California's Franchise Tax Board has drawn sharp criticism after announcing it will not conform to the federal tax treatment of Trump Accounts, the new child savings program established under the One Big Beautiful Bill Act (OBBBA) signed by President Trump on July 4, 2025. The decision creates what opponents are calling a "Toddler Tax," imposing immediate or annual state-level taxation on accounts designed to grow tax-deferred for decades and help build lifelong wealth for Am

President Trump's "Trump Accounts" initiative establishes tax-advantaged investment accounts for American children to build long-term wealth, modeled loosely on individual retirement accounts (IRAs). The program, enacted through the One Big Beautiful Bill Act, provides a one-time $1,000 government seed deposit for U.S. citizen children born between January 1, 2025, and December 31, 2028, with parents enrolling via a new IRS form during tax filing.

President Trump joined philanthropists Michael and Susan Dell at the White House to celebrate a historic $6.25 billion gift to “Trump Accounts,” the new child savings program created by the Working Families Tax Cuts Act. The donation will give an extra $250 to the Trump Accounts of the first 25 million U.S. children age 10 and under living in ZIP codes with median household income below $150,000.