Millions of American children will soon have Trump Accounts created for them automatically, eliminating a major step that previously required parents or guardians to enroll their children.
New temporary regulations from the Treasury Department and IRS take effect Sept. 30, with automatic enrollment beginning Oct. 1. Treasury expects the change to expand the program to tens of millions of additional children, with estimates reaching as many as 60 million.
Trump Accounts are tax-deferred investment accounts designed to help children build savings over time. Children born from Jan. 1, 2025, through Dec. 31, 2028, who meet the program’s requirements are eligible for a one-time $1,000 federal contribution. Other children under 18 can also have accounts, but they do not automatically qualify for that $1,000 government deposit.
Parents, relatives and others can contribute money to the accounts, while employers can also make contributions for employees’ children. During childhood, the money is invested in qualifying stock-market index funds and generally remains in the account until the child reaches adulthood.
Treasury says automatic enrollment could also make it easier for companies, charities and wealthy donors to contribute money to large groups of children because an account will already exist for eligible recipients. The department said the previous opt-in system risked leaving children out simply because an adult had not completed the enrollment process.
The Readovia Lens
Automatic enrollment dramatically changes the reach of Trump Accounts. Instead of depending primarily on parents to sign their children up, the government can establish accounts on a much larger scale. But families should remember that having an account created and receiving the $1,000 federal contribution are not the same thing — eligibility for that government deposit is limited to qualifying children born from 2025 through 2028.
