Trump Accounts Employer Rules, Form 5227 Trust Reporting

01. Proposed rules for Trump accounts

Under the proposed regulations, employer contributions to a Trump account are capped at $2,500 per employee annually, regardless of how many dependents or employers the employee has; the 2026 General Instructions for Forms W-2 and W-3 require reporting them in Box 12 with code TA.

Employers may allow employees to fund Trump account contributions via pre-tax salary reduction under a Section 125 cafeteria plan, but only for a dependent's account and not for the employee's own account.

02. Permanent Section 45S paid leave credit

The Section 45S employer credit for paid family and medical leave is now permanent and allows eligible employers to calculate the credit using a new premium method based on insurance policy costs rather than solely on wages paid.

For taxable years beginning after December 31, 2025, qualifying employees for the Section 45S credit are limited to those working at least 20 hours per week, and employers may elect to include employees after six months of employment instead of one year.

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03. Form 1041-A relief for passthrough trusts

Taxpayers may immediately rely on proposed regulations that eliminate the Form 1041-A filing requirement for trusts whose only Section 642(c) charitable deductions are passed through from partnerships or S corporations.

The guidance also formally clarifies that split-interest trusts under Section 4947(a)(2) must satisfy their reporting obligations by filing Form 5227 instead of Form 1041-A.

04. Late Form 8832 relief in two rulings

In PLRs 202633001 and 202633003, the IRS granted 120-day extensions under Section 301.9100-3 to file late Form 8832 classification elections - four professional LLCs electing association status, and two foreign entities electing partnership and disregarded-entity treatment.

The 120 days run from the date of each ruling letter, and relief is contingent on the entities filing all required returns consistent with the election in that window - expressly including Forms 5471, 8865, and 8858 for the foreign entities in PLR 202633003.