Reconciliation bill passes House, tax status remains secure

The credit union tax status is secured in the One Big Beautiful Bill Act (H.R. 1), passed by the House Thursday morning (215-214). Members of Congress voted on the bill shortly after the House Rules Committee advanced it after an all-night meeting. 
The tax status was left untouched in the original draft of the bill and remained out of the legislative text through the markup and amendment process due to credit unions’ continued tax advocacy and unified voice strategy. 

“Thank you to the U.S. House of Representatives for securing credit unions' not-for-profit tax status as part of H.R. 1 and recognizing the industry's importance to strong Main Streets across the country. More than 142 million Americans trust and rely on credit unions to achieve their American Dream, and this bill allows them to continue on their path of financial freedom,” said Jim Nussle, America’s Credit Unions president/CEO. “We will continue to advocate for policies that create more opportunities for credit unions to bolster our nation's economic prosperity. We call on the U.S. Senate to continue to protect the credit union tax status as they consider this legislation."  

America’s Credit Unions is hosting an advocacy update webinar for member credit unions Wednesday, May 28, at 1 p.m. Eastern to discuss the latest developments.

Register for the webinar here.

Prior to the vote, House members received a letter signed by 616 credit union presidents and CEOs urging them to ensure the credit union tax status remained protected through the floor vote.
America’s Credit Unions also sent messages to House members each day this week reinforcing how the tax status supports the positive impact credit unions make in the lives of more than 142 million Americans. 

America’s Credit Unions wrote in support of the bill prior to the early Wednesday morning meeting, thanking the House Ways and Means Committee for not changing the credit union tax status in its portion of the bill, and encouraging the Rules Committee to reject any efforts to change the tax status as the bill advances in the House. 

The letter also expresses support for provisions in the House Financial Services Committee-passed section of the bill to:

• Modify the CFPB’s authority to draw funds from the Federal Reserve to a maximum of 5% of the Fed’s operating expenses (down from the current 12%), a change that would ensure the CFPB has funding to operate, but would need any additional funds appropriated by Congress; and
• Require the CFPB to return Civil Penalty Fund money back to the Treasury after payment to direct victims only.

The Senate will now take up the budget reconciliation package when Congress returns from Memorial Day recess. If the upper chamber passes a different version than the House, it would need to meet with House members in a conference committee resolve differences and be voted on by each chamber again before it can be sent to the president for his final signature. 

Credit union advocates are encouraged to continue reaching out to their senators using the Don’t Tax My Credit Union website, and reach out to their House representatives to thank them for their effort. 

To date, the Don’t Tax My Credit Union campaign has generated more than 832,000 grassroots letters directly to lawmakers. Its digital ad campaign targeting key tax writers and congressional leaders has generated over 122 million ad impressions and engaged over 180,000 activists.

America’s Credit Unions will continue to lead unified advocacy efforts to ensure the tax status remains secure until the president signs the bill.