BREAKING: Kuster Voices Objection to IRS Reporting Proposal
**Kuster has worked across the aisle and with the Biden administration to advocate for NH businesses and financial institutions**
Washington, October 28, 2021
Washington, D.C. — Yesterday, Rep. Annie Kuster (NH-02) along with 20 of her House colleagues called on Congressional leadership to remove the IRS reporting provision from the reconciliation package under negotiation. This provision would create a new tax information reporting regime under the Department of Treasury and require local banks and credit unions in New Hampshire to report annual inflows and outflows to the Internal Revenue Service (IRS) annually, raising privacy concerns for the majority of bank account holders.
“Over the past several weeks, I have heard from thousands of constituents who shared concerns about proposals that would require local financial institutions to enhance reporting to the Department of Treasury in an effort to thwart tax evasion. While I strongly support efforts to ensure that the wealthiest 1% of Americans pay their fair share, the current proposal is overly broad and would sweep up sensitive financial information from middle-class Granite Staters. I was proud to join my colleagues in calling for a more targeted approach that protects the financial privacy of middle-class families while renewing our commitment to combating tax evasion,” said Rep. Kuster. “I will continue working to bring the voices of Granite Staters to the negotiating table as we advance the Build Back Better package.”
“Granite State Credit Union serves over 40,000 NH residents and small businesses and has heard directly from many members who are concerned about the privacy and security of their personal account information,” said Denise Barstow, President/CEO, Granite State Credit Union, Manchester. “Members are asking what the credit union will do to protect them should this proposal become law. We are very pleased to see and support Congresswoman Kuster as she speaks out in opposition to this rule that would violate the account privacy of NH residents.”
“We are deeply grateful to Congresswoman Kuster for standing with Granite Staters in opposition to sharing private financial information with the IRS. Throughout this process, she and her team have remained in regular contact with us and listened to our perspectives,” said Kristy Merrill, President of the New Hampshire Bankers Association. “Our member banks and their customers have serious concerns about how the IRS proposal would invade their financial privacy, along with the open questions concerning the ability of the IRS to safeguard their information and effectively process the additional information. The core of the relationship between New Hampshire’s banks and Granite Staters is founded upon trust. This proposal would unnecessarily inject skepticism and distrust into that important relationship.”
Rep. Kuster is a strong voice for the Granite State in Washington and has been a key negotiator in securing New Hampshire priorities in President Biden’s agenda. She secured more than $1 billion for New Hampshire in the American Rescue Plan Act, including critical funding to expand access to the COVID-19 vaccines, create jobs, keep kids in school, and establish the new Child Tax Credit to lift thousands of Granite State children out of poverty. She is working to deliver on critical infrastructure priorities such as rail, clean energy, and broadband in the Build Back Better package.
The full letter is available here and printed below.
Dear Madam Speaker and Mister Chairman:
We write today to express our concern about the new tax information reporting regime proposed by the Department of Treasury under consideration for inclusion in the reconciliation package. This proposal would require information on the gross annual inflows and outflows of all types of financial accounts in the United States (e.g., savings accounts, checking accounts, loans, investments) to be submitted to the Internal Revenue Service (IRS) annually. We respectfully request that this proposal be withdrawn from further consideration in favor of a more targeted approach.
While the intent of this proposal is to ensure all taxpayers meet their obligations—a goal we strongly share—the data that would be turned over to the IRS is overly broad and raises significant privacy concerns. We have little information about how the IRS plans to protect or use this massive trove of data. Americans expect their bank or credit union to safeguard their financial information. This proposal would erode trust in financial services providers.
Over the past few weeks, hundreds of thousands of constituents have reached out to our offices voicing concerns and opposition to allowing the IRS to collect this data. We have also heard from a wide range of constituent companies and small businesses about the significant burden and potential unintended consequences that could result from the new reporting regime.
Indeed, presumably based on this significant feedback, Treasury and other policy makers have proposed changes to the proposal, including increasing the de minimis level for reporting to $10,000 and providing for certain exclusions for payroll and federal program beneficiaries. We continue to hear from constituents that while these modifications somewhat decrease the level of reporting, a significant number of taxpayers will continue to meet the reporting criteria. Most of these taxpayers are not the wealthy tax evaders who are the stated targets of this proposal.
A change of this magnitude deserves careful consideration by Congress and impacted stakeholders. The Department of Treasury first included this idea in the Green Book, which was released in May 2021, and we have yet to see legislative language outlining the specific contours of this policy. Given the privacy concerns this raises in addition to the significant burden that would be imposed on a broad range of businesses and financial institutions, we respectfully request that this proposal not be included in the Build Back Better package.