Scott Bessent weighs major change to Trump Account rules
5 min readMost government programs that promise to make your kids rich fall apart on contact with reality. The fine print eats the headline number. The inflation adjustment never quite keeps up. The political will fades two administrations later.
Trump Accounts, the new tax-advantaged investing vehicles for American kids, were supposed to be the exception.
The rules were locked. The seed money was federal. The investments were boring on purpose: low-cost S&P 500 index funds, no individual stocks, no sector bets. Nothing exotic.
That simplicity was the whole pitch. A baby born in 2026 gets $1,000 from the Treasury, a parent fills out a form, and compound growth does the rest for the next 18 years.
Now, just two months before the program officially opens for contributions on July 4, the rulebook is back on the table.
I have been tracking Trump Accounts since the One Big Beautiful Bill Act became law last summer, and what is brewing inside Treasury looks like the biggest rewrite yet.
Officials are weighing whether to let billionaires donate stock, not just cash, into kids’ accounts.
What Treasury is weighing for Trump Accounts
White House and Treasury Department officials have discussed expanding what can flow into Trump Accounts to allow direct donations of company stock, according to a DealBook report cited by CNBC. Today, only cash contributions are permitted, and that cash must sit in a fund tracking the S&P 500.
The opening came from Brad Gerstner, the Altimeter Capital CEO who helped spearhead the program. He posted on X (formerly Twitter) that “the gifts may be cash / shares!”.
Related: Bessent’s ‘Trump Accounts’ pitch draws scrutiny over children’s finances
The pitch is straightforward. If a tech mogul like Elon Musk wanted to seed accounts with $1 billion of Tesla (TSLA) stock, current law forces him to sell first and pay capital gains.
Letting him donate appreciated shares directly would skip the sale, hand him a deduction at fair market value, and pump more dollars per donor into the program, as detailed by Moneywise.
Crucially, kids would not actually hold individual stocks. Gerstner pushed back on that interpretation in his X post, saying every dollar in a Trump Account will still sit in a low-fee S&P 500 index fund. The donated shares would presumably be sold and the proceeds funneled into that index structure.
Ben Henry-Moreland, a financial planner who spoke to CNBC, warned that reversing the index-fund rule would push kids’ accounts toward exactly the speculative risk-taking the law was written to prevent.
The White House and Treasury discuss stock donations to Trump Accounts.
Photo by SAUL LOEB on Getty Images
How Trump Accounts work today, and why the rules are tight
For now, the program is built around one conservative idea. Investments must sit in low-cost mutual funds or ETFs that track a broad U.S. equity index, with annual expenses capped at 0.10%, according to the IRS.
The fund cannot trade on margin. It cannot bet on a sector. It cannot buy a single stock.
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The numbers are real money. About 5 million kids are already enrolled, including 1.2 million newborns who qualify for the full $1,000 federal seed, Treasury Secretary Scott Bessent said at an April event, as reported by CNBC. Families can add up to $5,000 a year per child. Employers can chip in up to $2,500 of that. Charitable and state contributions sit on top of the cap.
The infrastructure is already standing up. Treasury named Bank of New York Mellon as the program’s official financial agent and tapped Robinhood as the initial brokerage, with a custom app planned for parents who want to manage balances from their phones.
Outside money is already showing up. Connecticut philanthropist Ray Dalio’s family committed $250 each for roughly 300,000 lower-income kids in their state, CNBC reported.
Oklahoma later approved a one-time $250 contribution for eligible children, according to CNBC. JPMorgan Chase (JPM), Charles Schwab (SCHW), BlackRock (BLK), Visa (V), Intel (INTC), and Bank of America (BAC) have all pledged employer matches, with several of those programs already documented in my TheStreetWall Street rollout coverage.
A look at the contribution math under current rules:
$1,000: One-time federal seed for U.S. citizens born 2025 through 2028, per the IRS$5,000: Annual contribution cap from family, friends, and employers, per the IRS$2,500: Cap on annual employer contributions toward an employee’s child’s account, per the IRS$191,000: Projected age-18 balance if a family maxes contributions at a 6% return, according to a Charles Schwab analysis1.2 million: Newborns already eligible for the full $1,000 seed, per Bessent’s April remarks reported by CNBCWhat stock donations would mean for your kid’s Trump Account balance
Here is where my analysis gets uncomfortable. The proposed change is sold as a way to supercharge the program by tapping ultra-wealthy donors. The math pencils out for the donors in particular.
Under current IRS rules, gifting appreciated stock to a qualified organization lets you deduct the fair market value while skipping capital gains tax on the gain you never realized, according to Moneywise. For a founder sitting on highly appreciated shares, that is a far better deal than writing a check.
The pitch to parents is a bigger pool of money for kids. The risk is concentration. If stock donations are permitted at scale, Trump Accounts could become a holding tank for hundreds of billions in tech founders’ shares. That money cannot be sold for years, and the knock-on effect on those companies’ stock prices is hard to model.
Related: Scott Bessent’s net worth in 2026: From hedge fund manager to Treasury chief
The index-fund-only rule was written into Section 530A precisely to keep accounts away from single-stock volatility, as the Congressional Research Service summarized in an April policy report.
Changing the rule will not be quick. Lawyers say a clean fix likely requires Congress to amend the statute, though Treasury is exploring whether new guidance or even an executive order could do similar work, ZeroHedge noted.
There is a political angle, too. Bessent has framed Trump Accounts as a way of “making every citizen a shareholder,” he said in a January Treasury speech.
Letting billionaires choose who gets shares is a different story than letting parents and employers decide. Parents will want to know which version they signed up for, especially after personal finance figures such as Dave Ramsey already called the program a political “stunt” on its current terms, TheStreet reported.
If you have a child eligible for the $1,000 seed, nothing about the July 4 launch has moved. Open the account, take the seed money, and watch this rule fight closely. The version of Trump Accounts your kid retires with may not be the one that opens for business this summer.
Related: Robinhood and BNY make a bold bet on Trump Accounts
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