The IRS should allow all banks to serve as trustees of initial Trump accounts for children rather than just rollover Trump accounts, the American Bankers Association said today in a letter to the agency.
The tax package passed by Congress last year created a new form of individual retirement account for children under 18, with children born from 2025 to 2028 eligible for a $1,000 pilot contribution from the government. The IRS recently proposed a rule to allow the contribution to be made to either an initial Trump account or a rollover Trump account.
Under the Treasury Department’s current arrangement, most banks can only serve as trustees for rollover Trump accounts, ABA said. Banks should be afforded the opportunities to serve as trusted financial advisers to current and future clients through the opening of initial Trump accounts.
“We believe that providing all banks of all sizes with the authority to open initial Trump accounts may increase participation in the program nationally,” ABA said.
ABA also asked the IRS to consider several issues raised by its members, such as broadening the definition of eligible investments under Trump accounts and clarifying the different types of contributions that can be made to the accounts. It also urged the Treasury Department and IRS to issue comprehensive proposed rulemaking and/or guidance on the remaining aspects of Trump accounts as soon as possible.
