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NATIONAL CREDIT UNION ADMINISTRATION
TO OFFICIALS OF THE FEDERAL CREDIT UNION ADDRESSED: As noted in Letter to Credit Unions No. 99, for the past several years, NCUA has filed a consolidated Internal Revenue Service (IRS) Form 990 (“Return of Organization Exempt From Income Tax”) -- an informational return -- for all Federal credit unions (“FCU’s”). In 1987, Congress amended the Internal Revenue Code (IRC) by adding subsection (e) to Section 6104 which requires that a.copy of the annual return filed by tax-exempt organizations will be made available by such or Sanizations for inspection for three years. We have contacted the IRS to determine whether it would be appropriate for the NCUA to continue filing a consolidated Form 990 in light of the new disclosure requirements for tax-exempt organizations. The Internal Revenue Service has now informed us that, according to their regulations, organizations that are tax exempt under Section 501(c)(1) of the IRC do not have to file an informational return or make such return available for inspection. (See Section 1.6033-2(g) (vi) of the Income Tax regulations, 26 C.F.R. 1.6033-2(g)(1)(vi).) Since FCU’s are tax exempt under Section 501 (c) (1) of the IRC, FCU’s are not required to file or maintain an informational tax return. Accordingly, NCUA will no longer file a consolidated Form 990. A copy of the letter from the Internal Revenue Service is attached.
Sincerely
DONALD E. JOHNSON
Attachment
Dear Mr. McCollum: We are responding to your letter dated July 26, 1988, in which you requested our opinion on a matter concerning the National Credit Union Administration (“NCUA”). In your letter you inquire as to whether is appropriate for NCUA to continue filing a consolidated Form 990 for all federal credit unions in light of the new disclosure requirements for exempt organizations. As part of the Omnibus Budget Reconciliation Act of 1987, Congress added section 6104(e) to the Internal Revenue Code. In accordance with this provision, during a three year period, a copy of an exempt organization’s annual return filed under section 6033 must be made available for inspection at the organization’s principal office. Section 6033(a)(1) of the Code generally requires every organization (with certain exceptions) to file an annual information return. For taxable years beginning after December 31, 1969, section 1.6033-2(g)(1)(vi) of the Income Tax Regulations specifically excepts all organizations described in section 501(c)(1) of the Code frog the requirement of filing an annual information return. Federal credit unions are described in section 501(c)(1). Because NCUA as well as the exempt federal credit unions under its supervision are organizations described in section 501(c)(1), they are not required to file annual information returns. We are, aware that Rev. Rul. 60-169, 1960-1 C.B. 621, holds that a group information return uiay be filed by the.Bureau of Federal Credit Unions (predecessor to NCUA) in lieu of the filing of a separate Form 990 by each federal credit union. However, in view of the regulation cited above, this revenue ruling no longer reflects the current Service position. Because
NCUA and the exempt federal credit unilons it supervises are not required
to file annual information returns, the disclosure requirements under
section 6104(e) of the Code, which discusses the availability of such
returns for inspection, are no~ applicable. In direct response to your
inquiry, it is our opinion that it is not appropriate for NCUA to continue
filing a consolidated Form 990 for all federal credit unions. We hope this general information will be helpful.
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