Credit unions secured a major victory as President Donald Trump signed H.R. 1, the “One Big Beautiful Bill,” into law on July 4, preserving the industry’s long-standing tax exemption.

This outcome is the culmination of a year-long, aggressive, and unified advocacy strategy by the California Credit Union League, Nevada’s Credit Unions, and America’s Credit Unions — in partnership with state leagues/associations and individual credit unions. The movement has made sure its not-for-profit tax status remained untouched throughout the sweeping tax reform and reconciliation process.

“We achieved this through credit unions’ support, leadership, and advocacy,” said Scott Simpson, president and CEO of the California Credit Union League and Nevada’s Credit Unions. “In partnership with you, we have consistently engaged with legislators in Washington, D.C. We want to wholeheartedly thank each credit union that invited employees and members to contact legislators in support of the credit union tax exemption.”

The passage of H.R. 1 by the U.S. House of Representatives with a narrow vote of 218-214 on July 3 — followed by the U.S. Senate’s approval — confirmed that the industry’s sustained efforts paid off. Despite initial concerns that “everything was on the table” for tax reform, the credit union tax exemption was not altered in any draft provision, legislation, or amendment during the entire congressional process.

A United Front: The Advocacy Campaign

The successful preservation of credit unions’ tax status is attributed to a relentless advocacy campaign built on strategic planning and widespread engagement. Recognizing that many provisions of the 2017 Tax Cuts and Jobs Act were set to expire in 2025, the credit union movement across California, Nevada, and the nation began preparing its strategy last summer, including supporting and educating credit union-friendly candidates.

Elements of this robust advocacy included extensive outreach. State leagues and individual credit unions engaged in continuous communication with lawmakers.

In California:

• Credit union advocates sent more than 341,000 messages to Washington, D.C. to support the preservation of the credit union tax status.
• As part of the “Don’t Tax My Credit Union” campaign, Senators Adam Schiff and Alex Padilla each received over 100,000 messages to protect the credit union tax exemption.
• Leaders from the credit union movement met with staff from Padilla and Schiff’s offices, highlighting the credit union difference with CEOs representing diverse credit union asset sizes.
• Senior Vice President of Federal Government Affairs Stephanie Cuevas flew to Washington, D.C. seven times to meet with legislators, including multiple face-to-face discussions with Senator Padilla and Senator Schiff.
• One major win from this level of advocacy resulted in Padilla introducing an amendment to support the preservation of the credit union tax status.

In Nevada:

• Credit union advocates sent more than 7,800 messages to Washington, D.C. to support the preservation of the credit union tax status.
• As part of the “Don’t Tax My Credit Union” campaign, Senators Catherine Cortez Masto and Jacky Rosen each received nearly 1,200 messages to protect the credit union tax exemption.
• Leaders from the credit union movement met with Rosen and Cortez Masto, highlighting the credit union difference with CEOs representing diverse credit union asset sizes.
• Senior Vice President of Federal Government Affairs Stephanie Cuevas flew to Washington, D.C. multiple times to meet with legislators and staff.

On a national level, grassroots mobilization was key. The “Don’t Tax My Credit Union” campaign proved highly effective, generating:

• Over 861,000 messages sent directly to lawmakers nationwide.
• A digital advertising campaign that resulted in over 139 million ad impressions and engaged more than 191,000 activists.
• More than 570 social media posts from credit unions, yielding 304,729 impressions and 21,285 engagements. External organizations contributed over 600 posts.
• An influencer campaign reaching over 28 million people with 751,555 post views.
• Partnerships with media outlets like Politico, which saw significant page views and impressions for content highlighting the credit union difference.

The ‘Credit Union Difference’

Central to the advocacy message was the concept that the credit union tax exemption is not a “gift” or “subsidy,” but rather a recognition of their unique not-for-profit, member-owned cooperative structure. This structure allows credit unions to reinvest earnings into benefits for their 142 million members and communities, such as lower loan rates, higher savings yields, reduced fees, and financial literacy programs.

Industry leaders consistently emphasized that taxing credit unions would essentially be a tax on these 142 million Americans. Studies commissioned by the industry showed that eliminating the tax exemption could shrink U.S. Gross Domestic Product by nearly $266 billion over the next decade and result in 822,000 lost jobs, highlighting its broader economic impact.

While the primary focus was on the tax exemption, H.R. 1 also included other provisions that may impact credit unions, such as:

• An expansion of the excise tax on executive compensation for tax-exempt organizations, though this is unlikely to affect most credit unions.
• An excise tax on remittances made by non-U.S. citizens to other countries, requiring credit unions offering such services to collect and send these taxes.
• A new excise tax on parking and transportation benefits, which could be a tax compliance issue.
• The creation of “Trump Accounts,” similar to 529 college savings plans, which credit unions can offer.
• A “no tax on overtime” provision, allowing a deduction for qualified overtime compensation.
• A provision for the Office of Management and Budget to pursue regulatory modernization and efficiency at agencies like the CFPB, potentially leading to reduced regulatory burdens.

The successful passage of H.R. 1 with the credit union tax exemption intact is a testament to the industry’s unified and aggressive advocacy, securing its ability to continue serving Main Street America and empowering individuals to achieve their financial goals.