Trump Accounts Update – Governmental Guidance But No Clarity

Legal Alert

June 22, 2026

As we mentioned in our prior Alert on July 17, 2025, the One Big Beautiful Bill (the “Bill”) created Trump Accounts. Trump Accounts are a new type of account that is similar to a traditional individual retirement account (“IRA”) but is set up for the benefit of children under age 18.

Trump Accounts are expected to be able to accept contributions beginning July 4, 2026, the earliest date permitted under IRS Notice 2025-68. Generally, up to $5,000 may be contributed to a Trump Account each year, subject to future inflation adjustments. In addition, employers may establish a qualifying program under which they may contribute to the Trump Account of an employee or the employee’s dependent up to $2,500 per employee per year on a tax-free basis (with such amount counting toward the overall annual $5,000 limit).

During the beneficiary’s “growth period” (which lasts until the beginning of the calendar year in which the beneficiary will turn age 18), special rules apply that restrict distributions and investments. After the growth period ends, the Trump Account generally is treated as a traditional IRA and becomes subject to the traditional IRA rules.

On March 9, 2026, the IRS issued proposed regulations that primarily address the election process for opening initial Trump Accounts. The IRS has scheduled a public hearing on those proposed rules for July 16, 2026. Although Trump Accounts are moving into the implementation stage, employers may want to wait until after the hearing and finalization of the regulations before starting a formal contribution program, since the proposed rules are limited and reserve additional sections for future guidance.

On June 17, 2026, the Department of Labor (“DOL”) issued Technical Release 2026-02, in which the DOL concluded that Trump Accounts and related employer contribution arrangements generally will not be treated as “employee pension benefit plans” under the Employee Retirement Income Security Act of 1974 (“ERISA”). The guidance is significant because there was some concern that these arrangements could be considered ERISA plans since they must be maintained pursuant to a separate written plan and must satisfy nondiscrimination and administrative rules similar to those applicable to a dependent care assistance program.

In the Technical Release, the DOL explained that employer contributions made during the beneficiary’s growth period generally will not trigger ERISA coverage for the account or the related contribution arrangement. However, the DOL did note that, for periods after the growth period, employer involvement should remain limited in accordance with the IRA payroll safe harbor rules.

The DOL’s Technical Release is helpful, but it is agency guidance and not a final regulation. As such, it generally does not have the force and effect of law. In addition, after the Supreme Court’s 2024 decision in Loper Bright, courts are not required to defer to an agency’s interpretation of a statute merely because the statute is ambiguous. Therefore, while the DOL’s view is helpful, a court could still reach its own conclusion regarding whether Trump Accounts are subject to ERISA if an employee were to challenge the employer's Trump Account arrangement.

Employers that are considering implementing Trump Accounts may want to continue planning and wait for further guidance and the finalization of the IRS proposed regulations before implementing. If an employer decides to move forward, we suggest it carefully document the program, keep its involvement limited, and avoid treating the arrangement like a conventional employer-sponsored retirement plan, especially after the beneficiary’s growth period ends.