IRS revokes credit union’s tax exempt status
A financially-troubled San Francisco cooperative is under state scrutiny for unsafe and unsound practices.
The IRS has revoked the tax-exempt status of a financially troubled California credit union.
The $590,634 Jones Methodist Church Credit Union in San Francisco, chartered in 1953 for its members who were being redlined or charged with unfair interest rates by banks, had its tax-exempt status automatically pulled on May 15, 2017 after the cooperative failed to file its Form 990 for three consecutive years.
The last time Methodist Church CU submitted its Form 990-N to the IRS was for tax year 2013, according to the federal agency. When a nonprofit organization, including any state-chartered credit union, fails to submit a Form 990 for three consecutive years, that organization’s tax-exempt status is automatically revoked.
California credit unions are required to incorporate under the nonprofit mutual benefit corporation law, which makes a credit union eligible to apply for tax-exempt status. However, the state’s law does not require credit unions to have tax-exempt status, Lila Mirrashidi, California DBO’s deputy commissioner, said.
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