Government Connection

Democrats Overhaul IRS Bank Reporting Plan

Democratic lawmakers and the Biden administration on Tuesday, October 19, 2021, unveiled an updated plan to require banks to report account information to the IRS. The proposal includes a $10,000 annual threshold for accounts—up from $600 in the initial White House plan—and new exclusions for wage deposits and federal payment programs. The idea is one of several strategies the White House is pushing to help the IRS crack down on tax evasion. The changes are an attempt to narrow the bank reporting plan in the face of criticism from Republicans and the banking industry, who have argued that the requirements are overly burdensome and would hit too many accounts. The goal is to include the reporting requirements in the budget reconciliation package that Democrats are negotiating. Treasury said Tuesday that banks would only have to provide two new data points on an existing form used to report interest and other account data to the IRS. The proposal would require the sum of all deposits and total value of withdrawals from accounts to the form. GOP lawmakers raised a host of concerns with the bank reporting proposal, including concerns about the Internal Revenue Service’s ability to protect taxpayer information. On October 14, 2021, GCCA joined 100 other trade association in sending a letter to congressional leaders opposing this new tax information reporting proposal.

Read the letter HERE.

October 21, 2021

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