Financial transaction

The IRS’s insane $ 600 reporting requirement

By U.S. Representative Blaine Luetkemeyer
R-Missouri

Washington, DC – What if I told you that every time you write a check, swipe your credit card, or deposit money into your bank account, you have to report it to the government?

What if I said you are no longer allowed to buy clothes for your kids, order a meal, or lend money to a loved one without notifying the IRS? If you’re like me, you’d say something like, “This is America. It is not the government’s business. We don’t do that in a free country.

Well, if the president’s $ 4.3 trillion reconciliation package becomes law, that’s exactly what we would be forced to do in this country.

I could write hundreds of articles devoted to the provisions regarding the reconciliation bill, but one of the many problematic provisions is the requirement for banks and credit unions to report to the IRS every transaction of a person who has, or has had, $ 600 in their bank account.

This means that if you have at least $ 600 in your account at any time, your financial transactions will be monitored by the IRS. There are several practical issues with this proposal, such as the IRS’s inability to perform its current duties, but the intention is clear: the administration and Congressional Democrats want the government to monitor, and therefore control, how and when you spend your money.

I’m sure – or at least I hope – that you find it hard to believe it. It’s ridiculous!

But just Thursday, September 30 at a Financial Services Committee hearing, my colleague William Timmons from South Carolina asked Treasury Secretary Janet Yellen if this could be a serious proposition. She replied categorically that this is an absolutely serious proposal. It’s a priority for the president and a priority they are working hard for.

Aside from the biggest problem: the massive invasion of individual liberty and privacy, there are several other reasons why this idea is terrible.

The first is the jurisdiction of the IRS. The IRS has always had efficiency issues, but its shortcomings have never been more evident than during the pandemic. The agency has had a hard time juggling the distribution of stimulus checks while facing tax season, and many families are still waiting for checks and tax returns as a result.

In fact, my office is still getting calls from families waiting for their 2019 tax returns, and countless families haven’t received their stimulus checks. They also had a bad history of data breaches. Now the Biden administration wants them to collect and monitor billions of transactions with a fine tooth comb? They barely have the resources to do their current job – it is absurd to think that they have the means to establish this new surveillance regime.

Another problem is the ability of financial institutions to report so many transactions. They don’t have the technology to track and report thousands, and in some cases millions, of transactions every day. Developing these capabilities would cost millions of dollars. The only way to cover these costs is to increase the prices. Free screening will be threatened, interest rates on loans will rise, and other services will simply disappear. So, for the government’s privilege of monitoring your daily expenses, you will pay additional fees for banking services. It is particularly difficult for low income families.

With the Democrats in charge of the federal government, I certainly don’t expect to like every proposal, and of course, we’ll have different opinions. But this is not about a difference of opinion or political goals. It is an attempt to fundamentally change our country from a country founded on ideas of personal freedom and responsibility to a society entirely dependent and controlled by the government.

This is absolutely unacceptable, and I will do everything in my power to stop it.


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