National Association of Federally-Insured Credit Unions (NAFCU) officials expressed concerns to Senate leaders about the proposed Internal Revenue Service (IRS) reporting requirements.
The proposed changes were excluded from the version of the Build Back Better Act (BBBA) that the House of Representatives passed in November. However, NAFCU officials are concerned about several compromises that have been floated in an attempt to push the legislation forward in the Senate version of the bill. The Senate has not yet voted on the Build Back Better act.
“We believe that requiring credit unions and other financial institutions to report on gross inflows and outflows stands to pose more costs and burdens on community institutions with uncertain returns,” Brad Thaler, vice president of legislative affairs at NAFCU, wrote to Senate Majority Leader Chuck Schumer (D-NY) and Senate Minority Leader Mitch McConnell (R-KY). “Furthermore, various compromises that have been floated, such as raising the reporting threshold above $10,000 or not counting direct deposits of paychecks or various payments, do not address the problems with this provision.”
Thaler said that financial institutions such as credit unions are already subjected to a wide range of reporting responsibilities and compliance burdens. While NAFCU supports efforts to increase taxpayer compliance, adding another reporting requirement would incur significant costs and burdens for credit unions, possibly redirecting resources away from consumers.
“This provision cannot be fixed and should be rejected outright,” Thaler said.
The association has been working with Congressional leaders to explain why this provision must be eliminated entirely.
“We must continue to keep the pressure on that this provision, in any form, is unacceptable,” NAFCU Director of Political Affairs Chad Adams said.