Treasury will enroll children in accounts without parent sign-up
Automatic enrollment begins Oct. 1, creating millions of children’s accounts and raising questions about parents’ role.
The Treasury Department is replacing parents’ sign-up step with automatic enrollment in Trump Accounts for eligible children across the United States, CBS News reports. The Treasury Department will automatically create up to 60 million accounts for eligible children, according to guidance published in the Federal Register1. The temporary regulations take effect Sept. 30, and auto-enrollment begins Oct. 11. The department expects auto-enrollment to add about 2 million more accounts per birth-year cohort1.
“eligible donors prefer that their contributions reach all children, not just children whose parents have the awareness to opt in.”
What it would do
The accounts were created under the One Big Beautiful Bill. Under the regulations, a Trump account is a type of traditional IRA held for the exclusive benefit of the child2, and distributions are barred during a growth period that ends Dec. 31 of the year the child turns 172.
U.S. citizens born Jan. 1, 2025 through Dec. 31, 2028 are eligible for a $1,000 government seed contribution, according to a Treasury fact sheet1. Children born after those dates but under 18 may also open accounts without the government gift, and friends, relatives or employers may contribute up to $5,000 per year1. Private money is already flowing. Michael and Susan Dell have pledged $6.25 billion to accounts of children born from 2016 to 2024 in ZIP codes with a household median income below $150,0001. Under the new rules, Treasury says auto-enrollment removes the need to create accounts for children in most cases.
- July 4Trump Accounts mobile app launched
- Sept. 30Temporary regulations take effect
- Oct. 1Auto-enrollment begins
The publication's view
Family Brief applies two tests to any program built around children. Does it help working families form and raise a family? Does it keep parents in charge? A $1,000 seed and a chance for relatives and employers to add to it passes the first test. It puts real money in a child’s name and gives grandparents and employers a way to invest in a young family. The second test is harder. An account the government opens without a parent making an election puts Treasury at the start of the process, so the rules have to make plain that the mother and father decide what happens next. The family is prior to government, and families are owed that answer now. The accounts start arriving when enrollment begins Oct. 1, and a program meant to serve the household has to leave the household in charge.
Record & context
Until now, parents or guardians had to submit IRS Form 4547 to open an account. They could do so through the Trump Accounts mobile app, which launched July 4, at tax filing, or on the IRS website. The government withdrew the earlier rule because it did not provide for broad automatic enrollment1. Treasury says public commenters argued an opt-in requirement would reduce participation among nonfilers and families with limited time or resources1. According to the Treasury notice, “eligible donors prefer that their contributions reach all children, not just children whose parents have the awareness to opt in.”1
Sources
FAMILY BRIEF The news and network for the American family.
