Biden Plan Would Give IRS Authority to Track Your Bank Account

Democrats in Congress are debating a President Biden priority that would give the Internal Revenue Service access to U.S. accounts (including U.S. territories) with $600 or more. This access would see banks providing the IRS with annual cashflows for ordinary accounts.

Swift backlash has caused the Ways and Means Committee — where the proposal is being shaped — to consider a higher threshold of $10,000, though the sum has not been settled. Both IRS Commissioner Charles Rettig and Treasury Secretary Janette Yellen have been championing the proposal.

V.I. Delegate to Congress Stacey Plaskett is a Democrat and member of Congress's Ways and Means Committee. Republicans are in stark opposition of the measure.

Ms. Yellen in a letter to the committee recently said the measure would reveal “opaque income streams that disproportionately accrue to the top.” She told CNBC Tuesday that it "would really help the IRS target their auditing resources.”

The proposal, whether for $600 or $10,000, has invited swift backlash from states, private sector leaders and Republicans. A group of 41 industry groups recently warned congressional leaders that the plan “is not remotely targeted” to detect major tax avoidance, according to the Wall Street Journal. Additionally, 23 state treasurers and auditors signed a letter last month opposing the plan, calling it “one of the largest infringements of data privacy in our nation’s history.” Nebraska Treasurer John Murante says his state won’t comply if the reporting rule takes effect, according to WSJ.

The Heritage Foundation, a conservative think tank primarily geared toward public policy, said the Biden plan would amount to invasion of privacy while putting more of Americans' financial data at risk. "Under this requirement, the Internal Revenue Service—an already scandal-ridden and historically politicized government agency—could once again be weaponized against political opponents while leaving middle-class Americans vulnerable to having more of their financial information hacked or leaked," wrote the Heritage Foundation.