On April 2nd the House Ways and Means Committee voted in favor of the Taxpayers First Act of 2019 (H.R. 1957), a bipartisan bill that contains several changes of interest to credit unions (and is generally supported by CUNA). The bill includes several measures designed to protect taxpayers from unfair practices and improve Internal Revenue Service (IRS) operations. This includes provisions that would make changes to the Bank Secrecy Act (BSA), including two related to suspected or actual “structuring transactions”:
- One change would allow the IRS to pursue the seizure of assets only if either the property was derived from an illegal source or the transactions were structured for the purpose of concealing a violation of a criminal law or regulation other than rules against structuring.
- The other provision provides a taxpayer exemption for interest liability should a court return funds to a taxpayer whose assets were mistakenly seized based on invalidated structuring claims.
Other provisions of interest:
- Requires the Treasury Department, IRS, and the Bureau of Fiscal Service to consult with financial institutions and submit a report to Congress describing how the IRS can utilize new methods to increase the number of tax refunds that can be paid by electronic funds transfer. The report is required to consider the impact on taxpayers who do not have access to traditional credit union or bank accounts;
- Requires the IRS to create a website to allow taxpayers to electronically file IRS Form 1099s;
- Requires the IRS to automate the “Income Verification Express Service (IVES)” system;
- Allows the payment of federal taxes by debit and credit cards;
- Requires electronic filing of the annual returns of certain tax-exempt organizations and make these returns available to the public by extending the requirement to “e-file” to all tax-exempt organizations required to file statements or returns in the IRS Form 990 series, and
- Requires the IRS to provide notice to an organization that fails to file a Form 990 for two consecutive years.