A new IRS proposal could affect your accounts and how your credit union operates.
Dear Valued Member,
As Congress considers new infrastructure spending, lawmakers are exploring unconventional sources of revenue to fund plans. One proposal under consideration effects GNO FCU and our members — it would require that your credit union (along with other financial institutions and popular apps like Venmo and PayPal) report to the Internal Revenue Service (IRS) how much money has gone into and out of all accounts with more than $600 in them.
The proposal is designed to close the tax gap. The financial reports would allow the IRS to compare how much cash came through a person’s accounts to how much was reported each year on income tax forms. That can include cash not reported by those who don’t list all their tips, people doing gig work for cash, side jobs paid in cash, people who sell crafts or products from home.
We value our members privacy and the security of their data, and this possible unprecedented access to your finances violates your personal privacy by forcing credit unions and banks to provide the government with information that does not reflect taxable activity.
The Louisiana Credit Union Movement’s Response
Credit unions across the state strongly object to the proposal, which would be an unwarranted infringement on the privacy of our members and create complex new reporting burdens. We have alerted congressional leaders, submitted a joint letter with the Louisiana Bankers Association, and submitted thousands of messages from credit union advocates. Our advocacy messages highlight that new IRS bank account mining would:
- Be intrusive and indiscriminate for our members.
- Increase taxpayer complexity and confusion.
- Enlist credit unions as agents of the IRS while imposing new reporting burdens.
- Expose credit unions to penalties for inadvertent errors.
- Channel more information into the IRS than it can process.
What can you do?
At https://www.cuna.org/advocacy/actions/grassroot-action-center.html?vvsrc=%2fcampaigns%2f87852%2frespond, credit union members can send a customizable message to their U.S. Representative expressing concern with the proposal and urging opposition. As always, GNO FCU urges our members to get involved and join us in this effort to fight for the average consumer.
The Louisiana credit union movement will continue speaking out against this proposal and the threat it poses to consumer privacy and credit union operations. Know that we will not simply hand over personal information at any time without it being required by law.
Please let us know if you have any questions. We look forward to continuing to serve you and our community.
President & CEO
Greater New Orleans Federal Credit Union