A New Opportunity for Families: Giving Newborns a Financial Head Start

Majority Leader | Research | The Leader Board | THE NEWSR...Skip to primary navigation Skip to content×Close THE NEWSROOMRemarks Press Releases The Leader Board Op-Eds Videos SENATE RESOURCESRepublican Senators Committees Congressional Record Congress.gov Senate Floor Webcast ABOUT LEADER THUNE×Close THE NEWSROOMRemarks Press Releases The Leader Board Op-Eds Videos SENATE RESOURCESRepublican Senators Committees Congressional Record Congress.gov Senate Floor Webcast ABOUT LEADER THUNExxsearchxMENUFacebookXInstagramFacebookXInstagramVisit Leader Thune's South Dakota Site Here THE NEWSROOMRemarks Press Releases The Leader Board Op-Eds Videos SENATE RESOURCESRepublican Senators Committees Congressional Record Congress.gov Senate Floor Webcast ABOUT LEADER THUNExxsearchxMENUHomeTHE NEWSROOMThe Leader Board12.05.25A New Opportunity for Families: Giving Newborns a Financial Head StartRepublicans’ Working Families Tax Cuts Act Creates “Trump Accounts” for Children That Are Invested in the Stock Market, Can Be Contributed to Annually, and Mature When They Reach Adulthood AS PART OF REPUBLICANS’ WORKING FAMILIES TAX CUTS, PARENTS ARE ABLE TO OPEN “TRUMP ACCOUNTS” THAT PROVIDE A $1,000 INVESTMENT FOR NEWBORNS, GIVING THEM A FINANCIAL HEAD START WHEN THEY TURN 18“[W]hat if all children, regardless of their family’s circumstances, could get a financial boost when they turn 18? That’s the idea behind ‘Trump Accounts.’” (Associated Press: With 'Trump Accounts,' your baby could qualify for $1,000. Here's what to know. – 12/3/25)“The One Big Beautiful Bill permits Trump Accounts to be established for American children who have not reached age 18.” (White House: Trump Accounts Give the Next Generation a Jump Start on Saving – 8/29/25)“The bill, signed into law earlier this year, gives $1,000 to every newborn, so long as their parents open an account. That money is invested in the stock market by private firms, and the child can access the funds when they turn 18.” (Associated Press: With 'Trump Accounts,' your baby could qualify for $1,000. Here's what to know. – 12/3/25)“Think of ‘Trump Accounts’ as seed money to encourage children and families to save and build wealth for the many expenses of adulthood.” (USA Today: 'Trump Accounts' for kids just got a $6B boost. How can you claim one? – 12/2/25)“Parents and others may contribute up to $5,000 a year into the accounts until the child turns 18. An employer may contribute up to $2,500 toward the $5,000 cap. State and local governments and private charities will be allowed to make broad contributions.” (USA Today: 'Trump Accounts' for kids just got a $6B boost. How can you claim one? – 12/2/25)“The program offers the $1,000 investment to children born after Dec. 31, 2024, and before Jan. 1, 2029.” (NPR: Parents, relatives and others can contribute up to $5,000 annually until the year the child turns 18. – 7/8/25)“Treasury estimates indicate that the ‘Trump accounts’ could accumulate into a seven-figure balance by early adulthood if families maximize contributions and allow the funds to grow.” (Fox Business: White House unveils 'Trump accounts' for children with $6.25B Dell investment – 10/2/25)And, “[t]hanks to a historic donation announced Tuesday by billionaires Michael and Susan Dell, some children 10 and under could receive $250 in seed money if their parents open an account. That money is reserved for kids who live in ZIP codes with a median family income of $150,000 or less and who won’t get the $1,000 seed money from the Treasury.” (Associated Press: With 'Trump Accounts,' your baby could qualify for $1,000. Here's what to know. – 12/3/25)FROM EDUCATION TO CHILD CARE AND HEALTH CARE, REPUBLICANS’ WORKING FAMILIES TAX CUTS PUT MORE MONEY IN PEOPLE’S POCKETSThe “Trump Accounts” “join a crowded field of tax-advantaged savings plans that help Americans navigate the costs of education, health care and retirement, among other things.” (USA Today: 'Trump Accounts' for kids just got a $6B boost. How can you claim one? – 12/2/25)“$124 billion investment in children of low- and middle-income families.” (U.S. Senate Committee on Finance: Crapo Highlights Tax Wins for Hardworking Americans and Main Street – 6/28/25)“The median cost of sending one child to daycare for five years is about $44,000 across the U.S., according to a Wall Street Journal analysis of Labor Department data. Trump’s new tax law expands some tax breaks for child care.” (The Wall Street Journal: Can ‘Trump Accounts’ for Babies Change the Economics of Having a Family? – 12/2/25)“All businesses providing employee child care are eligible for a tax credit, and there are expanded benefits for small businesses with less than $31 million in gross receipts for 2025, according to a resource guide from the U.S. Chamber of Commerce.” (CNBC: Biggest Trump tax cut benefits for small business owners to keep more income on Main Street – 10/5/25)“The new tax law also raised and extended the maximum child tax credit to $2,200 per child for 2025, and scheduled future inflation adjustments.” (The Wall Street Journal: Can ‘Trump Accounts’ for Babies Change the Economics of Having a Family? – 12/2/25)“[M]ore people will be able to benefit from the triple tax-advantaged health savings account, or HSA,” “enabling millions more enrollees to open and contribute to HSAs without having to change insurance plans.” (USA Today: A favorite savings tool of financial advisers gets better with 'One Big Beautiful Bill' – 8/9/25; White House: Expansion of HSA Eligibility Under OBBB Act to Improve Marketplace Coverage, Affordability, and Access – 9/26/25)The law also expands the use of tax-advantaged 529 savings accounts that help with the cost of education:“529 accounts were previously limited to K–12 tuition (up to $10,000 per year), but they can now be used for additional expenses such as books, online educational materials, testing fees (e.g., SAT/ACT), dual enrollment fees, tutoring by qualified professionals, and educational therapies for students with disabilities. The annual limit for all K–12 expenses will rise to $20,000 starting January 1, 2026.” (Fortune: New 529 plan rules let Gen Z invest in careers, not just college—and it reflects a seismic shift in education – 7/28/25)THE WORKING FAMILIES TAX CUTS ALSO CREATE SAVINGS FOR TIPPED AND OVERTIME WORKERS, AS WELL AS SENIORSThe law creates new tax relief for tipped and overtime workers, and gives those making less than $50,000 the largest proportional tax cut:Tipped wages, “up to $25,000 for qualified tips,” will no longer be taxed, benefiting millions of American service workers. (U.S. Senate Committee on Finance: Crapo Highlights Tax Wins for Hardworking Americans and Main Street – 6/28/25)Overtime wages, “up to $12,500 for hourly workers who work overtime and keep America running,” will no longer be taxed, increasing labor productivity and giving millions of hourly workers more take-home pay. (U.S. Senate Committee on Finance: One Big Beautiful Bill Act – accessed 12/5/25)Individuals making less than $50,000 per year will receive the largest proportional benefit of Republicans’ tax cuts. (U.S. Senate Committee on Finance: One Big Beautiful Bill: New Tax Relief Overwhelmingly Benefits Working Class – 7/1/25)“$93 billion in additional tax relief for seniors through a new $6,000 bonus exemption.” (U.S. Senate Committee on Finance: Crapo Highlights Tax Wins for Hardworking Americans and Main Street – 6/28/25)PrintEmailTweetPreviousTHE NEWSROOMSENATE RESOURCESABOUT LEADER THUNEFacebookXInstagram