Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive
150x172_CUEffect.jpg
Contacts
LISA MCCUEVICE PRESIDENT OF COMMUNICATIONS
EDITOR-IN-CHIEF
MICHELLE WILLITSManaging Editor
RON JOOSSASSISTANT EDITOR
ALEX MCVEIGHSTAFF NEWSWRITER
TOM SAKASHSTAFF NEWSWRITER

News Now

Washington
Second UBIT lawsuit makes strong case says CUNA
WASHINGTON (5/27/08)--The second lawsuit to be filed over policies imposed by federal tax collectors on payment of unrelated business income tax (UBIT) makes a strong case, said a representative of the UBIT Steering Committee last week. Bellco CU, Greenwood Village, Colo., filed what is now the second lawsuit this year over the UBIT policies. It filed a complaint against the Internal Revenue Service (IRS) May 21. The credit union is seeking a refund of $199,000, based on UBIT taxes paid for 2000, 2001 and 2003. "Bellco CU has made a strong case in its complaint, taking a critical stop toward compelling the tax agency to adopt a more reasonable position,” said Eric Richard, Credit Union National Association (CUNA) general counsel and executive vice president, speaking on behalf of the UBIT Steering Committee. “Bellco deserves the gratitude of the credit union system for taking on this important policy issue, essentially seeking to right a wrong that IRS has committed by forcing cooperatively owned, not-for-profit credit unions to pay tax on some of the financial services they offer,” Richard said. CUNA and the UBIT Steering Committee support Bellco’s position in the case. The UBIT Steering Committee comprises representatives from CUNA, CUNA Mutual Group, the American Association of Credit Union Leagues and the National Association of State Credit Union Supervisors. The Colorado credit union refund claim is based on income generated primarily through sales of credit life and credit disability insurance over those three tax years. Revenue generated from sales of accidental death and disability insurance, and the credit union’s involvement with CFS Member Financial Services, a credit union service organization, were included under the 2003 refund claim. The lawsuit contends that the revenue is substantially or otherwise related to the exempt purposes and functions of the credit union as a tax-exempt, state-chartered credit union. Bellco has asserted that no portion of the taxes paid were legally due. In January, a Wisconsin credit union filed a complaint against IRS seeking a refund of $54,000 in taxes paid in UBIT on income from several insurance products. The Wisconsin lawsuit also contends that the revenue from sale of the products is "substantially related" to the purposes and functions of the tax-exempt, state chartered credit union.


RSS





print
News Now LiveWire
CUNA: CUNA offices closed through Friday, News Now returns Monday http://t.co/a5xbLzQKDj
22 hours ago
Reminder: @CUNA's Madison, D.C. offices will be closed through Friday, open again on Monday. #NewsNow will publish Monday.
1 Day ago
MI dentist to match @CUDirect's $20K to @HurleyMedical as a result of #20for20 online voting http://t.co/hqmIc9LpK1 @CMNHospitals
1 Day ago
New #creditunion chartered in St. Louis - #LutheranFCU - by @TheNCUA http://t.co/faPfANGS0P. Only 3rd new FCU charter this year.
1 Day ago
Don't get hacked during the holidays-use these tips from @CUNA http://t.co/jEqxni6NhO #StoptheDataBreaches http://t.co/woIxPOIyys
1 Day ago