X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

WEST PALM BEACH, Fla. – Credit unions in some states are starting to learn about what could become a scary acronym for state-chartered credit unions – UBIT – which stands for Unrelated Business Income Tax. It is a tax levied against an exempt entity for income that is unrelated to that entity’s purpose. While it is not a new tax, there is increased emphasis on it by the IRS on state-chartered credit unions in some states, most notably Connecticut, but also including Colorado, Alabama, Texas and California. It does not apply to federal charters, and some believe this could become a major dual chartering issue. It is causing a stir among some credit unions that have been audited because the IRS is calling into question some longtime core CU products as possibly falling under UBIT. They include credit insurance as well as interchange income from debit and credit transactions. This new voting poll question deals with UBIT awareness. It reads as follows: “Are you aware of the Unrelated Business Income Tax, and that the IRS is still determining whether core credit union products such as credit insurance as well as the interchange income from credit and debit cards should be subject to UBIT?” *Yes *No *Was aware of UBIT, but not that credit insurance and interchange income were being looked at by the IRS? Log on to www.cutimes.com to cast your vote.

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.