Bankers Sound Alarm Over IRS Provisions in Reconciliation Bill
AUSTIN, September 10, 2021 – Bank Association Considers Legal Challenge if Bank Surveillance Program Included
The Texas Bankers Association (TBA) is warning small businesses and taxpayers about a Congressional proposal that would allow the IRS to collect data on all financial transactions of $600 or more. TBA is calling on Congress to withdraw language in the massive budget Reconciliation bill that would force banks to become reporting agents for the IRS.
“Texas banks value the privacy of customers and we strongly oppose this over-reach that will give the IRS unprecedented surveillance of the financial activity of citizens and small businesses,” said TBA President & CEO Chris Furlow. “If approved, individuals and small businesses will be caught in this IRS dragnet which, without probable cause, raises major Fourth Amendment concerns.”
The U.S. House Ways & Means Committee is following the budget Reconciliation process that includes S. Con Res. 14, which claims that reporting on large financial account balances will “ensure those evading the tax system pay what they owe.” However, the low dollar amount runs counter to the Biden Administration’s claim to just go after the largest tax offenders by looping in individuals and small businesses that often do not have the means to challenge IRS interpretations. This means that most mortgage payments, credit card transactions, and small business vendor payments of $600 or more would be captured, and vulnerable to hacking.
“It is a classic Washington political move to sneak such a proposal into a massive spending bill. If Congress passes the Reconciliation bill with these provisions included, we are considering taking this fight to the courts if necessary,” Furlow said. “In the meantime, we continue to urge our members, individual Texans and small business customers to contact their Members of Congress immediately to have this language stripped from the final bill.”
Founded in 1885, the Texas Bankers Association (TBA) is the oldest and largest state banking association in the United States. TBA advocates for its more than 400 member banks in Austin and Washington; trains more than 10,000 community bankers annually; provides nationally-recognized banking products and services; and proudly invests in Texas communities through financial literacy, scholarship and charitable activities.