Agency Information Collection: Trump Account Election(s)

IRS Preps 85 Million Households for 'Trump Account' Rollout

The Internal Revenue Service is gearing up for the large-scale implementation of "Trump Accounts," a new tax-advantaged savings program established under Section 70204 of Public Law 119-21, also known as the "One Big Beautiful Bill Act" (OBBBA). The initiative, which adds Section 530A to the Internal Revenue Code (IRC), is expected to impact an estimated 85 million households, necessitating the collection of new information via dedicated IRS forms.

The Mechanics: Forms 4547 and 8879-TA

The IRS will collect the necessary information to establish and administer these "Trump Accounts" primarily through two new forms. These accounts are authorized under Section 70204 of Public Law 119-21, also known as the "One Big Beautiful Bill Act" (OBBBA), which added Section 530A to the Internal Revenue Code (IRC). Section 530A creates a new type of tax-advantaged savings account for children under the age of 18, treating them, during their "growth period," as traditional Individual Retirement Accounts (IRAs) under Section 408(a).

The specific forms are:

• Form 4547 (Trump Account Election(s)): This form is used by an "authorized individual" (parent, guardian, or relative) to elect to establish a Trump Account for a child and, if eligible, to claim the one-time $1,000 federal "seed" contribution available for children born between January 1, 2025, and December 31, 2028.

• Form 8879-TA (IRS e-file Signature Authorization for Form 4547): This form serves as the declaration and signature authorization document when a tax professional, also known as an Electronic Return Originator (ERO), e-files Form 4547 on behalf of a taxpayer. It allows the taxpayer to authorize the ERO to enter or generate a Personal Identification Number (PIN) to electronically sign the Trump Account election. EROs are required to retain the completed Form 8879-TA for three years, though they do not submit it to the IRS unless specifically requested.

A Heavy Lift: The Compliance Delta

The rollout of the "Trump Account," authorized under Section 70204 of Public Law 119-21 (the "One Big Beautiful Bill Act") and codified as Section 530A of the Internal Revenue Code (IRC), represents a significant undertaking for both the IRS and taxpayers. Section 530A establishes a new type of tax-advantaged savings account for children under 18. Along with the implementation of this new savings vehicle comes a considerable compliance burden, as reflected in the scale of Forms 4547 and 8879-TA. The previous section discussed Form 8879-TA (IRS e-file Signature Authorization for Form 4547), used by tax professionals when e-filing Form 4547.

The introduction of these forms signals a substantial shift in tax administration. Here's a breakdown of what this means for those affected:

• Affected Public: The IRS estimates that individuals or households are the primary stakeholders impacted by this initiative.

• Scale of Impact: An estimated 85 million respondents are projected to interact with Form 4547 to elect to establish these accounts.

• Time Commitment: Each respondent is expected to spend approximately 1 hour and 28 minutes completing the necessary forms and understanding the new regulations.

• Total Burden: Cumulatively, this translates to an estimated total annual burden of 64.85 million hours spent navigating the Trump Account election process.

The 'winners' in this scenario are arguably children under 18 who may benefit from these new savings accounts, assuming successful investment and adherence to distribution rules. Losers could be taxpayers who find the process overly complex, or who make errors that lead to penalties. Furthermore, the IRS faces considerable administrative costs to manage this program.

The stakes are high for the "Affected Public." Failure to properly complete Form 4547, for example, could delay or disqualify a taxpayer from receiving the $1,000 federal "seed" contribution for eligible children, authorized under Section 530A. Given the potential for procedural errors, legal precedents like YA Global Investments, LP v. Commissioner (161 T.C. No. 11, 2023), which highlights the importance of properly filing required forms, become particularly relevant. This case underscores that failure to properly file Form 4547 could lead to disputes regarding account eligibility or the federal seed money.

Public Feedback Window Opens

With the rollout of the "Trump Account" program under Section 530A of the Internal Revenue Code (IRC) imminent, the IRS is seeking public input on the implementation process, particularly concerning Forms 4547 and 8879-TA. The Paperwork Reduction Act (PRA), codified as 44 U.S.C. § 3506(c)(2)(A), requires agencies to solicit feedback on proposed information collections. This provides an opportunity for stakeholders to shape the final implementation.

Practical Takeaways:

• Comment Deadline: Interested parties must submit written comments on or before March 6, 2026, to ensure consideration.
• Where to Submit: Comments should be directed to Andres Garcia, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW, Washington, DC 20224, or via email at pra.comments@irs.gov. The subject line must include ‘‘OMB Number: 1545–2336’’.
• Feedback Criteria: The IRS is specifically seeking feedback on the following:
  • Whether the collection of information (Forms 4547 and 8879-TA) is necessary for the proper performance of the agency's functions.
  • The accuracy of the IRS's burden estimate for completing the forms.
  • Ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology.

Taxpayers, tax professionals, and financial institutions should view this as an opportunity to influence the practical aspects of the Trump Account program, ensuring that the process for establishing these accounts and claiming the $1,000 federal "seed" contribution is as efficient and user-friendly as possible. Given legal precedents such as YA Global Investments, LP v. Commissioner (161 T.C. No. 11, 2023), which highlights the importance of proper form filing, the IRS's responsiveness to public comments could significantly impact the program's success and reduce potential disputes.