Yesterday, I wrote about Senator Hatch writing the National Credit Union Administration about credit unions operating outside their tax-exempt purpose.
In related news, the Tax Foundation has called on Congress to regularly review the credit union tax exemption to ensure that credit unions are fulfilling their original purpose.
The Tax Foundation cited an Internal Revenue Service (IRS) document from 1979, which identified three reasons for the credit union tax exemption -- "help unbanked, lower-income people; restrict their customer base; and avoid high-risk, high-return investments."
The Tax Foundation states if credit unions "have strayed from their intended function and now resemble other taxed financial institutions, their exemption would represent a disparity across similar economic activities" and should be an area for potential tax reform.
Read the story.
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Really?!? Just after banks just got a huge tax reduction from 35% to 21%.
ReplyDeleteWhat does the reduction in tax for banks have to do with the fact that the large credit unions have “strayed from their intended function”?
DeleteIt just means when congress taxes the big credit unions it won’t hurt so much. Plus we would be able to issue capital and do more business loans.
Sign me up.