A newly passed US bill introduces a $1,000 payment for children born between January 1, 2025, and December 1, 2028. Interestingly, this period mirrors the span of Donald Trump’s second term in office, which will end in January 2029 after the next presidential election.

Following its approval, the new policy is set to take effect on July 4 this year, coinciding with Independence Day celebrations.

It is part of Donald Trump’s “big, beautiful bill,” which states: “This is a pro-family initiative that will help millions of Americans harness the strength of our economy to lift up the next generation. And they’ll really be getting a big jump on life.”

Under the plan, the funds will be deposited into what’s being called a “Trump Account,” opened in the child’s name and designed to track the overall stock market.

Parents will also have the option to contribute additional money to the account if they wish, allowing them to potentially increase its value over time.

Parents whose kids qualify for the scheme can sign up for the Trump Account during tax filings.

IRS Form 4547 would be utilized to register for the account – a reference to President Donald Trump being the 45th and 47th president.

An additional alternative to applying for the account is through TrumpAccounts.gov website, where applicants can fill in a form to set up the account.

It was mentioned that applicants will be notified about activating their account at the right time. The funds will come from the US Treasury and will be put in an index fund. This means that the value of each Trump Account depends on the stock market and changes accordingly.

Only babies who qualify for the program can be entitled to receive the $1,000 one-time bonus.

Parents can add $5,000 of their own money to their child’s account annually.

The account remains locked from the moment it’s created until the child turns 18.

Although the funds become accessible at that point, they don’t need to be withdrawn right away.

Which companies are involved in the scheme?

Around 50 companies have been confirmed as involved in the accounts, according to Americans for Tax Reform.