Carolyn Schenck Weighs in on Stock Donations to Trump Accounts in CNBC

Elon Musk said on Monday that he will give every kid in America a share of SpaceX next year. He appeared to suggest the gift could land in Trump Accounts — thanking Brad Gerstner, an architect of the program, for “helping enable this” in a comment on X.

But if the shares are distributed through the new investment accounts for children, the gift could come with significant strings attached.

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In the broader world of charitable giving, donors can typically express preferences about how their gifts are managed, but the receiving organization or trustee retains final authority, said Carolyn Schenck, an attorney and former national fraud counsel at the IRS. 

Under the new Trump Account rules, however, it’s “the donor that’s dictating the terms of the gift,” she said. 

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This increases beneficiaries’ risk of loss if the share price rises before the trustee repurchases the stock, according to Schenck. Beneficiaries would ultimately bear that cost.

“If the fiduciary makes an investment mistake, then the focus is typically restoring value to the beneficiary. But here, the focus seems to be restoring the specific security itself,” said Schenck, who left the IRS in 2025 for law firm Caplin & Drysdale.

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Schenck noted that Treasury has broad authority to set the terms of Trump Accounts, and it is Treasury — not the original stock donor — that formally requires the shares to be held.

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