CUNA Comment Letter
NCUA Interim Final Rule and Request for Comments on Roth and Education IRAs
May 20, 1998
Becky Baker, Secretary of the Board
National Credit Union Administration
1775 Duke Street
Alexandria, VA 22314-3428
Dear Ms. Baker:
Credit Union National Association and Affiliates (CUNA), which represents over 90% of the 11,500 nationwide federal and state chartered credit unions, appreciates the opportunity to respond to the interim final rule with request for comments on Roth and Education IRAs. This interim final rule was issued March 24 in the Federal Register.
CUNA applauds the NCUA Board and staff for taking such quick action to make certain that federal credit unions have the authority to act as trustees and custodians of Roth and Education IRAs. As was noted in the preamble of the interim final rule, credit unions have been acting as fiduciaries of traditional IRAs for almost 23 years. They now want to be able to offer their members these new IRA products which became available January 1. Therefore, it was extremely important that NCUA quickly provide that authority. A Letter to Credit Unions (98-CU-5) provides credit unions with information on the insurance of these accounts.
We believe that the changes made to section 724.1 in the interim final rule do provide federal credit unions with fiduciary authority for Roth and Education IRAs. The addition of the reference to the Internal Revenue Code section 408A for the Roth IRAs and section 530 for the Education IRAs accomplishes that. We strongly urge the Board to adopt this interim final rule as a final rule.
We request that the agency move forward on a request for comment, rather than on an advanced notice of proposed rulemaking on Medical Savings Accounts (MSAs). It is our understanding that some federal credit unions are interested in having the authority to do more than merely allowing members to open such accounts.
CUNA appreciates this opportunity to comment and is ready to work with the agency on the issue of MSAs, SIMPLE 401(k) plans, and SEP plans.
Regulatory Affairs Counsel