The House Ways and Means Committee today reported out the House Republican tax bill, the Tax Cuts and Jobs Act (H.R. 1). After four days of review, the credit union tax exemption remains untouched.
Before reporting the bill, the committee adopted a manager's amendment offered by Chairman Kevin Brady, R-Texas, that, among other things, struck a provision from the text that would have accelerated the taxing of 457 deferred compensation plans. NAFCU had flagged this issue for the committee given the prevalence of 457 deferred compensation plan usage by credit unions. The committee's action would leave the current tax treatment of 457 plans in place.
The bill now awaits action by the full House.
"NAFCU is gratified that the credit union tax exemption would remain unchanged under the House Ways and Means Committee's mark-up of this bill," said NAFCU President and CEO Dan Berger. "We appreciate Chairman Brady and other committee members' efforts thus far to protect the exemption. NAFCU will continue to work with members of Congress as the process moves along to reiterate the positive contributions credit unions make to American consumers and our economy as a whole."
NAFCU staff has been on Capitol Hill, engaging with committee members during the mark-up process to tout the economic benefits credit unions provide their communities and nation as a whole. An independent tax study released by NAFCU earlier this year that shows the cumulative benefit credit unions provide the greater economy totals $16 billion a year.
The Senate is crafting its own version of the tax bill, which is expected to be released at any time.
NAFCU is advocating five tenets for ensuring a positive environment for credit unions, and one of these is a fair playing field. NAFCU will continue to engage lawmakers as this bill moves through Congress to determine potential impact this legislation would have on credit unions – not only with respect to the tax exemption, but other tax code provisions as well.
Preserving credit unions’ tax exemption remains NAFCU’s top legislative priority.