Discussing Credit Unions’ Tax Status and Regulatory Framework

Today, the Defense Credit Union Council (DCUC), represented by Chief Advocacy Officer Jason Stverak, and joined by AmeriCU President/CEO Ron Belle, shared a call with Congresswoman Claudia Tenney’s (NY-24) office. The parties discussed credit unions'  tax status and regulatory framework, including Community Reinvestment Act (CRA)  requirements. 

Today’s call followed DCUC’s letter sent to Congresswoman Tenney last week, in which DCUC  expressed appreciation for her openness to dialogue on these key issues. In the letter, Stverak highlighted the fundamental differences between credit unions and banks, and the historic role  

of credit unions in providing fair financial services to their members. Belle joined the call to provide perspective directly from a defense credit union leader and answer any questions from the Congresswoman and her staff. 

"Credit unions have long been guided by distinct features and legal requirements that set them apart from other financial institutions," said Belle. "Our industry was founded to provide affordable, small-dollar loans that were historically out of reach for many individuals due to high interest rates from other lenders. This commitment to a member-focused, not-for-profit model is  essential to our mission and to the communities we serve.” Belle added, “The credit union tax status enables us to continue serving those who need it most, especially military and veteran members, and underserved communities. AmeriCU deeply appreciates Congresswoman  Tenney’s willingness to discuss the unique mission defense credit unions serve to America’s  communities and armed forces." 

Credit unions remain distinctly different from banks - by law, they maintain a "common bond" among members and operate as democratically controlled, cooperative, not-for-profit organizations. This limitation on membership means that qualifying individuals, rather than corporations, make up the member base, reaffirming credit unions' unique purpose as defined under IRC 501(c)(14)(A). Credit unions focus on encouraging thrift and self-reliance by offering fair, reasonably priced credit to improve the economic and social well-being of their members and communities served.

Defense credit unions, committed to serving military and veteran communities globally, continue to embody these principles, delivering financial services aligned with the unique needs of service members. 

“Defense credit unions have a longstanding history of serving military members and their families worldwide, offering affordable loans, financial education, and resources tailored to the unique needs of those who serve,” said Stverak. “This targeted approach naturally aligns with CRA objectives and underscores credit unions’ deep commitment to their communities.” 

Stverak further noted that applying bank-specific CRA requirements to credit unions would overlook the unique and essential role they play in members' financial lives and contradict the distinction between member-focused, not-for-profit credit unions and large, for-profit banks. 

DCUC thanks Congresswoman Tenney and her staff for their time and her ongoing support of defense credit unions. The association looks forward to continued collaboration in ensuring that the distinct role and structure of credit unions remain recognized and protected in the regulatory landscape.

Click here to read the full letter sent to Congresswoman Tenney.