WOCCU and the Credit Union National Association (CUNA) jointly urged the Internal Revenue Service (IRS) to reduce regulatory burden for Credit Unions in connection with the Foreign Account Tax Compliance Act (FATCA). These comments came as part of the IRS’ FATCA rulemaking efforts looking for regulations that should be modified or eliminated in order to reduce unnecessary burdens.
WOCCU and CUNA strongly supported many aspects of the rule that will reduce unnecessary regulatory burden for credit unions including the elimination of withholding on payments of gross proceeds from the sale or other disposition of any property of a type which can produce interest or dividends from sources within the United States.
FATCA places significant compliance costs on U.S. credit unions, especially those that engage in remittances and/or have members who are not U.S. citizens. As a result, Americans living and working abroad have had their bank accounts closed, as well as loans and mortgages recalled and denied. This is in large part because many financial institutions simply cannot justify serving these members and customers due to the high costs associated with FATCA compliance.
A copy of the comments can be viewed here.