Treasury to Auto-Enroll Up to 60 Million Kids in Trump Accounts Starting October 1

The Treasury Department published temporary regulations Tuesday, September 29, that flip Trump Accounts from an opt-in program to automatic enrollment for millions of children, starting as soon as Thursday, October 1.

Treasury projects the switch will add more than 60 million accounts before the end of 2026, then roughly two million more per year after that as new babies become eligible, according to the regulations reported by CNBC and InvestmentNews.

Where the numbers stood before this

As of a September 15 hearing before the House Financial Services Committee, Treasury Secretary Scott Bessent said 7 million to 8 million American children were signed up. He told lawmakers that once auto-enrollment kicked in, "we anticipate within a month we will have 70 million."

That low starting number was the problem Treasury set out to fix. Families had to actively opt in by filing IRS Form 4547 with a tax return or applying directly at TrumpAccounts.gov. According to a report from the nonprofit Commonwealth cited by CNBC, only 5% of low- and moderate-income families, those earning up to $80,000 a year, had opened an account. Treasury itself estimated an opt-in system would have topped out near 50% enrollment industry-wide, according to InvestmentNews.

How the new mechanism works

The accounts, formally called Section 530A accounts, launched for contributions on July 4, 2026, under the One Big Beautiful Bill Act that President Trump signed in July 2025. U.S. citizen children born between January 1, 2025, and December 31, 2028, get a one-time $1,000 seed deposit from Treasury. Parents, relatives, employers and charities can add up to $5,000 a year after tax, with employer contributions of up to $2,500 counting against that cap.

The legal snag was privacy. Treasury couldn't build a broad auto-enrollment system in time for the July 4 launch because of what the agency called the need to prevent "unauthorized disclosure of return information," according to a Federal Register notice reported by michaelrcronin. The fix is a master group trust: each child still owns a separate account, but assets are pooled so the trustee can invest without handling individual tax data. Treasury holds the account until a parent or guardian claims it.

There's a catch families should know about. These new "auto accounts" can only receive two kinds of money automatically: government or charitable contributions and the $1,000 pilot payment. Even that $1,000 still requires a parent to file for it because Treasury can't make that election on a family's behalf, according to InvestmentNews. Contributions from parents, relatives or employers still require the family to formally claim the account.

The political angle

President Trump posted a video over the weekend saying "we're going to give every newborn child a financial stake in the future," a comment that appeared to tease the rule change.

The Washington Sun reported, citing four unnamed sources familiar with internal discussions and a story first broken by The Wall Street Journal, that the White House directed Treasury and the IRS to move on auto-enrollment ahead of the midterm elections. A Treasury spokesperson declined to comment on that characterization, and no Treasury official has publicly confirmed midterm timing as the motivation. The practical political payoff is unclear even by The Washington Sun's own account, since most children aren't eligible for the $1,000 seed money and none of the funds are accessible until a child turns 18.

Senator Ted Cruz (R-Texas), who wrote the underlying legislation, told The Washington Sun the auto-enrollment fix restores what he intended all along. "As the author of the Trump Accounts legislation, I drafted the bill to provide for auto-enrollment, allowing Treasury to enroll all 70 million American children under age 18," Cruz said. "I am glad to see Treasury, under the strong leadership of Secretary Bessent, working to fulfill that promise to American families."

Capacity concerns

Madeline Brown, a senior policy associate at the Urban Institute, told CNBC auto-enrollment "would certainly reach the vast majority of parents and children," but cautioned that building awareness and engagement after enrollment is a separate, unfinished job.

Omeed Firouzi, who directs the low-income taxpayer clinic at Temple University's Beasley School of Law, raised a fair concern: with recent IRS funding and staffing cuts, "I wonder if they have the ability to effectively do this." He noted, though, that having Frank Bisignano lead both the IRS and the Social Security Administration could help the two agencies coordinate on the rollout. The IRS added a new hire dedicated to the program last week, former Bank of New York and Convergex executive Joseph Velli, according to CNBC.

A departure at the top

Luke Pettit, the assistant secretary who architected the Trump Accounts program and has been at Treasury since July 2025, is leaving for the private sector in October, Axios first reported and The Hill confirmed. He'll depart shortly after auto-enrollment begins, handing off day-to-day execution just as the program scales from single-digit millions to tens of millions of accounts.

Bessent has framed the accounts as a financial literacy fix, telling the Financial Literacy and Education Commission in July that "38 percent of households in this country have no exposure to our great equity markets," and that Trump Accounts could create "a new class of shareholders." Whether tens of millions of newly auto-enrolled families actually engage with accounts they never signed up for, especially without the person who designed the program still at Treasury, is the open question nobody can answer yet.