November 07, 2017

CU exemption untouched in Senate Republican bill

Credit unions' tax exemption is untouched in a Senate Republican tax reform bill unveiled today. NAFCU has kept in close contact with House and Senate leaders to ensure preservation of the industry's tax exemption. The association is examining the Senate bill for any additional impacts on credit unions.

"NAFCU and our members thank Chairman [Orrin] Hatch and Senate Republican leaders for recognizing that altering the tax status of credit unions would have a devastating impact not only on credit union members across the country, but also on consumers and small businesses," said NAFCU President and CEO Dan Berger. "As both the House and Senate continue their work on tax reform, we're staying in close contact with lawmakers to ensure the preservation of credit unions' tax exemption and other interests."

The Senate Finance Committee, led by committee Chairman Orrin Hatch, R-Utah, is scheduled to mark up the bill, the Tax Cuts and Jobs Act, next week.

The bill preserves the mortgage-interest deduction with a cap of $1 million for newly purchased homes and keeps the 401(k) retirement account intact. The Senate bill entirely repeals state and local property tax deductions.

NAFCU is advocating five tenets for ensuring a positive environment for credit unions, and one of these is a fair playing field. NAFCU is continuing to review this tax bill and will be engaging Congress on any potential impact this legislation would have on credit unions – not only with respect to the tax exemption, but other tax code provisions as well.

The association has met repeatedly with members of Congress, including House Ways and Means Committee Chairman Kevin Brady, R-Texas, to discuss the importance of the credit union tax exemption and share an independent tax study that details the exemption's value to the U.S. economy. Preserving credit unions' tax exemption remains NAFCU's top legislative priority.