Who is likely to get caught in an expended IRS bank surveillance program? Just about everyone
Behind all the Democrats’ maneuvers to grow the size of government is a push to collect more tax revenue. That would mean giving the IRS sweeping new powers to see where all your money comes from, and where it goes. The intent is nabbing the rich, whom government suspects never pay enough. But as the National Taxpayers Union notes, the IRS dragnet would be far bigger…if the Biden administration gets its way:
The Treasury Department’s original proposal from May recommended applying the bank reporting requirement to all business and personal accounts except those “below a low de minimis gross flow threshold of $600 or fair market value of $600.” This would encompass essentially every bank account in the country, certainly all businesses as well as any individual with more than about $50 a month of inflow or outflow transactions.
That idea went nowhere. Congressional Democrats opted for a higher threshold:
…Rep. Neal [said] he wants to see a $10,000 threshold instead and that Sen. Ron Wyden (D-OR) is in agreement with him: “The idea is to build in guardrails so that people at the lower end are not targeted. This is about people at the upper end.” The Wall Street Journal noted that Rep. Don Beyer (D-VA) was inclined to support a bank reporting requirement but a leak of taxpayer data from the IRS to the group ProPublica “sapped support because of privacy concerns.”
Yes, the IRS is a leaky political shop, and handing it a key to every bank account in the nation was a recipe for trouble. But will the $10,000 threshold make any difference?
Unlikely, since $10,000 will be hit by anyone who earns even minimum wage and direct-deposits their paycheck, or has a rent payment of at least $850 a month. In fact, someone’s rent payment need not be nearly that high when accounting for the myriad of other necessities people must purchase just to get by.
The median small business has inflow and outflow of $755 a day, so they’ll hit $10,000 in about two weeks. The median checking account balance in the U.S. is $3,400 at any one time, and based on the rule of thumb that your balance should be one to two months’ worth of expenses, that’s $20,000 of inflow and $20,000 of outflow minimum for most Americans.
So even the higher amount means most bank account will fall under the taxman’s eye…not to mention the taxman’s power to shake people down for payment:
Much has been said about President Biden’s pledge not to raise taxes on Americans who earn less than $400,000 a year, but that’s exactly who will bear the brunt of a supercharged IRS bank information dragnet.
That’s the whole point. Intimidate, extract, repeat.