IRS Reporting Requirement Update: Grassroots Making Impact

Congressional chamber

This week, House Speaker Nancy Pelosi committed to having some form of the proposed Internal Revenue Service (IRS) reporting requirements that the credit union movement has been opposing within the final piece of the Build Back Better Act, also known as the reconciliation spending bill.

For those concerned about this IRS reporting-requirement provision, the California and Nevada Credit Union Leagues and the Credit Union National Association (CUNA) issued the following update:

  • Public comments or statements by all parties involved in these discussions should be considered negotiating tactics. Committing to some version in the final package does not necessarily mean any sort of reporting requirement will exactly mirror the initial proposal drafted by the U.S. Treasury Department and the IRS.
  • The simple fact the question has been raised during a press conference this week shows the contentious nature of this provision. It displays the grassroots engagement of all financial institutions. Additionally, the coverage by news media (New York Times and Wall Street Journal) is providing adequate pressure on Congress.
  • This week concludes the Leagues’ virtual Hike the Hill meetings, where League and credit union leaders met with senior members of the House Ways and Means Committee (tax policy writing), who said the committee did not support this provision in its version of the bill. This is of considerable importance to note. During a meeting with Rep. Mike Thompson (D-CA), he noted that as chairman of the Subcommittee on Revenue he has directly discussed his considerable concerns with Treasury Secretary Janet Yellen on this issue, and that the low figure of $600 was not acceptable.

Joint Trade Group Letter to Congress
More than 100 trade/business association groups and organizations (including the credit union industry) have sent a joint letter to Congress opposing the IRS reporting-requirements provision. This letter speaks volumes and adds weight to the cause of not only the credit union movement, but so many other industries that are against the proposed reporting requirement.

Please Keep Sending Letters: ‘Connect for the Cause’
Over 51,000 letters have been sent to Congress from California and Nevada credit union supporters out of more than 500,000 nationwide opposing the proposed burdensome IRS reporting requirement being discussed on Capitol Hill.

Several congressional offices have noted the influx of letters, emails and phones calls they are receiving from constituents opposed to this provision.

“In states like ours — with House Speaker Nancy Pelosi (D-CA), House Minority Leader Kevin McCarthy (R-CA), the chairman of the Subcommittee on Revenue and other party leaders — we need to keep the letters constant,” said Jeremy Empol, vice president of federal government affairs for the Leagues. “California and Nevada have 43 million residents combined, and 51,000 letters over a five-week period is a marker — but we could be much louder.”

While party leadership is committed to passing something by the end of October, a deal has not been announced, which means credit unions and their supporters still have time to act. 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.

Proposed IRS Requirement’s Burden on Financial Institutions
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. Please have your members send letters to Congress TODAY.

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