What This Bill Does
This bill creates the American Opportunity Fund, a government account that would give money to children born after December 31, 2023. Each eligible child would receive an initial $1,000 contribution and then yearly contributions based on their family's income level. These accounts would be invested and grow over time until the child turns 18 or older.
##
Who It Affects
* Children born after December 31, 2023 who have a Social Security number
* Families with children under age 18
* The Secretary of the Treasury
* The Executive Director of the American Opportunity Fund Board
* Financial institutions managing the accounts
* Congress (receives annual reports)
##
Key Provisions
* The federal government will transfer $1,000 to each eligible child's account when the child is born (Sec. 3(d)(1))
* Families receive additional yearly contributions ranging from $0 to $2,000 per year, depending on household income as a percentage of the poverty line (Sec. 3(d)(2))
* No money can be withdrawn from the account until the account holder turns 18, except for education expenses at colleges or career and technical schools (Sec. 4(c)(1) and (c)(1)(B))
* Account balances will not count against a person when they apply for federal benefits like student financial aid (Sec. 9)
* An American Opportunity Fund Board will oversee the accounts and invest money in U.S. Treasury securities (Sec. 3(c) and Sec. 6(a))
##
What Changes
If this bill passes, the government would create a new savings program for children. Every child born after December 31, 2023 would automatically receive money in an account held in their name. The amount each family receives each year would decrease as household income increases. These accounts cannot be used for spending money until the child is older, but can be used for education or home ownership. The accounts would not reduce eligibility for other government help programs.
##
Important Definitions
* **AO Account:** An American Opportunity account established for each eligible child to hold the money contributed by the government (Sec. 2(2))
* **Eligible Individual:** Any person born after December 31, 2007 who is under 18 years old and has a valid federal identification number recognized by the Internal Revenue Service (Sec. 4(b)(1))
* **Qualified Expense:** Money spent on higher education, home ownership, expenses after age 59½, or other investments in financial assets or personal capital that provide long-term gains, as determined by the Secretary (Sec. 4(c)(2)(B))
* **Poverty Line:** The same measure used for tax purposes under the Internal Revenue Code (Sec. 3(d)(2)(C)(iii))
##
Effective Date
The tax treatment provisions apply to taxable years beginning after December 31, 2023 (Sec. 12(d)). The bill specifies that the initial contributions apply to individuals born after December 31, 2023 (Sec. 3(d)(1)).
II
118TH CONGRESS
1ST SESSION
S. 441
To establish American opportunity accounts, and for other purposes.
IN THE SENATE OF THE UNITED STATES
FEBRUARY 15, 2023
Mr. BOOKER (for himself, Mr. DURBIN, Mr. MARKEY, Mr. MERKLEY, Ms.
WARREN, Mr. SANDERS, Mr. BROWN, Mr. BLUMENTHAL, Mr. VAN HOL-
LEN, Mr. SCHATZ, Mr. WHITEHOUSE, Mr. SCHUMER, Ms. BALDWIN, Ms.
KLOBUCHAR, Mrs. GILLIBRAND, and Mr. HEINRICH) introduced the fol-
lowing bill; which was read twice and referred to the Committee on Fi-
nance
A BILL
To establish American opportunity accounts, and for other
purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
3
(a) SHORT TITLE.—This Act may be cited as the
4
‘‘American Opportunity Accounts Act’’.
5
(b) TABLE OF CONTENTS.—The table of contents for
6
this Act is as follows:
7
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. American Opportunity Fund.
Sec. 4. AO accounts.
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6211
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
2
•S 441 IS
Sec. 5. Assignment, alienation, and treatment of deceased individuals.
Sec. 6. Rules governing AO accounts relating to investment, accounting, and
reporting.
Sec. 7. American Opportunity Fund Board.
Sec. 8. Fiduciary responsibilities.
Sec. 9. Accounts disregarded in determining eligibility for Federal benefits.
Sec. 10. Reports.
Sec. 11. Programs for promoting financial capability.
Sec. 12. Tax treatment.
SEC. 2. DEFINITIONS.
1
For purposes of this title—
2
(1) AMERICAN OPPORTUNITY FUND.—The term
3
‘‘American Opportunity Fund’’ means the fund es-
4
tablished under section 3.
5
(2) AO ACCOUNT.—The term ‘‘AO account’’
6
means an American opportunity account established
7
under section 4.
8
(3) SECRETARY.—The term ‘‘Secretary’’ means
9
the Secretary of the Treasury or the Secretary’s del-
10
egate.
11
(4) AMERICAN OPPORTUNITY FUND BOARD.—
12
The term ‘‘American Opportunity Fund Board’’
13
means the board established pursuant to section 7.
14
(5) EXECUTIVE DIRECTOR.—The term ‘‘Execu-
15
tive Director’’ means the executive director ap-
16
pointed pursuant to section 7.
17
SEC. 3. AMERICAN OPPORTUNITY FUND.
18
(a) ESTABLISHMENT.—There is established in the
19
Treasury of the United States a fund to be known as the
20
‘‘American Opportunity Fund’’.
21
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
3
•S 441 IS
(b) AMOUNTS HELD BY FUND.—The American Op-
1
portunity Fund consists of the sum of all amounts paid
2
into the Fund under this title, increased by the total net
3
earnings from investments of sums held in the Fund or
4
reduced by the total net losses from investments of sums
5
held in the Fund, and reduced by the total amount of pay-
6
ments made from the Fund (including payments for ad-
7
ministrative expenses).
8
(c) USE OF FUND.—
9
(1) IN GENERAL.—The sums in the American
10
Opportunity Fund are appropriated and shall re-
11
main available without fiscal year limitation—
12
(A) to make contributions to AO accounts;
13
(B) to invest under section 6;
14
(C) to make distributions in accordance
15
with this title;
16
(D) to pay the administrative expenses of
17
carrying out this title; and
18
(E) to purchase insurance as provided in
19
section 8(c)(2).
20
(2) EXCLUSIVE PURPOSES.—The sums in the
21
American Opportunity Fund shall not be appro-
22
priated for any purpose other than the purposes
23
specified in this section and may not be used for any
24
other purpose.
25
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
4
•S 441 IS
(d)
TRANSFERS
TO
AMERICAN
OPPORTUNITY
1
FUND.—The Secretary shall make transfers from the gen-
2
eral fund of the Treasury to the American Opportunity
3
Fund as follows:
4
(1) INITIAL CONTRIBUTION FOR ELIGIBLE INDI-
5
VIDUALS BORN AFTER DECEMBER 31, 2023.—Upon
6
receipt of a certification under section 4(b)(2) with
7
respect to an individual born after December 31,
8
2023, the Secretary shall transfer $1,000 to the AO
9
account of the individual.
10
(2) ANNUAL CONTRIBUTIONS.—
11
(A) IN GENERAL.—Each year which occurs
12
after the year in which an AO account is estab-
13
lished for an eligible individual and before the
14
year the eligible individual attains the age of
15
18, the Secretary shall transfer the annual con-
16
tribution amount to the AO account of the indi-
17
vidual.
18
(B) ANNUAL
CONTRIBUTION
AMOUNT.—
19
The annual contribution amount shall be the
20
amount such that the annual contribution
21
amount for any taxpayer whose household in-
22
come is within an income tier specified in the
23
following table shall decrease, on a sliding scale
24
in a linear manner, from the initial amount to
25
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
5
•S 441 IS
the final amount specified in such table for
1
such income tier:
2
In the case of household income
(expressed as a percent of the poverty line)
within the following income tier:
The initial
amount is—
The final
amount is—
Up to 100 percent ..................................................
$2,000
$2,000
100 percent up to 125 percent ...............................
2,000
1,500
125 percent up to 175 percent ...............................
1,500
1,000
175 percent up to 225 percent ...............................
1,000
500
225 percent up to 325 percent ...............................
500
250
325 percent up to 500 percent ...............................
250
0
500 percent or more ...............................................
0
0.
(C) APPLICABLE
HOUSEHOLD
INCOME;
3
POVERTY
LINE.—For purposes of this para-
4
graph—
5
(i)
APPLICABLE
HOUSEHOLD
IN-
6
COME.—The term ‘‘applicable household
7
income’’ means household income (as de-
8
fined in section 36B(d) of the Internal
9
Revenue Code of 1986), except that—
10
(I) with respect to any calendar
11
year, the Secretary shall use the in-
12
come of the second calendar year pre-
13
ceding the calendar year for which the
14
contribution relates; and
15
(II) in determining household in-
16
come the Secretary shall aggregate
17
the income of married individuals fil-
18
ing separate tax returns.
19
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
6
•S 441 IS
(ii) SPECIAL RULE FOR INDIVIDUALS
1
NOT FILING RETURNS.—
2
(I) IN GENERAL.—In the case of
3
any taxpayer who was not required to
4
file a return of tax for the tax im-
5
posed by section 1 for the taxable
6
year described in clause (i)(I) or for
7
whom the information described in
8
clause (i) is not available for such
9
year, such taxpayer shall be treated as
10
a taxpayer with a household income
11
which is less than 100 percent of the
12
poverty line.
13
(II) USE OF OTHER DATA.—Sub-
14
clause (I) shall not apply if the Sec-
15
retary determines, based on such
16
other information from any agency of
17
the United States as the Secretary de-
18
termines is reliable, that the tax-
19
payer’s household income for such
20
year is 100 percent of the poverty line
21
or greater.
22
(iii) POVERTY LINE.—The term ‘‘pov-
23
erty line’’ has the meaning given such term
24
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
7
•S 441 IS
under section 36B(d) of the Internal Rev-
1
enue Code of 1986.
2
(D) AUTHORITY TO PROVIDE TAX INFOR-
3
MATION.—
4
(i) IN GENERAL.—Section 6103(l) of
5
the Internal Revenue Code of 1986 is
6
amended by adding at the end the fol-
7
lowing new paragraph:
8
‘‘(23) DISCLOSURE OF RETURN INFORMATION
9
TO
CARRY
OUT
ELIGIBILITY
REQUIREMENTS
FOR
10
CERTAIN PROGRAMS.—
11
‘‘(A) IN
GENERAL.—The Secretary shall
12
disclose to officers and employees of the De-
13
partment of the Treasury or the American Op-
14
portunity Fund Board return information of
15
any taxpayer whose income is relevant in deter-
16
mining any annual contribution to an American
17
Opportunity Account under section 3 of the
18
American Opportunity Accounts Act. Such re-
19
turn information shall be limited to—
20
‘‘(i) taxpayer identity information
21
with respect to such taxpayer,
22
‘‘(ii) the filing status of such tax-
23
payer,
24
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
8
•S 441 IS
‘‘(iii) the number of individuals for
1
whom a deduction is allowed under section
2
151 with respect to the taxpayer (including
3
the taxpayer and the taxpayer’s spouse),
4
‘‘(iv) the modified adjusted gross in-
5
come (as defined in section 36B) of such
6
taxpayer, of any spouse of such taxpayer
7
who filed a separate return, and of each of
8
the other individuals included under clause
9
(iii) who are required to file a return of tax
10
imposed by chapter 1 for the taxable year,
11
‘‘(v) such other information as is pre-
12
scribed by the Secretary by regulation as
13
might indicate whether the taxpayer is eli-
14
gible for such an annual contribution (and
15
the amount thereof), and
16
‘‘(vi) the taxable year with respect to
17
which the preceding information relates or,
18
if applicable, the fact that such informa-
19
tion is not available.
20
‘‘(B) RESTRICTION ON USE OF DISCLOSED
21
INFORMATION.—Return information disclosed
22
under subparagraph (A) may be used by offi-
23
cers and employees of the Department of the
24
Treasury or the American Opportunity Fund
25
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
9
•S 441 IS
Board for the purposes of, and to the extent
1
necessary in establishing eligibility for, and
2
verifying the appropriate amount of, any annual
3
contribution described in subparagraph (A).’’.
4
(ii)
PROCEDURES
AND
RECORD-
5
KEEPING
RELATED
TO
DISCLOSURES.—
6
Paragraph (4) of section 6103(p) of such
7
Code is amended by striking ‘‘or (22)’’
8
each place it appears and inserting ‘‘(22),
9
or (23)’’.
10
(E) STUDY ON INCORPORATION OF OTHER
11
WEALTH
FACTORS.—Not later than 2 years
12
after the date of the enactment of this Act, the
13
Comptroller General shall submit to Congress
14
and the Secretary of the Treasury a report on
15
the feasibility and distributive impacts of a new
16
measure for determining the amount of the an-
17
nual contribution amount under this paragraph
18
based on family wealth, total assets, and overall
19
net worth. Such measure may—
20
(i) include financial assets, the value
21
of family home, retirement accounts, busi-
22
ness and entrepreneurial ventures, poten-
23
tial future inheritances, and any other as-
24
sets or debts; and
25
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
10
•S 441 IS
(ii) continue to factor in current or
1
past income to the extent such information
2
is useful in estimating overall household
3
wealth.
4
(3) ADJUSTMENT FOR INFLATION.—
5
(A) IN GENERAL.—For each calendar year
6
beginning after 2024, each of the dollar
7
amounts under paragraphs (1) and (2)(B)(i)
8
shall be increased by such dollar amount multi-
9
plied by the cost-of-living adjustment deter-
10
mined under section 1(f)(3) of the Internal
11
Revenue Code of 1986 determined by sub-
12
stituting ‘‘calendar year 2023’’ for ‘‘calendar
13
year 2016’’ in subparagraph (A)(ii) thereof.
14
(B) ROUNDING.—If any amount adjusted
15
under paragraph (1) is not a multiple of $50,
16
such amount shall be rounded to the next low-
17
est multiple of $50.
18
(e) PROHIBITION ON USE OF PAYROLL TAXES TO
19
FUND AO ACCOUNTS.—The American Opportunity Fund
20
and AO accounts are wholly separate and unique from the
21
Social Security system. No amount from any tax on em-
22
ployment may be contributed to the American Opportunity
23
Fund or AO accounts.
24
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
11
•S 441 IS
SEC. 4. AO ACCOUNTS.
1
(a) IN GENERAL.—
2
(1) ESTABLISHMENT.—The Executive Director
3
shall establish in the American Opportunity Fund an
4
account (to be known as an ‘‘American Opportunity
5
account’’ or an ‘‘AO account’’) for each eligible indi-
6
vidual certified under subsection (b). Each such ac-
7
count shall be identified to its account holder by
8
means of a unique personal identifier currently rec-
9
ognized by the Internal Revenue Service and shall
10
remain in the American Opportunity Fund.
11
(2) ACCOUNT BALANCE.—The balance in an ac-
12
count holder’s AO account at any time is the excess
13
of—
14
(A) the sum of—
15
(i) all deposits made into the Amer-
16
ican Opportunity Fund and credited to the
17
account under paragraph (3); and
18
(ii) the total amount of allocations
19
made to and reductions made in the ac-
20
count pursuant to paragraph (4); over
21
(B) the amounts paid out of the account
22
with respect to such individual under subsection
23
(c).
24
(3) CREDITING OF CONTRIBUTIONS.—Pursuant
25
to regulations which shall be prescribed by the Exec-
26
VerDate Sep 11 2014
03:02 Mar 03, 2023
Jkt 039200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\S441.IS
S441
kjohnson on DSK79L0C42PROD with BILLS
12
•S 441 IS
utive Director, the Executive Director shall credit to
1
each AO account the amounts paid into the Amer-
2
ican Opportunity Fund under section 3(d) which are
3
attributable to the account holder of such account.
4
(4) ALLOCATION OF EARNINGS AND LOSSES.—
5
The Executive Director shall allocate to each AO ac-
6
count an amount equal to the net earnings and net
7
losses from each investment of sums in the Amer-
8
ican Opportunity Fund which are attributable, on a
9
pro rata basis, to sums credited to such account, re-
10
duced by an appropriate share of the administrative
11
expenses paid out of the net earnings, as determined
12
by the Executive Director.
13
(b) ELIGIBLE INDIVIDUAL.—For purposes of this
14
title—
15
(1) IN
GENERAL.—The term ‘‘eligible indi-
16
vidual’’ means any individual who—
17
(A) was born after December 31, 2007;
18
(B) has not yet attained the age of 18
19
years; and
20
(C) has a valid, unique, Federal Govern-
21
ment issued identification number recognized by
22
the Internal Revenue Service.
23
(2) CERTIFICATION OF ACCOUNT HO
[Text truncated for display. Full text available on Congress.gov.]