Tax Compliance & Reporting Update

September 11, 2015

Today’s Topics

New Tax Deadlines Alternative Investments Common Form 990 Errors

New Tax Deadlines

Highway Trust Fund Extension• Effective for tax years beginning after 12/31/2015

Revised Extension Periods• Employee Benefit Plans – Automatic 3 ½ month extension• Exempt Organizations – Automatic 6-month extension• FinCEN 114 – New 6 month extension

Also includes changes relevant to for-profit subsidiaries

Alternative Investments

Investments that are not stocks, bonds, or cash• Reported on Form 990, Part X, Line 12

Why do we care?•Unrelated business income•Character of income passes through to NFP•May require 990-T and state income tax filings•S Corp income is “per se” UBI (IRC Sec. 512(e))

Alternative Investments

Alternative Investments

Reporting is keyed off of Schedule F, Part IV

•Secondary effect of alternative investments

•Ownership in a foreign • Corp• Trust• Partnership• Passive Foreign Investment

Company

•Penalties for failure to disclose are severe

Common Tax Filing Issues

Accurate reporting of Form 990• Take time to understand and evaluate:

• Gross receipts• Compensation• Highest compensated independent contractors• Grants and other assistance

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Common Tax Filing Issues – Gross Receipts

Gross Receipts

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Common Tax Filing Issues - Compensation

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Common Tax Filing Issues – Highest Compensated Contractors

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Common Tax Filing Issues – Grants and Other Assistance

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Questions?

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Thank you for your participation!

John Huskins, CPATax Senior Manager

Johnson Lambert LLP

jhuskins@johnsonlambert.com

919-719-6431

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