economy
Parents could put pretax paycheck money into Trump Accounts, with employers matching, Treasury says
The U.S. Department of the Treasury issued guidance that could allow parents to make pretax contributions to a child's Trump Account directly from their paycheck.
TL;DR
- Proposed regulations allow employers to contribute to and employees to fund Trump Accounts (530A accounts) for children.
- Employer contributions to Trump Accounts may be excluded from an employee's gross income.
- Employees can fund their dependent children's accounts with pretax dollars directly from their paychecks.
- Treasury Secretary Scott Bessent stated these accounts help families build wealth from day one.
- Employers can contribute up to $2,500 per worker per year towards a dependent's account, as part of a $5,000 annual limit.
- Children under 18 with a Social Security number are eligible.
- A pilot program offers a one-time $1,000 deposit from the Treasury for children born from 2025 through 2028.
- Over 50 companies have committed to Trump Account contributions.
- Employer interest is expected to grow following this guidance, despite some initial hesitancy.