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President Biden’s New Reporting Requirement: Will this Drive More People to Non-Banking, Crypto, and


Normally in the mornings we have on a business channel while we are first waking up. While swilling a cup of my highly caffeinated morning fuel, we heard a guest on the show Varney & Company discussing a new government ruling that was a bit hard to believe, yet a quick internet check showed numerous confirmations of what we heard. Checking with an article listed from the Wall Street Journal, which puts the punch line right up front in their take: Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig pressed lawmakers Wednesday to give the Internal Revenue Service more information about taxpayers’ bank accounts, as the Biden administration tries to salvage its struggling tax-compliance proposal. Care to know the amount? Not the old amount that triggers the Treasury’s rules for cash transactions or requires a form for when one leaves or enters the country, that being $10,000 in cash, or what is referred to as “negotiable instruments or cash equivalents.” Nope, the threshold of the interest in your account is - $600. Isn’t that kind of small? Good grief, that’s much smaller than the average mortgage payment, and pretty close to a mere car payment. In fact, a quick search led to several closely similar amounts; per LendingTree’s website, the average new car monthly payment is a whopping $568. So we are talking full blown IRS scrutiny in any bank account that has the indignity of having a tad more than a car payment in available funds. Ah, the joys of a fully computerized society. Human beings with ledgers and making phone calls could never begin to keep up with bank accounts achieving the questionable quantity of a huge $600. Do you know how small that is? That is the amount that was the threshold amount under President Franklin Roosevelt, some 80 years ago. You think maybe our economy has grown past that just a tad? This was interesting - the financial commenters on Varney said the banking industry is against this new rule for two reasons, the second reason is it would boost their costs. The main reason is that many people would opt out of banking, and use cash, cryptocurrencies, or other things (it is easy for one to suppose silver coins at the daily spot price). Per the reporter on the show, the non-banking part of this new feature has many of the banks seriously concerned. Further, the online newsletter Americans For Tax Reform, at ate.org, commented: These findings should be alarming to taxpayers given that President Biden has proposed creating a new comprehensive financial account information reporting regime which would force the disclosure of any business or personal account that exceeds $600. Not only would this include the bank, loan, and investment accounts of virtually every individual and business, but it would also include third-party providers like Venmo, CashApp, and PayPal. Why is this? Why the sudden interest in that for the most part, and figuring the amounts that through the month may be in a person’s checking account or credit union account? Well, we got the answer the same day. Through no explanation on how this number was determined, the US taxpayer is, using the current rules, undertaxed by $1 trillion per year. This is an interesting number. First off, I was always either required, or sometimes at least encouraged, to show my work. Whether what I was working on was a new slide group for my students to present them with additional cybercrime information, a case that could possibly go to court, or anything involving a forensic exam. Show my work. So how did these federal or contracted bean counters come up with this large, round number? Secondly, this is a round number. I would be less inclined to throw the BS flag if the number presented were something like $992,300,000,000. Fine, that’s close to the commonly used number trillion now. The just mentioned amount at least shows some calculation as opposed to a general estimation, and we all like to round things up. “Only A Trillion” was the name of an Isaac Asimov general science book that was published maybe 50 years ago - I read it in high school - and it was about some outrageous things that numbered “only a trillion.” Like many people, I have a one trillion dollar bank note. From Zimbabwe. I hope that none of this stimulus spending and digital money that’s supposedly keeping deflation at bay does not lead us down the same road. What is your take on this? While the vast majority of us have nothing to hide, this level of microscutiny seems a bit heavy handed. Of course, this may not be all the information, so I look forward to more facts.

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James F. Ponder

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