Preserving the credit union tax exemption continues to be our top priority. Because of NAFCU's persistent advocacy, on December 20, 2017, Congress passed the "Tax Cuts and Jobs Act" (the Act). On December 22, President Trump officially signed it into law. This landmark piece of legislation keeps the credit union tax exemption fully intact and it is a testament to the value and strength of credit unions. But we remain focused on fighting any future attempts to tax credit unions, because our country can not afford the negative impacts of slashing and burning the credit union tax exemption.
If credit unions are taxed, there will be many consequences for credit union members. Possible outcomes include:
- Credit unions would lose their identity: By losing the not-for-profit, cooperative structure, credit unions would be forced to focus on increasing profits instead of their member-owners
- Rates and fees: If the tax exemption is repealed, it would adversely impact savings, borrowing rates and increase fees for millions of Americans
- Capital: Further limitations on the ability to raise capital potentially impacts safety and soundness
- Erosion of the volunteer base: If credit unions become "more like banks," the self-help, volunteer characteristic of credit unions, and the community as a whole, would become less distinct