Credit union tax status remains secure in initial Senate Finance Committee draft

The Senate Finance Committee released the initial text of its portion of the reconciliation bill without any changes to the credit union tax status. The full legislative text is likely to be released in the coming days.

“America’s Credit Unions, leagues, credit unions, and the 142 million consumers our industry serves thank Senate Majority Leader John Thune and Senate Finance Committee Chairman Mike Crapo for understanding the credit union difference and protecting the credit union tax status in H.R. 1,” said America’s Credit Unions President/CEO Jim Nussle. “Credit unions have tremendous impact on Main Streets across the country and work every day to strengthen our communities and people's lives. We appreciate the Senate Finance Committee for their support and will continue to keep the momentum until the bill is sent to the President’s desk.”

America's Credit Unions is still reviewing the draft bill and will release a more detailed analysis soon. The bill appears to retain provisions expanding the excise tax on executive compensation, creating a deduction for interest on auto loans assembled in the U.S., and establishing Trump accounts for minors. 

The bill also retains the excise tax on remittance transfers; however, transfers made from accounts at credit unions and other financial institutions or funded by a debit or credit card issued in the U.S. are now exempt. America's Credit Unions had highlighted the remittance excise tax as a significant potential burden for credit unions.

America’s Credit Unions, leagues, and credit unions engaged with offices from every Senate Finance Committee member in recent weeks. Each state league and the American Association of Credit Union Leagues joined America’s Credit Unions in reaching out to senators urging their support of the tax status, and senate offices also received the independent study on the economic impact of the tax status.

Registration is open for a June 18 webinar for America’s Credit Unions that will provide the latest updates.

Stakeholders should continue to contact senators in support of the credit union tax status using the Don’t Tax My Credit Union website.