A new U.S. savings vehicle for children — informally known as the “Trump Account” — is beginning to attract attention among American families worldwide. For U.S. citizens living in Israel, this account offers a rare opportunity to start building long-term wealth for children from birth — with government funding and tax-deferred growth.

At the same time, dual U.S.–Israeli families must navigate two tax systems, making planning more nuanced than it first appears. In this article, we’ll focus on the $1,000 benefit available for young children with Social Security numbers. In the next installment, we’ll explore the pros and cons of adding extra funds from the family’s after-tax savings (spoiler: it’s usually not a good idea!).

But let’s start with the $1,000 seed accounts. Here, there’s no downside. Even with the restrictions, this represents money the child wouldn’t otherwise have — a true opportunity to build a financial foundation at no cost to the family.

What Is a Trump Account?

A Trump Account is a federally created tax-advantaged investment account for children under age 18.

Key features:

• Opened in the child’s name
• Earnings grow tax-deferred for U.S. purposes
• Converts into a retirement-style account at adulthood
• Parents, grandparents, and relatives may contribute up to $5,000 per year per child
• Certain children qualify for a $1,000 U.S. government seed deposit

The $1,000 Government Seed Deposit — How It Works

Children may receive a one-time $1,000 federal deposit if all of the following are met:

1. Born during the eligible window (currently births from 2025–2028).
2. The child has a valid U.S. Social Security Number.
3. A parent or guardian makes the required election on a U.S. tax return.
4. A Trump Account is opened in the child’s name.

The deposit is not taxable income and grows tax-deferred inside the account.

Investment Tracks Inside Trump Accounts

Permitted investments include:

• Broad U.S. stock market index funds
• Total-market or large-cap U.S. equity ETFs

Foreign funds, alternatives, sector funds, and crypto are not permitted.

How U.S. Citizens Living in Israel Can Obtain the $1,000 Trump Account Seed Deposit

For Americans living in Israel, the opportunity is very real — but the process is not automatic and requires deliberate action. Below are the three ways to obtain the $1,000 seed money and the important brokerage issues unique to expats.

Who Is Eligible?

Your child must:

• Be a U.S. citizen
• Have a valid Social Security number
• Be born between January 1 2025 and December 31 2028
• Have a Trump Account established through one of the methods below

There are no income limits.

Option 1 (Most Common)

File Your U.S. Tax Return and Attach Form 4547

This will be the default approach for most families.

When you file your U.S. tax return, attach Form 4547 – Trump Account Election to establish the account and request the $1,000 government contribution.

• Can be filed:
  • Electronically (preferred)
  • Or with a paper return
• This method works even if you normally owe zero U.S. tax.

Once processed, Treasury deposits the $1,000 directly into the newly created Trump Account.

Option 2

File Form 4547 as a Stand-Alone Form (No Tax Return)

If you are not required to file a U.S. tax return (for example, you have no income), you may submit Form 4547 by itself.

For U.S. citizens living in Israel, mail the form to:

Internal Revenue Service
Austin, TX Service Center
(International filings — same address used for Form 1040 from Israel)

This allows you to receive the $1,000 seed deposit without filing a full tax return.

Option 3

Register Online at TrumpAccounts.gov (No Tax Return Required)

Beginning mid-2026, parents will be able to open Trump Accounts online at:

👉 www.trumpaccounts.gov

This method will:

• Not require filing a tax return
• Allow direct online account establishment

However, the system will require identity verification, likely through ID.me or a similar platform.

⚠️ Expat warning:
ID verification can be very difficult without a U.S. address, U.S. phone number, or recent U.S. credit history. Many Americans in Israel encounter obstacles completing ID.me verification.

You Will Also Need a Brokerage Custodian

Opening the Trump Account with the IRS is only the first step. To actually invest the funds, the account must be held with a brokerage custodian.

This is where many Americans abroad get stuck:

• Many U.S. brokerages require U.S. residency or a U.S. address.
• Accounts are often frozen or rejected once a foreign address is disclosed.

Two firms that are generally reported to work with U.S. citizens living in Israel are:

• Charles Schwab
• Interactive Brokers

No endorsement is given or implied — policies change frequently, and you must confirm eligibility directly with the custodian before relying on any firm.

Which Option Is Best for Americans in Israel?

Final Notes

• The $1,000 seed deposit is in addition to the Child Tax Credit.
• Parents and relatives may contribute up to $5,000 per year, but basis must be tracked carefully to avoid double taxation on withdrawal.
• Every child who is also an Israeli resident must comply with both U.S. and Israeli tax rules, and families should consult their Israeli CPA regarding potential “Teisha Gimel” treatment.

Disclaimer

This article is for educational purposes only and does not constitute tax, legal, or investment advice. Every family’s situation is different. You should consult with your U.S. and Israeli tax advisors before opening or funding any Trump Account.

The post Trump Accounts Part 1: A New Tax-Advantaged Savings Account for Children – How to Obtain the $1000 Seed Deposit appeared first on Cole & Waxman Tax Services.

by I. David Waxman

Introduction

Dealing with the IRS isn’t anyone’s idea of fun. But mistakes happen, and when they do, you need a roadmap to get them corrected. Below are common issues taxpayers run into, followed by practical steps to resolve them.

1. Common IRS Problems

• Erroneous tax assessment – The IRS incorrectly assesses additional tax you don’t owe.
• Missing refund checks. The IRS sent the refund, but you didn't receive it (also see IRS form 3911).
• Misapplied tax payments
  • Posted to the wrong tax year
  • Posted under the wrong taxpayer (for example, the “spouse” on a joint return pays under their own SSN, and the IRS refuses to apply it to the joint balance).
• Penalty relief requests – If you missed a filing or payment deadline, you may qualify for a first-time penalty abatement if you’ve been compliant for the prior three years.
• Data entry errors – Wrong SSN, filing status, or other clerical mistakes.
• Disaster relief claims – Special rules extend deadlines if you’re in an area covered by IRS Notices (e.g., for residents of Israel seeking war relief, see IRS notices 2023-71, 2024-72).
• State tax issues – Sometimes it’s not the IRS but your state. Example: you list a New York address on your Form 1040 while living abroad, and New York issues a bill. The IRS shares data with the states, so you may need to call the state revenue department directly.

2. How to Fix the Problem

Step 1: Review Your IRS Records

Get your account transcripts from IRS.gov. (See our guide on registering—spoiler: it’s not simple.) Review wage & income, account, and tax return transcripts carefully for discrepancies.

Step 2: Establish a Written Record

Send a written explanation to the IRS.

• This won’t guarantee resolution, but it documents your good faith effort.
• You can use AI tools (ChatGPT, Claude, Copilot, Gemini, etc.) to draft, but always review and edit for accuracy.
• Mail the letter to the address on your notice, or fax it to +1 681-247-3101 (international fax). Include a copy of the notice.
• Keep a copy - this is important for establishing that you are doing your due diligence to resolve the conflict through normal channels before escalating.

Step 3: Call the IRS

• For international taxpayers: +1 267-941-1000 (6AM–11PM ET).
• Call at opening time for the shortest waits.
• Expect to spend 1–2 hours. This is for the wait time, verification process, and time on hold while they review your records.
  • 💡 Pro Tip for Sanity Put your phone on speaker — but set the volume just high enough that you’ll hear when a live person finally answers. The IRS hold muzak and repetitive messages are mind numbing; too much exposure can drive even the calmest taxpayer to the edge.
• Have your return and ID info handy (SSN, DOB, address). If you miss a question, they won’t help you.
• Be polite, explain the issue clearly, and hope for a sympathetic rep. Some fix problems immediately; others don’t.
• Afterward, write up your notes and send a summary to the IRS by mail/fax for your records. See notes above on Step 2.
  • 💡 Extra tip: Hope for the best, but be prepared for the worst—whether dealing with the IRS or life in general. Occasionally, you'll reach a representative who listens with empathy and genuinely tries to help. Others may respond with indifference, showing little concern for your issue or the time you spent waiting. Most fall somewhere in between. Do the best you can with whoever you're dealing with.

Step 4: Wait and Recheck

While IRS representatives often estimate 30 days for corrections, allow 60-90 days for processing before following up. Then check your transcripts again. If the correction shows up—victory! If not, got back to step #3 and repeat the process. Give it another 60 days, and the it is time to escalate.

Step 5: Escalate to the Taxpayer Advocate Service (TAS)

• File Form 911 by mail or fax.
• If your case is accepted, TAS will request supporting documents (often ones you already gave the IRS). Provide them promptly.
• TAS is swamped, so getting an advocate assigned is a big win.

Step 6: Contact Your Senator or Representative

If TAS doesn’t help, reach out to the last state where you lived. Congressional offices only assist constituents. Visit their website and look for the IRS casework request section.

Other: Respond to a Statutory Notice of Deficiency

This is the IRS formally saying you owe more tax. You can:

• File a petition in Tax Court (even without a lawyer, “pro se”). Court fee is $60.
• IMPORTANT: The deadline is 90 days from the date of the assessment if you live in the USA. If you live outside the USA (like most of our clients), then the window is 150 days. The tax court has zero flexibility. If you miss this deadline, then this door closes permanently.
• The IRS will transfer the case to Appeals, where you can negotiate.
• If Appeals fails, work directly with IRS Counsel.
• If that fails, a Tax Court judge decides. (Most cases settle before then.)
• Tip: You can engage a CPA or Enrolled Agent to represent you after you file the petition.

Other: File an Amended Return (Form 1040X)

• Amended returns require a formal IRS response, unlike letters or phone calls.
• This is another option that could be implemented at any point.
• Processing can take up to two years.

Getting Ahead of the Curve

When the IRS makes an error, the path to resolution is often uneven. Most taxpayers never push back, which means the Service rarely corrects mistakes unless pressured. By leveraging the right resources, you can move your case forward faster than most people do.

The reality is that with each escalation step, fewer taxpayers follow through:

Takeaway: If you’re proactive and willing to escalate when necessary, you stand out from the majority who simply give up. That persistence can make the difference between years of waiting and a timely correction.

Final Thoughts

IRS conflict resolution is a marathon, not a sprint. Start by gathering your records, documenting every step, and escalating strategically. With persistence—and sometimes a little help from an advocate, attorney, or member of Congress—you can usually reach a resolution.

Disclaimer: This article is for educational purposes only and does not constitute legal, accounting, or tax advice. Every taxpayer’s situation is unique. The article could include errors and/or outdated information. You should consult a qualified tax professional before taking any action based on the information provided.

Last updated: September 10, 2025. IRS rules change; verify on IRS.gov.

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The post Refund Delays – IRS Letter 5447C appeared first on Cole & Waxman Tax Services.

Follow these instructions to get the status of your refund.

Please note that direct deposit is available only for the current tax year and only to a bank in the U.S.A. Most banks will only accept the deposit if all names listed on the refund are also listed on the bank account. This means that if your tax filing listed both you and your spouse, then the bank account must likewise list you and your spouse. Check with your bank manager for further details.

Direct deposit is available only for clients that listed their bank routing number and account number at the time of filing your tax return. The IRS cannot add the direct deposit information after the tax return has been filed.

• First, check the status of your tax refund online via this page from IRS.gov: https://sa2.www4.irs.gov/irfof/lang/en/irfofgetstatus.jsp
Allow 45 days from posting your tax return by mail or 7 days from electronically filing to check the status.

• If the page does not provide information and you have filed your tax return (either electronically via our office or by mail), then call the IRS at +1-267-941-1000 (toll call). The service is available from 06:00 to 23:00 EST, or from 13:00 until late at night Israel time. For fastest service, call in the evening Israel time, or late afternoon EST.

• If the page indicates that your tax filing is under review, then you can call the IRS examinations department for further information at +1-267-941-1037 (toll call). The office opens at 10:00 EST or 17:00 Israel time. Ask the examinations representative for the name and phone number of the “tax compliance officer” assigned to your case, then let us know. Allow at least 120 days from filing your tax return before calling the examinations department.

Feel free to contact the office for further assistance on tracking your refund status.  

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Why is this year’s refund lower than last year’s refund?

“Where did my refund go?” Perhaps you have asked your accountant this question after receiving a copy of your tax return. Many factors can affect a change on your refund from year to year. Understanding the variables that effect your refund can help you understand a bit more about how much to expect, and why your refund may have gone down since last year.

• If your total income is above $55,000 for married filing separately (MFS), $110,000 for married filing jointly (MFJ) or $75,000 for head of household (HOH). The child tax credit is reduced by  $50 for every $1000 over these watershed marks.
• Your refund for the child tax credit is limited to 15% of your earned (salary, tofes 106) income in excess of $3,000.  If your earned income was lower, than your refund could be lower.
• Earned income that is reduced by the foreign earned income exclusion (form 2555) is not considered for the refundable child tax credit.  If you use the foreign earned income exclusion (form 2555), to reduce your taxable income, your earned income for purpose of calculating the refund will be your total earned income less the excluded amount. If the exclusion was used for all of the earned income then you will not be eligible for a refund.
• If you are self employed, you will owe social security tax of about 15% on your self employment income. If you are eligible for a child tax credit, the refund will be offset by the social security tax owed.
• If you pay zero or reduced income tax to Israel (aka mas hachnassa) then you might have tax liability to the IRS.  This tax liability is offset by the child tax credit and therefore the refundable portion will be reduced.
• If one of your children turned 17 any time during the year then this child will no longer qualify for the child tax credit.  It makes no difference if the child turned 17 on 01-Jan or 31-Dec.  There is no partial credit.  That is, 16 is the maximum eligible age for the child tax credit.

On the bright side, all of these issues can have the reverse effect as well. To increase your additional child tax credit, you might need to earn more salary (or perhaps less), revoke the foreign earned income exclusion, reduce self-employment income, or (best of all) have more children.

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Rather than receiving refunds, many of our clients have been receiving letters from the IRS requesting “verification of identity”. The most common letter is labeled “LTR 5447C”. Another variant is labeled “LTR 5071C”. The gist of the letter is that the IRS suspects that some unknown person has commandeered your name and social security number and has attempted to use this information for illicit gains. This is otherwise known as “identity theft”.

The abundance of caution on the part of the IRS is not unreasonable. The problem of identity theft combined with fictitious and fraudulent tax filings is well known. For instance, some enterprising prison inmates actually have invested a good deal of their rehabilitation time to research the tax system and innovate new ways to harvest bogus refunds. See full details here.

In any case, what this abundance of caution means to you is that obtaining your refund may require some extra work and patience. Without response, the IRS will simply not release your refund. You have two options to respond. I suggest that you try the first option for reasons soon to be clear.

1. Call them. The phone number listed on the LTR 5447C is +1-267-941-1083. Call during business hours, east coast USA time (from 15:00 and later in Israel). Budget 1-2 hours for this task as the IRS is understaffed.
2. Submit documents by mail. They request at least 2 documents which will typically include a copy of your social security card and USA passport. Other possible documents to submit include your birth certificate, citizenship document (if born overseas), driver’s license, ITIN letter (if relevant). Allow the IRS 90 days to respond to the written submission.
3. After the 90 days passes without response from the IRS (and you should expect no response), then call IRS accounts at 267-941-1000 and ask the representative to confirm receipt of documents. Then ask him/her to place a “referral” to the person handling your case (which is most likely no one) and allow another 45 days for (non)response.
4. After the 45 days passes without response, then contact the taxpayer’s advocate office for assistance. Call them at +1-787-522-8601, or fill out form 911 and fax to +1-855-818-5697. The advocate should call you in the next 14 days. If not, then re-fax form 911.
5. With the intervention of the advocate, the IRS should then release your refunds in the next 90 days.

Because you will most likely need to call the IRS anyway, I suggest that you start by calling them as detailed in option 1.

UPDATE 20-Dec-15

If your earned income is sourced from Israel or any country outside of the USA, then you will also need to submit verification of your earned income. The IRS letter does not mention this, but in addition to verifying your identity they also want to verify your earned income.

For taxpayer’s living in Israel, submit your Israel forms 106 in Hebrew and also translated to English. For other non-English documents, have a local translator provide the English translation or contact our office. For English speaking countries, simply submit copies of your pay slips or annual earned income summary.

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As we get ready to kickoff the 2013 tax season in less than two weeks, the most common inquiry from
taxpayers seems to be: “But I still haven’t received my 2012 refund”? In a recent trend that has
infuriated taxpayers and tax preparers alike, the IRS has in many cases drastically delayed the issuing of
tax refunds. While taxpayers are still required to timely submit their 2013 tax filings, the IRS is taking its
time in issuing many outstanding refunds.

According to an independent taxpayer advocacy group, the increase in delayed refunds is a direct result
of the IRS intensifying its efforts to prevent identity theft. The IRS expanded the amount and types of
filters used to catch potential fraud and find false tax returns. In 2013, the IRS rejected or suspended
nearly 5 million suspicious tax returns, up almost 400% from 2012. Around ninety percent of the
“suspicious” tax returns were eventually deemed legitimate, after the refund had been delayed for
months. While the IRS attempts to resolve all identity theft cases within six months, it often takes closer
to a year to close a case and correctly issue the refund.

Other factors that cannot go unnoticed – as much as the IRS hopes it will – are the furloughs and
spending cuts. While the IRS insists that recent budget cuts have not caused delays in processing
returns, it seems to be an obvious factor in the IRS having issued 1.5 million fewer refunds as of May
2013, as opposed to the same time in the previous year. According to the National Treasury Employees
Union, the IRS’ budget has decreased in the last two years by almost $1 billion with 8,000 fewer
employees. In addition, hiring freezes and multiple federal furloughs inevitably resulted in further
processing delays.

While the IRS continues to deny that having fewer employees and working fewer days is not a cause in
delaying returns, it certainly seems that this would be a factor.
While an increase in identifying fraud would be an understandable reason to delay refunds, the
disappointing “success” rate certainly calls into question whether the new tactics are doing more good
than harm.

For many clients, the fact that they will eventually receive their refunds – plus a relatively generous
interest rate – serves as little consolation for the powerless feeling of someone else withholding their
money. Other taxpayers are not appeased when told “misery loves company” and that many people are
in similar, fortuitous positions. Probably least reassuring is that the IRS recently announced for 2013
electronically filed tax returns, the refunds will no longer be issued in five to seven days as in the past.
Now the average time for “non risk” returns will be 14 days and “high risk” returns will be 28 days
(unless pulled for Examination). In other words, things could get worse before they get better…

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