The second way credit unions protect their directors and officers is to offer indemnification
for legal expenses.
Income tax indemnifications are contractual arrangements between two parties whereby one party will reimburse the other for income taxes paid to a taxing authority related to tax positions that arose, typically, before the transaction in which the indemnification was established.
While the income tax accounting principles (ASC 740) do not apply to taxes other than income taxes, the other elements of this framework may be applied with respect to indemnifications for such taxes.
Frankly, HUD has always maintained much negotiating power in seeking indemnification, as the MRB would alternatively withdraw a lender's FHA approval if the lender did not obtain the requested indemnifications.
8, 2010, the Department of Housing and Urban Development (HUD) announced plans to strengthen the Federal Housing Administration's (FHA's) lender indemnification process.
The airline said that it will offer all necessary assistance with regard to monetary indemnification
proceedings according to a set of three principles.
The costs of indemnification
insurance also rose and threatened to become unaffordable for individuals and families.
provisions should be designed to maximize the benefits of insurance, reduce insurance premiums, and minimize disputes among the parties and their insurance carriers.
They often seek a contractual allocation of potential environmental liabilities or use indemnification
provisions, which do not affect CERCLA liability but provide for reimbursement of the indemnified party's cleanup costs.
The seller will want to know of any potential toxic or hazardous substances on the property in order to determine what types of representations, warranties, conditions, and indemnification
provisions to include in the sales contract.
The purpose of an indemnification
clause is to contractually shift the liability and financial burden for damages suffered by a third party to the party that is at fault.
Dunn wrote that CUNA's major concerns about the proposed restrictions on paying legal expenses--or indemnifications--include the potential financial burden on credit union executives, including those eventually exonerated, who would have to pay their legal expenses; and the lack of safeguards preventing the agency from blocking indemnification
payments because its examiners don't accept a board's determination that the individual acted in good faith.