With the year-end deadline for Trump Account contributions looming, families and employers are urged to review their contributions carefully to avoid penalties. The Trump Account, a new tax-deferred investment option for children, allows contributions of up to $5,000 for 2026, including employer contributions and employee paycheck deferrals.
However, contributions from employers are capped at $2,500 per employee and are subject to payroll taxes. The Treasury Department's proposed regulations clarify some aspects of these accounts but leave other questions unanswered, particularly regarding self-employed individuals who cannot contribute to their own children's accounts.
A Mercer poll indicates limited employer participation in the initial years, with only 4% of surveyed companies planning to implement Trump Account programs. This new benefit could provide small businesses with a cost-effective way to attract and retain employees while promoting long-term wealth building for the next generation