Are you a member of a Federal Credit Union in Florida, New York or Virginia?
If you paid a Mortgage Recording Tax at your real estate loan closing with your Credit Union for a home purchase or refinance you may be entitled to a Mortgage Tax Refund from the State.
We are investigating whether Federal Credit Unions, which are not for profit, member owned and managed financial institutions, are tax exempt from State Mortgage Recording Taxes by virtue of their statutory exemption from “all taxation” (including state and local taxation.) This exemption was bestowed by Congress on Federal Credit Unions in 1933.
Under Federal Law States are forbidden from taxing Credit Union’s and their intangible property, including its mortgages. Despite this exemption from State taxation, Florida, New York, and Virginia require Credit Unions to pay the Mortgage Recording Tax. The Credit Unions in these States do not pay the tax from their own funds, but pass the Mortgage Recording Tax on to their unknowing and unsuspecting members. These taxes typically run in the thousands of dollars per mortgage loan. A 1% Mortgage Recording Tax in New York on a $500,000.00 mortgage loan totals $5,000.00.
The State’s reasoning that an exemption from “all taxation” does not include excise taxes, like the Mortgage Recording Tax, has been recently and unanimously rejected by ten United States Court of Appeals and over forty Federal District Courts. All these courts have determined that an excise tax, like the Mortgage Recording Tax, is exempted by the statutory phrase “all taxation.”
Credit Unions have no incentive to challenge the Mortgage Recording Tax themselves because the tax is merely passed on to the members under the pretext that it is a required fee.
If you paid a Mortgage Tax within the past three years we would like to talk with you. Please submit your information below if you are interested in discussing your potential Mortgage Recording Tax refund claim. There is no cost or obligation to do so.