What Is a Trump Account? Everything You Need to Know About How to Open an Account, Their Tax Benefits, and Michael and Susan Dell’s Donation.

Core Viewpoint - The Trump Account is a new investment account designed for children under 18, aimed at encouraging long-term savings through tax incentives and contributions from various sources [4][6]. Contribution and Eligibility - Family members, friends, employers, and charitable organizations can contribute to a child's Trump Account, with a limit of $5,000 per child per year in private contributions and employers can contribute up to $2,500 per employee per year [2][11]. - The account is open to any child under 18 who is a U.S. citizen with a valid Social Security Number (SSN), with accounts expected to be available for parents to open in early 2026 [3][6]. Financial Benefits - A one-time government deposit of $1,000 will be made into each Trump Account for eligible children born between January 1, 2025, and December 31, 2028, which does not count towards the annual contribution cap [7][8]. - The account allows for tax-deferred growth, meaning investment earnings are not taxed as long as they remain in the account, enabling compounding over time [9][10]. Investment Structure - Funds in the Trump Account are required to be invested in low-cost mutual funds or ETFs that track broad U.S. equity indexes, providing potential for higher long-term returns compared to traditional savings accounts [10][11]. - The account has a legally capped management fee of 0.10% per year, which helps maximize net returns for the child [1][10]. Additional Contributions - The Dells' $6.25 billion donation aims to provide an additional $250 for children under 10 living in lower-income areas, enhancing the program's reach and support for families in need [18][19]. Account Setup Process - To open a Trump Account, parents must file IRS Form 4547, which is expected to be finalized and available in early 2026, with contributions starting from July 4, 2026 [14][16].