We are writing to alert you to a serious threat to the entire credit union system, the possible elimination of the credit union federal tax exemption. The Credit Union National Association (CUNA), the State Credit Union Leagues and all credit unions including your University Credit Union are taking this threat seriously and calling on your help to ensure the credit union tax exemption is protected.
Congress is turning its attention to comprehensive tax reform and there is a possibility that the U.S. House of Representatives and U.S. Senate are already considering possible legislation to reform the U.S. tax code.
It appears lawmakers are considering a “blank piece of paper” approach—under that scenario, all exemptions would be removed from the tax code and Congress would start from scratch to write a new tax code. If Congress goes down that road, all tax exemptions, including the credit union tax status, would be gone and then our job #1 will be to proactively advocate for inclusion of the credit union tax exemption in the new tax code. It is also important to note that a consequence of this approach is that the credit union tax status must not only compete against banker opposition, but with the more than 400 other industries that enjoy special status under the current tax code.
Given the seriousness of the situation on Capitol Hill, we are initiating a national grassroots campaign aimed at telling Congress “Don’t Tax My Credit Union.” Accordingly we are launching a National Action Alert. We need to ask members to take action and share this Action Alert with others who will get involved in this effort. It is critical that Congress hear from the 96 million credit union members who want the credit union tax status preserved.
We encourage you to visit the website, www.DontTaxMyCreditUnion.org to learn more and be proactive in contacting your respective legislators with this important message. Please take a minute and do it now! In order to protect the credit union system we know and trust, this communication from each of us to our legislators is crucial.
Michael J. Welch