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NAFCU’s latest round of advocacy and grassroots efforts against the proposed IRS reporting requirement is continuing this week as the Build Back Better Act makes its way through Congress. 

Senator Tommy Tuberville, R-Ala., is the latest to join efforts to block the IRS proposal. Tuberville Monday introduced the Protecting Financial Privacy Act, legislation that would prohibit the IRS or any other agency from requiring financial institutions to report on transaction data and account balances.

The NAFCU-backed bill would ensure that consumers are protected from identity theft, fraud, and cyber leaks that could result from the acquisition of personal financial data by the IRS. “The American people don't need the IRS in their business any more than what they are,” stated Tuberville.

Of note, other lawmakers, including Sens. John Thune R-S.D., Mike Crapo R-Idaho, Pat Toomey, R-Penn., and other members of the Republican Senate, continue to urge Congress to do away with the IRS proposal. The Senators sent a letter to Senate Majority Leader Chuck Schumer Monday calling to reject the proposed IRS reporting requirement in the reconciliation package. 

“This proposal represents a radical departure from existing reporting requirements associated with national security and actual taxable events,” wrote the Senators. 

Earlier this month, Crapo also introduced the Tax Gap Reform and Internal Revenue Service (IRS) Enforcement Act, similar legislation aimed at deploying guardrails against IRS reporting requirements. 

The proposed IRS reporting requirement is being considered in the reconciliation package, which Speaker Nancy Pelosi yesterday said would be decoupled from the bipartisan transportation bill that the House is scheduled to consider tomorrow.  The decoupling occurs as Democrats struggle to reach partisan consensus on the package and likely means longer deliberations on the reconciliation package.

As part of NAFCU’s continued efforts against the proposal, NAFCU Vice President of Legislative Affairs Brad Thaler sent a letter to the House Ways and Means Committee and Senate Finance Committee noting significant concerns around the proposals and possible compromises being floated to change reporting thresholds.

The association remains alert on this issue to ensure its exclusion from the Build Back Better Act and will continue to advocate against provisions that would further complicate credit union compliance. Stay tuned to NAFCU Today for the latest on the legislation as it moves through Congress.