Federal tax proposal may have unintended consequences for everyday Americans
BANGOR, Maine (WABI) - A federal proposal that aims to catch more of the nation’s tax cheats might have unintended consequences for everyday Americans.
The Biden Administration’s proposal aims to lower the $600 billion annual “tax gap” between taxes owed and collected.
Under that proposal, banks would have to report to the IRS the inflows and outflows for all customer accounts with activity or balance over $600.
Bank officials say this will only lead to more public distrust of the government and perhaps individual bank relationships, which could jeopardize customers’ financial safety.
Maine Bankers Association President Jim Roche says it’s a plan with good intentions, but one that could hurt the wrong people.
”The idea is to go after tax cheaters at really the high income level, that’s where a lot of revenue can be generated, at least according to experts. But, when you’re going after residents of towns all over the state and routine transactions and routine relationships that they have with their local bank, it just seems really wrong-headed to us,” said Roche.
Roche suggested the IRS should address its own security issues before introducing new, potentially invasive measures.
The tax proposal is still to be voted on in Congress.
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