CUNA Presses For Dividend Tax Break

CUNA has sent a letter to the top Senate Republican and Democratic leaders for the chamber and to the Finance Committee urging them to include interest income and dividends received by individual credit union members under the partial tax exclusion of dividend income provision of the tax cut bill.

In the letter, CUNA CEO Dan Mica stated allowing the exclusion of credit union dividends received and interest income "would encourage additional savings and investment through traditional deposit and fixed income instruments in a significant way."

The letter arrived as the Senate was considering the Jobs and Growth Tax Act of 2003 (S. 2) and a vote could come as early as tomorrow.

Mica pointed out that prior to 1986, an exclusion existed for a portion of both interest and dividends earned by individual taxpayers. "Providing such an individual exemption would ensure that more taxpayers have the flexibility to invest in interest- or dividend-generating savings and investment options and would increase the national savings rate," wrote Mica.