Understanding Credit Unions
Credit Unions are not for profit, member owned, financial institutions that exist to serve the financial needs of their member owners. Their main focus is our member and local community.
Becoming a member is simple and easy.
Credit Unions are owned by their members and governed by a volunteer board of directors who are also members of the credit union.
Unlike other not-for-profits, credit unions receive a tax exemption because they are mutually operated without profit. Earnings are returned back to members of the credit union in the form of lower rates and fees.
By current federal statute, credit unions cannot serve the general public. People qualify for a credit union membership through their employer, organizational affiliations like churches or social groups or a community such as Rockland County.
Our critics often claim that credit unions don't pay taxes. Credit unions do pay payroll taxes, sales taxes, and property taxes. Congress exempts credit unions from federal income taxes. The exemption was established in 1937, affirmed by statute in 1951, and reaffirmed in 1998 in H.R. 1151, the Credit Union Membership Access Act, which states:
"Credit unions, unlike many other participants in the financial services market, are exempt from Federal and most State taxes because credit unions are member-owned, democratically operated, not-for-profit organizations generally managed by volunteer boards of directors and because they have the specified mission of meeting the credit and savings needs of consumers, especially persons of modest means."Go to main navigation