# Prop. Treas. Reg. § 1.530A-3: Trump accounts—Eligible investments. Proposed regulation, not in force. REG-117002-25, 91 FR 54280, published 2026-08-21 . Interprets 26 U.S.C. § 530A. Par. 2. Section 1.530A-3 is added to read as follows: (a) Overview. Under section 530A(b)(1)(C)(iii), for an account to qualify as a Trump account, the written governing instrument creating the account may not permit any part of the account funds to be invested in any asset other than an eligible investment during the period that begins when the initial Trump account is established and ends on December 31 of the calendar year in which the account beneficiary attains age 17 (the growth period). Paragraph (b) of this section provides definitions related to eligible investments. Paragraph (c) of this section provides rules regarding whether an investment fund tracks the returns of an index. Paragraph (d) of this section provides rules regarding whether an investment fund uses leverage. Paragraph (e) of this section provides rules related to qualified indices. Paragraph (f) of this section provides rules for determining whether an investment fund has annual fees and expenses within the 0.1 percent limit. Paragraph (g) of this section provides procedures for a trustee of a Trump account (trustee) to ensure that no part of the account funds will be invested in any asset other than an eligible investment. Paragraph (h) of this section provides the applicability date of this section. (b) Definitions. The following definitions apply for purposes of section 530A and this section: (1) Eligible investment. The term eligible investment means any mutual fund or exchange traded fund that tracks the returns of a qualified index, does not use leverage, does not have annual fees and expenses of more than 0.1 percent of the balance of the investment in the fund, and meets such other criteria as the Secretary of the Treasury or the Secretary's delegate (Secretary) determines appropriate for purposes of section 530A. (2) Exchange traded fund ( ETF ). The term exchange traded fund ( ETF ) means a domestic corporation (including a regulated investment company (RIC)) that is registered under the Investment Company Act of 1940, Public Law 76-768, 54 Stat. 789 (the 1940 Act), as amended, and that is either— (i) An “exchange-traded fund” as defined for purposes of the 1940 Act in 17 CFR 270.6c-11(a)(1); or (ii) An entity that operates in substantially the same manner as an exchange-traded fund but that is not described in 17 CFR 270.6c-11(a)(1), such as a unit investment trust or ETF share class of a mutual fund operating as an ETF under exemptive relief granted by the Securities and Exchange Commission. (3) Investment fund. The term investment fund means a mutual fund or an ETF. (4) Mutual fund. The term mutual fund means a domestic corporation (including a RIC) that is registered under the 1940 Act as an open-end company (as defined in 15 U.S.C. 80a-5(a)(1)) and that is not an ETF. (5) Qualified index. The term qualified index means the Standard and Poor's 500 stock market index, or any other index that is comprised of equity investments in primarily United States companies and for which regulated futures contracts (as defined in section 1256(g)(1)) are traded on a qualified board or exchange (as defined in section 1256(g)(7)). A qualified index does not include any industry or sector-specific index but may include an index based on market capitalization. Paragraph (e) of this section provides rules for determining whether an index is a qualified index. (6) Regulated investment company ( RIC ). The term regulated investment company ( RIC ) means a regulated investment company within the meaning of section 851(a). (c) Tracking the returns of an index —(1) In general. For purposes of section 530A(b)(3)(A)(i) and this section, an investment fund tracks the returns of an index if the fund's investment objective is to seek to provide investment results that, before fees and expenses, replicate the performance of the index, and the fund holds investments that are reasonably expected to accomplish that objective. For example, a fund may track the returns of an index by holding shares of most or all of the stocks that are constituents of the index in proportion to the stocks' weightings in the index. An investment fund does not fail to track the returns of an index merely because the returns from the fund are affected by fees, expenses, trading costs, variations arising from buying and selling securities when the index changes, and similar variations incidental to operating a fund that seeks to replicate the performance of an index. (2) Investment funds that do not track the returns of an index. Except as provided in paragraph (c)(3) of this section, an investment fund does not track the returns of an index if the fund uses one or more strategies to outperform or otherwise perform differently from the index. Thus, an investment fund that, in some or all market conditions, uses any strategy to decrease or increase the volatility, risk, or current income associated with the index does not track the returns of the index. For example, an investment fund that owns shares of each stock that is a component of an index and sells covered calls on some or all of those shares does not track the returns of the index, because the fund's strategy diminishes the fund's participation in the potential appreciation in the shares and increases the fund's current income. An investment fund that seeks to provide investment results consistent with the return on several different indices does not track the returns of an index. (3) Securities lending. An investment fund does not fail to track the returns of an index because the investment fund engages in securities lending transactions so long as the investment fund retains full economic exposure to the securities. (d) Does not use leverage —(1) In general. For purposes of section 530A(b)(3)(A)(ii) and this section, an investment fund that references an index is considered to use leverage if the fund uses borrowings, derivatives, or other strategies that are economically equivalent to borrowings in a way that materially increases the risk of loss associated with an investment in the investment fund (as compared to an investment in a fund that holds the index components physically and that does not borrow or use derivatives). Thus, an investment fund uses leverage if, as a result of borrowings or derivatives or another economic equivalent, a change in the level of the index the returns of which the fund seeks to replicate tends to cause a materially greater proportional change in the net value of the fund's portfolio. For example, an investment fund is considered to use leverage if the fund provides investment results that correspond to the performance of an index multiplied by a number greater than one (regardless of whether the fund uses borrowings, derivatives, or another economic equivalent to provide such results). (2) Permitted borrowings and derivatives. An investment fund is not considered to use leverage merely because it borrows or uses derivatives as part of its strategy to replicate the performance of an index, so long as the borrowings or derivatives do not materially increase the risk of loss associated with an investment in the investment fund. Thus, an investment fund is not considered to use leverage merely because the fund incurs short-term borrowings to provide liquidity for redemptions or to purchase portfolio securities in connection with investment flows into the fund or because the fund uses derivatives to gain synthetic exposure to certain index components. An investment fund's obligation to return collateral received for securities lending transactions described in paragraph (c)(3) of this section is not treated as leverage so long as the investment fund takes appropriate steps to limit the risk of loss with respect to the collateral. To limit the risk of loss with respect to cash collateral, the investment fund must hold the collateral in cash or in highly liquid, conservative positions (like money market funds). To limit the risk of loss with respect to non-cash collateral, the investment fund must not sell the collateral or otherwise use the collateral (for example, by pledging it as collateral in another transaction) to increase the fund's exposure to the index or other assets. (e) Qualified index —(1) In general. This paragraph (e) provides rules to determine whether an index is a qualified index within the meaning of section 530A(b)(3)(B) and paragraph (b)(5) of this section. To be a qualified index, an index must have a publicly available index methodology that describes the criteria for inclusion in the index and the construction of the index. Whether an index meets the requirements in this paragraph (e) is generally determined by reference to the index methodology for the index. (2) Industry-specific and sector-specific indices. For purposes of section 530A(b)(3)(B) and paragraph (b)(5) of this section, an index is industry-specific or sector-specific if inclusion of a stock or interest in the index depends on the business or industry in which the issuing company is engaged. Thus, any index that depends on industry classification codes for inclusion of a company in the index is an industry-specific or sector-specific index. Similarly, an index that includes stocks of companies operating in several related industries or sectors (such as hotels, air travel, and outdoor recreation) is an industry-specific or sector-specific index. (3) Other index-related criteria for eligible investments. Any investment fund that corresponds to the returns of an environmental, social, and governance (ESG) index is not an eligible investment. An ESG index includes any index that has, or is marketed as having, a focus on environmental, social, or governance factors. Any investment fund that is marketed or sold as having an investment objective to track an ESG index is not an eligible investment. (4) Market capitalization. For purposes of section 530A(b)(3)(B) and paragraph (b)(5) of this section, an index is based on market capitalization if a condition for the inclusion of a company's stock (or other ownership interests) in the index is that the company has a market capitalization that is within a specified range or over or under a specified threshold, or that meets specified ranking criteria. Therefore, an index that meets the requirements to be a qualified index in section 530A(b)(3)(B) and this paragraph (e) does not fail to be a qualified index as a result of such a condition for inclusion. (5) Equity investments. For purposes of section 530A(b)(3)(B) and paragraph (b)(5) of this section, an index is considered to be comprised of equity investments if the index is comprised entirely of stocks and similar ownership interests in the form of partnership or membership interests. An index is not comprised of equity investments if it includes debt instruments, derivatives, or any other asset that is not an ownership interest in a company. (6) United States companies. For purposes of section 530A(b)(3)(B) and paragraph (b)(5) of this section, United States companies (U.S. companies) are companies that are domestic under section 7701(a)(4). (7) Safe harbor for indices that include interests in foreign companies. For purposes of section 530A(b)(3)(B) and paragraph (b)(5) of this section, an index is comprised primarily of U.S. companies if U.S. companies represent at least 90 percent of the index based on their weightings in the index. (f) Limit on annual fees and expenses —(1) In general. For purposes of section 530A(b)(3)(A)(iii) and this section, an investment fund is not an eligible investment if the sum of its annual fees (as described in paragraph (f)(2) of this section) and annual expenses (as described in paragraph (f)(3) of this section) is more than 0.1 percent of the net value of its assets. (2) Annual fees —(i) In general. Except as provided in the following sentence, the amount of an investment fund's annual fees for purposes of section 530A(b)(3)(A)(iii) and this section is the aggregate amount of fees of the investment fund (as described in paragraph (f)(2)(ii) of this section) imposed during the most recent fiscal year (within the meaning of 17 CFR 210.1-02(k)) of the investment fund the financial data from which has appeared in the investment fund's prospectus, expressed as a percentage of the investment fund's average net asset value during that fiscal year (or a reasonable estimate). If an investment fund's most recent prospectus discloses a change in the investment fund's fee structure that increases the investment fund's aggregate annual fees, the computation described in the preceding sentence must take into account the effect of such increase (or a reasonable estimate). If an investment fund has multiple share classes, annual fees are computed separately for each class, based on the fees that apply to that class and the assets allocable to that class. (ii) Fees of an investment fund. For purposes of section 530A(b)(3)(A)(iii) and this section, an investment fund's fees are all of the amounts that the fund charges its investment fund holders directly, without regard to how such amounts are computed, when they are imposed, or how such amounts are referred to in securities filings or marketing materials. Thus, fees include annual, periodic, transactional, and other recurring amounts charged by an investment fund. Fees also include amounts charged by an investment fund a single time, such as upon a purchase or redemption of interests in the investment fund. Fees include amounts expressed as a fixed dollar amount, as a percentage of the amount invested, or on another basis. An investment fund's fees are disclosed in the fund's prospectus, often under the heading “Shareholder Fees” or “Unitholder Fees” in a fee table. (iii) Fees not associated with an investment fund. The 0.1 percent limit on fees and expenses in section 530A(b)(3)(A)(iii) is a requirement for an eligible investment and not for a Trump account. Fees charged by a trustee for providing an account are not treated as part of any investment fund's annual fees but as trustee fees. A fee charged by a financial intermediary for a service, such as carrying out a purchase or sale of an investment fund is not considered a part of the investment fund's fees if the fee is not charged on behalf of or at the direction of the investment fund, is not paid (directly or indirectly) to the investment fund, and is not attributable to any cost of offering the investment fund. A fee charged by a trustee for such a service would also not be considered a part of the investment fund's fees under this paragraph. (3) Annual expenses. For purposes of section 530A(b)(3)(A)(iii) and this section, the amount of an investment fund's annual expenses is the amount set forth as the investment fund's total annual operating expenses in its prospectus. The amount may be stated as a percentage of the value of the investment fund holder's investment, or as a percentage of the net value of the fund's net assets. If an investment fund's prospectus lists total operating expenses reduced by fee waivers or expense reimbursements, the reduced amount applies for purposes of section 530A(b)(3)(A)(iii) and this section. If an investment fund has multiple share classes, annual expenses are computed separately for each class, based on the expenses and assets allocable to each class. (g) Trustee's procedures regarding eligible investments —(1) In general. To meet the requirement of section 530A(b)(1)(C)(iii), a trustee must ensure that Trump account funds are invested only in one or more eligible investments during the growth period. The trustee satisfies that requirement by following the procedures provided in this paragraph (g). (2) Written governing instrument. The written governing instrument creating a Trump account must include the procedures provided in paragraphs (g)(4), (5), and (7) of this section. (3) Consequences of failure. Except as otherwise provided in this paragraph (g), if any funds of an account are invested in an asset other than an eligible investment (ineligible investment) during the growth period, then the account will cease to be a Trump account (and thus will also cease to be an individual retirement account (IRA) under section 408(a)) as of the first day the account holds the ineligible investment. However, if any funds of an account are invested in an asset that is an eligible investment at the time the asset is acquired but that becomes an ineligible asset during the growth period, then the account will cease to be a Trump account (and an IRA) as of the 30th day after the day that the asset ceased to be an eligible investment (taking into account paragraph (g)(5)(ii) of this section). If this paragraph (g)(3) applies to cause an account to cease to be a Trump account (and an IRA), then the account will be treated as if there were a distribution on that day of an amount equal to the fair market value of all of the assets in the account on that day. The preceding sentence applies even if part of the fair market value of the account as of that day is attributable to excess contributions that may otherwise be returned tax-free under section 530A(d)(5). (4) Selection of eligible investment and default eligible investment —(i) Selection of eligible investments. A trustee must limit the investment or investments available for a Trump account during the growth period to investment funds that the trustee has determined are eligible investments. (ii) Default eligible investment. The trustee must establish for each Trump account under the trustee's administration a default eligible investment in which, during the growth period, all contributions, proceeds from sales or other dispositions, and any other amounts for investment (other than amounts addressed by paragraph (g)(4)(iii) of this section) will be invested unless the account beneficiary (as defined in section 530A(b)(4)) (or any person authorized to act on behalf of the account beneficiary under the Trump account's written governing instrument (the responsible party)) specifies a different eligible investment for the contribution or other amount. The default eligible investment for a Trump account can be a single eligible investment or a combination of eligible investments in specified proportions and may be changed by the trustee from time to time. The trustee must clearly disclose to each account beneficiary the default eligible investment in effect upon the establishment of the account and upon any subsequent change to the default eligible investment. The requirement to establish a default eligible investment does not preclude arrangements between the trustee and the account beneficiary that give effect to different instructions on an ongoing basis. For example, the trustee may follow instructions of an account beneficiary (or responsible party) to invest all contributions or other amounts for investment in that account beneficiary's account (or all such amounts for which another instruction is not provided) in a specified eligible investment other than the trustee's default eligible investment. (iii) Dividends and other investment fund distributions. The trustee of a Trump account must disclose to the account beneficiary how amounts received as dividends or other distributions from eligible investments will be invested unless the account beneficiary (or responsible party) gives different instructions regarding the dividends and distributions. For example, amounts received as dividends and distributions might be reinvested in the same eligible investments that paid the dividends or other distributions or invested in the Trump account's default eligible investment. The trustee may give effect to directions from the account beneficiary (or responsible party) that a specific distribution, or distributions generally, be invested in a different way that complies with section 530A(b)(1)(C)(iii). (5) Situations in which funds need not be invested in an eligible investment —(i) Certain cash holdings. During the growth period, the trustee may permit an amount received in a Trump account as cash, such as an amount received as a contribution, proceeds of a sale or other disposition, or a distribution, to be held in cash for the time reasonably necessary to complete a transaction permitted under section 530A, including an investment, reinvestment, distribution of excess contribution, qualified rollover contribution, or qualified ABLE rollover contribution. (ii) Ceasing to be an eligible investment —(A) In general. In the event an investment fund that was an eligible investment (as determined by the trustee as of the trustee's last determination date described in paragraph (g)(6) of this section) then ceases to be an eligible investment during the growth period, in order for the account to remain a Trump account, the trustee must ensure the prompt sale or disposition of shares in the investment fund and the reinvestment of the proceeds consistent with paragraph (g)(4)(ii) of this section and disclose how the proceeds were reinvested to the account beneficiary. A sale or disposition of shares in the investment fund and the reinvestment of the proceeds will be considered prompt if the sale or disposition and reinvestment of the proceeds occur within 30 calendar days of the investment fund ceasing to be an eligible investment. (B) Time when a fund is treated as ceasing to be an eligible investment. For purposes of this paragraph (g)(5)(ii), the time when the investment fund is treated as ceasing to be an eligible investment is determined based on whether the trustee is in compliance with the monitoring and periodic determination requirements in paragraph (g)(6) of this section. ( 1 ) If the trustee is not in compliance with the monitoring and periodic determination requirements of paragraph (g)(6) of this section, the investment fund ceases to be an eligible investment on the first day that the investment fund does not meet the requirements to be an eligible investment; ( 2 ) If the trustee is in compliance with the monitoring and periodic determination requirements of paragraph (g)(6) of this section, the investment fund is treated as ceasing to be an eligible investment on the earlier of the date of the next periodic determination conducted by the trustee or the date on which the trustee acquires actual knowledge that the investment is no longer an eligible investment. (6) Trustee monitoring of investment funds. During the growth period, the trustee must monitor each investment fund that the trustee makes available to Trump account beneficiaries. After making an initial determination that an investment fund is an eligible investment at the time the trustee first offers the investment fund to any Trump account for which it is the trustee, the trustee must then make subsequent periodic determinations at least once every 12 months whether the investment fund continues to be an eligible investment. These determinations must include verifying that the annual fees and expenses of the investment fund continue to meet the requirements of section 530A(b)(3)(A)(iii) and paragraph (f) of this section. The trustee may rely on an investment fund's prospectus and other public documents required by Federal securities laws in making determinations pursuant to this paragraph (g)(6). (7) Correction of administrative error. If a trustee has procedures in place in accordance with this paragraph (g) but a portion of the assets of a Trump account are not invested in an eligible investment during the growth period due to an administrative error by the trustee (for example, due to an oversight or mistake in applying the procedures), the account will not cease to be a Trump account under paragraph (g)(3) of this section if the trustee sells or disposes of the assets that are not invested in an eligible investment and reinvests the proceeds in an eligible investment consistent with paragraph (g)(4)(ii) of this section within 30 calendar days from the first day that the portion was not invested in an eligible investment. Furthermore, the trustee must disclose to the account beneficiary the duration of the error, the assets that were held during the error period, and the amount reinvested in an eligible investment at the end of the error period. (h) Applicability dates. This section applies to taxable years beginning on or after January 1, 2026, except for paragraph (g) of this section, which applies for taxable years beginning on or after [DATE OF PUBLICATION OF FINAL RULE].