Bill · S. 1718· Senate(119-S-1718)
Invest America Act
- Introduced
- 5/12/2025
- Last activity
- 5/12/2025 — Read twice and referred to the Committee on Finance.
- Sponsored by
- Ted Cruz
- Cosponsors
- None
- Introduced
- In Committee
What this bill would do
The Invest America Act proposes to amend the Internal Revenue Code to establish "invest America accounts." These accounts are trusts created for the exclusive benefit of an individual, with assets invested in specific mutual funds or exchange traded funds tracking the S&P 500. The bill allows for annual contributions up to $5,000, which are adjusted for cost-of-living. Furthermore, the government will provide an initial $1,000 federal contribution to eligible individuals born after July 4, 2026. These accounts are intended to be tax-exempt, though distributions are included in gross income.
Yes· 3 of 8
Would children be better off under this?+7
The bill provides an initial $1,000 federal contribution and a vehicle for long-term savings for those born after July 4, 2026.
Would people in their twenties and thirties be better off under this?+5
Young adults can benefit from the growth of these tax-exempt accounts once they reach adulthood.
Would households on low incomes be better off under this?+5
The initial $1,000 grant and annual contribution limits provide a significant wealth-building tool for those starting with nothing.
The opposite
Does this reduce what the federal government spends?-2
The bill requires a federal appropriation for the initial $1,000 contribution to eligible individuals.
Who it would affect, and how
Potential Positive Impacts for People
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Initial Federal Funding: The Secretary of the Treasury will pay $1,000 into the account of an eligible individual as soon as practical after they are certified (Section 3(a)). This applies to U.S. citizens born after July 4, 2026, who have at least one U.S. citizen parent (Section 3(b)).
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Tax Advantages: The accounts are exempt from taxation under the subtitle, and distributions are taxed at the same rate as net capital gains (Section 2(a), Section 2(b)).
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Annual Contribution Growth: The $5,000 annual contribution limit is subject to a cost-of-living adjustment starting after 2026 (Section 2(c)(2)).
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Automated Account Setup: To ensure children receive their benefits, the Secretary shall automatically establish an account if an eligible individual does not have one (Section 3(d)(1)).
Potential Negative Impacts for People
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Distribution Restrictions: No distributions are allowed from the account before the beneficiary reaches the age of 18, unless it is a qualified rollover distribution (Section 2(b)(1)(B)).
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Contribution Limits and Penalties: Contributions are limited to $5,000 per taxable year (excluding qualified rollovers), and there are taxes imposed on excess contributions (Section 2(c)(1), Section 2(c)).
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Investment Restrictions: Funds can only be invested in eligible investments, specifically mutual funds or exchange traded funds that track the returns of the Standard and Poor's 500 stock market index (Section 2(b)(2)).
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Taxation on Distributions: Any distribution from an invest America account must be included in the gross income of the person receiving it (Section 2(d)(1)).
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Demographic And Interest Groups
- Good For Children+7Good For Low Income Households+5Good For Young Adults+5Good For Middle Class Households+4Good For Seniors+2
- Economy And Finance
- Reduces Capital Gains Tax+5Improves Economic Growth+3Reduces Government Spending-2
- Social Issues And Justice
- Improves Poverty Reduction+4
- 5/12/2025
- Read twice and referred to the Committee on Finance.
- Introduced in Senate