Thursday, May 24, 2012 8:57:00 AM
CUNA has been working on an effort to correct the IRS’s public list of credit unions, the tax exemptions of which ostensibly have been revoked. CUNA says they are working with the information that has been supplied by leagues and credit unions and they will soon be making a major presentation to the IRS on the problems with the list.
In the interim CUNA wanted to share a letter with credit unions that CUNA just sent to the IRS on a different aspect of the problems that credit unions are experiencing there: the issue of federal credit unions that have claimed the health insurance premium tax credit. Such credit unions are required to file Form 990T, even if they are federal credit unions which are exempt from filing Form 990 itself. This filing triggers a search by the IRS computer for past Form 990 filings; if none are found, an exemption revocation letter is automatically sent to the credit union. But federal credit unions are not required to file Form 990 and should not be receiving these letters.
In cases where this has already occurred, the IRS has been issuing corrections to the affected federal credit unions. But May 15th marked the annual deadline for filing a new Form 990 for those organizations that are required to file it. The concern now is that we will see a whole new round of erroneous revocation letters from the IRS to federal credit unions.
The letter asks the IRS to stop this from happening. CUNA hopes it will be effective.