Strategic tax planning & advisory for multi-entity business owners.
Client Planning Tool
From a child's Trump Account to a retirement nest egg
Model the new federal Trump Account: the one-time $1,000 government grant, your annual contributions, optional employer contributions, and tax-deferred index growth — then let the untouched balance keep compounding to retirement. See both the pre-tax balance and the estimated after-tax value.
Gift-tax note: Unlike 529 plans, an individual's contributions to a Trump Account do not currently qualify for the gift-tax annual exclusion, so larger gifts may require filing Form 709 — until and unless Congress aligns the rules with 529 treatment. Confirm with your advisor before funding.
Your assumptions
Adjust the inputs to model a specific child's account.
2025 · age 1
Eligible from birth through age 17. Growth runs until the year the child turns 18.
$1,000
After-tax (nondeductible). Becomes basis — returned tax-free at withdrawal.
$0
Up to $2,500/yr, excluded from W-2 income. Counts toward the $5,000 combined cap and is taxable on withdrawal.
Combined contributions of $0 exceed the $5,000 annual cap. Reduce your personal or employer amount.
One-time federal seed for U.S.-citizen children born 2025–2028. Does not count toward the $5,000 cap.
6.0%
0.10% expense-ratio cap applied · net return 5.90%
60
No further contributions after age 18 — the account simply keeps compounding.
22%
Applied to the taxable portion (earnings + employer + grant). Your contributions come back tax-free.
Adjust results for inflation so future amounts are shown in present-day purchasing power.
2.5%
Projected balance at age 60
$0
— pre-tax, after the account compounds untouched from age 18
Estimated after-tax value
$0
Balance at age 18
$0
After-tax = your contributions (basis, tax-free) + the taxable portion taxed at the assumed rate.
Your contributions
$0
Basis · returned tax-free
Employer + grant
$0
Taxable on withdrawal
Net market growth
$0
After fees · to retirement
Fees paid (to 18)
$0
0.10% ratio · already deducted
Return scenarios, side by side
Projected balance at retirement under three return assumptions — same contributions, expense-ratio cap applied. After-tax in green.
At 18: keep it, convert it, or move it
In the year the child turns 18 the account becomes a normal traditional IRA. The big decision is whether to leave it (taxed later, when withdrawn) or convert it to a Roth (pay tax now, then grow and withdraw tax-free). This compares the after-tax result at retirement.
18
When the converted amount is taxed. Earlier = longer tax-free growth, but watch the dependent rule below.
10%
Applied to the taxable portion (earnings + employer + grant) in the conversion year. A young adult with little income may be in a low bracket.
Dependent / "kiddie tax" flag: while the child is a dependent (often through age 23 if a student), unearned income — including a Roth conversion — above roughly $2,700 (indexed) is taxed at the parents' marginal rate, not the child's. Converting a large balance at 18 rarely hits a 0% rate. The usual fix is to stagger conversions across low-income years or wait until they're no longer a dependent.
Convert to a Roth IRA — allowed at 18. Only the non-basis portion (earnings + employer + grant) is taxed; the child's own contributions convert tax-free. No 10% penalty on the conversion itself, but a 5-year clock applies to each conversion before age 59½.
Roll into a 529 plan — not permitted. A Trump Account is a traditional IRA, and there is no IRA-to-529 rollover. (The well-known 529→Roth move runs the opposite direction and is unrelated.)
Change custodians — allowed. During the growth period the balance can move only as a full trustee-to-trustee transfer into another Trump Account ("rollover Trump account"); it's a provider change, not a strategy change.
ABLE account — narrow exception. For a disabled beneficiary, the full balance may roll to an ABLE account in the calendar year the child turns 17 (exempt from the annual ABLE limit).
After 18 the account also follows ordinary traditional-IRA rules — it can roll to another traditional IRA or, if a plan accepts it, into an employer plan (pre-tax portion only). RMDs and the pre-59½ penalty (with the usual exceptions) apply.
Growth over the full timeline
Contributions through age 18, then untouched compounding to retirement.
Contributions + grant (cash in) Market growth
Account converts to a traditional IRA at age 18
View the year-by-year breakdown ▾
Phase
Age
Year
Cash in
Your basis
Fees
Balance
How this works & key assumptions
A Trump Account is a traditional (pre-tax) IRA for a U.S.-citizen child under 18 with a Social Security number — not a Roth. No contributions are allowed before July 4, 2026.
The combined annual contribution cap is $5,000 from all sources (individuals + employers), indexed for inflation after 2027. Employers may add up to $2,500/yr, excluded from the employee's W-2 income and counted toward the $5,000 cap.
The one-time $1,000 federal grant applies only to children born Jan 1, 2025 – Dec 31, 2028, and it does not count against the $5,000 cap. This tool auto-enables the grant only for eligible birth years.
During the growth period (through Dec 31 of the year before the child turns 18) funds must track a qualified low-cost U.S. index with an expense ratio at or below 0.10%, which this model subtracts from the assumed gross return. Withdrawals are generally not permitted during this period.
On Jan 1 of the year the child turns 18, the account converts to a normal traditional IRA — subject to RMDs and the 10% early-withdrawal penalty before age 59½ (with the usual exceptions for qualified higher education, a first-time home purchase, certain medical costs, etc.). This tool then compounds the untouched balance to your chosen retirement age.
On withdrawal: an individual's nondeductible contributions are basis, returned tax-free; employer contributions, the $1,000 grant, and all earnings are taxable as ordinary income. The grant's exact character is treated here as an assumption pending final regulations. The after-tax figure is a simplified estimate that ignores RMD timing, the early-withdrawal penalty, and pro-rata rules.
Several inputs here reflect positions and assumptions rather than settled law. In particular, the tax character of the $1,000 grant and employer contributions as non-basis (taxable on withdrawal) is MyCPAPro's reading of pre-tax IRA mechanics under OBBBA §530A and IRS Notice 2025-68. Initial proposed regulations were issued in March 2026, but final regulations have not yet been published, and the published guidance may change these results.
The rollover and Roth-conversion modeling applies traditional-IRA mechanics to the post-18 account and is likewise an estimate. The Roth comparison assumes the conversion tax is paid from the account, taxes only the non-basis portion, and does not model the 5-year rule, the kiddie-tax/dependent rules in detail, RMDs, or state tax. Whether a Trump Account may be rolled to a 529 is settled (it may not); other mechanics may be refined by the final regulations.
MyCPAPro, P.C. has an obligation to update all calculations and assumptions when new or final regulations are passed. Figures shown should be re-confirmed against the final regulations once published. Do not rely on these projections as a definitive tax outcome.