FIN 48 for Exempt (Non-Profit) Companies has been issued in compliance with FASB Statement 109 for the purpose of simplifying uncertainties that may appear in a company’s financial statements. This Interpretation is designed to identify significant data in an income tax return at the time it is adopted. It also serves as an effective measure in the classification, penalties, disclosure and transition of tax returns and financial statements. Exempt organizations should strongly familiarize themselves with FIN 48 as the consequences of not doing so can lead to huge penalties.
The Knowledge Congress is producing a two-hour webinar that will feature a panel of experts and key regulators to discuss the important aspects of this Interpretation.
Nancy Z. Evetts
Director
James P. Sweeney
National Lead, Exempt Organization Technical Tax Services
Managing Director/Partner
Jerry O. Allen
Partner
Chair, Nonprofit Organizations Group
Jode L. Shaw (Tentative)
National Director – Tax Accounting and Risk Services Practice
Nancy Z. Evetts, Director, Deloitte Tax LLP
- What is FIN 48 and why did FASB issue FIN 48?
- Who must adopt FIN 48?
- FIN 48 Overview - 5 key concepts
1. Applied to all tax positions
What constitutes a tax position
Types of taxes (i.e. does not include taxes such as property or sales tax)
2. Benefit recognition approach
3. MLTN concept
4. Report tax positions at the largest amount of tax benefit that is > 50%
5. Generally record tax positions not eligible for benefit recognition as a liability
- Effective Date
- Focus for Exempt Organizations:
» Implementation Steps
» Financial Analysis
» Elements of Exemption
James P. Sweeney, National Lead, Exempt Organization Technical Tax Services; Managing Director/Partner, RSM McGladrey, Inc./McGladrey & Pullen LLP
- Issues related to the “open years” issue related to tax positions analyzed under FIN 48
- The two universal tax issues related to exempts
- The 28 overarching principles that should at least be examined and reviewed collectively under each universal tax position
- Case study, FIN 48 analysis
Jerry O. Allen, Partner; Chair, Nonprofit Organizations Group, Bricker & Eckler LLP
- FIN 48 applies only to income tax matters - not employment tax, excise tax, etc.
- FIN 48 will have the most significant impact on tax-exempt organizations that are required by law or otherwise compelled to provide audited, GAAP-compliant financial statements - hospitals, universities, bond-issuers.
- FIN 48’s largest area of impact on tax-exempt organizations will be in the area of UBIT - at the Federal, state and local levels.
- Organizations will have to more carefully scrutinize any position that could be construed as an uncertain tax position.
- Impact of tax positions or financial statements and potential for IRS audit must be evaluated.
- Tax counsel can assist affected organizations with the reporting, disclosure, and continuous monitoring required by FIN 48. Tax opinions will likely be more common regarding whether an issue is an uncertain tax position and the likelihood of success if challenged.
- Exempt organizations should review any political or lobbying activities they have engaged in with their tax advisors and determine if they have been properly accounted for.
- Exempt organizations should review all revenue streams they receive with their tax advisors and determine if they have been properly accounted for. Special attention should be paid to joint ventures with for-profits, royalty agreements and sponsorship agreements.
Jode L. Shaw, National Director – Tax Accounting and Risk Services Practice, RSM McGladrey, Inc.
** Speaker Talking Points not available.. **
- Executive Directors
- CFOs
- Trustees
- Controllers
- Tax Managers
- Enrolled Agents
- Financial Planners
- Non-Profit Organization Senior Officers
This is a must attend event to anyone interested in understanding the latest updates on FIN 48 for Exempt (Non-Profit) Companies.
- New guidance explained by the most qualified key leaders & experts
- Hear directly from key regulators & thought leaders
- Interact directly with panel during Q&A