Earlier this month, President Joe Biden received major backlash when he proposed fighting tax fraud by allowing the Internal Revenue Service to access customer accounts with total annual deposits or withdrawals of more than $600.
The effort was part of Biden’s massive $3.5-trillion Build Back Better infrastructure bill.
Republican lawmakers and banking industry representatives are among those who went nuts, saying the tax enforcement plan, if implemented, would represent an invasion of privacy by the federal government.
Now the White House has backed off, saying it has changed the number from $600 to $10,000. Banks will still be required to provide information to help the IRS find tax cheats more easily, but the target has changed.
Democrats want banks, other financial institutions, and peer-to-peer services such as Venmo to report annual totals of account inflows and outflows to the Internal Revenue Service, The Wall Street Journal reported.
Biden and Senate Democrats propose raising the threshold to accounts with more than $10,000 in annual transactions. Also, income from paychecks where federal taxes are automatically deducted will not be subject to the reporting. Recipients of federal benefits such as unemployment and Social Security would also be exempt, ABC News reported.
The IRS would collect the total sum of deposits and withdrawals from bank accounts with more than $10,000 in non-payroll income. Data on individual transactions would not be collected.
“In response to considerations about scope, it (Congress) has crafted a new approach to include an exemption for wage and salary earners and federal program beneficiaries. Under this revised approach, such earners can be completely carved out of the reporting structure. This is a well-reasoned modification: for American workers and retirees, the IRS already has information on wage and salary income and the federal benefits they receive,” a Treasury Department fact sheet on the changes said.
Listen to GHOGH with Jamarlin Martin | Episode 74: Jamarlin Martin Jamarlin returns for a new season of the GHOGH podcast to discuss Bitcoin, bubbles, and Biden. He talks about the risk factors for Bitcoin as an investment asset including origin risk, speculative market structure, regulatory, and environment. Are broader financial markets in a massive speculative bubble?
The proposal still has to be enacted, and there is still major criticism from Republicans in the Senate.
“So how long is it gonna take for them to say, ‘Well, you know we need a little bit more information because we really can’t make much of this.’ Then they’re going to want individual transactions and who knows what,” Sen. John Thune, R-S.D., told reporters.
Stay up to date with all the latest news that affects you in politics, finance and more.
Jan 14 2022
Jan 07 2022
Jan 14 2022
Jan 10 2022
Jan 07 2022
Jan 03 2022