IRS should open Trump accounts for eligible children automatically, AICPA says

The IRS and Treasury should automatically enroll eligible children in the new Trump accounts and deposit the corresponding $1,000 seed contribution “to promote fairness and ease administrative burden,” the AICPA said in a letter this week.

Without automatic enrollment, “some taxpayers may be unaware of the program and may inadvertently fail” to open an account or elect into the federal pilot program for the $1,000 contribution, the AICPA said in the letter to the IRS and Treasury.

Families should be allowed to opt out of the proposed automatic enrollment, the AICPA said in the letter, which made several other recommendations.

Background

Under Sec. 530A of H.R. 1, P.L. 119‑21, known as the One Big Beautiful Bill Act, Trump accounts are a new type of individual retirement account for minors. A $1,000 contribution from the federal government is available under Sec. 6434 for eligible children born after Dec. 31, 2024, and before Jan. 1, 2029. Eligible individuals are generally children with a Social Security number who have not yet reached the calendar year in which they turn 18 years old prior to the election to open a Trump account.

Notice 2025-68 delegates authority to the IRS and Treasury to determine how a Trump account election may be designated and establishes that authorized individuals may elect to open a Trump account for an eligible individual.

Process

The AICPA said the IRS and Treasury could coordinate with the Social Security Administration, which already assigns Social Security numbers at birth. That approach would reduce the administrative burden of collecting and processing individual elections, the letter said.

“Automatic enrollment would promote equitable access, reduce procedural barriers, and strengthen the intended reach of the program,” the letter said. “This would ensure that the benefits of Sec. 530A and Sec. 6434 accrue broadly rather than disproportionately to those with greater awareness or resources.”

Other AICPA comments on Trump accounts

The AICPA also made recommendations on other parts of Trump accounts:

• Clarification of the gift and generation-skipping transfer tax treatment of Trump account contributions.

• Addition of ordering rules for returning excess contributions made to an eligible individual’s Trump account and allocation of gain or loss related to such excess contributions.

• Clarification of the priority listing for authorized individuals electing to open Trump accounts for an eligible individual.

• Permission to use Form 8879-TA use with electronically filed tax returns.

• Creation of procedures and rules for new responsible party selection after the Trump account is established.

• Clarification of whether an index is composed primarily of U.S. equity investments, and the circumstances under which assets may be held in noneligible funds for a de minimis time during the growth period.

— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.