The timeline of Trump Account guidance has been faster and more consequential than most practitioners expected. Since IRS Notice 2025-68 was issued December 2, 2025, the IRS and Treasury have added three additional layers of significant guidance, all of which are in effect as of today.
A full map of what has been issued: Notice 2025-68 (December 2, 2025), which established the foundational framework. Two sets of proposed regulations published March 9, 2026: REG-117270-25 addressing the Section 530A election mechanics, and REG-117002-25 addressing the pilot program contribution. Rev. Proc. 2026-25, published June 29, 2026, which established the transfer tax safe harbor for individual donor contributions. Treasury's announcement, released July 2, 2026, confirming the initial investment lineup: low-cost funds tracking the S&P 500, administered by Bank of New York Mellon and Robinhood Markets. And Technical Release 2026-02, issued June 17, 2026, adding further operational clarity.
This post explains precisely what each layer of guidance adds beyond the prior one, what the proposed regulations specifically cover, what they reserved for future guidance, and what the most recent June and July 2026 developments confirm for families and employers setting up Trump Account programs today.
What Did IRS Notice 2025-68 Establish About Trump Accounts?
Notice 2025-68 was the foundational document. It provided the first operational framework for Section 530A Trump Accounts, covering six substantive areas.
The basic account structure: a Trump Account is a type of traditional IRA established for the exclusive benefit of an eligible individual who has not turned 18 before the close of the calendar year in which the account election is made, and for whom a Social Security number has been issued. The account operates under special rules during the growth period (from establishment through December 31 of the calendar year in which the beneficiary turns 17), after which the standard IRA rules of Section 408 apply.
The contribution framework: no contribution of any type can be made before July 4, 2026. The annual aggregate contribution limit from non-exempt sources (employers, parents, family, and other private sources) is $5,000 for 2026 and 2027, indexed for cost-of-living thereafter. Pilot program contributions from the government ($1,000 for eligible children) and qualified general contributions from governments or Section 501(c)(3) organizations are exempt from the $5,000 limit.
The employer contribution mechanism: Section 128 allows employers to contribute up to $2,500 per employee per year (not per dependent) to the Trump Accounts of eligible dependents of employees, tax-free to the employee. This requires a written Trump Account Contribution Program (TACP) satisfying nondiscrimination requirements similar to Section 129 dependent care assistance programmes.
What the notice explicitly did not address: ERISA status of TACPs, state law issues (including state income tax conformity and age of majority questions), gift and transfer tax treatment of individual contributions to Trump Accounts, the specific investment options available during the growth period, and the regulatory mechanics of the cafeteria plan salary reduction integration under Section 125.
What Do the IRS Proposed Regulations Add or Change?
The proposed regulations issued March 9, 2026, came in two separate notices of proposed rulemaking. REG-117270-25 addressed the Section 530A election mechanics. REG-117002-25 addressed the pilot program contribution under Section 6434. The comment period for both closed April 8, 2026.
The March 2026 proposed regulations are narrow in scope by design. REG-117270-25 focused on one primary question: who has the authority to open a Trump Account and in what order of priority? This had been a gap in Notice 2025-68, which described the general eligibility framework but did not specify how competing claims to open an account would be resolved.
The proposed regulations established a priority order for the authorised individual who may make the initial Trump Account election. The order is: the eligible individual's legal guardian, followed by the eligible individual's parent, followed by the eligible individual's adult sibling, followed by the eligible individual's grandparent. If multiple people share the same priority level, any person at that priority level may make the election.
One important clarification in REG-117270-25: if an individual who is not technically an authorised individual makes the election to open a Trump Account (for example, an aunt or a family friend), the account does not automatically fail to qualify as a Trump Account. The account stands even if opened by someone outside the priority list, unless the account was established incorrectly in some other way.
The proposed regulations also confirmed the Form 4547 as the election form for opening an initial Trump Account. The form is a single page and may be filed with the authorised individual's tax return or separately.
REG-117002-25 addressed the pilot program. The proposed regulations established that an eligible child for the $1,000 pilot program contribution must be: a qualifying child under Section 152(c) of the individual making the election, born between January 1, 2025 and December 31, 2028, a US citizen, in possession of a Social Security number, and without a prior pilot program election. The regulations clarified that mere anticipation of dependency is sufficient at the time of election. If the child turns out not to be the taxpayer's dependent when the tax return is ultimately filed, this does not invalidate the pilot program election.
The proposed regulations reserved for future guidance: the rules for contributions beyond the election mechanics (Sections 1.530A-2 through 1.530A-6 in the Code of Federal Regulations), covering investments, distributions, reporting, and coordination with IRA rules. These are the most consequential sections for day-to-day administration and remain pending.
Critically, the proposed regulations did not address: employer TACP rules, nondiscrimination testing, cafeteria plan integration, investment options, distribution mechanics, or ERISA status. Those remain in the pipeline.
Key Clarifications: Investment Restrictions and Eligible Index Fund Requirements
The most practically useful new information to arrive since the March proposed regulations is the Treasury's July 2, 2026 announcement of the initial investment lineup for Trump Accounts.
The OBBBA specified that during the growth period, Trump Account investments are restricted. Section 530A does not allow unrestricted investment in individual securities, derivatives, or alternative assets during the child's minority. The statute and implementing guidance contemplate a constrained investment universe to protect the long-term savings nature of the account.
Treasury's July 2, 2026 announcement confirmed: the initial investment lineup comprises low-cost funds that track the S&P 500. Bank of New York Mellon and Robinhood Markets are the initial trustee partners. This means that as accounts come online beginning July 4, 2026, the default and potentially only available investment option during the growth period is S&P 500 index fund exposure through the designated trustee structure.
The investment restriction is one of the significant differences between a Trump Account and a standard traditional IRA, which allows virtually unrestricted investment in publicly traded securities. During the growth period, families and employers making contributions cannot direct those funds into individual stocks, bonds, sector funds, or other assets. The investment restriction is designed into the statute and is not a temporary administrative convenience.
For employers designing their TACP, the investment restriction has a specific implication: the contribution goes to the trustee, and the trustee invests in the designated lineup. The employer has no discretion over the investment of the contributed funds. The trustee (BNY Mellon and Robinhood initially) manages the investment. This eliminates one layer of employer administrative complexity but also eliminates any investment customisation option for families.
Key Clarifications: Employer Section 128 TACP Nondiscrimination Rules
The proposed regulations issued in March 2026 did not address the nondiscrimination rules for TACPs. That guidance remains pending. The most current statement of the expected framework is still IRS Notice 2025-68's description of Section 129-style nondiscrimination requirements.
What has been added since Notice 2025-68 in terms of nondiscrimination specifics: an IRS representative informally indicated (according to the Verrill Law analysis from May 2026) that the IRS intends to add the average benefits test (currently used for qualified retirement plan nondiscrimination testing) as a permissible compliance method for Trump Account nondiscrimination alongside the standard Section 129 approach. This would give employers with disproportionately higher-paid workforces more flexibility in demonstrating compliance.
Groups submitting comments on the March 2026 proposed regulations specifically asked for automatic enrolment provisions and clarification on how to handle employees at companies where both parents work (and where the $2,500 per-employee limit could theoretically be reached twice for a single child's account if both employers contribute). Comments submitted in April 2026 flagged this as a significant administration question that the IRS needs to address in future guidance.
The Verrill Law analysis summarises the current employer guidance state accurately: employers are ready to contribute starting July 4, 2026, with the Section 129 nondiscrimination framework as the operative model for the TACP, but several employer-specific questions (double-contribution for dual-employed parents, specific average benefits test methodology, and attestation reliance for dependent eligibility) are awaiting further IRS guidance.
For employers deciding whether to launch a TACP today, the practical answer is: the Section 129 model applies, the $2,500 per-employee limit applies, and the nondiscrimination testing methodology should follow Section 129 principles until the IRS issues TACP-specific guidance. This is a workable position for employers with straightforward benefit structures and predominantly single-employer families.
Key Clarifications: ERISA Status of Employer Contribution Programs
The ERISA question remains the most significant outstanding issue for employer adoption decisions, and neither the March 2026 proposed regulations nor any subsequent IRS guidance has resolved it.
Notice 2025-68 acknowledged explicitly that ERISA status of TACPs was not being addressed and that DOL and Treasury anticipated issuing guidance on how to structure TACPs to avoid ERISA coverage. As of July 9, 2026, that guidance has not arrived.
The Verrill Law analysis from May 2026 is the most current assessment from benefits counsel: the ERISA question remains genuinely open, and employers that implement a TACP today do so without certainty about their ERISA obligations. If a TACP is treated as an ERISA-covered employee welfare benefit plan, employers would face fiduciary obligations, annual Form 5500 reporting, ERISA bond requirements, and claims and appeals procedures.
Two structural design factors that may help employers reduce ERISA risk in the interim: keeping the TACP as a pure employer-contribution programme (no salary reduction, no employee contributions, no pooling of assets), and ensuring that the programme does not create any ongoing employer obligation beyond the annual discretionary contribution decision. Programmes that look more like supplemental executive retirement plans and less like fringe benefit programmes carry more ERISA risk. Those that look like the employer simply writing a cheque to a third-party trustee on behalf of an employee carry less.
However, these are design judgements made in the absence of official guidance. Employers with large employee populations where ERISA compliance cost would be material may prefer to wait for the DOL/Treasury ERISA guidance before launching.
Key Clarifications: State Tax Treatment and Conformity Questions
Notice 2025-68 explicitly declined to address state tax issues, noting they were outside the notice's scope. The proposed regulations similarly did not address state law questions. The federal income exclusion for Section 128 employer contributions is a federal rule. State tax conformity must be assessed separately for each state.
State conformity varies in two important ways. First, whether the state excludes Section 128 employer contributions from state income: states with fixed-date conformity to the federal IRC as of a date before July 4, 2025 (the OBBBA's enactment date) may not automatically exclude the employer contribution from state taxable income. Second, whether the state taxes investment growth in Trump Accounts during the growth period: some states do not conform to the IRA deferral rules for all types of accounts.
As of July 9, 2026, no comprehensive state-by-state conformity analysis for Section 530A has been published by the IRS. Employers with multi-state workforces need state-level tax counsel to assess the state income tax treatment of TACP contributions in each material state before launching.
Key Clarifications: Cafeteria Plan Coordination Under Section 125
The cafeteria plan salary reduction integration remains unavailable. Notice 2025-68 signalled intent to issue Section 125 regulations, but those have not been published as of today, July 9, 2026.
The technical structure of the cafeteria plan integration, when it arrives, was described in Notice 2025-68 with one important limitation: employee salary reduction contributions to fund the employee's own Trump Account are not permitted through a cafeteria plan, because it constitutes impermissible deferred compensation. Only salary reductions directed to the Trump Account of an eligible dependent child of the employee would be permissible.
The comment record from April 2026 on the proposed regulations specifically asked the IRS to prioritise the Section 125 regulations, noting that many employers view the pre-tax salary reduction option as important to employee uptake of the benefit. The IRS acknowledged comments on this issue but has not yet issued the promised regulations.
What Open Questions Did the Proposed Regulations Leave Unanswered?
The March 2026 proposed regulations reserved Sections 1.530A-2 through 1.530A-6 in the Code of Federal Regulations for future guidance. Each reserved section corresponds to a major pending question area.
Section 1.530A-2 (reserved): contribution rules. This includes the full mechanics of the $5,000 annual contribution limit, how the limit applies when multiple sources contribute to the same account, how the limit interacts with the pilot programme, and the rollover mechanics.
Section 1.530A-3 (reserved): investment rules. This will address the permissible investment universe during the growth period, how trustees manage account investments, and what happens to investment restrictions when the account converts to a standard traditional IRA at age 18.
Section 1.530A-4 (reserved): distribution rules. Distributions from Trump Accounts during the growth period are restricted. The rules governing permissible and impermissible distributions, the tax consequences of improper distributions, and the transition to standard IRA distribution rules at the end of the growth period are all pending.
Section 1.530A-5 (reserved): reporting requirements. The trustee reporting obligations under Section 530A(i), including how trustees classify contributions by type (pilot, Section 128 employer, qualified general, other), will be addressed here.
Section 1.530A-6 (reserved): special rules and IRA coordination. The interaction between Trump Accounts and existing IRA rules, including the coordination between Trump Account contributions and standard IRA contribution limits (which do not apply during the growth period), will be addressed here.
For employers and families launching today, the most operationally critical pending section is 1.530A-2 (contribution rules), because the exact mechanics of how the $5,000 limit applies across multiple contribution sources and how employer contributions are processed by trustees need more specificity.
When Is the Comment Period and Who Should Submit Comments?
The comment period for the two March 2026 proposed regulations (REG-117270-25 and REG-117002-25) closed April 8, 2026. Comments received after that date are considered in drafting final regulations but were not formally in the comment record.
The most recent piece of guidance, Rev. Proc. 2026-25 on the gift tax safe harbour, was published June 29, 2026, as a final revenue procedure rather than as a proposed rule, so there was no public comment period for it. Rev. Proc. 2026-25 takes effect immediately.
For the reserved sections (1.530A-2 through 1.530A-6), proposed regulations have not yet been issued. When they are proposed, they will carry their own comment periods. Given the pace of guidance since December 2025 (Notice 2025-68, two NPRMs in March, Technical Release in June, Rev. Proc. in June, investment lineup in July), the IRS has signalled it is moving relatively quickly on this priority statute. Practitioners and employer organisations should monitor the Federal Register and IRS newsroom for NPRM publications covering the reserved sections, particularly the contribution and investment rules.
The AICPA issued a warning in late June 2026 specifically advising taxpayers to research the Trump Account programme before contributing, citing unexpected tax complexities including the state tax conformity questions and the interaction with gift tax rules that Rev. Proc. 2026-25 was issued to address. The AICPA's warning is not a reason to avoid the programme, but it is a reason to involve CPA and benefits counsel before setting up either a family contribution or an employer TACP.
What Should Employers Do Now vs Wait for Final Regulations?
The layered guidance creates a decision tree for employers. Some actions are appropriate now. Others should wait.
Do now: Draft and adopt a TACP written plan for employer contributions. The foundational TACP requirements are confirmed in Notice 2025-68 and confirmed to be modelled on Section 129. Employers that want to offer the employer contribution benefit starting July 4, 2026 can draft a written TACP, satisfy Section 129-style nondiscrimination and notification requirements, and make contributions using the Section 128 mechanism. The TACP can be structured as a pure employer-contribution programme that avoids the ERISA risk associated with more complex plan structures.
Do now: Confirm payroll coding for W-2 Box 12 code TA. The W-2 reporting mechanics for employer contributions (Box 12 code TA) are confirmed in the 2026 Form W-2 instructions. Employers making contributions need payroll to code them correctly.
Wait: Cafeteria plan salary reduction. The Section 125 regulations needed to implement pre-tax employee salary reduction contributions have not been issued. Launching a cafeteria plan integration before those regulations are available creates legal risk.
Wait: Formal ERISA compliance structure. Until DOL/Treasury guidance on ERISA status is issued, the optimal TACP structure for large employers is a pure employer-contribution model. Adding employee contributions, creating pooled assets, or building in ongoing employer obligations increases ERISA risk without guidance on how to structure around it.
Monitor: Contribution mechanics regulations (Section 1.530A-2). The full rules for how the $5,000 annual contribution limit applies across multiple contribution sources will be addressed in forthcoming proposed regulations. Employers and families making contributions before those regulations are final should track those rules carefully and be prepared to adjust procedures when they arrive.
Frequently Asked Questions
What did the IRS proposed regulations on Trump Accounts cover?
Two sets of proposed regulations were issued on March 9, 2026. REG-117270-25 addressed the mechanics of making an election to open an initial Trump Account, including the priority order for authorised individuals (guardian, parent, adult sibling, grandparent) and the Form 4547 election process. REG-117002-25 addressed the pilot programme contribution mechanics for the government's $1,000 contribution to eligible children born between 2025 and 2028. Both proposed regulations reserved major areas (contributions, investments, distributions, reporting) for future proposed regulations.
What changed from Notice 2025-68 to the proposed regulations?
Notice 2025-68 established the foundational framework: account structure, contribution limits, employer TACP requirements under Section 128, and a general overview. The March 2026 proposed regulations added specificity on two narrow questions: who has authority to open an account and in what order of priority, and how the pilot programme contribution election mechanics work. Since then, Rev. Proc. 2026-25 (June 29, 2026) added the gift tax safe harbour for individual contributions, and Treasury's July 2, 2026 announcement confirmed the initial investment lineup (S&P 500 index funds through BNY Mellon and Robinhood).
Does ERISA apply to employer Trump Account programs?
Unknown. IRS Notice 2025-68 explicitly declined to address ERISA status and stated that DOL and Treasury anticipate issuing guidance on how to structure TACPs to avoid ERISA coverage. As of July 9, 2026, that guidance has not been issued. Employers implementing TACPs today do so without certainty about their ERISA obligations. The safest structure pending guidance is a pure employer-contribution programme with no employee contributions and no pooling of assets.
When is the comment period for the Trump Account proposed regulations?
The comment period for the March 9, 2026 proposed regulations (REG-117270-25 and REG-117002-25) closed April 8, 2026. The June 29, 2026 Rev. Proc. 2026-25 was issued as a final revenue procedure with no comment period. Future proposed regulations covering contributions, investments, distributions, and reporting (Sections 1.530A-2 through 1.530A-6) have not yet been published; they will carry their own comment periods when issued.
Can families rely on the proposed regulations before they are final?
Yes, with limitations. The IRS stated in Notice 2025-68 that taxpayers may rely on the notice until proposed regulations are issued. Proposed regulations themselves generally may be relied upon until final regulations are published, unless the final regulations specify otherwise. However, the proposed regulations only cover the election mechanics and pilot programme. The major areas reserved for future proposed regulations (contributions, investments, distributions) cannot yet be relied upon because no proposed regulations have been issued for them.
Key Takeaways
- The IRS has issued four layers of Trump Account guidance since the OBBBA was enacted: Notice 2025-68 (December 2025), two NPRMs (March 9, 2026), Technical Release 2026-02 (June 2026), Rev. Proc. 2026-25 (June 29, 2026, gift tax safe harbour), and the Treasury investment lineup announcement (July 2, 2026).
- The March 2026 proposed regulations (REG-117270-25 and REG-117002-25) added specificity on the election priority order for opening accounts and on the pilot programme mechanics. They reserved Sections 1.530A-2 through 1.530A-6 for future guidance covering contributions, investments, distributions, and reporting.
- The initial investment lineup is S&P 500 index funds, administered by Bank of New York Mellon and Robinhood Markets. During the growth period, investments are restricted to the designated trustee lineup and cannot be directed into individual securities or other assets.
- Rev. Proc. 2026-25 establishes a transfer tax safe harbour: individual contributions to Trump Accounts are treated as completed gifts eligible for the annual per-donee gift tax exclusion, and qualifying donors do not need to file gift tax returns.
- ERISA status of employer TACPs remains unresolved. DOL and Treasury have promised guidance, but it has not been issued. Employers should structure TACPs as pure employer-contribution programmes pending that guidance.
- Cafeteria plan salary reduction contributions (Section 125 integration) remain unavailable pending promised but unissued IRS regulations.
- Employers can launch pure employer-contribution TACPs under Section 128 today, using Section 129 nondiscrimination principles as the operative model.
