Proposed Requirement for Credit Unions & Banks to Report your Account Activity to the IRS

As Congress considers critical new infrastructure spending, policymakers are eying unconventional sources of revenue to fund their plans.

One proposal under consideration would require credit unions and other financial institutions to report to the Internal Revenue Service (IRS) how much money has gone into and out of many consumer accounts.  The stated goal is to allow the IRS to detect unreported taxable income.  The amount to trigger reporting varies with one proposal as low as $600 per year.  This is not just cash, but includes direct deposit, checks and cash!

This unprecedented access to consumers’ personal financial data raises several alarms.

  • This proposal would violate consumers’ personal privacy by forcing credit unions and banks to provide the government with information that does not reflect taxable activity.
  • The government relies on decades old data systems to store and secure IRS information. These systems have already been compromised in recent years, and the addition of this type of data only increases the likelihood of a future breach.
  • Financial institutions—particularly those in rural and low-income communities—would face unnecessary and expensive regulatory hurdles that could make it untenable to serve those consumers already left behind by Wall Street banks.  
  • The Speaker of the House said Tuesday that language expanding financial institution reporting requirements to the Internal Revenue Service (IRS) would be included when the House takes up its 2022 Budget Reconciliation bill.

The Bottom Line:

Don’t jeopardize consumers’ personal financial privacy by allowing the IRS to access nontaxable deposit account information from credit unions and banks. 

See contact information for Montana’s congressional delegation below.

 

U. S. SENATOR U. S. SENATOR
STEVE DAINES
REPUBLICAN

Washington, DC Office
320 Hart Senate Office Building
Washington, DC 20510-2604
202-224-2651
FAX: 202-224-9412
daines.senate.gov

JON TESTER
DEMOCRAT

Washington, DC Office
311 Hart Senate Office Building
Washington, DC 20510-2604
202-224-2644
FAX: 202-224-8594
tester.senate.gov

 

U. S. REPRESENTATIVE
 
MATT ROSENDALE
REPUBLICAN

Washington, DC Office
1037 Longworth House Office Building
Washington, DC 20515
202-225-3211
rosendale.house.gov