- Nov 26, 2011
- Reaction score
Okay, I've just looked into this. It's not what I thought it was.I sent a form letter sponsored by small banks of america to my senator. The bank is concerned about the excessive burden extra IRS reporting will create for them. I'm concerned as well, because extra reporting always causes extra paperwork for me as well.
My senator's response:
View attachment 539029
The full text of his response:
There can be no mistake that those in power intend to milk every last one of us for everything they can. Monetarily, it's already a negative sum game considering how many extra people will they have to hire to monitor the citizens to this degree: That alone will blow the budget for any meager amount they may be rubbing their hands together hoping to eek out of us.
They refuse to even consider reducing their spending, but instead scheme on ways to collect more in taxes. The plan will affect every single business and every single non-government employee.
And just as a side note, the House Democrats have hacked this suggested new reporting requirement out of the Biden Administration's budget proposal. Biden is the one who is pushing this. With the House trying to kill it, may be dead in the water already.
So let me try to explain what this is about.
This is not a situation where your bank has to report to the IRS every time you move more than $600 in or out of your account. That's what I thought it was, but it is not.
The requirement is that your bank has to report the total amount of money you moved in or out of your account for the past year. They do not report individual transactions. So if you deposited 24 paychecks of $2000 apiece over the course of a year, they don't tell the IRS you deposited 24 paychecks of $2000 apiece. They tell the IRS you deposited $48,000 into your account over the past 12 months. They also report the total of how much you took out over the past 12 months.
This is an annual reporting requirement. This requirement applies to any account which has more than $600 in it, or has moved more than $600 in and out over the past 12 months.
Also, this requirement does not target 99 percent of us for auditing. It only targets those who earn more than $440,000.
Apparently, some rich people have found a way to cheat the tax system by continuously moving their money across several bank accounts in some kind of shell game.
Biden is going after the 1 percenters who are tax cheats.
The bank is still going to have to report your total transactions, too, but the IRS isn't going to audit you unless you are in the 1 percent.
If a Biden administration proposal now being considered is adopted, financial institutions would be required to report m/> <meta name=
Chuck Marr, senior director of federal tax policy at the Center on Budget and Policy Priorities, said the proposal would help identify business and partnership owners who report relatively low income to the IRS but have millions of dollars flowing through their accounts.
"It just helps the IRS get better at finding noncompliance, finding people who are cheating," he said.
Marr said setting a low threshold of $600 would make it harder for tax dodgers to set up multiple accounts and avoid having the activity in those accounts reported to the IRS.
From the Treasury department: Investing in the IRS and Improving Tax Compliance
A key component of this initiative is the provision of a sustained, multi-year stream of funding. Altogether, the proposal directs roughly $80 billion to the IRS over a decade to fund an array of priorities—including overhauling technology to improve enforcement efforts, which is more effectively implemented with the assurance of a consistent funding stream. This investment will also facilitate the IRS hiring and training auditors to focus on complex investigations of large corporations, partnerships, and global high-wealth individuals. The President’s proposal directs that additional resources go toward enforcement against those with the highest incomes, rather than Americans with actual income of less than $400,000.