On December 22, President signed the Tax Cuts and Jobs Act (H.R. 1) into law.
While the legislation preserved the credit union industry's income tax exemption, the legislation will impose an excise tax on excess executive compensation at credit unions and other tax-exempt entities.
Specifically, the Tax Cuts and Jobs Act imposes a 21 percent excise tax on executive remuneration that exceeds $1 million annually. The tax would apply to the compensation paid to the five highest-paid executives at a tax exempt organization, if their compensation exceeds $1 million.
Executive remuneration includes employee total compensation (including benefits, except those to a tax-qualified retirement plan, such as Roth IRA plans and 457(b) deferred compensation plans, and amounts not included in gross income). Non-qualified deferred compensation will be treated as income for the first taxable year when there is no substantial risk of forfeiture.
In addition, the excise tax will be applied to any any excess parachute payment paid by the applicable tax-exempt organization to a covered employee.
This provision in the law is meant to provide parity with for-profit businesses, which cannot deduct more than $1 million in compensation in any taxable year for covered employees.
The employer will be responsible for paying the excise tax.
To promote compliance with the law, the Internal Revenue Service should require federal credit unions to file Form 990s just like other tax-exempt organizations including state chartered credit unions.
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So the members pay.
ReplyDeleteTax exempt status probably going away soon for us anyway. Note a good time to have head in the sand.
Not a problem here. Like the directors did at WesCorp FCU with former CEO Bob Siravo (RIP) they will gross up the SERP so the poor bastards can net the full shakedown and catch all the juice. It's a crack pipe high called GREED: When more is not enough. It is a theft from the membership. But it is NCUA approved. Just ask Bob Siravo - that SERP haul was north of $6Million. Not too shabby for a credit union in conservatorship and later liquidated. Where was the clawback? Approved by a board of credit union CEO directors. How do you say: incest? And who has served on the WesCorp board of directors? Call CCUL CEO Diane Dykstra or Schools 1st CU CEO Bill Cheney for the roster. Find Jesus...who stole the moral compass?
ReplyDeleteNot a problem here. Like the directors did at WesCorp FCU with former CEO Bob Siravo (RIP) they will gross up the SERP so the poor bastards can net the full shakedown and catch all the juice. It's a crack pipe high called GREED: When more is not enough. It is a theft from the membership. But it is NCUA approved. Just ask Bob Siravo - that SERP haul was north of $6Million. Not too shabby for a credit union in conservatorship and later liquidated. Where was the clawback? Approved by a board of credit union CEO directors. How do you say: incest? And who has served on the WesCorp board of directors? Call CCUL CEO Diane Dykstra or Schools 1st CU CEO Bill Cheney for the roster. Find Jesus...who stole the moral compass?
ReplyDeleteNot a problem here. Like the directors did at WesCorp FCU with former CEO Bob Siravo (RIP) they will gross up the SERP so the poor bastards can net the full shakedown and catch all the juice. It's a crack pipe high called GREED: When more is not enough. It is a theft from the membership. But it is NCUA approved. Just ask Bob Siravo - that SERP haul was north of $6Million. Not too shabby for a credit union in conservatorship and later liquidated. Where was the clawback? Approved by a board of credit union CEO directors. How do you say: incest? And who has served on the WesCorp board of directors? Call CCUL CEO Diane Dykstra or Schools 1st CU CEO Bill Cheney for the roster. Find Jesus...who stole the moral compass?
ReplyDelete