Credit Union Representatives Tell IRS Give Us Better Information, More Reasonable Time Frames

December 18, 2001

FOR IMMEDIATE RELEASE
Contact: Pat Keefe
(202)508-6765
pkeefe@cuna.com

WASHINGTON -- Better information and more reasonable compliance time frames were two key issues raised by CUNA President and CEO Dan Mica in a meeting Monday, Dec. 17, with Internal Revenue Service Commissioner Charles O. Rossotti.

The meeting was held in Washington at IRS headquarters. Also joining in the meeting were Representatives of CUNA Mutual.

"The better information credit unions have, the better they can comply with IRS requirements," Mica told the IRS commissioner. "Credit unions are formed to pool members' savings, make loans and provide financial services. By and large, they cannot afford cadres of well- heeled attorneys, accountants and consultants to decipher IRS regulations. The better the information from IRS, the less of a burden on credit unions," Mica said following the meeting.

Mica suggested some steps the IRS could consider in improving the quality of information to credit unions. Among those steps: Establish industry groups to discuss development of proposed rules and feedback on existing requirements. Mica suggested this would allow credit unions and others to address concerns before rules are implemented and outside of the IRS' more formal hearing process.

Mica also told the IRS commissioner that credit unions need adequate time to adapt practices and procedures mandated by the tax agency, and urged that aspect be considered when compliance deadlines are set. "An example is from just last year," Mica said. "The IRS issued the new W-9 Form on Dec. 15, 2000-with an effective date of Jan. 1, 2001. That's barely two weeks' time for credit unions to print and execute new forms, which is clearly infeasible for many of our members."

In other comments, Mica discussed with the IRS commissioner the application of the Unrelated Business Income Tax (UBIT) toward credit unions, and expanded requirements for reporting on interest paid to nonresident aliens.

Joining Mica at the meeting to represent credit unions were CUNA Mutual's Faye Patzner (general counsel), Larry Blanchard (senior vice president of Legislative and Corporate Affairs) and Dennis Zuelkhe (senior compliance analyst).

Rossotti praised Zuehlke for his past testimony to the tax agency and for the credit union system's comment letters that recognize the importance of public policy needs.

With its network of affiliated state credit union leagues, CUNA serves more than 90 percent of America's 10,200 credit unions, which are owned by more than 81 million consumer members. Credit unions are not-for-profit cooperatives providing affordable financial services to people from all walks of life.

With its network of affiliated state credit union leagues, Credit Union National Association serves more than 90% of America's 10,000 credit unions, which are owned by more than 81 million consumer members. Credit unions are not-for-profit cooperatives where people are worth more than money. For more information, visit www.cuna.org.

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