FHFA Backs CU in N.Y. Mortgage Tax Appeal

Wednesday, January 18, 2012 10:57:00 AM

ALBANY, N.Y. – The Federal Housing Finance Agency (FHFA) has filed an amicus brief in support of Hudson Valley FCU's appeal of a lower court ruling that denied the Poughkeepsie, N.Y. credit union's challenge to the state's mortgage recording tax (MRT).

At issue is whether a federal credit union, including its members, must pay the MRT to record its mortgages with the state. Hudson Valley FCU has argued that the tax is not considered a "privilege tax" under federal law and that the credit union federal tax exemption and applicable U.S. Supreme Court rulings should control.

The credit union filed the suit in May 2009 against the NY State Department of Taxation and Finance. This suit was dismissed by a NY Supreme Court justice a year later, but the credit union appealed this ruling. The Credit Union Association of New York (CUANY) and CUNA late last year supported Hudson Valley FCU's appeal in an amicus brief filed in the NY Court of Appeals.

The FHFA, which oversees mortgage servicers Fannie Mae and Freddie Mac, said in its brief that the credit union tax exemption, as provided under the FCU Act shields federal credit unions "from state taxation of any type whatsoever, carving out only direct taxes on real property and tangible personal property from the otherwise all-encompassing exemption."

An amicus briefs can be filed by a party with no direct involvement in a given court case, but who wishes to provide additional information or opinions.

Comments

Comments are closed on this post.