How the Trump Account vs 529 projection model works

What are the inputs?

How does the compounding work?

1 loop, 1 line of arithmetic per month, per account.

Let r be the annual return divided by 12. For each month in the window, the balance becomes the old balance times 1 plus r, then the month's deposit is added. Deposits land at the end of the month, so the first deposit earns nothing in its own month.

Of course 7% a year is an average, and no single year ever lands on the average… you know how the rest of that paragraph goes. A flat rate is in here because it is the only way 3 accounts stay comparable at all.

The $1,000 pilot deposit is not part of that loop. It lands at the start of the window and is compounded as a single lump: $1,000 times 1 plus r, raised to the number of months. On the baseline that is 216 months and $3,513.

The window starts at the later of the birth month and July 2026, because no money of any kind could go into a Trump Account before July 4, 2026, per the Form 4547 instructions and 26 U.S.C. 530A(b)(1)(C)(i)(I). The model holds that same start date on the 529 and the Roth so the only difference between the 3 lines is the tax treatment. A baby born January 2025 gets 198 deposits, not 216.

Why does the Trump Account stop depositing early?

Because the statute runs out before the birthday does.

26 U.S.C. 530A(c)(2) writes the Trump Account contribution rule for "any contribution made before the calendar year in which the account beneficiary attains age 18", and 530A(b)(1)(C)(i)(II) puts the matching bar in the account's governing instrument. Nothing in 530A carries that treatment into the age 18 year itself. From Jan 1 of that year, 530A(a) leaves the account as an ordinary traditional IRA, and a traditional IRA contribution needs the beneficiary's own taxable compensation, which the baseline sets at $0.

So the Trump Account line takes its last deposit on Dec 31, 2043, then compounds through the final 6 months of the window with nothing added, and lands on the July 2044 birthday at $67,207. The 6 deposits it never takes are worth $913 at that date. The 529 and the custodial Roth are not governed by 530A, so both run all 216.

The size of that gap depends only on the birth month. A January baby loses nothing, because the 18th birthday already falls on the cutoff. A December baby loses 11 deposits.

Age 60 is the 18th birthday balance times 1 plus r, raised to 504. Nothing is added after 18.

How is each account taxed at the exit?

Family money goes in after tax in all 3. What separates them is what happens on the way out, and the model applies that once, on a full withdrawal.

A Trump Account is a traditional IRA, which the IRS states in Notice 2025-68. That is the rule doing the most work in this model. Personal contributions are not deductible, so they become basis and come back out untaxed, and everything above basis is ordinary income on the way out.

It took 26 U.S.C. 530A, 26 U.S.C. 6434 and a 2025 IRS notice to arrive at a sentence that short. We read all 3 so this page could spend 1 line on it.

The education exception waives the 10% additional tax and nothing else. Income tax on the taxable part still applies, so on the baseline the college exit nets $64,608 in the 529 against $62,922 in the Trump Account, a gap of $1,686 that holds even after the Trump Account is handed a free $1,000.

The 529 row at age 60 is ours, not the article's. Our published article stops at 18 for the 529 and marks the age 60 cell as not modeled. A 529 held to 60 and then spent on something other than education takes income tax plus 10% on the earnings at any age, so that is how the engine prices it.

What are the contribution caps?

Each account gets its own cap, applied per calendar year inside the monthly loop. A month's deposit is the smaller of the monthly contribution and whatever room is left in that account for that year.

• Trump Account: $5,000 per child per calendar year for 2026 and 2027, indexed after 2027. The model holds $5,000 flat. A contribution over $416 a month stops funding it partway through any full calendar year, and later than that in the short years at either end of the window: 2026 takes only 6 deposits on the baseline, so the cap does not bite there until over $833 a month. The $1,000 pilot deposit sits outside the cap. The cap also runs out early: 26 U.S.C. 530A(c)(2) covers only calendar years before the one the kid turns 18, so the arm takes nothing from Jan 1 of that year.
• 529: no federal yearly cap, so the full monthly contribution always lands.
• Custodial Roth IRA: the lesser of the 2026 IRA limit of $7,500 and the kid's taxable compensation for the year. With $0 of earned income the arm contributes $0, and the page says so in plain words. The account could not legally hold a balance in that case, so the model declines to print one.

The $1,000 pilot deposit only lands for a birth in 2025 through 2028, per 26 U.S.C. 6434. Outside those years the engine sets it to $0.

How is the state 529 deduction handled?

Contributions are summed by calendar year and multiplied by the state rate. On the baseline that is $900 in 2026, $1,800 a year for 2027 through 2043, and $900 in 2044, which is $1,620 at a 5% rate and $2,916 at 9%.

The savings are not reinvested and never touch a balance. The line sits beside the table. No state cap is applied, so a state with a low deduction ceiling will read high here. The real per-state caps are in our state 529 plan article.

How are the figures rounded?

The arithmetic runs at full precision. The display does not.

Every dollar figure the calculator prints is rounded to the nearest $1, and every difference it prints subtracts those rounded figures rather than the full precision ones. A net is the printed pre-tax minus the printed tax. A margin is 1 printed net minus another. So the Trump Account's $67,207 pre-tax and $4,285 of tax print a net of $62,922, and against the 529's $64,608 that prints a gap of $1,686.

The alternative, rounding each figure off its own full precision number, is how a table ends up showing $67,207 minus $4,285 as $62,923. A reader holding a calculator and nothing but the printed numbers can reproduce every row and every margin on these pages exactly.

Does the engine reproduce the published article?

That is the acceptance test. Every dollar figure our Trump Account vs 529 article published on its own inputs, run back through this engine.

21 figures, 21 matches, 0 differences. A separate Python implementation of the same recurrence, written from this spec alone with the JavaScript closed, returns the same 21 numbers.

What does the model not do?

The short version: it prices compounding and the federal exit, and nothing else.

• No fund fees. Trump Account funds are capped at 0.1% a year by law and the average age-based 529 portfolio ran 0.43% in Morningstar's 2026 study, so a fee-aware run would move the 529 line down more than the Trump Account line.
• No inflation adjustment. Every figure is nominal, which matters most on the age 60 row.
• No state income tax on the withdrawal, and no California 2.5% additional tax on non-qualified 529 earnings.
• No kiddie tax, because none of the 3 accounts throws off yearly taxable income in this model.
• No FAFSA effect. The Education Department has not issued guidance naming Trump Accounts.
• No employer contributions, no cafeteria plan money, no qualified general contributions, no Dell $250.
• No partial withdrawals. The full balance comes out at once at each exit, and the 529 exit at 18 assumes every dollar of that balance pays a qualified education expense inside that 1 year, which is the assumption putting $0 in the 529 tax cell.
• No bracket math. The rate you set is applied flat to the whole taxable lump, and a lump that size would not all sit in 1 bracket on a real return.
• No 529 to Roth IRA rollover bridge, and no Roth conversion of the Trump Account.
• No raises to the contribution and no gifts from anyone else. The return runs flat every month, so there is no market path in here.
• The IRA limit, the $5,000 cap and the tax brackets are held flat for the whole projection. All 3 move over time.

Checked Sep 17, 2026: a Trump Account is a traditional IRA (Notice 2025-68), the $1,000 pilot deposit covers US citizen kids born 2025 through 2028 with nothing landing before July 4, 2026, the yearly cap is $5,000 per child for 2026 and 2027 and is indexed after 2027 and covers only calendar years before the one the kid turns 18 per 26 U.S.C. 530A(c)(2), the taxable part of an IRA withdrawal before 59 and a half carries a 10% additional tax unless an exception applies, non-qualified 529 earnings take income tax plus 10%, and the 2026 IRA limit is $7,500 capped at the kid's taxable compensation. Rates and limits move, so check the date on this line before you lean on it.