The Biden administration is going after Americans on taxes.
Secretary of the Treasury Janet Yellen has again proposed the idea that banks should report all transactions of more than $600 throughout the year to the IRS, claiming that it would target the wealthy.
According to a report in Fox Business, Yellen said that, “there’s a lot of tax fraud and cheating that’s going on,” and said the White House believes that the plan would bring in more than $460 billion in taxes over the next decade.
The treasury secretary claims that the transaction materials will only be used to enforce already existing tax laws and is not intended as a way for the government to check up on what Americans are spending their money on.
Yellen made her comments Tuesday on CBS News where Norah O’Donnell asked Yellen, “Does this mean that the government is trying to peek into our pocketbooks if you want to look at $600 transactions?”
“Absolutely not,” the treasury secretary replied, insisting, “I think this proposal has been seriously mischaracterized. The proposal involves no reporting of individual transactions of any individual.”
The treasury secretary claimed that this is targeted at “individuals” the IRS does not receive enough information about and believes they need to know more on:
“Look, the big picture is that we have a tax gap that over the next decade is estimated at $7 trillion,” she continued. “Namely, a shortfall in the amount that the IRS is collecting due to a failure of individuals to report the income that they have earned.”
O’Donnell asked, “But that’s among billionaires. Is that among people who are transferring $600?”
“No, it tends to be among high-income individuals whose income is opaque and the IRS doesn’t receive information about it,” Yellen said. “If you earn a paycheck, you get a W-2, the IRS knows about it. But high-income individuals with opaque sources of income that are not reported to the IRS, there’s a lot of tax fraud and cheating that’s going on, and all that’s involved in this proposal is a few aggregate numbers about bank accounts – the amount that was received in the course of the year, the amount that went out in the course of a year.”