A new report from the National Association of Federally Insured Credit Unions (NAFCU) outlines how the newly enacted Tax Cuts and Jobs Act impact credit unions.
First and foremost, NAFCU stated, the credit union tax exemption remains intact, due in large part to the advocacy efforts of NAFCU and credit unions.
Also, the tax reform package act places a limit on the deductibility of interest paid on some home equity loans and lines of credit (HELOCs) that began after Dec. 31, depending on the purpose of the loan.
In addition, the law eliminates the deduction of home equity debt. Further, it limits acquisition debt to $750,000, reduced from its current cap of $1 million.
However, the act does not alter distinctions between acquisition debt and other home equity debt,
NAFCU’s full analysis of the tax plan is available online at www.nafcu.org. The report summarizes other provisions, including the mortgage interest tax deduction, unrelated business income tax, and small business loan interest deduction.
As Congress implements these changes to the tax code and considers technical corrections, NAFCU will continue to advocate for credit unions. NAFCU staff is available to assist member credit unions in understanding how the tax revisions will impact them and their members.