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Trump Accounts

89 item(s) · sort: newest first · title A–Z

Auto-Enrollment & Claiming (4)

Employers Seek Simpler Path for Supporting Trump Accounts
PLANSPONSOR 2026-10-23 · issue № 81
Summary

Employer interest in contributing to Trump Accounts keeps running into administration. PLANSPONSOR reports hearing participants and consultants describing multiple trustees, payroll mechanics and account authentication as the obstacles between a willing employer and an actual contribution. Automatic account opening doesn’t replace the parent’s claiming process, so an employer can’t assume every employee’s child has a usable account. The picture is operational choices and uncertainty, not a settled model.

Trump Accounts Launch as Employers Weigh New Benefits Role
401(k) Specialist 2026-10-08 · issue № 70
Summary

The White House marked the formal launch of Trump Accounts this week, with roughly 60 million children registered through the auto-enrollment added late in the program’s design and $1,000 in seed money for eligible children. Since the July 4 start the accounts have taken in more than $4.5 billion, including $1.3 billion in seed contributions, $600 million from families and $2.6 billion in philanthropic gifts, the latter anchored by a $6.25 billion commitment from Michael and Susan Dell. Family and friends may contribute up to $5,000 a year, and employers may contribute up to $2,500 within that cap. For sponsors, Aon’s Melissa Elbert points to Treasury’s continued support for running dependent contributions through a Section 125 cafeteria plan, which she calls a middle ground that lets employers facilitate participation through existing benefits infrastructure even if they never contribute a dollar themselves.

Treasury Announces Completion of Trump Account Auto-Enrollment
Treasury · press release 2026-10-01 · issue № 65
Summary

Treasury explains how parents and guardians can claim the Trump Accounts that automatic enrollment created. The official app is the channel, a parent or guardian verifies identity and relationship to the child, and families with questions are pointed to TrumpAccounts.gov. The announcement doesn't change the employer-contribution rules the agencies proposed in August, which are still proposals, not final rules.

Trump Account Auto-Enrollment Proposal Lands in the Federal Register, Comments Due November 30
Treasury and IRS · proposed rule · 91 FR 61812 2026-10-01 · issue № 64
Summary

The Trump Account auto-enrollment proposal has been published in the Federal Register. Comments are due November 30, 2026. The proposal would pair the temporary regulations' automatic account creation with rules for the claiming process and for qualified general contributions, and a scheduled October 15 public hearing on the related employer-contribution rules has been [switched to telephonic only](https://www.federalregister.gov/documents/2026/09/30/2026-20021/employer-contributions-to-trump-accounts-and-nondiscrimination-rules-for-dependent-care-assistance). The rules mainly concern how Treasury will create and administer the accounts. Jim Earle of Troutman Pepper Locke [told SHRM](https://www.troutman.com/insights/what-trump-account-auto-enrollment-means-for-employers) the temporary and proposed rules don't directly affect employers or change the separately proposed rules for employer contributions. The comment window is the place to press questions about how claiming will work when employers start funding accounts.

Employer Contributions (28)

Trump Accounts Face Adoption Questions as Employers Weigh Complexity
PLANADVISER 2026-10-22 · issue № 80
Summary

An employer contribution to a child’s Trump Account could involve considerably more work than adding a payroll deduction. At an IRS hearing, Aon’s Grace Lattyak warned that employers might have to validate accounts, transmit contributions and handle corrections separately with numerous financial institutions. PLANADVISER also reports questions about payroll taxes and whether existing payroll systems can accommodate the benefit. For employers considering it, the unresolved issue is how the administration would work across account providers, not simply whether employees would welcome another contribution.

What Employers Need to Know About Trump Accounts
Marsh / Mercer 2026-10-14 · issue № 79
Summary

Mercer’s 15-page explainer covers the employer side of the new child savings accounts, to which employers have been able to contribute since July 2026. The $2,500 exclusion applies per employee, not per child. Additional employer contributions outside the program are taxable wages, and individual and employer contributions remain subject to the account’s separate aggregate annual limit, while Social Security, Medicare, and federal unemployment taxes still apply under the proposed guidance. Minor employees cannot fund their own accounts pretax, and the linked proposed regulations carry their own open questions.

Trump Accounts: What Employers Need to Know
Haynes Boone · via JD Supra 2026-10-15 · issue № 76
Summary

Haynes Boone walks employers through contributing to Trump Accounts, which the firm describes as traditional IRAs for children under 18 that took effect earlier this year. Ordinary contributions, including qualifying employer contributions, share a $5,000 annual limit per child, with certain government, qualified general and rollover contributions excluded, and an employer program may contribute up to $2,500 per employee, counted within that shared limit rather than on top of it. Qualifying employer contributions are exempt from federal income tax but not from the employer’s Social Security and unemployment payroll taxes, and the firm describes the written-program and nondiscrimination requirements along with open administrative questions. These are accounts for employees’ children, not a new retirement account every adult employee can open, and the analysis is the firm’s reading of the underlying guidance.

Treasury Dept. Enrolls 60 Million Children in Trump Accounts and OK’s Stock Contributions
Ed Slott and Company 2026-10-12 · issue № 72
Summary

Ian Berger explains how automatically opened Trump Accounts work and when families can start adding money. Only about seven million Trump Accounts had been opened by parents as of July, so Treasury automatically created an account for roughly 60 million more eligible children. The auto accounts live together in a master group trust and can hold only two things, the $1,000 federal contribution, which parents still must claim, and contributions from tax-exempt organizations. Before a family can add its own money or accept employer contributions, a parent must claim the account and move it out of the trust. The second announcement lets private foundations contribute publicly traded stock instead of cash, with no dollar cap and no effect on the $5,000 annual limit that applies to individual and employer contributions, though contributions must go to a targeted group of children and stock generally must be held five years before sale.

Trump Accounts as an Employee Benefit: An Employer’s Roadmap
Kilpatrick · via JD Supra 2026-10-01 · issue № 67
Summary

Sanyam Parikh and Sterling Perkinson turn the Trump Account rules into an implementation checklist. A contribution program must be a separate written plan; up to $2,500 per employee per year, a cap that applies per employee rather than per dependent, is excluded from income but still subject to FICA and FUTA; and salary-reduction contributions run through the cafeteria plan and can fund only a dependent’s account. Two details matter before launch. Under the September 30 temporary regulations, an automatically created account that hasn’t been claimed can’t receive employer contributions, so payroll needs to verify claiming before routing a dollar, and contributions report on the W-2 under new code TA. Their ERISA tip is to set eligibility at age 21 with a year of service, which keeps working minors, and the thorniest coverage questions, out of the program.

DOL Provides Welcome Clarity on Trump Accounts
The Rosenbaum Law Firm · via JD Supra 2026-10-01 · issue № 66
Summary

Ary Rosenbaum's short take on Technical Release 2026-02, in which the Labor Department concluded that Trump Accounts and most employer contribution programs tied to them won't be treated as pension plans under ERISA. The accounts belong to children, not employees, and the department described limits on employer involvement that keep a program outside Title I. His point for employers is that the guidance answers the ERISA-coverage question and that question only; the written-program, certification, and contribution-limit requirements still apply.

What Employers Need to Know About Trump Account Nondiscrimination Rules
IFEBP Word on Benefits 2026-09-15 · issue № 53
Summary

The follow-up to IFEBP's earlier walk-through of the proposed Trump-account contribution rules, this one on the testing, all of it still proposed. An employer contribution program could not favor highly compensated employees in contributions or benefits, and would need reasonable, objective eligibility classifications. The heart is an average benefits test: the average benefit going to non-highly compensated employees must be at least 55 percent of the average going to the highly compensated, counting only employees who actually receive something and, where benefits run through salary reduction, permitting workers earning under $25,000 to be disregarded. Certain employees, including those under 21 or with less than a year of service, can be left out of the testing populations, and collectively bargained employees may be excludable subject to conditions. Comments are due September 25, a hearing follows October 15, and the proposal would let employers correct specified 2026 testing failures until January 31, 2027.

Proposed Rules on Trump Accounts Address Employer Contributions and Eligible Investments
Nixon Peabody 2026-09-10 · issue № 50
Summary

The first alert to give equal time to the second proposed rule: what Trump accounts may actually hold during the growth period. Investments must be index tracking mutual funds or ETFs with no leverage and annual fees capped at 0.1 percent of net asset value—actively managed funds, fund of funds structures, and ESG index funds are all ineligible—and trustees must re-verify eligibility every twelve months and dispose of noncompliant holdings within thirty days. On the employer side, two cautions easy to miss: a written employee certification is not enough by itself to verify an account, and contributions escape income tax but remain wages for FICA and FUTA. A safe harbor covers employers that match the $1,000 pilot contribution identically for all non-excluded employees.

Employer Contributions to Trump Accounts: Partially Explained
Seyfarth Shaw · via JD Supra 2026-09-02 · issue № 45
Summary

Two sets of proposed regulations address how employer-sponsored Trump Account contribution programs will operate and how account assets may be invested before a beneficiary turns 18. Seyfarth walks through the requirements, including a separate written plan document, a $2,500 per-employee cap on tax-favored Section 128 contributions, cafeteria plan elections for employee pre-tax contributions to dependents' accounts, and nondiscrimination testing that tracks the dependent care FSA rules. Contributions default to an S&P 500 index ETF with ESG index funds off the table, and open questions remain, from tracking eligible dependents to coordinating contributions across a controlled group.

Been Wanting to Learn More About Trump Accounts?
Seyfarth Shaw · Beneficially Yours 2026-08-31 · issue № 43
Summary

Seyfarth reviews the IRS's latest proposed Trump Account guidance, which addresses employer contribution programs and the eligible-investment rules confining account assets to low-fee, broad-market index funds during a beneficiary's childhood.

Section 530A Account Update: ERISA Status of Trump Accounts
Verrill 2026-08-24 · issue № 40
Summary

In Technical Release 2026-02, the DOL concluded that Section 530A accounts and employer contribution programs generally are not ERISA-covered pension plans when employers keep a neutral, administrative role. To stay outside ERISA, employers should avoid endorsing particular providers, influencing investment decisions, imposing conditions on account use beyond what the tax code requires, or receiving compensation. Verrill's takeaway is that the guidance clears a major compliance concern for employers weighing 530A contributions, while ERISA risk still turns on program design, communication, and administration.

Trump Accounts Gain Market Momentum: Is Your Company Ready?
Vedder · via JD Supra 2026-08-26 · issue № 39
Summary

Trump Accounts are a new tax-favored, IRA-style savings vehicle that may be established for eligible children by an authorized individual, such as a parent, legal guardian, or grandparent, and may receive federal, family, and employer contributions.

Employer Contributions to Trump Accounts and Nondiscrimination Rules for Dependent Care Assistance Programs (Proposed Rule)
IRS / Treasury · 91 FR 51611Deadline 2026-08-11 · issue № 28
Summary

Treasury and the IRS proposed the framework for employer Trump account contribution programs: a separate written plan, eligibility classes tested under DCAP-style nondiscrimination rules including a 90% sliding-scale safe harbor, written employee notification, and W-2 reporting, with employees able to exclude up to $2,500 per year of employer contributions. The proposal also updates the section 129 DCAP nondiscrimination rules themselves, reflecting the OBBBA's increase of the dependent care exclusion to $7,500. Employers may rely on the proposed rules now; comments are due September 25 and a public hearing is set for October 15.

DOL Clarifies ERISA Treatment of Trump Accounts
Nelson Mullins Riley & Scarborough LLP · via JD Supra 2026-07-14 · issue № 8
Summary

The U.S. Department of Labor (the “DOL”) recently issued Technical Release 2026-02, providing guidance on whether certain Trump accounts established under Section 530A of the Internal Revenue Code and the One, Big, Beautiful Bill Act (“Trump Accounts”) and employer contribution programs to such accounts constitute employee benefit plans subject to ERISA.

Investments, Gifts & Funding (12)

Elon Musk Pledges SpaceX Shares to American Children
401(k) Specialist 2026-10-21 · issue № 81
Summary

Elon Musk pledged a SpaceX share for each American child, and the article explores whether Trump Accounts could hold them. Aon commentary highlights the family, tax and trustee complications an employer would face before anything like that could be administered. It’s a pledge, not a delivery, and nothing establishes that individual SpaceX shares are permissible Trump Account investments under the statute’s limits. For employers, the gap between a headline gift and a working mechanism is the story.

Retirement Industry Seeks Changes to Trump Account Investment Rules
NAPA 2026-10-21 · issue № 80
Summary

What happens when a Trump Account’s investments drift outside the permitted limits? Retirement-industry commenters want a correction process and protection for trustees relying in good faith on public investment information. Other requests go further. Vanguard sought room for bonds and Coinbase for cryptocurrency, although the statute restricts the eligible investments. The October 20 comment deadline has passed. For providers building these accounts, the distinction matters between changes Treasury could make through guidance and changes that would require Congress.

Trump Account Rules Open the Door to Donated Stock and Billion-Dollar Class Gifts
Treasury and IRS · TD 10056 · temporary regulations 2026-09-30 · issue № 63
Summary

New Trump Account rules let governments and charities fund equal contributions for every eligible child in a class defined by birth year and geography, and those contributions can now arrive as publicly traded stock rather than cash. Donated stock generally must be held for five years before it is sold and reinvested in the index funds the accounts otherwise require. Until accounts are claimed, the assets of automatically created accounts are invested together through a master trust while Treasury keeps ownership records for each child. The preamble names the Michael & Susan Dell Foundation's $6.25 billion pledge, to children born between 2016 and 2024 in lower-income ZIP codes, as the kind of giving the rules are designed to attract, and it gives charitable donors certainty that these contributions qualify for deductions. Comments on the companion proposed rule are due 60 days after it publishes in the Federal Register.

Breaking Down the Proposed Trump Account Investment Rules
NAPA · Paul Mulholland 2026-09-18 · issue № 58
Summary

Comments on the proposed Trump Account investment rules are due October 20. The proposal's requirement that eligible funds invest at least 90 percent in U.S. equities remains contested. It also excludes ESG index funds even though they aren't sector funds. Speaking at a webinar covered by NAPA, Mindset's Chantel Sheaks said the 0.1 percent fee cap includes all charges to the account holder, whatever they're called. Actively managed funds generally wouldn't qualify.

Trump Accounts: Proposed Regulations Regarding Eligible Investments
Boutwell Fay 2026-09-17 · issue № 55
Summary

A comment deadline is approaching on the investment side of the accounts we covered all week. October 20 is the date for [the August proposed regulations](https://www.federalregister.gov/documents/2026/08/21/2026-17123/guidance-on-eligible-investments-for-trump-accounts) defining what a Trump Account may hold. The proposed rules are strict. Mutual funds or ETFs only, tracking the S&P 500 or another broad U.S. equity index (no sector, ESG-focused, or actively managed funds, and no leverage), with annual fees capped at 0.1 percent of assets. Under the proposal, trustees would offer only eligible funds, name a default, monitor eligibility annually, and unwind any fund that falls out of compliance within 30 days. The investment menu would stay deliberately narrow, and employers considering contributions should understand those limits before describing the benefit to employees.

IRS Proposes Rules for Trump Account Investment Options: Considerations for Employers
Mayer Brown 2026-08-28 · issue № 42
Summary

Proposed regulations under section 530A would confine Trump Account investments during the growth period to unleveraged index funds that track broad U.S. equity benchmarks and charge annual fees of 0.1% or less, excluding actively managed, sector, and ESG-labeled funds. Employers contributing to the accounts bear no fiduciary duty for investment selection but should confirm contributions flow to compliant accounts. Comments are due October 20.

Guidance on Eligible Investments for Trump Accounts (Proposed Rule)
Internal Revenue Service / Treasury DepartmentDeadline 2026-08-21 · issue № 36
Summary

Treasury and the IRS proposed rules defining what a Trump Account can hold before the beneficiary turns 18: generally an unleveraged mutual fund or ETF tracking a broad U.S. equity index such as the S&P 500, charging no more than 0.1 percent in annual fees, with the trustee selecting a default fund when no election is made. The August 11 rules told employers what they may contribute; this one tells trustees what the money may sit in. Comments are due October 20, 2026.

2026 Policy Developments in Benefits and Executive Compensation
Hall Benefits Law 2026-08-20 · issue № 36
Summary

Hall Benefits Law's half-year policy roundup names four developments: the DOL's proposed safe harbor for fiduciaries selecting 401(k) investments, EBSA's shift to fewer but more participant-focused enforcement interactions, SEC moves to streamline executive compensation disclosure by company size, and EBSA's technical release that ERISA Title I generally does not apply to Trump Accounts. A mixed but useful mid-year checkpoint for benefits and executive compensation practice.

Rulemaking & Guidance (29)

Is Adding a Trump Account Option the Next Big Cafeteria Plan Benefit?
FiduciaryNews 2026-10-20 · issue № 82
Summary

Christopher Carosa asks benefits lawyers Marcia Wagner and Michelle Capezza how an employer would actually offer Trump Account contributions, and the answers separate adopting the benefit from running it. Under the proposed rules, salary-reduction contributions would be available only for employees’ dependents through a separate program the tax code creates. Employers would need to build payroll and trustee coordination, let elections change prospectively at least monthly, and run nondiscrimination testing that examines both who qualifies and whether benefits disproportionately favor higher-paid employees. The $2,500 annual exclusion is a combined limit per employee, not per dependent. The article examines proposed administrative rules, whose details could change before they are finalized.

Trump Account Regulations—Out With the Proposed, in With the Temporary: Step Right Up to Claim Your Child’s Auto Account
Boutwell Fay 2026-10-22 · issue № 81
Summary

Temporary regulations replaced the proposed opening procedure with automatic accounts, and Boutwell Fay reports the result in numbers. Automatic accounts were opened for more than 60 million children on October 1, bringing the total to nearly 70 million. An automatic account still has to be claimed and activated by a parent or guardian, and an employer can’t simply send contributions to an unclaimed account. The firm flags open questions about how employers verify an employee’s account and how these rules fit the earlier employer-contribution proposal.

The $2,500 Question: What Employers Need to Know About Contributing to Trump Accounts
Foley & Lardner · via National Law Review 2026-10-21 · issue № 79
Summary

Foley & Lardner’s explainer covers the employer-contribution side of the new accounts, up to $2,500 per employee per year, fundable by employer dollars or pre-tax salary reductions for dependents through a cafeteria plan. An employer offering contributions needs a separate written program plus nondiscrimination, notification, reporting, and trustee-notice compliance, and salary-reduction designs require plan amendments. Parts of the framework rest on proposed regulations, so not every mechanic is final.

October 2026 Regulatory & Legislative Update
CBIZ · Benefit Beat 2026-10-06 · issue № 71
Summary

CBIZ’s October update flags three dates for employers. Medicare Part D creditable coverage notices, which tell employees whether their drug coverage is at least as good as standard Medicare coverage, are due before October 15. Extended Form 5500s for calendar-year plans are due October 15, and Massachusetts HIRD filings open November 15. The Labor Department’s benefits agency, in new Field Assistance Bulletin 2026-03, is focusing mental health parity enforcement on blanket exclusions of mental health treatment, the review practices plans use to decide whether care is necessary, and inadequate provider networks. Its updated red-flags checklist helps plans spot potential problems in their own designs while new regulations are drafted. The issue also covers the Trump Accounts temporary regulations, with IRS automatic enrollment reaching more than 60 million children and comments open through November 29, San Francisco’s 2027 health care expenditure rates, New York and New Jersey paid leave figures for 2027, and the District of Columbia’s October 1 reductions in paid family leave durations and maximum benefits.

Treasury and IRS Map the Year Ahead for Benefits Guidance
IRS · 2026-2027 Priority Guidance Plan 2026-09-29 · issue № 66
Summary

The initial 2026-2027 Priority Guidance Plan lists 121 projects the agencies intend to prioritize, and the benefits entries sketch the year ahead. From the One Big Beautiful Bill Act, the plan includes Trump Account guidance, regulations on the expanded employer child care credit, and guidance on the paid family and medical leave credit. The retirement entries run from an update to the Employee Plans correction program and a new program for correcting IRA mistakes, through SECURE 2.0 guidance including the saver’s match and student-loan matching contributions, to electronic-delivery modernization and defined benefit funding guidance. Other projects address fringe benefits and VEBAs, the tax-exempt trusts some employers use to fund benefits. For executive pay, the plan lists regulations on the deduction limit for high pay at public companies and the parallel excise tax at tax-exempt organizations. The list sets the agencies’ priorities for the coming year. It doesn’t change existing requirements or promise when any project will be finished.

Federal Agencies Issue Guidance on Employer Trump Account Contributions
Hall Benefits Law 2026-10-02 · issue № 65
Summary

A plain-English rundown of the employer side of the Treasury and IRS proposals. Employers could contribute up to $2,500 a year tax free with respect to each employee, a single cap that covers contributions to the employee's own account and to dependents' accounts combined, and the money counts toward an account's $5,000 annual contribution limit. The proposed regulations add the mechanics, including a separate written plan document, certification procedures on the beneficiary's age and dependent status, employee notices and annual statements, and data sharing with the account trustee, and eligibility can't favor highly compensated employees or their dependents. These remain proposed rules, so the details can change before they're final.

IRS Proposed Regulations Provide Initial Guidance for Employers Offering Trump Account Benefits to Employees
Troutman Pepper Locke · Baldwin, Earle & Stitz · via JD Supra 2026-09-22 · issue № 59
Summary

Comments on the proposed rules for employer contributions to Trump accounts close tomorrow, September 25, with a public hearing October 15. Troutman walks through what a program requires under the August proposed regulations. A program needs a separate written plan, notice to eligible employees, and an annual statement of contributions. Up to $2,500 per employee each year, across all of the employee's children or other expected tax dependents, can be excluded from federal income tax. Dependent status is judged when the contribution is made, based on what the employee reasonably expects, with nothing to unwind if it changes later. The contributions remain subject to Social Security, Medicare, and federal unemployment taxes, so payroll systems must treat them differently from other pretax benefits. If a program fails its nondiscrimination testing, only highly compensated employees lose the tax break. The Labor Department has said these programs generally aren't ERISA plans.

What's Waiting at OMB: Auto-Portability, PBM Fee Disclosure, and Two Brand-New Trump Accounts Rules
OIRA · Regulations Under Review 2026-09-21 · issue № 57
Summary

Several major benefits rules are awaiting White House review, the last stop before publication. EBSA's automatic portability exemption arrived September 14 as a final rule with a statutory deadline. Its PBM fee disclosure transparency rule has been there as a final since July 23. Treasury sent two Trump Accounts rulemakings on September 18, an interim final rule and a companion proposal under new section 530A. And Treasury's final rule on automatic enrollment under section 414A has been in review since June.

IRS Proposed Regulations Provide Initial Guidance for Employers Offering Trump Account Benefits to Employees
Troutman Pepper Locke 2026-09-21 · issue № 57
Summary

Troutman walks employers through the piece of the Trump Accounts proposed regulations that's theirs to act on: the first framework for employer contribution programs under new Code section 128. We covered the proposal when it published August 11, and the detail worth repeating is the calendar: comments close this Friday, September 25, with a public hearing set for October 15.

IRS Guidance Answers Questions on Employer Tax Credit for Paid Leave
Ogletree Deakins 2026-09-18 · issue № 56
Summary

[Notice 2026-28](https://www.irs.gov/pub/irs-drop/n-26-28.pdf) led the Digest when it arrived August 5, and comments on it close October 16. Ogletree Deakins's Friday analysis is a prompt to revisit three details before then. The six-month eligibility period is an election an employer makes in its written policy, not an automatic change. Leave required or paid by a state or local program can help an employer qualify for the credit even though it doesn't increase the amount. And an employer can't claim twice for the same funded benefit, though it may use the premium method for an insured portion and the wage method for a portion paid separately from general assets. Employers can rely on the notice for tax years beginning after 2025 until proposed regulations arrive. It's one of three open comment windows. Comments on the [Trump Account and dependent-care assistance proposal](https://www.federalregister.gov/documents/2026/08/11/2026-16314/employer-contributions-to-trump-accounts-and-nondiscrimination-rules-for-dependent-care-assistance) we covered August 11 close Friday, September 25, and the Saver's Match questions from [Notice 2026-48](https://www.irs.gov/pub/irs-drop/n-26-48.pdf) close October 5.

Is a Trump Account Contribution Program in the Cards for Your Company?
Bradley Arant Boult Cummings 2026-09-03 · issue № 49
Summary

The alert turns the proposed regulations into an employer decision memo. Contributions of up to $2,500 per employee per year can flow either directly or through a cafeteria plan, income tax free but payroll taxable, and only common law employees may participate, leaving out partners and 2 percent S corporation shareholders. The program needs a written plan, DCAP style nondiscrimination testing, trustee verification of accounts rather than employee certification, and identification of contributions within 21 days.

The IRS Issues Proposed Regulations on Trump Accounts and Dependent Care Assistance Programs
Trucker Huss 2026-09-08 · issue № 48
Summary

Employer contributions to Trump Accounts are excluded from income but count as wages for FICA and FUTA, a cost that FSA and HSA contributions do not carry. A contribution program may not steer money to a preferred trustee, so payroll must accommodate whatever custodian each employee's dependent uses, and contributions are reported on the W-2 under a new code. On the dependent care side, the average benefits test counts only participating employees in the denominator, relief for sponsors who kept failing the test with every eligible employee counted, and a failing program can preserve favorable treatment for everyone else by moving only the excess benefits into highly compensated employees' income by the W-2 deadline. Employers may rely on the proposal immediately.

Considering Trump Account Contributions in 2027? What Employers Should Know
Warner Norcross + Judd · via JD Supra 2026-09-04 · issue № 47
Summary

Proposed regulations issued in August spell out how employers can make tax-free contributions to employees' Trump Accounts, beginning with a separate written plan document. Warner Norcross walks through the ground rules. Contributions are capped at $2,500 per employee per year no matter how many children an employee has, the cap counts both direct employer dollars and cafeteria-plan elections, and amounts get reported on the W-2. Employers cannot steer workers to a preferred custodian, so contributions may flow to many institutions, and the Labor Department has said these plans generally sit outside ERISA because the benefits belong to the children rather than the employees. A public hearing is set for October 15, and employers may rely on the proposal immediately.

More (16)

ESOPs, Benefits & Compensation 2026 Fall Client Update
Kaufman & Canoles · via JD Supra 2026-10-19 · issue № 77
Summary

Kaufman & Canoles’ fall update covers employee stock ownership plan valuations, retirement-plan amendments, written cafeteria-plan terms, educational assistance, and Trump accounts. The firm urges employers to check that their written cafeteria-plan documents match how payroll handles pretax premiums and that educational-assistance documents can accommodate inflation adjustments rather than hard-coding the existing $5,250 limit. It also advises documenting an independent appraisal process when relying on the new ESOP valuation law.

An Update on State Law Tax Treatment of Trump Accounts
Ed Slott and Company 2026-09-09 · issue № 49
Summary

The fifty state scorecard answers the question employers will get from employees: whether their state will tax these accounts the way the federal code does. Nine states have no income tax, twenty plus the District broadly conform, ten more have said they will conform or passed legislation, and California, Hawaii, and Kentucky reversed earlier positions and will now follow federal law. Four holdouts remain—Massachusetts, Pennsylvania, South Carolina, and Wisconsin—where earnings would face annual state tax despite federal deferral. The list is still moving, and the safest answer remains checking with the state tax office.

Not Child’s Play: How the “Kiddie Tax” Works
Slott Report 2026-07-27 · issue № 18
Summary

With contributions to Trump accounts having gone live on July 4, 2026, there has been lots of discussion recently about the “kiddie tax.” That’s because, once a child reaches January 1 of the year they turn age 18, they will be able to withdraw or do a Roth conversion of accumulated Trump account funds.

Trump Accounts Are Live: What Employers Need to Know Now
Ropes & Gray LLP · via JD SupraDeadline 2026-07-23 · issue № 18
Summary

Effective July 4, 2026, employers may contribute up to $2,500 annually on a tax-free basis to “Trump Accounts,” a new tax-advantaged savings account for employees’ dependent children under age 18, which was established under the Working Families Tax Cuts Act (Pub.

Revenue Procedure 2026-25
IRS 2026-06-29 · issue № 1
Summary

Transfer-tax safe harbor for individual donors who contribute to Trump accounts under IRC §530A. If specified conditions are met, contributions are treated as completed gifts that are not future

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