Trump Account Rules: What You Can and Can't Do

Trump Accounts come with clear rules about what you can and cannot do with the money. This page is your one-stop reference — organized by age, with links to deeper guides for each topic.

What You CAN Do Before Age 18

During the growth phase (birth through age 18), Trump Account money stays invested. Here is what is allowed:

• Contribute up to $5,000/year — from parents, grandparents, aunts, uncles, or anyone else. All contributions are after-tax.
• Receive employer contributions — up to $2,500/year per employee, tax-free under IRC §128. Counts toward the $5,000 cap.
• Receive the $$1,000 government pilot deposit — for U.S. citizen children born January 1, 2025 through December 31, 2028.
• Qualify for the Dell Foundation deposit — $$250 per child under 10 in ZIP codes with median income under $150,000.
• Switch between eligible index funds — you can move between qualifying S&P 500 or broad U.S. equity funds at any time.
• Roll over to a different custodian — transfer the account to a different brokerage without penalty.
• Let earnings grow tax-deferred — no taxes on gains while the money stays in the account.

What You CANNOT Do Before Age 18

The growth phase has strict restrictions. Here is what is not allowed:

• Withdraw money — no withdrawals before 18, period. No hardship exceptions, no emergency access, no medical exemptions. The only exceptions are rollovers, excess contribution returns, or death.
• Invest in individual stocks — no Apple, no Tesla, no picking winners. Only S&P 500 or broad U.S. equity index funds.
• Invest in bonds, crypto, or alternatives — no Bitcoin, no bond funds, no REITs, no international funds, no target-date funds (unless they meet the index requirement).
• Hold cash or money market funds — all money must be invested in eligible index funds. No parking money on the sidelines.
• Contribute more than $5,000/year — excess contributions face a 6% excise tax for each year they remain.
• Open an account for a non-U.S. citizen — the child must be a U.S. citizen with a valid Social Security number.
• Open an account for someone 18 or older — the child must be under 18 at the end of the election year.
• Use funds with an expense ratio above 0.1% — only low-cost index funds qualify.

What You CAN Do After Age 18

At age 18, the Trump Account converts to a traditional IRA. Your child takes full control. The rules open up significantly:

• Withdraw for any purpose — college, a home, a business, travel, living expenses, or anything else. The IRS does not restrict how the money is spent.
• Convert to a Roth IRA — pay taxes on the conversion now, then enjoy tax-free growth and tax-free withdrawals later. Especially powerful at age 18 when income is often low.
• Keep the money invested — leave it in the traditional IRA and let it continue to grow tax-deferred for decades.
• Use penalty-free withdrawal exceptions — the 10% early withdrawal penalty is waived for a first-time home purchase (up to $10,000), qualified education expenses, disability, SEPP/72(t), and other IRA exceptions.
• Invest in anything — once it is a traditional IRA, standard IRA investment rules apply. Stocks, bonds, mutual funds, ETFs, REITs — the S&P-only restriction ends.
• Contribute additional IRA funds — your child can make standard IRA contributions on top of the existing balance (subject to annual IRA limits and earned income requirements).

What You CANNOT Do After Age 18

Even after the account converts to a traditional IRA, there are still rules:

• Avoid income tax on withdrawals — every dollar withdrawn from a traditional IRA is taxed as ordinary income. The only way around this is a Roth conversion (which requires paying taxes upfront).
• Avoid the 10% penalty before 59.5 — withdrawals before age 59.5 face a 10% early withdrawal penalty on top of income tax, unless an exception applies.
• Skip required minimum distributions after 73 — starting at age 73, the IRS requires annual withdrawals from traditional IRAs. Missing an RMD triggers a 25% penalty.
• Put money back once withdrawn — once funds are withdrawn from a traditional IRA, you cannot return them (with the narrow exception of a 60-day indirect rollover).
• Avoid taxation entirely — the growth was tax-deferred, not tax-free. The IRS will collect eventually, either through withdrawals or RMDs.

Quick Reference Table

The Bottom Line

Trump Accounts are simple but strict before 18 and flexible after 18. During the growth phase, your only job is to contribute and let it grow. You cannot touch the money, and you cannot invest in anything outside of low-cost index funds.

Once the account converts to a traditional IRA at age 18, your child gets full control. They can use the money for anything, convert to a Roth, or keep it invested for decades. The key trade-off: all withdrawals are taxed as ordinary income.

For more details, see our guides on what the money can be used for, penalties and withdrawal rules, and investment requirements.