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Congressional Committee Releases New CU Tax Exemption Cost Estimate

By David Baumann - December 28, 2022

Figure differs from Treasury Department projection by close to $1 billion.

The Congress tax scorekeeper estimated last week that between 2022 and 2026, the credit union tax exemption will cost the federal government $14.4 billion.

The report from the Joint Committee on Taxation follows a Treasury Department report from November that estimated that, during the same time period, the credit union tax exemption will cost $15.36 billion.

Impact of the Figures

Congress and the Treasury Department use different methodologies in estimating tax revenue. The Biden Administration is likely to use the Treasury Department’s figures when it releases its FY24 budget plan next year.

Congressional tax-writing committees meanwhile are likely to use the Joint Tax Committee’s figures in calculating the impact of tax policies. The joint committee is made up of members of both houses.

Banking trade groups in the past have used various estimates of the cost of the tax exemption to argue that credit unions should be subject to federal income taxes.


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