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Creates a refundable $3,000 payment for each child born, adopted, or placed after the law is enacted and requires Treasury to pay the amount within 30 days of a valid claim. It also renames certain child savings accounts to “American Dream accounts,” makes the initial government seed contribution permanent and inflation‑adjusted, adds new ongoing refundable government contributions into those accounts for qualifying children, and directs Treasury to automatically open and manage accounts for eligible children. The bill limits how the new payments and account balances can be offset by other federal tax debts, adds fraud and misuse disallowance periods, and generally exempts American Dream account funds from most means‑tested federal program asset tests (with a specific rule for SSI). It requires Treasury to issue guidance and set up an automatic enrollment and information‑collection program within one year of enactment.
The bill provides sizable, quick cash support and long-term, auto‑enrolled savings for children—strengthening family finances and child assets—while creating significant ongoing federal costs and raising risks of exclusions, privacy concerns, and benefit losses for some vulnerable households.
Parents of eligible newborns or adoptees receive a refundable $3,000 payment per child paid quickly (within ~30 days), protected from IRS offsets, and indexed for inflation after 2025, providing immediate and sustained cash support.
Every child is automatically enrolled in an American Dream savings account and receives a permanent, inflation‑indexed $1,000 seed deposit plus ongoing refundable contributions ($500 or $750, with up to $250 matched for EITC-eligible households), boosting long-term child savings—especially for low-income families.
Account balances in American Dream accounts are excluded from means-tested federal eligibility calculations until the child turns 18, allowing low-income families to accumulate assets without losing program benefits.
The refundable payments, permanent seed deposits, and indexing will create a substantial, ongoing federal cost that increases fiscal pressure and could require future tax increases, spending cuts, or offsets.
Families can lose access to the credit for extended periods if a taxpayer is found to have committed fraud (up to 10 years) or for reckless/intentional disregard (two years), which could deny timely support to households even for non-criminal errors.
Requiring Social Security numbers or existing taxpayer identification may exclude some newborns, recent immigrants, or families who lack documentation, preventing timely access to payments and accounts.
Introduced February 3, 2026 by Ruben Gallego · Last progress February 3, 2026