Opposition voiced to IRS monitoring

A resolution expressing opposition to the Biden administration’s proposal to require financial institutions to report all account holder transactions of at least $600 was unanimously endorsed Thursday by the House Insurance and Commerce Committee.

House Concurrent Resolution 1021 is a preemptive move to let national policymakers know that Arkansas is against the “major intrusion of consumer privacy” if that portion of Biden’s American Families Plan is adopted, bill sponsor Rep. Delia Haak, R-Gentry, told the committee.

“It is something that we would like to be on record as a Legislature that we oppose this kind of overreach for all the reasons that have been stated,” Haak said. “In particular, we want our financial institutions to partner with our communities and our consumers, both banked and unbanked as well. They have been really good partners and this kind of scrutiny is not necessary nor has it ever been deemed to be necessary up until this point.”

The plan was announced by the White House on April 28 and, if adopted, is expected to go into effect for tax years after Dec. 31, 2022.

The proposal would open the door to more cyberattacks to steal financial information, and the administration has failed to explain how the changes would close the tax gap, Haak said.

Lorrie Trogden, president and CEO of the Arkansas Bankers Association, told legislators that customer privacy is the top concern but costs banks “a lot of resources and a lot of money” to implement.

Rep. Robin Lundstrom, R-Elm Springs, asked Trogden if the proposal would trigger banks to report to the IRS “every paycheck, every dime,” to which Trogden affirmed.

“It sounds like the government is actually digging in my couch cushions for change instead of stopping spending or doing a better job at managing itself,” Lundstrom said.