As Prepared for Delivery on May 25, 2023
Thank you, Justin and Rick, for your work on this proposed rule. May is National Military Appreciation Month, so it is fitting we address this issue now.
First, I’d like to congratulate the staff and Board for developing the Charitable Donation Account (CDA) program back in 2013. Credit unions can only grow through their earnings, and the CDA program provides an innovative way to fund donations to 501(c)3 charities without taking dollars away from regular income.
Today’s vote is about adding tax-exempt veterans’ groups – 501(c)19 organizations – as permissible recipients of CDA donations. This proposed change will provide another way for all credit unions to support America’s military.
Given the make-up of the credit union movement itself, this change is especially meaningful. Military credit unions represent a significant portion of the nation’s credit union system. According to NCUA call report data, nearly 20 percent of America’s over 130 million credit union members belong to military credit unions. Although this proposed change applies to credit unions in general, it is appropriate to give the nation’s military credit unions the ability to take advantage of Charitable Donation Accounts to support 501(c)19 tax-exempt veterans’ groups.
Thank you to the staff for addressing my concern that there may be other organizations we should consider in the future. If stakeholders know of other 501(c) or non-501(c) organizations that the NCUA should consider adding as permissible recipients of CDA donations, I urge them to use this opportunity to comment. Those comments will be used for consideration of future changes to the rule.
I’d like to thank the Marion County Veterans’ Honor Guard in Kentucky for helping to educate my office over the past two years on this issue. With their help, we confirmed that the IRS automatically gives 501(c)19 status to veterans’ organizations when they apply for a 501(c)3 designation. This is to ensure veterans’ groups receive all the benefits intended for these organizations. Unfortunately, the 501(c)19 designation prevented credit unions from including them as recipients of CDA donations.
The Marion County Veterans’ Honor Guard also put a human face on these 501(c)19 organizations. Just like thousands of veterans’ organizations in communities across the country, this group provides, at no cost, full military burial honors to all veterans in their community who have honorably served in any branch of the United States Armed Forces. Marion County Veterans’ Honor Guard is but one of many 501(c)19 organizations providing a variety of support for veterans. This proposed change gives credit unions one more tool as they seek to enhance their support of our nation’s military.
Thank you, this concludes my remarks.