Pirate's Cove

That will make all the difference in the world, right?

Biden admin backs down on tracking bank accounts with over $600 annual transactions

The Biden administration on Tuesday backed down on a controversial proposal to direct the IRS to collect additional data on every bank account that sees more than $600 in annual transactions, after widespread criticism from Republican lawmakers and banking industry representatives, who said the tax enforcement strategy represented a breach of privacy by the federal government.

Instead, the administration and Senate Democrats are proposing to raise the threshold to accounts with more than $10,000 in annual transactions, and any income received through a paycheck from which federal taxes are automatically deducted will not be subject to the reporting. Recipients of federal benefits like unemployment and Social Security would also be exempt.

The IRS would collect the total sum of deposits and withdrawals from bank accounts with more than $10,000 in non-payroll income. Information on individual transactions would not be collected.

The changes were announced Tuesday by the Treasury Department.

“In response to considerations about scope, it [Congress] has crafted a new approach to include an exemption for wage and salary earners and federal program beneficiaries. Under this revised approach, such earners can be completely carved out of the reporting structure. This is a well-reasoned modification: for American workers and retirees, the IRS already has information on wage and salary income and the federal benefits they receive,” a Treasury Department fact sheet on the changes said.

That’s totally gonna catch all those bigwig rich folks cheating on their taxes, right? Oh, wait, most of them simply have very good accountants which allows them to take advantage of all the benefits of the tax code as passed by the federal Legislative branch and signed into law by Presidents. This is what Democrats, who vote “yes” for these laws and sign the bills into law, call loopholes. Perhaps many of these things are not what was intended, but, then, they should read and understand the implications of what they’re voting “yes” for. Perhaps slimming down the tax code, a simple flat tax, would be better?

In reality, this will catch almost no one who is “rich”, which in Dem World is those in the $400k and up earnings bracket. It might not even catch most. If implemented, will the IRS track the data and publish it to let us know if this spying scheme worked? Because it is spying, and asking banks to assist in spying on most Americans. The difference, for most citizens, between $600 and $10,000 is negligible.

My monthly mortgage total is $600. Car lease $250. Electricity about $125. Water/sewer around $60. Cell service $100. That’s already $13,620, and doesn’t include cable bill, food, gas, the small hit for natural gas, clothes, shoes, sundries, contacts stuff, and general purchases. If your rent/mortgage is $833 a month or more, you’ve hit that $10k line. If this was all about single transaction, like is required for cash purchases/deposits, it might be understandable. Not acceptable, but, understandable. But, everything says this is not

The fact sheet says, “Imagine a taxpayer who reports $10,000 of income; but has $10 million of flows in and out of their bank account. Having this summary information will help flag for the IRS when high-income people under-report their income (and under-pay their tax obligations). This will help the IRS target its enforcement activities on those who are actually evading their tax obligations—decreasing costly and burdensome audits for the vast majority of taxpayers who pay what they owe.”

Yes, but, it will mean banks have to report your private financial data to the IRS. It won’t say what you purchase, just the overall cash flow.

(Fox News) “Well, if you deposit or withdraw more than $10,000 over a year, the Biden Administration wants the IRS to be able to spy on you,” (Senator Joni) Ernst’s remarks continue. “To put this number into perspective, if you rent an apartment in Iowa, the average annual cost to do so is just above $10,000 per year.”

And they’ll be doing this without benefit of a warrant. This is a clear violation of the 4th Amendment. It is not a reasonable search. Certainly not a blanket requirement for reporting, and you can bet if Democrats pass this or Joe’s admin creates a rule it will end up in court within a week, and is tailor made for a Supreme Court ruling.

Read: Let’s Go Brandon “Backs Down” On $600 Bank Transaction Line, Raises To $10,000 »