New for 2026: Trump Accounts for your children

How it works

1. Make the election. A parent or guardian elects to open the account for the child with the IRS (Form 4547), including the request for the $1,000 seed if the child was born 2025–2028.
2. The account is funded. The Treasury deposits the seed. Family members and employers can add up to $5,000 a year combined, starting July 4, 2026.
3. It stays invested. The money must be held in low-cost funds that track a broad index of U.S. stocks.
4. At 18, it opens up. Withdrawals generally aren’t allowed before the year the child turns 18. After that, the account generally follows traditional IRA rules: earnings are taxed when withdrawn.

Pair it with a Kids Roth

A Trump Account needs no earned income, so it works from birth. Once your child has real earned income, for example from working in your business, they can also contribute to a Roth IRA, up to what they earn. Roth money grows tax-free, so the two accounts work well together.

Who it fits

• Parents of children under 18 who want to start investing for them early.
• Families with babies born from 2025 through 2028, who can claim the $1,000 seed.
• Business owners looking at offering employer contributions as a benefit.

When another account may fit better

• Saving for college: a 529 plan offers tax-free withdrawals for education and may carry Oklahoma tax benefits.
• Families who may need the money before the child turns 18.
• Children with earned income, where a Roth IRA may come first.

The rules

• Eligibility. A child under 18 with a Social Security number. The $1,000 seed is for U.S. citizen children born January 1, 2025 through December 31, 2028.
• Contribution limit. $5,000 a year from all family and employer sources combined, adjusted for inflation after 2027. Contributions stop after the year before the child turns 18.
• Employer contributions. Up to $2,500 a year per employee can be excluded from the employee’s income under a written employer program.
• Investments. Limited to low-cost mutual funds or ETFs that track a U.S. stock index.

Risks to weigh

• New and still being clarified. The IRS and Treasury are still issuing guidance on how the accounts work, so details may change.
• Owner-employees. Employer programs must meet nondiscrimination rules, and fringe-benefit rules for S corp owners can limit what an owner’s own business can contribute for the owner’s children. Check before you contribute.
• Locked until 18. Money generally can’t come out for other needs before then.
• Taxable earnings later. Unlike a Roth IRA, earnings are taxed when withdrawn.

How we handle it for clients

With a Cannon & Brown tax plan, we make sure eligible children get the seed election, help you decide how a Trump Account fits with a 529 and a Kids Roth, and check whether your business can offer employer contributions the right way. Because our technology keeps your numbers current all year, we can test this strategy against your real numbers and adjust it as your business changes.

Illustrative example. The family and figures on this page are hypothetical, used to explain how the strategy works. They are not a client and not a promise of results. The example assumes a child born in 2026, $2,500 of parent contributions, $2,500 of employer contributions under a qualifying program, and a 22% federal bracket. This page is educational and is not tax advice for your situation; tax rules and limits change, and guidance on these accounts is still being issued.