On Tax Day Reminder of the Billions CUs Generate in Consumer Benefits

CUNA has released research supporting the benefits of the credit union tax status.

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Maintaining the credit union federal income tax status is critically important to the survival of the nation’s nearly 5,500 credit unions which now report a total of approximately 115 million memberships. In 2018 alone, these benefits – which accrued to both directly to members and indirectly to bank customers – totaled more than $16 billion. Additionally, the dollar amount of these benefits greatly exceeds the loss in federal revenue— estimated by the Joint Committee on Taxation to be $1.8 billion in 2018—that would result from imposing new federal income taxes on credit unions.

“Bankers seem to take the occasion of Tax Day each year as the chance to spread false narratives about credit unions, their tax status and their members,” said CUNA President/CEO Jim Nussle. “Fortunately, credit unions have facts and research to highlights the numerous public policy benefits to every American due to the existence of credit unions, and we’re empowering our member credit unions to push back against these falsehoods wherever necessary to set the record straight.”

CUNA released a white paper to show the numerous benefits realized by Americans due to credit unions’ presence in the market, and how any change to the credit union tax status would result in a significant loss of those benefits. Read White Paper Here.

Highlights from Credit Union Tax Exempt Status

Credit unions delivered an estimated $16.5 billion in direct and indirect financial benefits 2018 — an amount that is roughly eight times larger than the $1.8 billion tax expenditure Congress has granted credit unions.

Since 2007, credit unions have contributed nearly $142 billion back into the economy.

Credit unions collectively paid an estimated $20 billion in federal, state, and local taxes, and credit union members paid and estimated $1.5 trillion in state and federal taxes on proceeds and interest in the most recent tax year.

While the credit union tax expenditure was approximately $1.8 billion in 2018, lower tax rates have reduced the tax burden on U.S. banks by nearly $30 billion due to the Tax Cuts and Jobs act.