Trump Account for self-employed business owner?

[Eddy]

What happens in the case of a self-employed business with only the owner as an employee (e.g. independent contractor-type businesses) and the non-discrimination provision?  Can they offer a Trump Account to their employees (just themselves in this case)?  Obviously, in this case, no true discrimination can occur, as there are no other employees to discriminate against. Further one could argue that we cannot calculate the average benefits paid to non-highly compensated employees (we cannot divide by zero), so the 55% rule should not apply. Is there any guidance or case law on this?

[Brian Gilmore]

My guess is no, but we're still awaiting the employer-side Trump Account guidance.  Here's what they said in the recently proposed regs--

https://www.federalregister.gov/documents/2026/03/09/2026-04533/trump-accounts

Section 128 employer contributions paid to a Trump account of an employee or a dependent of an employee are not includible in the employee's income. Such contributions are limited to $2,500, subject to cost-of-living adjustments after 2027. Section 128 employer contributions must be made pursuant to a section 128(c) Trump account contribution program. (The Treasury Department and the IRS intend to issue guidance under section 128 at a future date.)

[Peter Gulia]

Brian Gilmore, I’d welcome your learning about a related question of law.

Internal Revenue Code § 129(d)(8)(A) provides: “A plan meets the requirements of this paragraph if the average benefits provided to employees who are not highly compensated employees under all plans of the employer is at least 55 percent of the average benefits provided to highly compensated employees under all plans of the employer.” https://www.govinfo.gov/content/pkg/USCODE-2024-title26/html/USCODE-2024-title26-subtitleA-chap1-subchapB-partIII-sec129.htm.

Imagine an employer has only one employee, and the employee is a highly-compensated employee.

Could the employer provide a § 129(d) dependent care assistance program? Or is a § 129(d) plan impossible because there is no “employee[] who [is] not highly compensated”?

Although Eddy’s question involves a self-employed individual treated as a deemed employee, a one-employee situation can happen with an employee who is a common-law employee and one who lacks control of, or even any ownership interest in, the employer.

Does a distinction between self-employed deemed employee and a common-law employee matter?

Could a § 501(c)(3) charitable organization provide a § 129(d) plan for its only employee, if the employee is highly-compensated?