Congressional Democrats still may try to add to tax legislation a controversial plan to require credit unions and banks to report the inflows and outflows from customer accounts to the Internal Revenue Service, House Ways and Means Committee ranking Republican Kevin Brady, R-Texas, warned Tuesday.
The 818-page tax bill being marked up by the Ways and Means Committee as part of the budget reconciliation process this week does not contain that proposal.
“That doesn’t mean it won’t surface,” Brady told those attending the National Association of Federally-Insured Credit Unions’ Congressional Caucus. “We’ve got to make sure it doesn’t surface later. We’ve got a lot of bad ideas to stop.”
The Biden Administration has proposed requiring financial institutions to report data from accounts that have “gross flow thresholds” over $600 as a way of increasing tax compliance. Credit union and bank trade groups are opposed to the plan, contending that it would increase their regulatory costs.
Even if the bill approved by Ways and Means does not contain the provision, Democrats could try to add it as a manager’s amendment when the tax measure goes to the House Rules Committee prior to it going to the House floor. Also, the reporting proposal could be added when the Senate considers its version of the bill.
This week, Brady and Senate Finance Committee ranking Republican Sen. Mike Crapo of Idaho introduced legislation which would, among other things, prohibit the IRS from spending any funds to collect the financial institution data.
“This legislation places important guardrails around IRS funding to protect taxpayers’ rights and privacy,” Crapo said, in announcing the bill.