What are the factors that determine whether the credit union should produce revenue directly under Incidental Powers or through a CUSO?
Many services, can be offered with or without a CUSO. NCUA has broadly construed the Incidental Powers of federal credit union to include Finder Activity income. This is the ability to enter into an arrangement with any vendor that desires to market their services to credit union members and receive revenue from the vendor. Of course, the arrangement must be otherwise legal and if there are some licenses under state law that the credit union must obtain to legally receive the income (e.g. an insurance license or mortgage broker license), then the credit union must obtain the applicable license. Credit unions that choose to provide the services through the Finder Activity Incidental Power should insure that they are satisfied with (a) a third party vendor exclusively providing the services, (b) the business control provisions in the vendor agreement, (c) the fact that the revenue sharing services are limited to members, (d) assuming the risk of the business without the CUSO layer of pro
Related Questions
- Is there any difference in tax treatment to running a service directly through the credit union under Incidental Powers or through a limited liability company ("LLC") CUSO?
- Is there any difference in tax treatment to running a service directly through the credit union under Incidental Powers or through a limited liability company ("LLC") CUSO?
- What are the factors that determine whether the credit union should produce revenue directly under Incidental Powers or through a CUSO?
