WASHINGTON–While credit unions have largely been focused on any language that might have affected the CU tax exemption in the reconciliation bill before Congress, the versions of the bill passed by both the House and Senate have numerous other provisions that will affect credit unions.

Those include provisions around remittances, taxes on certain bank corporations, and the CFPB (see related story in the CU Daily).

Here’s a look at each as shared by Carrie Hunt, chief advocacy officer with America’s Credit Unions. 

Remittances

The House version of the bill imposes a 3.5% tax on international remittances, while the Senate version has a 1% tax. 

In the Senate version, funds that are remitted from a bank or credit union account are tax free.

“The Senate version of this language also adds another layer and makes clear that if these remittances were happening on a cash basis, that entity that was doing the remittance would be responsible for collecting the tax and sending it to Treasury,” said Hunt. 

Pass-Through Deductions

Both the House and Senate versions of the reconciliation bill include language related to deductions for pass-through entities such as subchapter S corporations. 

The House version increased the deduction to 23% from 20%, but that change is not included in the Senate’s version of the legislation, Hunt noted. 

“That would have given an extra boost to our some of our banking friends, so we will see if that survive the final version,” Hunt stated.