Credit union leaders speak out on tax status, ’Don’t tax my credit union’

As the reconciliation bill moves forward, credit unions and state Leagues are speaking out and working to ensure the credit union tax status is not put at risk during the legislative process. 

Using language shared in America’s Credit Unions’ action alert and on the Don’t Tax My Credit Union website, Massachusetts’ Norfolk Community Federal Credit Union CEO Susan J. Kenney, Luminate – Louisiana’s Credit Unions President/CEO Juan Fernández Ceballos, and Cornerstone League President/CEO Caroline Willard all wrote op-eds that highlighted the benefits of the tax status while challenging misinformation about the credit union tax status.

In her op-ed in Norfolk & Wrentham News, Kenney described the stakes should the tax status be eliminated:

“The federal income tax [status] for credit unions exists because of their unique structure and mission. Congress recognized long ago that credit unions provide essential financial services to underserved communities, and that taxing them like for-profit banks would undermine that mission,” Kenney wrote.

“Eliminating the tax exemption wouldn't just hurt credit unions—it would hurt you. It would force your credit union to operate more like a bank, focusing on profits instead of people. And ultimately, those costs would be passed on to you in the form of higher fees and worse rates.”

Kenny states, “Let Congress know that you stand with credit unions—and that any attempt to tax them is an attack on the financial security of more than 140 million Americans.”

On Nola.com, Fernández Ceballos highlighted the impact credit unions have on those they already serve:

“Across Louisiana, credit unions are a financial lifeline to over 1.3 million members—people from every walk of life who rely on these not-for-profit financial cooperatives for affordable services, personalized support and community-focused solutions,” he said. “Our 144 credit unions serve communities from Shreveport to New Orleans and everywhere in between and employ more than 4,000 Louisianans. Yet, today, that is under threat.”

Willard pointed to other countries’ experience in taxing credit unions in her CUInsight op-ed, pointing out that we need not look far outside the United States to see the consequences.

Willard pointed out that in Australia and Poland, credit union numbers declined by about 75% once a tax on credit unions was levied. “As smaller credit unions folded, access to affordable services in rural and underserved communities shrank,” she said.

While the Ways and Means Committee now moves to marking up the bill, America’s Credit Unions’ grassroots outreach continues to ensure the tax status stays out of the bill.

Credit unions can use the Member Activation Program resources to encourage credit union members to tell the credit union difference and keep sending the message to Congress to protect the credit union tax status on the Don’t Tax My Credit Union website.

Read the three op-eds: Fernández Ceballos’s op-ed, Kenney’s op-ed, and Willard’s op-ed.