DOL issues guidance confirming Trump Accounts generally are not ERISA plans

Trump Account Background.

The One, Big, Beautiful Bill Act of 2025 created Trump accounts by adding sections 530A, 128, and 6434 to the Code. A Trump account is a type of traditional individual retirement account (IRA) established for the exclusive benefit of eligible individuals. In March 2026, the Internal Revenue Service and Department of Treasury proposed regulations clarifying several account-opening rules, including who may make the election to open an initial Trump account, how that election must be made, who serves as the default responsible party for a minor beneficiary, and when ordinary traditional IRA rules generally apply after the account beneficiary’s growth period ends.

An “eligible individual” is an individual who has not attained age 18 before the close of the calendar year in which the election to open a Trump account is made and has been issued a Social Security number before the election. The regulations also define the “growth period” as beginning when the initial Trump account is established and ending on December 31st of the calendar year in which the account beneficiary attains age 17. Contributions to Trump accounts are permitted on and after July 4, 2026.

Employer Contributions to Trump Accounts

Employers may establish Trump account contribution programs under Section 128 of the Code. Under these programs, employer contributions may be made to the Trump account of an employee or a dependent of an employee. Contributions are not includible in the employee’s income, but they are subject to a $2,500 annual dollar limit (per employee, not per eligible individual), which is adjusted for inflation. Employees can also make pre-tax salary deferral reductions into the Trump accounts of their dependents (which are also included in the $2,500 annual dollar limit), but not into their own Trump accounts, as that would create deferred compensation for the employee. Because employer involvement in retirement savings often has ERISA implications, employers and their advisors had asked the DOL to provide guidance on whether Trump accounts would be subject to Title I of ERISA. 

DOL’s Guidance Regarding Application of ERISA

ERISA defines an “employee pension benefit plan” as a plan, fund, or program established or maintained by an employer that provides retirement income to employees or results in a deferral of income by employees. Employee pension benefit plans are subject to Title I of ERISA, which requires (among other things) Form 5500 filings, summary plan descriptions, certain employee notices, and fiduciary oversight. In the Technical Release, the DOL concluded that Trump accounts and related Trump account contribution programs established for dependents of employees generally will not constitute “employee pension benefit plans.” This is because under Section 3(2) of ERISA, an “employee pension benefit plan” is a plan, arrangement or program designed to provide retirement income or deferral of income to employees. When Trump account contribution programs are established for the benefit of dependents rather than the employees themselves, the programs will not be “employee pension benefit plans” subject to ERISA. 

Contributions to Employee Trump Accounts

The DOL also considered the scenario where an employer contributes to the Trump account of teenage employees while the Trump account is still in the growth period. While ERISA coverage could apply, the DOL concluded that employer contributions during the growth period will not automatically create an ERISA plan, even though the Trump account contribution program would not meet the IRA safe harbor requirements under 29 C.F.R. 2510.3-2(d). The Technical Release establishes a new safe harbor that employers can satisfy to keep their Trump account contribution program exempt from ERISA if employers choose to make employer contributions to the Trump accounts of employees themselves. Employee participation in the Trump account contribution program must be voluntary, and employers must not: 

(1) impose conditions on the utilization of Trump account funds beyond those permitted under the Code; 
(2) make or influence Trump account investment decisions; 
(3) represent that the Trump accounts or Trump account contribution program are an employee pension benefit plan or an employee welfare benefit plan; or 
(4) receive any payment or compensation in connection with a Trump account.

The Technical Release also addressed employer payroll deduction arrangements that permit employees to make taxable contributions to their own Trump accounts outside a Trump account contribution program. The DOL indicated that the IRA payroll deduction safe harbor may be available for these arrangements, including after the growth period ends, if no employer contributions are made, participation is voluntary, the employer avoids endorsing the program or any IRA sponsor, and the employer does not receive any consideration in connection with the program.

The Technical Release provides welcome guidance for employers evaluating whether and how to offer Trump account contribution programs. Employers that structure Trump account contribution programs consistent with the Technical Release generally should not be subject to the compliance obligations that would apply if the arrangement were treated as an ERISA-covered pension plan, such as satisfying ERISA reporting and disclosure requirements, complying with ERISA fiduciary obligations, and administering claims and appeals procedures.

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