PIA Opposes Burdensome Tax Reporting Requirements for Small Businesses

On September 17, PIA, along with several business groups, wrote to U.S. House leadership to oppose a proposal included in the reconciliation package currently under consideration that would impose a broad new tax information reporting requirement on small businesses throughout the country.

The proposal would require financial institutions and other providers of financial services to track and submit to the Internal Revenue Service (IRS) information on the inflows and outflows, including cash, of every account above a threshold of $600 per year.

In addition to imposing another burden on small businesses, it would create tremendous liability for everyone who is subject to it by requiring the collection of financial information for nearly every American without explaining how the IRS will store, protect, and use this huge mass of personal financial information. This proposal would also create substantial challenges for financial institutions, increase tax preparation costs for individuals and small businesses, and create serious financial privacy concerns.

As the reconciliation process proceeds, PIA will continue to push back on proposals that would negatively affect small businesses.