The IRS Is Terrified Of Biden's Plans

Written By BlabberBuzz | Wednesday, 27 October 2021 09:45 PM
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The IRS Is Terrified Of Biden's Plans

On Monday, a group of 99 banks and industry groups addressed a letter to President Biden prompting him to drop his proposal to hand over transaction data to the IRS, noting they were not satisfied with simply raising the threshold from $600 to $10,000.

The organizations that represented business and financial interests, called for the White House to withdraw support for the measure and find 'more targeted measures' to reduce the tax gap.

The proposal to hand over data on all aggregate inflows and outflows of accounts with more than $600 in total transactions, drew sharp outcry from Republicans and banks alike, provoking Democrats to raise the amount to $10,000. However, the letter asserted that raising that cap amounted only to 'cosmetic' changes.

The banking groups commended the administration's 'good-faith attempt' to make sure all Americans pay the taxes they owe, but wrote: 'our members, and the American people, believe that they have a reasonable right to privacy and this overly broad proposal to report gross annual inflows and outflows from nearly every account is disconnected from its purported narrow purpose of focusing government scrutiny on Americans with actual income above $400,000.'

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'The privacy concerns for Americans who pay their taxes and would be swept into this account reporting program are real and should not be taken lightly,' the letter proceeded to say.

Various groups signed the letter, ranging from the American Bankers Association, the American Farm Bureau Federation, and the Chamber of Commerce to the Asian American Hotel Owners Association, the National RV Dealers Association, the National Grocers Association, and the North American Die Casting Association.

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Under the revised policy, accounts with $10,000 or above in total deposits and withdrawals, excluding wage income, would be subject to greater scrutiny. Banks would have to send over their aggregate inflow and outflow to the IRS to help the agency target its audits.

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The inflow would not take into account salary or wage income, which is already under the purview of the IRS under W-2 forms. It would also leave out income in the form of Social Security checks.

'At its core, this program that has not had a significant study or detailed examination to show consumer impact, will collect financial “metadata” on nearly every American in the hope that the IRS will be able to discern patterns in aggregate numbers that do not correspond to tax liabilities and target audits only to those who are breaking the law,' the letter reads. 'This is a substantial expansion of the IRS’s authority that, once established, is sure to expand rather than roll back.'

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The narrowing in scope came after Republicans and banks put up fierce outcries over what they view as an invasion of privacy. Yet, such groups are not even satisfied with the revision.

'If they raise it to 10,000, it will still capture everybody, and every small business,' Sen. Pat Toomey, R-Pa., said in a press conference on Tuesday. 'The average American runs over $61,000 through their account,' argued Sen. Mike Crapo, R-Idaho.

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