KPMG, Proposed regulations: Guidance regarding “Trump accounts” and contribution pilot program, Tax News Flash (Mar. 6, 2026) (future guidance is reserved for growth-period and employer-contribution issues).

First Proposed Rule

Opening account. The first proposed rule, REG-117270-25, provides that an initial Trump account may be opened by an “authorized individual” on Form 4547 or through the online election form. The election must be made on or before Dec. 31 of the calendar year in which the eligible individual attains age 17. If a pilot-program election is made at the same time, the same person who is authorized to request the $1,000 pilot contribution may open the account. If no pilot election is made simultaneously, Treasury proposes an ordering rule under which the authorized individual is, in order, a legal guardian, parent, adult sibling, and then grandparent.

That hierarchy is significant because it shows Treasury’s preference for administrability over individualized family law inquiry. In effect, the government is trying to reduce friction at the enrollment stage by supplying a bright-line order of authority rather than building a more elaborate adjudication process into the election system. Groom Law Group, in one of the first professional analyses of the proposed rules, highlighted these setup rules as a central feature of the initial guidance package. Groom Law Group, Trump Accounts Get First Round of Proposed Regulations, In Brief (Mar. 9, 2026).

Control. The proposed rule also addresses who controls the account after it’s opened. In general, the person who makes the election to open the initial Trump account becomes the account’s “responsible party.” While the beneficiary lacks legal capacity, that responsible party generally may select among eligible investments offered by the trustee, request a qualified rollover to a rollover Trump account, request a transfer for a qualified ABLE (Achieving a Better Life Experience) rollover contribution if permitted, and designate a successor responsible party. The IRS also stated that the regulations are intended to provide operational guidance to families and prospective trustees considering whether to establish accounts.

Trustee administration. The same proposed rule also streamlines trustee administration by automatically treating entities already approved as nonbank IRA trustees as approved nonbank trustees for Trump accounts as of Dec. 31, 2025. Treasury is thus attempting to build upon existing IRA infrastructure rather than require the market to create an entirely new trustee approval framework for these accounts.

Second Proposed Rule

The separate proposed rule, REG-117002-25, implements the Trump accounts contribution pilot program under Code §6434. Treasury proposes that an eligible child may receive a one-time $1,000 contribution only if a qualifying individual affirmatively makes a pilot election for that child and the child already has a Trump account. The child must be a US citizen, have a valid Social Security number, be born in 2025, 2026, 2027, or 2028, and not previously have been enrolled through a processed pilot election.

The proposed rule uses an unusual, but workable, tax administration mechanism to move the money. Once a valid pilot election is processed, the child is treated as if the child made a $1,000 payment against federal income tax for a specially defined taxable year. Because that special taxable year is deemed to have zero tax liability, the deemed payment creates an overpayment, and Treasury remits that amount directly into the child’s Trump account. The proposed rule is explicit that the amount is refunded only as a direct account contribution, not as a cash refund to the family.

Treasury also proposes that the $1,000 pilot contribution won’t be reduced by the usual offset rules for past-due child support, certain federal debts, certain state tax debts, unemployment-compensation debts, or similar refund offsets. That feature reinforces that Treasury views the pilot contribution as an asset-building payment delivered through the tax system, rather than as an ordinary refund subject to interception for unrelated obligations.

The most notable aspect of these proposed rules may be what they don’t address. KPMG observed that Treasury reserved sections for future guidance on the special rules that apply during and after the growth period, as well as the rules under §128 governing employer contributions. KPMG, Proposed regulations: Guidance regarding “Trump accounts” and contribution pilot program, Tax News Flash (Mar. 6, 2026) (noting that sections are reserved for future guidance, including §128 employer-contribution rules and other growth-period rules). That omission matters because the statutory framework appears designed to permit a broader ecosystem of funding beyond the one-time government seed contribution.

IRS Notice 2025-68 makes clear that Trump accounts are intended to be broader than a simple government-seeded savings vehicle. During the growth period, Trump accounts generally may receive contributions from governments, charitable organizations, employers, and individuals; most nonexempt contributions are subject to a $5,000 aggregate annual cap, indexed after 2027; and employer contributions under §128 are expressly contemplated by the statutory structure.

The notice also explains that investments during the growth period generally are limited to mutual funds or exchange traded funds tracking indexes of primarily US companies, that leverage is prohibited, and that annual fees and expenses are capped at 0.1%. Distributions generally aren’t permitted during the growth period except for limited permitted distributions, including certain rollovers and death-related distributions, and a qualified ABLE rollover may occur only during the year in which the beneficiary turns 17.

For families, the immediate takeaway is that Trump accounts appear headed toward a relatively simple enrollment framework: Form 4547, a web portal, and an express mechanism for combining account-opening with the pilot-program election. For trustees and custodians, the proposed rules provide the first real operational map for who may act for a child and who will control the account while the child is a minor.

For employers, however, the most important questions may still lie ahead, because §128’s employer-contribution regime remains only partially developed in current guidance.

In that respect, the proposals are best read as a beginning rather than a complete framework. Treasury and the IRS have now explained how an account gets opened and how the government’s first $1,000 gets in. They haven’t yet fully addressed how the broader ecosystem, especially employer programs and long-term administration, will function once these accounts move from statute to scale. Comments on the account-opening proposal are due May 8, and comments on the pilot-program proposal are due April 8.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Samuel Krause is a partner at Hall Benefits Law.

Write for Us: Author Guidelines