I have spent many years learning about financial freedom and focused on how to teach students to achieve it. Focus on paying your debt, invest, and begin to make your assets pay for your liabilities. These are very simple rules I would tell students so they can attain ‘financial freedom’ in their lives. However, while they may be focused on building their wealth, they may be losing another aspect of their financial freedom. This is their freedom to keep their finances private.
Recently Janet Yellen, the United States secretary of the treasury, advocated for giving the IRS the ability to look at all transactions over $600. You just bought a new TV? The IRS wants to watch with you.
You want to pop the question with an engagement ring? The IRS wants to know how many carats. You want to buy a new car? The IRS wants to know the make and model. Even your rent payments are not safe from the IRS eyes under this rule. Yellen wants your bank to tell the IRS whenever you have reached any major milestone in your life.
Now why is this important? Many – I would presume Yellen included – would say, ‘If you have nothing to hide, then why do you care?’
Well, you should care because one, your transactions are none of the IRS’s business. Two, the IRS will use this power to target Americans. Three, you have a right to privacy as an American. And four, your transactions are none of the IRS’s business.
The IRS has already shown its willingness to target Americans it does not like. In 2017, the IRS was forced to settle with over 40 conservative non-profits after the agency attempted to restrict their 501-c3 status because of their ideological leanings.
This is not the only time the IRS was embroiled in a scandal either. If you catch their attention in any way the IRS will audit you until they find the smallest error in your taxes. The IRS will not even shy away from releasing your tax records if they really want to shame you. The agency has shown it is willing to abuse its power already, why should we give them more of it?
We should tell Janet Yellen to go back to her office and let the IRS know they can either keep working as normal or lose the power they currently have. Our financial freedom is worth infinitely more than any money the IRS wants to take from us, and we need to fight for that freedom.
No government official should feel comfortable asking for that much power, and when they do, we should turn around and take all their power away.