This Might Be Worth a Few Minutes If…
- You have a grandchild, child, niece, or nephew born on or since January 1, 2025
- You have a grandchild or child under 18, even if they were born outside that window
- You’ve heard about a “$1,000 from the government” and want to know if it’s real and how to claim it
Key Points
- Eligibility window for the $1,000 deposit: your grandchild must be born on or after January 1, 2025, before the window closes at the end of 2028
- No automatic enrollment: you must elect to receive the $1,000 deposit, typically via IRS Form 4547
- No tax-season deadline: you can file anytime, separate from a tax return, and open the account anytime before your grandchild turns 18
- Annual family contribution limit: $5,000 combined across everyone who contributes, separate from the $1,000 seed deposit
- Employer contributions: capped at $2,500/year and count toward the $5,000 limit, not in addition to it
- Accounts go live July 4, 2026
- Who can file for the $1,000: generally whoever claims the child as a tax dependent that year – usually a parent
If you’ve heard about the new Trump Accounts and assumed there’s a tax-season deadline you already missed, you haven’t. These new savings accounts for kids began accepting contributions on July 4, 2026, but you can open one anytime before your grandchild turns 18.
The real cost of waiting is losing time for the money to grow.
What you’re actually looking at
A Trump Account is a new type of savings account for kids under 18. It works something like a traditional IRA, but it’s built around your grandchild’s early years rather than a working adult’s career. Money goes in, it’s invested, and it grows without being taxed each year. Your grandchild gains full access once they turn 18, at which point the account starts following standard IRA rules.
The accounts officially go live on July 4, 2026. That date is set by law, not by a bank’s processing calendar, so don’t expect a delay just because it falls on a weekend and a federal holiday. If you’re just hearing about this now, you have time. There’s no hidden cutoff you’ve already walked past.
The $1,000 starting deposit
If your grandchild was born on or since January 1, 2025 (and before the window closes at the end of 2028) the federal government will make a one-time $1,000 contribution to their account. This isn’t automatic. You, or your grandchild’s parent, has to elect to receive it, typically by filing IRS Form 4547. You can do this with a tax return, or separately through the trumpaccounts.gov website once it’s available.
This is the detail most people get wrong: they assume if their grandchild qualifies, the money just shows up. It doesn’t. If your grandchild was born in that window and nobody’s filed anything yet, that’s the one concrete thing worth doing.
One thing worth saying clearly: this is usually a parent’s election, not yours
The $1,000 deposit specifically has to be claimed by whoever expects to claim your grandchild as a dependent on their taxes that year — in almost every case, that’s a parent, not a grandparent. If you’re a grandparent reading this, you likely can’t file the election yourself unless you’re the one claiming your grandchild as a dependent.
That doesn’t make this any less worth doing. It just means the most useful thing you can do is make sure it happens — not necessarily be the one who files it. Mention it to your grandchild’s parents if you’re not sure it’s been done. Offer to help cover the cost of opening the account or contributing to it once it’s open. A lot of these $1,000 deposits will go unclaimed simply because nobody got around to the form, and a grandparent asking the question is often what moves it from “we should look into that” to actually done.
How the contribution limits work
Beyond the $1,000 government deposit, you and other family members can contribute up to $5,000 total per year to your grandchild’s account, combined across everyone who contributes. If you put in $3,000, your grandchild’s parents can add up to $2,000 more that same year before hitting the cap.
An employer can also contribute, up to $2,500 a year, but that amount counts toward the same $5,000 limit rather than sitting on top of it. The $1,000 federal seed deposit is the only contribution that doesn’t count against your annual cap.
Where the money goes, and what you can’t do with it
While your grandchild is under 18, the account can only be invested in low-cost index funds tracking the broader U.S. stock market. You can’t choose a specific sector or industry fund, and you can’t pick individual stocks. That’s intentional. The rules are built to keep things simple during the years before your grandchild can make their own decisions about the account.
You can’t withdraw money at all during this period, with very limited exceptions. Once your grandchild turns 18, that changes. The account can be rolled into a traditional IRA, converted to a Roth IRA, or left as is, and a much wider range of investment options opens up.
Who can open the account, and where
Right now, every Trump Account opens through the U.S. Treasury first. Raymond James and other custodians aren’t yet able to open these accounts directly, though that’s expected to change as the program matures. Once your grandchild’s account exists at Treasury, you’ll be able to move the full balance to a different custodian later through a standard transfer process. You can’t split a transfer between two custodians. It has to move as a whole.
The real timeline, in plain terms
You can open an account and elect the $1,000 deposit anytime until your grandchild turns 18. If you wait, you lose growth time. A dollar invested at birth has eighteen years to compound. A dollar invested at fifteen has three.
If you have a grandchild who was born on or since January 1, 2025, you have a real, concrete reason to act sooner rather than later, and it has nothing to do with a deadline you might have missed.
If you’re not sure whether this has been handled for your grandchild, or you’re trying to figure out who in the family should take it on, that’s a quick conversation, not a complicated one. Reach out and we’ll help you sort out who needs to do what.
Not a Cornerstone client?
If you’re not sure whether a Trump Account makes sense for your family’s financial plan, we can help you look at the account in context, compare it with the planning you’re already doing, and sort through next steps.
Contact our office to schedule a conversation:
Email: cfsteam@mycfsgroup.com
In Sioux Falls: 605-357-8553
In Huron: 605-352-9490
Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional.
