"ICI recommended that Treasury authorize many custodians and providers to participate in the market for Trump Accounts ... ICI also pushed for Treasury to interpret the statute to permit as many investing strategies as possible.... State Street Global Advisors also noted that 'guidelines are needed on the process of converting Trump accounts to traditional IRAs.' ... [The Aspen Institute asked] that Trump Accounts [be] categorically disregarded in determining eligibility for means-tested public assistance programs[.]" MORE >>
"In most cases, other vehicles offer superior tax benefits, higher contribution limits and greater portfolio customization. Advisers shouldn't be afraid to make these comparisons. But they need to be very careful if the alternatives they recommend to a Trump Account would earn them fees or other compensation. Doing so in a haphazard way could put them in the SEC's fiduciary crosshairs." MORE >>
"The OBBBA requires custodians to maintain a clear separation between the investment in the contract (basis) and taxable amounts for a Trump account.... Custodians that do not offer 529s or ESAs need to decide whether to invest in building tracking systems or to opt out of offering Trump accounts.... The IRS can ease the transition to these by permitting trustee-to-trustee transfers to traditional IRAs at age 18, ensuring accurate basis reporting and preventing tax errors." MORE >>
"Agency guidance is needed to answer ... [1] How employers can substantiate that employees or their dependents are eligible to receive contributions for the year, and that the receiving account is indeed a Trump Account. [2] Whether employers have any obligation to confirm the employer contribution won't cause the receiving account to exceed the annual contribution limit when made. [3] Methods for performing nondiscrimination testing and correcting testing failures. [4] Whether employers are permitted to recoup erroneous contributions and how to do so." MORE >>
"Fortunately, since Trump account contributions can't be made before July 4, 2026, the IRS should have enough time to issue guidance....[1] How will Trump accounts be established? ... [2] How will elections be made? ... [3] Will Roth conversions be allowed starting in the age-18 year? ... [4] Will Trump account funds be subject to required minimum distribution (RMD) rules? ... [5] Is the employer Trump account contribution limit a lifetime limit or an annual limit? ... [6] Do employer contributions count towards the $5,000 limit? " MORE >>
"[M]ore guidance is necessary before employers can properly consider whether [this] is a worthwhile benefit to offer employees.... [1] Is the $2,500 employer contribution limit an annual limit or lifetime limit? [2] Is it possible for an employer to contribute more than $2,500 if the excess is included in the employee's gross income for the year? ... [3] May an employer make contributions only on behalf of employees who establish Trump Accounts with a trustee selected by the employer? ... [4] How would an employer run nondiscrimination testing? [5] What happens if a Trump Account Contribution Program fails nondiscrimination testing?" MORE >>
"If the employer chooses to make contributions, employers must have a written plan that follows certain rules such as the prohibition of discrimination against certain income groups and notice to eligible employees. Contributions could also be made by an employer to an employee who is under the age of 18 and has their own Trump account. Employers may choose to contribute up to $2,500 either directly to the employee or the employee's dependent." MORE >>
"Contributions to Trump Accounts are not permitted until July 2026, giving plan sponsors time to evaluate their approach and prepare accordingly.... [G]overnment entity and employer contributions are fully taxable upon withdrawal, while parent contributions require basis tracking.... Employers may contribute up to $2,500 (indexed) per employee on a tax-free basis.... [C]ontributions from states, local governments and charitable organizations ... will not count toward the $5,000 annual limit. " MORE >>
"Starting July 4, 2026, employers can contribute up to $2,500 tax-free (indexed) each calendar year to the [Trump Accounts (TAs)] of employees' dependents.... [T]here is no option for employees to contribute through payroll on a pre-tax basis to TAs ... Nor is there the option to embed tax-free TA contributions in a broader arrangement such as flex credits through a cafeteria plan or a lifestyle spending account (LSA)." MORE >>
"Employers may contribute up to $2,500 per year (adjusted for inflation), on a tax-free basis, on behalf of their employees' dependents or their teenage employees. Contributions in excess of $2,500 will be treated as taxable income to the employee. Employers can claim a tax deduction for such contributions as a business expense. However, employer contributions will require a written plan document, and the program will have to comply with certain rules applicable to dependent care FSA accounts under Code Section 129(d) (e.g., related to nondiscrimination and statement of expenses)." MORE >>
"Withdrawals from 529 plans are tax-free as long as they're used for qualified educational expenses. Withdrawals from Trump accounts would have fewer restrictions on their uses, but are taxed at long-term capital gains rates.... Trump accounts would be funded at birth and allow for additional contributions each year, while custodial Roth IRAs require a child to have earned income during the year in order to contribute." MORE >>
