As Congress considers critical new spending, policymakers are eying unconventional sources of revenue to fund their plans. On October 12, House leadership doubled down on the unprecedented proposal to require financial institutions to turn over vast amounts of consumer account data to the Internal Revenue Service (IRS). This would require credit unions and other financial institutions to report to the IRS how much money has gone into and out of money consumer accounts. This unprecedented access to consumers’ personal financial data raises several alarms.
- This proposal would violate consumers’ personal privacy by forcing credit unions and banks to provide the government with information that does not reflect taxable activity.
- The government relies on decades old data systems to store and secure IRS information. These systems have already been compromised in recent years, and the addition of this type of data only increases the likelihood of a future breach.
- Financial institutions—particularly those in rural and low-income communities—would face unnecessary and expensive regulatory hurdles that could make it untenable to serve those consumers already left behind by Wall Street banks.
The Bottom Line: Don’t jeopardize consumers’ personal financial privacy by allowing the IRS to access nontaxable deposit account information from credit unions and banks.
Credit union advocacy has kept this policy out of early legislative drafts, but we need your continued help to keep this policy out of Congress’ reconciliation bill. We need to work together to keep this from becoming law. Please visit here to access a pre-composed letter to your lawmakers, and let them know you oppose this legislation.
The Bottom Line:
Don’t jeopardize consumers’ personal financial privacy by allowing the IRS to access nontaxable deposit account information from credit unions and banks.