The U.S. Treasury Department stated on Thursday that more than 60 million American children under the age of 18 have been automatically registered into Trump Accounts, a piece of information provided exclusively to CNBC by that agency.
On Tuesday, the Ministry of Finance introduced relevant regulations to initiate an automatic registration process for millions of children. The agency stated that by Thursday, this process had been completed.
Trump Accounts is also known as the 530A account, which was officially launched on July 4th and is open to any American child under the age of 18 who holds a Social Security number. Children born between 2025 and 2028 are also eligible to apply for a one-time funding of $1,000 from a pilot program provided by the Treasury Department.
Finance Minister Scott Bessent stated, "Millions of children have already registered for Trump Accounts. With automatic registration, another over 60 million eligible children now also have an account that can be claimed."
The Ministry of Finance will also allow donations of stocks to Trump Accounts. According to the temporary regulations announced this week, this may lead to "large-scale private donations."
Certified Financial Planners, from the Kitces.com advisory platform, stated that "wealthy founders and shareholders have been advocating for direct stock donations" because this approach allows them to avoid capital gains tax that would be incurred on selling stocks or giving cash as gifts.
It is worth noting that this update allows Trump Accounts to hold donated individual stocks, whereas previous guidelines only permitted the holding of diversified, low-cost funds. The Ministry of Finance stated that donated stocks typically must be held for five years before they can be sold.
This latest news comes about a month before the mid-term elections, at a time when the Republican Party is striving to maintain their narrow advantages in both the House of Representatives and the Senate.
What do parents need to do?
Automatic registration alone will not trigger a $1,000 deposit. According to the regulations announced on Tuesday, eligible families still must actively choose to receive the government's startup funds.
Henry-Moreland to CNBC means: "Children who meet the criteria to receive $1,000 in government pilot funding will not automatically receive this money."
To claim the account, parents or guardians should download the Trump Accounts application to verify their identity and their relationship with the child, view the account information, and accept the account terms, according to the Ministry of Finance.
Children who meet the criteria must first claim an account, and only then can contributions from family members, friends, and employers be added to the account, and the Ministry of Finance's one-time $1,000 startup fund will also be credited to the account.
Under certain conditions, other Trump Account funds may also be available. Michael Dell, the CEO of the technology company, and his wife Susan have pledged to donate $6.25 billion to provide an additional $250 for children born between 2016 and 2024 who reside in areas with a median family income of $150,000 or less. These funds are specifically targeted at low-income children.
Urban Institute, a senior policy researcher at a think tank located in Washington, Madeline Brown stated: "This rule actually introduces the concept of creating automatic accounts for every child under 18 who has a Social Security number." She said, "This means that even if the accounts have not been activated yet, children will not miss out on charitable donations, such as those from the Delf family, or the growth generated by these donations."
However, she added, "This still requires the family to ultimately claim the child's account, and we don't have many details about how this process will be carried out yet."
Brown indicates that since Trump Accounts previously required families to "voluntarily choose to join," large-scale participation has always been difficult, especially among low-income families.
She said, "The proposed regulations represent an important step forward in automatic registration, bringing the design of accounts closer to an evidence-based approach that can improve participation rates. This transition is particularly important given the low participation rates observed under the current voluntary participation structure."
Bessent stated during a hearing held by the House Financial Services Committee in mid-September that approximately 7 to 8 million American children have registered for Trump Accounts.
Parents' "Window of Opportunity"
A nationwide automatic registration policy, coupled with a large amount of federal and private funding, has created an "opportunity window," said Commonwealth, the CEO of the national non-profit organization Timothy Flacke.
A recent report, Commonwealth, indicates that before the implementation of the automatic registration policy, only 5% of low-income and middle-income families had set up Trump Account.
A survey conducted by Commonwealth involving nearly 1,100 parents of children aged 10 and under from low- and middle-income families found that the main barriers were the impact on taxation, the impact on public welfare, and the inability to contribute to these new investment accounts.
In the analysis of Commonwealth, low-income and middle-income families are defined as those with an annual income of up to $80,000, which is lower than the median family income of $87,460 reported by the U.S. Census Bureau last year. The survey was conducted in July, with a margin of error of plus or minus 3%.
According to a policy analysis released on June 9 by Adam Michel, the director of tax policy research at the Cato Institute, a Washington-based libertarian think tank, for some families, issues regarding eligibility, contribution limits, and withdrawal restrictions may deter participation, "especially among those with limited time, insufficient financial knowledge, or no adequate external savings for emergencies."
He wrote, "As a result, this system is mainly used by those who are most capable of controlling it."
Temple University Beasley, a practicing professor and director of the Low-Income Taxpayer Clinic at the Law School, told CNBC that those with lower incomes often face obstacles when it comes to government programs.
He said that many low-income families “don’t have the time or resources to hire someone to help them with these matters.”
Families may still miss out on $2.88 billion
According to the research by Commonwealth, approximately 14.4 million children born in the United States between 2025 and 2028 from various income levels are expected to be eligible to receive a federal startup grant of $1,000. Of these, 5.8 million come from low-income and middle-income families.
According to research on the historical receipt rates of federal labor income tax credits, Commonwealth has found that it is estimated that 20% of eligible infants may not receive their $1,000 deposit.
Labor income tax credit, referred to as EITC, is designed to support low-income and middle-income families by reducing the amount of tax due. Since it is a refundable tax credit, eligible taxpayers may receive a rebate even if they owe almost no federal income tax.
However, Firouzi indicates that many applicants did not claim due to reasons such as "complicated rules," which may be "stringent and cumbersome." Earlier this year, the U.S. Internal Revenue Service (IRS) stated that among taxpayers eligible to claim EITC, nearly one-fifth of them did not do so; in the 2024 tax filings, the average amount claimed for EITC was $2,916.
According to the analysis by Commonwealth, if the collection rate of Trump Accounts is similar as well, then during the pilot phase, children living in low-income and middle-income families may miss out on approximately $2.88 billion in federal startup funds.
However, Flacke signifies that "the value here is not just about money"; what's more important is "knowing that that money is there, watching it grow, and having the feeling of owning some kind of financial future for oneself."
