What a Trump Account can invest in
Trump Accounts are limited to simple, low-cost index investments while the child is growing up. Here is what the law and the proposed rules say.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on October 9, 2026.
The rules during the growth period
The "growth period" is the time from when the account is opened until December 31 of the year the child turns 17. During it, money can be invested only in eligible investments.
- A mutual fund or exchange-traded fund (ETF) that tracks an index of primarily U.S. companies, such as the S&P 500.
- No leverage.
- Annual fees and expenses of no more than 0.1% of the amount invested (that is $1 per $1,000 a year).
- Other criteria that Treasury may set.
What the August 2026 proposal adds
- The IRS and Treasury proposed rules on August 20, 2026 (IR-2026-96).
- If you do not choose an investment, the trustee places the money in an eligible option it selects.
- The rules are not final. Comments are due October 20, 2026.
- The proposal would apply to tax years beginning on or after January 1, 2026.
What this means for you
- Expect a plain stock-index investment. There is little to choose or to manage, which keeps costs very low.
- Your child's account value will move with the U.S. stock market. A long time horizon is the main reason this can work.
- Because the cap is $5,000 a year, a Trump Account is one piece of a family's savings, not the whole plan.
We are a CPA firm, not an investment adviser, and we do not recommend investments. We can help you fit a Trump Account into your tax and savings picture. Talk to us.
Common questions
Can I pick individual stocks?
No. During the growth period, funds may be held only in eligible investments: a mutual fund or ETF that tracks an index of primarily U.S. companies, such as the S&P 500, without leverage and with annual fees of no more than 0.1%.
What if I do not choose an investment?
Under the proposed rules, the trustee invests the money in an eligible option it selects. The rules are not final.
Can the money lose value?
Yes. Stock index funds go up and down, and a Trump Account can be worth less than what was put in. The long time before withdrawals begin helps, but nothing is guaranteed.
When do the investment limits end?
The growth period ends on December 31 of the year the child turns 17. After that, the account is treated like a traditional IRA and can generally be invested more broadly, as the IRA rules allow.
Official sources
- IRS Notice 2025-68
- IRS: proposed rules on eligible investments (Aug 20, 2026)
- TrumpAccounts.gov (official)
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