accounting for iasc 740 for tax exempts-morris

-shy _

NovemberDecember 2011 volume 23 number 3

ARTlCLES

3 CO-INVESTING BY PRIVATE FOUNDATIONS AND DISQUALIFIED PERSONS Douglas M Mancino and Oler Lion

TheCode clearlycontemplates co-investment arrangements in partnership form betweenprivale foundalions and disqualified persons

12 WHEN CELEBRITIES AiID 501 (c)(3)s COLUDE-THE PERILS AiID THE PATHWAYS Mark B Weinberg and Bl ake K Behnke

Celebrity and charity make a lovely harmony so long as Ihe music primarily benefils the public

10 GUARDING AGAINST ANTI-CORRUPTION PROBLEMS IN OVERSEAS ACTIVITIES Kei th M Ko renchuk James P Joseph Samuel M Willen and Andras Kosaras

Charilable activilies 100 are subject to the ForeignCorrupl Practices Act

24 INNOVATIONS IN PROVIDING AFFORDABLE HOUSING Jonathan Gross and Nathan L Mize

Affordable housing community development and renewableenergy projects can be challenging in todays economy

30 APPLYING ASC 740-10 TO REPORTING BY TAX-EXEMPT ORGANIZATIONS-PART 1 Cassady V Brewer Marc A Azar and Katherine O Morris

SlOp kidding yourself or the joke will be on you

37 WHAT IS SO EASY ABOUT VALUING A FACADE EASEMENT Craig J Langslraat and Akela Young

The current IRS audit effort slrains ils resources and may fall 10 dislinguish between a legitimale

deduction and an abUSive tax shelter

COLU MNS

45 CURRENT DEVELOPMENTS WHAT LEVEL OF LEGISLATIVE INFLUENCE MAY A PRIVATE FOUNDATION HAVE

Gregory A Frezados

WGampL

bull

~-------------~

bullLeaders who

think that their organizations

ani safe because they always

have med in a certJinway

cou d be in fora rude awakenIng

whcnthelRS comes calling

APPLYNG ASC 7 40-10 TO REPORTNGBY TAX-EXEMPT ORGANIZATIONSshyPART 1 CASSADY V BREWER M ARC A AZAR CPA AND KATHERINE 0 MORRIS CPA

At least two tax policy trends currently bave a sigshynificant impact on all taxpayers including exempt organizations One demonstrated by tbe extenshysive Form 990 tbat now must be filed by most exshyempt organizations of even modest size is inshycreased scrutiny and enforcement by the IRS Second there is an emerging broader trend ofenshylisting professional advisors to police their own clients witb respect to income tax compliance2 With looming federal budget deficits now and for the foreseeable future these tax policy trends al shymost certainly are not going away

One unwelcome but nevertheless logical byshyproduct of these policy trends has been the deshyvelopment of new financial statement and tax return disclosure requirements concerning uncer tain tax positions Publicly traded forshyprofit companies and nonprofits with public debt (eg tax -exempt bonds) have been dealing with these disclosure requirements for a few years now but most tax-exempt organizations have remained blissfully ignorant Today though all exempt organizations with either reviewed or audited financial statements issued under generally accepted accounting principles

CASSADY V BREWER is an Assistant Professor at Georgia State Unishyvwity Colege of Law in Atlanta MARC A AZAR is a partner with Smith amp Ho ward PC in Atlanta KATHERINE D MORRIS is a CPA practicing in Atlanta

TAXATION OF EXEMPTS bull NQVEMSERIDECEMIlfR 20 11

(GAAP) are subject to the new disclosure rules regarding uncertain tax positions Furthershymore the IRS clearly is tired of some organizashytions flouting the unrelated business income rules3 As a result exempt organizations should take a fresh look at their income tax returns and any potential IRS audit exposure Failure to do so could be costly and in extreme cases could result in loss of exempt status Leaders who think their organizations are safe because they always have filed tax retufDs a certain way or because everybody else does it could be in for a rude awakening when the IRS comes calling

This article will be published in two install shyments The first installment below will deshyscribe the basic rules and set out a case study on uncertain tax positions The second to be pubshylished in a future issue of Taxation ofExempts discusses the application of the rules in the context ofspecific issues relevant to exempt orshyganizations fOCUSing on UBIT

Case study-The tax-exempt private school To illustrate the new rules and disclosure requireshyments regarding uncertain tax positions consider the following example

For the past ten years a tax-exempt private school (the SchooJ) has permitted individuals

30

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and businesses to use portions of its facilities for private special events such as weddings parties photo shoots and similar activities The School provides exclusive access to por shytions of its facilities during these special events It employs a full-time staff to schedule plan and conduct these special events With the asshysistance of an independent contractor the School provides set-up furniture food and beverage (including alcohol) and cleaning services for the special events It charges for hosting the special events The fees it charges vary according to the type of event and the services requested The School also separately charges rent for the use of its facilities for the special events These rent charges vary accordshying to the amount of space needed and the length of the event The School has a standard agreement that it uses to contract with individshyuals and businesses using its facilities for these special events

Although it always has filed an annual Form 990 with the IRS the School had never filed a Form 990- T (Unrelated Business Inshycome) until 1111505 (for its fiscal year ended 63005) Although its activities had not changed materially from prior years it filed a Form 990-T for that fiscal year because earlier that year it had hired a new chief financial ofshyficer more familiar with the unrelated busishyness income rules The new CFO decided that the School should file a Form 990-T for its fisshycal year ending in 2005 and each year thereshyafter in order to report income from alcohol sales and furniture rentals in connection with its special events The CFO however detershymined that income realized strictly from the use of facilities for special events should be considered rental income which did not have to be reported as income potentially subject to UBIT

Midway through its fiscal year ending 63010 the CFO discovered that the School made two unfortunate and improper expendishytures earlier that year First unbeknownst to the CFO the newly-hired executive director caused the School to pay a very large bonus to

The new Form 990 clearly assisls the IRS in identifying orshyganizations with an increased risk of noncompliance The recent college and university audits are another example of increased scrutiny and enforcement See the Interim Report with respect to the ongoing School and University Audits isshysued 57 10 by the Tax Exempt and Government Entities Dishyvision of the IRS available at wwwirsgovpubirsshytegelcucpjnterimrpt_052010 _pdf

For example see IRS Commissioner Doug Shulmans reshymarks to the American Bar Association on 92410 an-

UNCeRTAIN TAX POSITIONS

the directors adult son who had been hired to redesign the Schools Web site The CFO detershymined that the bonus clearly was excessive and unreasonable Unfortunately during that same period and without the CFOs knowledge the executive director also directed the organiza shytion to make a $500 campaign contribution to his daughters political campaign committee Immediately upon learning of these expendishytures the C FO informed the board ofdirectors and the executive director was fired The CFO also demanded that the campaign committee for the now-former directors daughter refund the $500 contribution and the campaign promptly did so Further the CFO began workshying with the Schools outside accounting firm to implement tighter fiscal controls within the School and informed the Schools attorneys about the expenditures

The accounting firm communicated with the School in preparation for an audit of its fisshycal year ending in 2010 The accountants adshyvised the School that for the firm to issue GAAP-compliant financial statements the School must comply with new rules requiring financial statement disclosure of all material uncertain income tax positions that if chalshylenged by the IRS and litigated likely would not be upheld by the court The firm also reminded the School that any such required disclosure on its financial statements also had to be disclosed on Schedule D of its Form 990

Acting on its accounting firms advice the School made a preliminary analysis of its prior years activities and tax reporting SpeCifically it performed the following tasks bull It reviewed its numerous activities supporting

its tax-exempt purpose and identified any acshytivities that were unrelated to its exempt purshypose or that might jeopardize its tax-exempt status

bull It reviewed the sources of its revenue espeshycially from the special events and carefully considered whether unrelated business income and properly allocable expenses were being reshyported correctly to the IRS with respect to that revenue

nouncing the new Schedule UTP available at wwwirsgov newsroomarticleO id=228126OOhtml

Commenting on exempt organizations and their lack of compliance with the unrelated business income rules Lois Lerner IRS Director of Exempt Organizations recently reshymarked Generally there is not really a very good reason for that other than that they thought they could get away with it Remarks to the Independent Sector and IRS Confershyence Washington DC 42711

ASC 740-10 discussed further below

NOVEMBERDECEMBER 2011 bull TAXATION OF EXEMPTS

bull

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There isanbullemerging trend

toward enlisting professional

advisors to police their own clients

bull To determine whether it had a material uncershytain tax position that it had to disclose it closely examined Accounting Standards Codishyfication 740-10

ASC740-10 Publicly traded for-profit companies and nonshyprofits with public debt-such as those with taxshyexempt bonds-had to implement Accounting Standards Codification (ASC) 740-10 Accountshying for Uncertainty in Tax Positions (ASC 740shy10) for fiscal years beginning after 1211506s

Nonprofit organizations without public debt were allowed to defer the implementation of ASC 740shy10 until fiscal years beginning after 1211508 (genshyerally calendar year 2009 and fiscal years beginshyning in 2009) With the expiration of that deferral period however disclosure of material uncertain tax positions is now mandatory for all organizashytions including nonprofits that have any potenshytial income tax liability and that issue financial statements in accordance with GAAP

ASC 740-10 applies only to income tax conshytingencies Other tax contingencies are subject to a different standard6

For any organization whether for-profit or tax-exempt the proper application of ASC 740-10 initially requires the identification of potential uncertain tax positions Among the many items that should be reviewed in the course ofidentifying such positions the followshying are of particular relevance to the issues disshycussed herein

All sources of revenue including underlying investments and all deductions and credits on each tax filing in all jurisdictions for all tax years in which the statute of limitations reshymains open (generally three or four years) The statute generally is open indefinitely if a return was not filed Financial statements and trial balances for all open years

bull The board of directors and board committees meeting minutes for all open years

bull With the involvement of human resource legal and financial and accounting personnel

The Financial Accounting Standards Board (FASB) codifies its accounting standards Accounting Standards Codificashytion (ASC) 740 governs accounting for income taxes ASC 740-10 provides guiding principles for accounting for uncershytain income tax positions

ASC 450-20-25 provides general guidance with respect to the financial accounting for loss contingencies and applies to contingencies arising out of taxes other than income taxes as well as other types of loss contingencies ASC 450shy20-25 provides that a loss contingency must be accrued

TAl(AnON OF EXEMPTS bull NOVEMBEPIDECEMBER 2011

the existence of any transactions with officers directors and others with Significant influence over the organization All of the organizations significant contracts with third parties

bull The outcome of any prior year income tax audits The results of this identification and invenshy

tory process should be summarized and classishyfied in one of three broad categories highly cershytain (virtually no tax risk) uncertain (along with the level of uncertainty) and immaterial7

The rationale or tax authority for any uncertain positions should be listed as well

After performing this identification and inshyventory uncertain tax positions (UTP) and any corresponding tax benefit to be recorded for fishynancial statement purposes are determined using a two-step process

The first step is recognition The organizashytion must determine whether it is more likely than not that any uncertain tax position will be sustained and the corresponding tax benefit upheld based on the technical merits of the poshysitiona If not the analysis stops and the tax benefit is lost for financial statement purposes If so the analysis proceeds to step two The technical merits of the position primarily inshyclude support in statutes regulations case law published rulings and administrative practices dealing with similarly situated taxpayers As noted above the application of ASC 740-10 presumes that the tax position will be examined by all relevant taxing authorities (ie no audit lottery may be assumed) Thus each tax posishytion must stand on its own technical merits without regard to extraneous factors such as the likelihood of audit the organizations prior cusshytom and practice or the fact that other organishyzations are taking the same position

For instance in the case study of the Schoo the tax treatment and reporting offacilityuse income as rent is a tax position The corresponshyding tax benefit is the exclusion of the rent from unrelated business income

The second step in the ASC 740-10 analysis is measurement using a separate more likely

(ie expensed to income) if (1) it is probable-meaning that one or more future events probably will occur confirming the loss-that an asset has been impaired or a liability has been incurred at the date of the finanCial statements and (2) the amount of loss can be reasonably estimated

The materiality standard is discussed further below

The threshold for permit1ing recognit ion of a tax benefit is the more likely than test-ie a greater than 50 chance that the position will be sustained upon examination by the releshyvant taxing authority Once the more likely than not threshshy

UNCERTAiN TAX POSITIONS 32

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EXHIBIT 1 Possibile Liability Outcomes in School Case Study

Possible Individual Cumulative Outcomemiddot Probability Probabilitymiddotmiddot

$500000 5 5 $350000 50 55 $ 20000 95 155

bull The possible outcome refers to the maximum potential tax benefit to be sustained or lost upon examination and final settlement

The cumulative probability is derived by adding the separate individual probabilities Probability is a judgment based on the facts known and the facts that should be known at the financial reporting date this judgment should be reevaluated in subsequent reporting periods for each uncertain tax position

than not test For each uncertain tax position the amount of tax benefit to be recognized for financial statement purposes is the largest amount with a greater than 50 likelihood of being realized 9

This second step can be confuSing In particshyular note that ASC 740-10 is designed to recogshynize and measure ta x benefits for financial statement reporting purposes whether the orshyganization expects to recognize those benefits in the future or has claimed them in the past With respect to tax positions and corresponshyding tax benefits that have been claimed by an organization in the past however the applicashytion ofASC 740-10 essentially requires a detershymination of an organizations potential outshystanding tax liabilities Put differentl y if a tax position taken by an organization in the past is uncertain and thus could overturned on examshyination by the relevant taxing authority the poshytential outstanding tax liability (ie the loss of the tax benefit) is subject to the ASC 740-10 measurement ana lysis

For example referring back to the case study assume that the School clearly met the highly certain threshold with respect to all of its current and prior ta x positions apart from its past treatment of facility-use income as rent Further assume that the Schools treatment of facility-use income as rent is uncertain (ie is not highly certain) and that the School has deshytermined that the loss of the tax benefit of exshycluding that income from unrelated business income (ie the maximum potential outstandshy

old is reached an organization must recognize Ihe tax benshyefit of a tax posilion

For measurement the illustrations provided in the FASB guidance have one consistent theme They emphasize that the enterprise must recognize the largest amount of benefit thai is more than 50 likely of being realized upon ultimate

UNCERTAIN TAX POSITIONS

ing tax liability relating to the income) is $500000 Put differently the School has detershymined that in the absolute worst case scenario it would owe $500000 to the IRS with respect to its facility use income Therefore in terms of financial acco unting the School has claimed a past tax benefit valued at a maximum of $500 0000

With respect to the potential loss of this $500000 tax benefit the School has identified three possible outcomes 1 There is only a 5 probability that the entire

$500000 tax benefit will be upheld and the school assessed no back taxes upon examinashytion

2 There is a 50 probability that a $350000 tax benefit will be sustained upon examination and confirmation by the court In other words there is a 50 probability that the School will be assessed only a $150000 tax deficiency leaving $350000 of its maximum potential tax benefit of $500000 undiminished

3 There is a 95 probability that at least a $20000 tax benefit will be sustained upon ex shyamination and confirmation by the court In other words out of the total potential tax benshyefit of $500000 there is a 95 chance that the School will be entitled to keep at least $20000 of the benefit The cumulative probabilities of these three

outcomes is shown in Exhibit I above Therefore the first possible outcome that has

a greater than 50 cumulative probability ofoc shycurring)s for the School to retain a tax benefit of

settlement As no ted furth er below one way to illustrate thi s concept is with the use of probability tables

10 For the sake of simplicity this example ignores potential inshyterest and penalties on the Schools possible back taxes but as discussed further below interest and penalties must be taken into account in the ASC 740-10 analysis

NOVEMBERDECEMBER 20 11 bull TAXATION OF EXEMPTS

ASC 740-10 applies only to income tax contingencies

33

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$350000 (ie be assessed only $150000 in back taxes relating to its facility use income)

Since the School has already claimed the $500 000 tax benefit a contingent $150000 lishyability ($500000 benefit claimed less $350000 benefit likely to be sustained) must be accrued for this uncertain tax position Assuming a $150000 liability is material with respect to the Schools financial position the School would disclose $150000 of potential tax liability on its financial statements to comply with ASC 740shy

ASC 740-10 requires quantifying the tax benefits derived by an organization

34

10 According to FASB there is no exact definishytion of materiality Rather materiality is to be determined after careful consideration of an organizations entire financial pOSition Among practitioners the omission or misstatement of an item in a financial report is considered to be material if in the light of all of the surrounding circumstances the magnitude of the item is such that a reasonable person relying upon the financial report probably would be influenced by the inclusion or omission of the item

In summary then ASC 740-10 requires identifying and quantifying the tax benefits derived by an organization With respect to prior tax reporting positions ASC 740-10 reshyquires a determination of how much income tax would be owed and thus how much tax benefit would be lost if the IRS (or other releshyvant taxing authority) was successful in imshyposing an additional tax liability on an organshyization As noted above when undertaking the two-step ASC 740-10 analysis it is imporshytant to keep in mind that all tax positions for all open tax years must be examined to detershymine the aggregate amount of an organizashytions potential tax liability Thereafter the orshyganization must undertake a materiality analysis to determine if it must accrue and disshyclose its uncertain income tax pOSitions As is so for any other organ ization documents that a exempt organization might review in an ASC 740-1 0 analysis include but are not limshyited to articles of incorporation and bylaws the application for exemption the IRS detershymination letter updates to the articles and byshylaws and disclosure to the IRS if exempt activshy

11 FASB Statement of Financial Accoun ing Concepts No 2 Qualitat ive Characteristics of Accounting Informat ion (Conshycepts Statement No2) 132 (1980) See also Concepts Statement No2 Glossary of Terms - Matenality)

TAXATION OF EXEMPTS bull NOVEMBERDECEMBER 2011

Hies change minutes of board of directors meetings major contracts opinions of counshysel and other tax advisors an d any correspon shydence middotvith taxing authorities including prishyvate letter rulings and prior audits Revenue streams also should be examined to determine whether the tax-exempt organization engages in unrelated business activities and whether direct and indirect expenses associated there shywith have been allocated properly Last but not least it is important to determine if all reshyquired tax returns have been filed because failure to file a return also is a ta x position

In addition to determining the potential inshycome tax liability from an uncertain tax posishytion interest and penalties must be calculated for each relevant taxing authority for each open year Uncertain tax positions generally must be tracked until the statute of limitations expires the liability is paid the required return is filed or the applicable law changes in the taxpaye rs favor

Applicationto tax-exempt organizations As noted above ASC 740 -10 now applies to all exshyempt organizations that issue financial statements in accordance with GAAP Because exempt organ shyizations generally are not subject to income taxashytion however there are some unique aspects to applying ASC 740 -10 to nonprofits Potential trouble spots include the follOWing bull Evolving activities Organizations may claim

that certain activities are related to their exshyempt purposes when in fact these activities bear little relation to the exempt activities they described on IRS form 1023 or 1024 as the basis for their exemption An example of evolving activities might be the use of the Schools assets for special events

bull Same as last year Unrelated business income calculations often are prepared in the same way year after year without questioning the technishycal merits of the position This is problematic Often activities have changed or the amount or method of expense allocation is outdated due to changes in general ledger coding Furshyther expense allocations against unrelated business income may be overly aggressive In addition applicable law can and does change Activities once considered exempt or nontaxshyable may be questionable under current law

bull Investment income Income from hedge funds pass-through en tities and lor foreign investshyments often can be taxable or partially taxable

UNCERTAIN TAX POSIf1ONS

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State income tax issues State unrelated business income tax sometimes is not apportioned properly andor the required returns someshytimes are not filed Organizations often do not realize they have a state income tax nexus due to multi-state operations or employees Altershynatively organizations may owe state income taxes outside their jurisdiction due to unreshylated business income from pass-through entishyties joint ventures or other non-local operashytions

bull Sponsorships Corporate sponsorship payments can be troublesome if they are booked entirely ltS donations when in fact they require signifishycant return benefits to the sponsor or contain elements of advertising income Foreign operations Organizations with foreign operations often have little knowledge of tax filings and payments required by foreign jurisshydictions

bull Net operating loss activities Net operating losses may have been carried forward without conshysidering whether such losses are valid whether the activity which generated the losses is in fact a trade or business from which losses may be used to offset taxable income or whether exshypense allocations taken in prior years were inshycorrect

bull Royalties A closer examination of royalty contracts may reveal that some require signifishycant activity on the part of the nonprofit posshysibly making income partially taxable as comshypensation for services Furthermore under ASC 740-10 exempt

status itself is a tax position Thus even assumshying a nonprofit does not have an uncertain tax position due to revenue -generating activities tax -exempt organizations must be organized and operated for valid exempt purposes If an organizations activities have changed substanshytially the organization may no longer be exshyempt Moreover to maintain its exempt status an exempt organization generally cannot enshygage in certain prohibited behaviors such as private inurement political activity or substanshytiallobbying activity A discussion of all of the restrictions imposed on tax-exempt organizashytions clearly is outside the scope of this article but a few are worth mentioning here to illusshytrate the potential impact of ASC 740-10

One issue is that any amount of private inshyurement by a Section 501 (c)(3) organization technically is grounds for revocation of exempt status 2 The same is true of any amount of poshylitical activity by a Section 501 (c)(3) organiza-

UNCERTALJ TAX POSmoNS

tion 3 Recall that in the case study of the School the CFO determined that the bonus paid to the executive directors son clearly was excessive and unreasonable The CFO also unshycovered the $500 contribution to the daughters political campaign The Schools attorneys however advised it that because both of these missteps were isolated incidents and because it took remedial measures by firing the former executive director implementing tighter finan shycial controls and recovering the $500 contribushytion from the political candidates campaign revocation of exempt status was unlikely

Though revocation of exempt status may be unlikely the Schools attorneys are certain that taxes under Section 4955 (for political expenshyditures) and Section 4958 (for excess benefit transactions) will be imposed if the organizashytion is audited by the IRS (although the latter would be imposed upon the son and pOSSibly on his father the former executive director not the School itself) After consulting with the atshytorneys the CFO in consultation with the board of directors determined that the School must report the improper transactions on Schedule C of its Form 990 for its fiscal year bullThe amount of tax benefit to be recognized for financial statement purposes is the largest amount with a greater than 50 likelihood of being realized

ended 6 3010 and pay the associated taxes Nevertheless the organization does not have a disclosure obligation under ASC 740-10 The taxes imposed under Sections 4955 and 4958 are excise taxes not income taxes Further the Schools attorneys advised it that revocation of exempt status based on these issues is unlikely Because the more likely than not test is met with regard to preservation of exempt status ASC 740-10 does not apply

It is important to understand however that even though the School does not have an oblishygation to disclose under ASC 740-10 it nevershytheless may have an obligation to disclose on its financial statements the potential imposishytion of the Section 4955 excise tax as a loss conshytingency under ASC 450-20-25 If an asset has been iITlpaired or a liability has been incurred and themiddot impairment or liability can be reasonshy

12 Hill and ManCino Taxation of Exempt Organizations fNarshyren Gorham amp Lamont 2002) 11 404(21 middot

13 Id at 11 601 fn 6

NOVEMBERIDECEM8ER201 1 bull TAXATION OF EXEMPTS 3S

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ably estimated the impairment or liability should be accrued and reported on an organishyzations financial statements ASC 450-20-25 thus can require financial statement disclosure of potential non-income tax liabilities such as excise taxes Fortunately though the instrucshytions to Form 990 Schedule D do not require specific disclosure for loss contingencies relatshying to non-income-based taxes (with an excepshytion for any loss contingency exceeding 5 of total assets)

In addition to the prohibition on political activity organizations exempt under Section 501 (c)(3) also may not engage in substantial lobbying activities Whether lobbying activity is substantial is a facts-and-circumstances question susceptible to broad interpretation

Consequently many exempt organizations make the Section 501 (h) election to measure and tax their lobbying activities under Section 4911 and to report the activities on Schedule C of their annual Form 990 Like the taxes imshyposed under Sections 4955 and 4958 though

the tax imposed under Section 4911 is an excise tax not subject to the ASC 740-10 disclosure

Conclusion One common area of income tax exposure for exshyempt organizations relates to the unrelated busishyness income rules and the calculation of VBIT How ASC 740-10 applies to this and other issues will be discussed in a future issue of Taxation of Exempts bull

TAXATION OF EXEMPTS NOVEMBERIOECEMBER 2011 UNCERTAIN TNlt OSITIONS

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NovemberDecember 2011 volume 23 number 3

ARTlCLES

3 CO-INVESTING BY PRIVATE FOUNDATIONS AND DISQUALIFIED PERSONS Douglas M Mancino and Oler Lion

TheCode clearlycontemplates co-investment arrangements in partnership form betweenprivale foundalions and disqualified persons

12 WHEN CELEBRITIES AiID 501 (c)(3)s COLUDE-THE PERILS AiID THE PATHWAYS Mark B Weinberg and Bl ake K Behnke

Celebrity and charity make a lovely harmony so long as Ihe music primarily benefils the public

10 GUARDING AGAINST ANTI-CORRUPTION PROBLEMS IN OVERSEAS ACTIVITIES Kei th M Ko renchuk James P Joseph Samuel M Willen and Andras Kosaras

Charilable activilies 100 are subject to the ForeignCorrupl Practices Act

24 INNOVATIONS IN PROVIDING AFFORDABLE HOUSING Jonathan Gross and Nathan L Mize

Affordable housing community development and renewableenergy projects can be challenging in todays economy

30 APPLYING ASC 740-10 TO REPORTING BY TAX-EXEMPT ORGANIZATIONS-PART 1 Cassady V Brewer Marc A Azar and Katherine O Morris

SlOp kidding yourself or the joke will be on you

37 WHAT IS SO EASY ABOUT VALUING A FACADE EASEMENT Craig J Langslraat and Akela Young

The current IRS audit effort slrains ils resources and may fall 10 dislinguish between a legitimale

deduction and an abUSive tax shelter

COLU MNS

45 CURRENT DEVELOPMENTS WHAT LEVEL OF LEGISLATIVE INFLUENCE MAY A PRIVATE FOUNDATION HAVE

Gregory A Frezados

WGampL

bull

~-------------~

bullLeaders who















30

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bull

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$500000 5 5 $350000 50 55 $ 20000 95 155




















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13 Id at 11 601 fn 6


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bullLeaders who















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bull

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$500000 5 5 $350000 50 55 $ 20000 95 155




















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13 Id at 11 601 fn 6


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bull

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$500000 5 5 $350000 50 55 $ 20000 95 155




















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13 Id at 11 601 fn 6


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$500000 5 5 $350000 50 55 $ 20000 95 155




















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13 Id at 11 601 fn 6


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$500000 5 5 $350000 50 55 $ 20000 95 155




















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13 Id at 11 601 fn 6


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13 Id at 11 601 fn 6


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13 Id at 11 601 fn 6


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accounting for iasc 740 for tax exempts-morris

Documents

tax exempt bonds

uncertain tax positions

tax retufds

tax policy trends

income tax compliance

income tax returns

abusive tax shelter

tax policy trend s