DOL Clarifies ERISA Treatment of Trump Accounts: What Employers Need to Know

OverviewThe Department of Labor (DOL) issued Technical Release 2026‑02 on June 17, 2026, providing critical clarity for employers evaluating whether to offer contributions to “Trump Accounts” under IRC sections 530A and 128; contributions to Trump accounts could be made as of July 4, 2026. The guidance addresses a key open question flagged in our earlier post regarding whether these arrangements would trigger Employee Retirement Income Security Act (ERISA) plan status, which would implicate technical rules regarding fiduciary duties, claims and appeal procedures, and plan reporting and disclosures, among others.



The DOL concluded that Trump Accounts and related employer Trump Account Contribution Programs (TACPs) will generally not constitute “employee pension benefit plans” under ERISA Title I, even if funded in whole or in part by employer contributions pursuant to IRC section 128. The guidance provides favorable clarity and removes a potential stumbling block for employers considering establishing a TACP.



DOL Technical Release 2026-02



Prior to Technical Release 2026‑02, ERISA classification was a key unresolved risk for employers, particularly given that TACPs require a written employer program and could resemble benefit plans.



DOL’s conclusion that TACPs will generally not be subject to ERISA removes a major barrier for employers. The rationale underlying the guidance includes that Trump Accounts are individually owned Individual Retirement Accounts (IRAs), not employer‑established retirement plans; that in most cases, benefits accrue to a child (dependent), not the employee, which weighs against ERISA plan characterization; and that the accounts can be funded by multiple sources (family, government, employers), reinforcing their non‑employer‑centric design.



Employer Contributions to Trump Accounts of an Employee’s Dependent



Notably, the guidance reinforces a practical design point for TACPs—employer contributions to the Trump Accounts of an employee’s dependent children present the lowest ERISA risk. This is because the benefit accrues to the child—not the employee—undermining ERISA plan characterization.



Conditions Employers Must Satisfy for Employer Contributions to Employee-Owned Trump Accounts



Despite the favorable conclusion above, ERISA relief is not automatic for contributions to Trump accounts held by an employee (e.g., an employee under age 18). The DOL guidance indicates that employee-owned Trump Accounts present greater ERISA risk and require stricter adherence to safe harbor conditions. As such, if a Trump Account is established for an employee, employers must carefully structure the TACP to avoid any potential ERISA application.



Broadly, participation in TACPs must be completely voluntary for employees and employers must maintain a limited role. Specifically, consistent with both DOL guidance and IRA safe harbor principles under 29 CFR section 2510.3‑2(d), in order for employer contributions during the growth period to generally not trigger ERISA coverage, employers must not:




impose conditions on utilization of Trump account funds beyond those permitted under the Code; 



make or influence the investment decisions with respect to funds contributed to a Trump account;



represent that the Trump accounts or TACP are an employee pension benefit plan or an employee welfare benefit plan established or maintained by the employer; or



Receive any payment or compensation in connection with Trump accounts.  




If an employer imposes terms and conditions on contributions that would be required to satisfy tax requirements under the Code, without more, it will not create an ERISA-covered plan, unless the employer or Trump account trustee restricts the ability of the employee to move funds to a rollover Trump account beyond any restrictions that may be imposed by the Code or regulations thereunder.



Employers May Permit Post-Tax Payroll Deductions—During and Post-Growth Period



During the growth period, the guidance comments that an employer could permit an employee to make post-tax payroll deduction contributions to the employee’s Trump account outside a TACP, noting that Treasury has indicated any such contributions would be treated as those from other sources such that they would create basis in the account.



After the growth period, Trump accounts are generally subject to the rules applicable to traditional IRAs. Although an employer may not make a section 128 employer contribution to a Trump account after the growth period, employers may permit post-tax payroll deductions to be made to an employee’s Trump account, similar to any payroll deduction programs available for IRAs.



The guidance clarifies that the IRA safe harbor regulation (29 CFR 2510.3‑2(d)) would be available in both of these circumstances, provided that no contributions are made by employers, and the remaining conditions of the safe harbor regulation also are satisfied prospectively. The availability of the safe harbor regulation is not foreclosed solely because its conditions were not met for employer and employee pre-tax contributions during the growth period. However, employers must ensure they don’t endorse the program, and cannot exercise control over it or make it appear to employees to be part of the company’s own benefit package. The guidance provides examples of what an employer may do without exceeding the scope of the endorsement prong of the safe harbor, including placing Trump account information provided by IRA sponsors on their intranet sites, permitting the IRA sponsor to publicize the program to employees of the employer, and providing neutral information about the benefits of using payroll deduction to fund benefits.   



Strategic Takeaways




Mitigating ERISA Risk: An employer can contribute to Trump Accounts for employees’ dependents without creating an ERISA plan. Employers may consider adopting TACPs for the benefit of employees’ dependents only and not for employees themselves, but should consult counsel regarding any potential nondiscrimination or other issues that may arise under applicable law. Note that, if ERISA does not apply, then ERISA preemption does not apply and the TACP may be subject to state law claims.If an employer does decide to contribute to Trump Accounts for employees, it can do so without creating an ERISA plan if the employer essentially maintains a ministerial, limited role and satisfies other requirements under the guidance. However, compliance with the guidance does not necessarily immunize an employer from exposure to ERISA claims from individuals, who may attempt to make fact-specific assertions about whether the employer truly had a ministerial, limited role or endorsed or discussed its TACP with employees in a way that would create an ERISA plan. The consequences of getting it wrong and creating an ERISA “employee pension benefit plan” for employees could be significant, as ERISA imposes vesting and participation requirements (in addition to fiduciary, claims procedure, and reporting and disclosure rules) on such plans.



Design matters: Maintaining a limited, non-discretionary role is essential to preserve non‑ERISA status. Careful documentation and communication practices remain critical to support non‑ERISA treatment. Available guidance suggests employers may be at risk of creating an ERISA plan if they impose too many conditions on TACP contributions (e.g., service-based vesting conditions, matching contribution requirements, etc.).



Opportunity for differentiation: TACPs may become a competitive tax-efficient family-focused benefit, particularly for employers focused on family-oriented compensation strategies, but note that relevant guidance limits the ability of an employer to represent that its TACP is an employee benefit of the employer. The guidance facilitates offering Trump Account contributions as a non‑ERISA workforce benefit, minimizing fiduciary and reporting burdens.




ConclusionTechnical Release 2026‑02 resolves a key uncertainty and provides favorable clarity: employer contributions to Trump Accounts can be offered as a non‑ERISA benefit to dependent accounts and, provided employers adhere to a carefully limited role, to employee accounts. Employers considering TACPs should now focus on program design, tax compliance, and implementation mechanics. The release addresses only ERISA status; broader tax, reporting, and operational guidance is expected from Treasury/IRS.
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