All 50 Senate Democrats support President Biden’s plan to monitor bank accounts, Venmo accounts, and other financial accounts with a value exceeding $600. Yesterday, they voted against Senate Finance Committee Ranking Member Mike Crapo’s (R-Idaho) S. Amdt #3099 to S.Con Res. 14, which would have prohibited the IRS from implementing President Biden’s proposal to create a new financial account reporting regime which would force the disclosure of any business or personal account that exceeds $600.
Not only does this reporting requirement include the inflows and outflows of bank, loan, and investment accounts of virtually every individual and business, but it also includes third-party providers like Venmo, CashApp, and PayPal.
President Biden wants to give the IRS $80 billion in new funding. This funding would add 87,000 new IRS agents that Biden claims will squeeze taxpayers for an additional $787 billion. It will allow the agency to audit and harass more taxpayers. A major way the agency will do this is through this new $600 reporting regime.
Under the Bank Secrecy Act, financial institutions are currently required to report transactions exceeding $10,000 or multiple transactions in aggregate of $10,000 in a single day. Already, the IRS abuses this reporting requirement. The IRS Criminal Investigation Division (IRS-CI) regularly violated taxpayers’ rights and skirted or ignored due process requirements when investigating taxpayers for allegedly violating the $10,000 currency transaction reporting requirements, according to a 2017 report by the Treasury Inspector General for Tax Administration (TIGTA). In addition, less than one in ten investigations uncovered violations of tax law.
Given that these investigations were conducted due to possible violations of the $10,000 currency transaction threshold, the Biden proposal to create an entirely new reporting regime for financial accounts that exceed $600 should be alarming to taxpayers. If this proposal is implemented, it is inevitable that we will see new cases of the IRS targeting and harassing taxpayers.
Further, the IRS cannot be trusted with such sensitive information. The agency, for decades, has had serious security vulnerabilities, its employees leak sensitive taxpayer information to the public out of political malice, and it has repeatedly discriminated against organizations and taxpayers for political involvement.
In fact, the American public already thinks the IRS is too powerful. A June 19 – 22 Fox News National Survey of 1,001 registered voters asked if the IRS has “too much power.” 65 percent said yes, 31 percent said no.
The IRS has a record of mismanagement and corruption. It has routinely failed to protect taxpayer data. Rather than being given new responsibilities the IRS needs reform so that it can better assist taxpayers. By rejecting Sen. Crapo’s amendment, Senate Democrats have made every taxpayer more vulnerable to IRS targeting, harassment, and violations of privacy.