Once upon a time, people could only join the PenFed credit union if they shared a “common bond” with other members through an affiliation with the military. Such restrictions were once offered as a reason large credit unions were exempt from paying federal taxes.
Cost to Taxpayers
Credit unions’ federal tax exemption costs the U.S. more than $3.1 billion per year. Without reporting requirements holding them accountable to their mission, it remains unclear what exactly taxpayers get in return.