Bank of America has announced it will match the U.S. government’s $1,000 contributions to newly established Trump accounts for eligible employees, as detailed in an internal memo distributed to staff. The initiative, part of the recently implemented One Big Beautiful Bill Act, allows parents to open tax-advantaged investment accounts for children under 18 years of age who possess Social Security numbers.
Additionally, employees will be able to contribute to these accounts through pre-tax payroll deductions. Starting July 4, the U.S. Treasury will provide a $1,000 seed contribution for accounts opened for children born between 2025 and 2028. Bank of America expressed support for this federal initiative, highlighting its potential to assist families in planning for their financial futures.
Under the proposals, the government will invest these funds in low-cost index funds. However, unlike 529 plans or Roth IRAs, the Trump accounts lack certain tax advantages. Withdrawals will only be allowed after the child turns 18, at which point the funds will roll into an IRA and be subject to taxation.
In a broader context, the legislation has made it easier for corporations and philanthropists to support these investment accounts. Contributions to the accounts are capped at $5,000 per year, with a maximum employer contribution of $2,500 annually. Notable figures such as Michael and Susan Dell have committed to contribute $6.25 billion toward these accounts for 25 million children, while celebrity Nicki Minaj plans to contribute between $150,000 and $300,000 to assist her fanbase.
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