Trump Accounts: Treasury allows employers to contribute up to $2,500 ta free for dependents

Published 11 August 2026 · india

The US Department of the Treasury and the Internal Revenue Service (IRS) on August 11 issued guidance on employer- Trump Account contribution programmes, including arrangements

The US Department of the Treasury and the Internal Revenue Service (IRS) on August 11 issued guidance on employer- Trump Account contribution programmes, including arrangements that allow employees to make pre-tax contributions to accounts set up for their dependents. The new guidance provides a framework for employers that want to contribute directly to Trump Accounts for employees or their dependents. Treasury Secretary Scott Bessent said the rules will allow employers to contribute up to $2,500 ta free each year for employees' dependents. “Trump Accounts are giving American families a new way to build wealth from day one,” Bessent said. Employees can make pre-tax contributions Under the Working Families Tax Cuts, employees can make pre-tax contributions to their dependents' Trump Accounts through an employer cafeteria plan. The law also allows certain employer contributions to Trump Accounts to be excluded from an employee's gross income.

The Treasury said the new options could give businesses a ta preferred benefit that can help employees build wealth for their families while potentially supporting employee recruitment and retention. More than 50 companies have committed More than 50 companies have already committed to making contributions to Trump Accounts for their employees, according to the Treasury. The department said the employer contribution option could also benefit children who are not eligible for the initial $1,000 Treasury contribution, as they could still receive ta free money through an employer- Trump Account programme. What employers need to do Employers seeking to establish a Trump Account contribution programme generally must maintain a separate written plan and comply with several administrative requirements. These include Following certification procedures covering the beneficiary's age and dependent status. Verifying that the account receiving the contribution is a Trump Account.

Providing notices to employees. Providing annual statements to employees. Reporting contributions to the Trump Account trustee. The proposed regulations also require employer programmes to satisfy applicable nondiscrimination requirements. Rules aim to prevent preferential treatment Under the proposed regulations, eligibility to participate in Trump Account contribution programmes, as well as contributions and benefits, generally cannot discriminate in favour of highly compensated employees or their dependents. The regulations also clarify how nondiscrimination rules apply to employer- Trump Account programmes and dependent care assistance programmes. IRS CEO Frank J. Bisignano said the agency had worked with more than 50 major employers to prepare them for the new option. Public comments due by September 25 The Treasury and IRS guidance has been issued as proposed regulations, meaning the rules are open to public feedback. Comments on the proposed regulations must be submitted by September 25, 2026.