While some likened the choices to “gun” or “cyanide,” our latest LinkedIn poll, which asked: Which is worse for your credit union: Regulatory burden or loss of tax-exempt status? prompted quite a discussion.
The completely unscientific poll found that regulatory burdens slightly edged out tax exemption as a concern 51% compared to 48%.
For many tax exemption didn’t seem as concerning because as Ken Bator, president/founder of Bator Training and Consulting, argued “it is the cooperative nature that makes the brand and culture of the credit union industry unique and not its tax-exempt status. Credit unions will simply adapt and change their business model if the tax exemption were taken away. The regulatory burden, however, could be the beginning of the end for some institutions.”
John Neusanenger, president/CEO of Orlando Federal Credit Union, added that it was more a question of “fear of the unknown.”
“Loss of our tax exemption MAY not be as painful, given our structure and ability to limit our taxable income,” Neusanenger commented. “We don't really know how IRS would structure taxes for a not-for-profit financial cooperative.”
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Our latest poll is out. This time we want to know: What percentage of your senior management team is 49 years old or younger?