|
| |
Credit Unions and Banks
Tension has always existed between credit unions and banks. When credit unions
were first organizing in North America in the early twentieth century, the
banking industry was opposed, remaining so ever since. These tensions have only
been exacerbated as many credit unions have grown, expanded their fields of
membership to include large communities and whole states, and in the eyes of
some, are indistinguishable from banks.
Due to their status as not-for-profit financial institutions, credit unions in
the United States are exempt from federal and state income taxes (but, not from
employment or property taxes, among others). Additionally, credit union members
pay income taxes on dividends earned through financial participation in the
credit union; this is similar to the taxation structure enjoyed by many banks
incorporated under Chapter S.
Credit unions maintain that no matter their size or field of membership, the
fact that they are owned by their members and not shareholders makes them
fundamentally different from banks, and therefore continuing to deserve their
non-profit, tax-exempt status
| |
|
