Debt collectors hate the Biden plan



Add debt collectors to the list of people who are dissatisfied with a Biden administration plan that would require banks to report account data to the Internal Revenue Service.

In a letter to parliamentary leaders On Monday, ACA International, the trade group that represents the collection industry, joined 40 other groups in the banking and trade sectors to urge lawmakers to drop the proposal.

“While the stated goal of this vast data collection is to uncover tax evasion by the wealthy, this proposal does not remotely target that goal or that population,” the groups wrote. “In addition to significant privacy concerns, it would create enormous liability for all parties involved in requiring the collection of financial information for almost all Americans without a proper explanation of how the IRS will store, protect and use this enormous treasure. personal financial information. . “

The letter was addressed to House Speaker Nancy Pelosi, Minority Leader Kevin McCarthy and other members of the House of Representatives. It is the latest in a series of attacks on what was supposed to be a key fundraising vehicle for the $ 3.5 trillion budget reconciliation bill currently under consideration.

As the the Wall Street newspaper reports, the proposal would require financial services institutions to “report annual inflows and outflows” of individual accounts containing at least $ 600, thus giving the IRS an easier way to find tax evasion and conduct audits. The proposal would not require the reporting of individual transactions, according to to supporters, despite some of the more exaggerated claims of the banking lobbies.

Still, critics say the new rules would be too onerous, especially for small institutions, in addition to creating privacy concerns for consumers. ACA International says most of its members are small businesses, 85% of collection companies with fewer than 49 employees.

For now, it’s unclear whether the proposal will survive. According to WSJDemocrats did not include it on a list of tax policy changes last week, despite Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig urging them to do so. It is possible that a reduced form may still emerge.


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