WASHINGTON (Sept. 7, 2021)—The R Street Institute urges all U.S. representatives to reject a recent proposal in the 2022 budget reconciliation package that would impose new Internal Revenue Service (IRS) reporting requirements on customer bank accounts.
Financial institutions like banks and credit unions already provide a significant amount of tax information to the IRS. However, the new provisions would require them to report additional private data, including the deposits and withdrawals of all business and personal accounts with a balance of $600. Not only does this reporting place an undue burden on financial institutions, it also infringes on members’ personal privacy.
Jerry Theodorou, Director of Finance, Insurance and Trade Policy at the R Street Institute, said: “The proposed enhanced reporting rule constitutes attempted regulatory overreach that would impose disproportionately higher compliance-related costs on smaller financial institutions, including credit unions, as well as expose individuals to data breaches.”
New reporting requirements are both unnecessary and potentially harmful to customers. We urge all members to reject their inclusion in the reconciliation package.