Lawmakers introduce NAFCU-supported bill prohibiting IRS overreach
Legislation to protect consumers and their financial institutions from IRS overreach and a burdensome reporting regime has been introduced in both the Senate and House. Sens. Tim Scott, R-S.C., and Mike Crapo, R-Idaho, and Rep. Drew Ferguson, R-Ga., introduced the bills, respectively.
“NAFCU thanks Senators Scott and Crapo and Representative Ferguson for reintroducing important legislation to protect consumers from invasive IRS surveillance of their financial data that could compromise their privacy," said NAFCU Senior Vice President of Government Affairs Greg Mesack. “The Prohibiting IRS Financial Surveillance Act has broad support as Americans have made it clear the government should not be tracking their daily finances. We look forward to working with lawmakers to get this legislation enacted this Congress.”
The Biden Administration sought to require financial institutions to report to the IRS every withdrawal and deposit that total at least $10,000. During the last congressional session, NAFCU’s advocacy team successfully fought against a provision that would have required new account information reporting by financial institutions to the IRS even as the agency was provided with additional enforcement funding.
The Prohibiting IRS Financial Surveillance Act would prohibit any future attempts to establish this reporting regime.
NAFCU advocated against the increased IRS reporting requirements as it would increase burdens on credit unions and smaller financial institutions. In addition, the association raised privacy concerns and cautioned that it could lessen the trust consumers have towards financial institutions, perhaps even deterring financially-vulnerable consumers from having their financial services needs met by credit unions.
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