Payroll-Powered Trump Accounts Could Let Parents Save Tax-Free for Kids
The Treasury and IRS are proposing guidelines to let families contribute to Trump Accounts through payroll on a pretax basis, with employees able to contribute up to $2,500 per year and employers able to match up to $2,500 per year; in addition, children born between 2025 and 2028 could receive a one-time government contribution of $1,000 with up to $5,000 annually in total contributions including employer funds. Trump Accounts would work like traditional IRAs, with taxes owed on withdrawals after age 18 and a 10% penalty for taxable amounts withdrawn before 59½; enrollment would use IRS Form 4547 and a public hearing on Oct 15, 2026 will determine final rules. More than 50 companies have pledged to contribute, and experts say the programs could help attract and retain employees while expanding savings options for families.
