CUs Boldly Advocate as Lawmakers Weigh IRS Proposal

Professional in a suit at desk talking

It’s been busy on Capitol Hill as credit union supporters make their voices heard, leaders meet with members of Congress, and lawmakers in Washington, D.C. deliberate on the nation’s budget, debt limit, and pending infrastructure legislation.

IRS Reporting Requirement Proposal
More than 47,700 letters have been sent to Congress from California and Nevada out of over 300,000 nationwide opposing the proposed burdensome Internal Revenue Service (IRS) reporting requirement being discussed.

“Meetings with members of Congress are ongoing on this topic, and discussions have been positive during our virtual ‘Hike the Hill’ event this past week,” said Jeremy Empol, vice president of federal government affairs for the California and Nevada Credit Union Leagues. “Representatives are now very aware of our objection to adding new IRS reporting requirements.”

The Leagues are still asking every credit union supporter capable of sending a letter to Congress via Connect For The Cause to do so! (Email Emily Udell if you need guidance for activating your members)

You can also download, customize, and distribute the following Credit Union National Association (CUNA)-provided social media materials: Facebook post, Instagram post, and Twitter post. Please use these to redirect members to our Connect For The Cause webpage on this particular issue. Additionally: to alter and edit a templated email, click here and scroll down.

The proposed IRS requirement would amount to a major compliance burden on credit unions, as well as an invasion of their members’ privacy. The intention behind the proposed requirements is to go after tax cheaters, but it would unfortunately give the IRS new access to private information. Financial service providers would have to report gross cash flows greater than $600 on all their accountholders. This almost assures that every financial institution, fintech, and depository will report information on every single accountholder.

Other News in Congress
The House Financial Services Committee held an informational hearing on the future of financial services, listing two credit union bills for discussion purposes. The first (HR 2311), which the Leagues vocally support, addresses member expulsions for federally chartered credit unions. The second, a bill the Leagues and CUNA oppose, would give the National Credit Union Administration (NCUA) regulatory authority over third-party vendors.

Neither bill advanced as the hearing was informational (the vendor authority bill is currently without an author).

Additionally, the Senate Banking Committee met to hear the nomination of NCUA Board Chairman Todd Harper for a full term of six years. The committee did not advance nominations, but it is expected to do so in a two-to-three-week timeframe.

Meanwhile, the Senate has confirmed Rohit Chopra as the next director of the Consumer Financial Protection Bureau (CFPB). The final Senate vote was 50-49. The Leagues look forward to working with him once he is officially sworn in.

Leagues’ Virtual ‘Hike the Hill’
This year’s virtual Hike The Hill took place this past week and focused on raising concerns over new IRS reporting requirements for financial institutions, supporting the Expanding Financial Access for Underserved Communities Act, and opposing legislation to regulate credit card interchange fees.

Credit union leaders from California and Nevada were also prepared to discuss the following topics as they engaged with their members of Congress: financial well-being and inclusion, operations, the Paycheck Protection Program (PPP), credit union tax status, credit union charter bills, postal banking, cannabis banking, the Government Sponsored Enterprises (GSEs), Community Development Financial Institutions (CDFIs), and other topics.

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