Increasing Internal Revenue Service (IRS) reporting requirements would not increase financial inclusion and fairness, CUNA wrote with other co-ops to President Joe Biden and leaders in Congress and the ‘administration. The increase in reporting was discussed under reconciliation legislation, but was removed from the text released last week after nearly 800,000 credit union stakeholders wrote to Capitol Hill to share their concerns. concerns.
“We share the administration’s goal of building a more inclusive and equitable financial system, but we do not believe the proposed new IRS reporting requirements will meet our common goal,” the letter said. “Fundamentally, we are concerned about the proposed radical change in approach, focusing on aggregate account flows. This approach fails to adequately reach the people who cheat our country’s tax laws and instead places an undue burden on average consumers and their financial institution.
The letter notes that co-ops – and credit unions in particular – would be subject to additional administrative requirements that would create compliance burdens and confusion for consumers.
“Finally, we are deeply concerned about the potential negative consequences for the privacy of this report proposal on cooperative members. In addition to institutional concerns about the IRS’s history of vulnerabilities to data breaches, there are major privacy concerns, ”the letter said. “Our diverse membership includes many consumers who may or may not otherwise be underbanked, and we are concerned that this proposal will not only have a negative impact on confidence in finance.”