NAIFA President Christopher Gandy along with NAIFA’s Government Relations team met with Department of the Treasury staff on February 24 to discuss the implementation and rollout of “Trump Accounts,” the newly established tax-deferred investment accounts for children under age 18 created by legislation passed last year.

Gandy provided Treasury with an overview of NAIFA and the clients served by its members. The group then discussed NAIFA’s comment letter submitted to Treasury regarding implementation of the Trump Accounts and the role of financial advisors. Gandy offered an overview of his clients and how financial advisors can help manage and grow these accounts.

Treasury is also interested in NAIFA’s support during the rollout of these accounts and noted that proposed regulations for the accounts are forthcoming.

Key Points from Treasury

• Implementation
  • Treasury staff emphasized that the rollout and success of the Trump Accounts is a high priority for the administration. Their goal is to enroll as many eligible children as possible — potentially nearly 70 million.
  • Treasury has sought to make opening the accounts simple, including introducing a one-page Form 4547 to elect to open an account and receive the initial $1,000 pilot program contribution. Treasury estimates that more than 1 million children have already enrolled.
• Role of Financial Advisors
  • Gandy explained how financial advisors can advise on Trump Accounts, illustrating the long-term value when annual contributions are made.
  • Gandy also referenced the history of 529 accounts, noting that uptake increased when awareness grew and when accounts were modified to allow tax-free withdrawals for qualified expenses. He suggested that the Trump Accounts could follow a similar trajectory.
  •  NAIFA described our upcoming financial literacy events with Members of Congress. 

• Employers and Trump Accounts
  • Treasury staff reported that many large employers have committed to funding Trump Accounts as an employee benefit they intend to promote.
  • NAIFA noted that our members advise many small businesses and could help disseminate information about Trump Accounts during rollout. Gandy added that as clients become aware of this benefit, they may begin asking employers to offer it.