Oneida Healthcare Systems Inc.

“The endowment funds are to be used for the maintenance of a free bed in the name of a loved one predesignated by the donor. The purpose of the bed is to assist patients whose needs meet specifications listed in the donation letter. Oneida healthcare foundation holds $ 79,350 in restricted funds. Endowment funds are for construction improvements and equipment for the facility.”

“The system is a not-for-profit corporation as described in section 501(c)(3) of the internal revenue code and is exempt from federal income taxes on related income pursuant to section 501(a) of the internal revenue code. The system recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than fifty percent likely of being realized upon settlement. Changes in recognition in measurement are reflected in the period in which the change in judgment occurs. The system did not recognize the effect of any uncertain income tax positions in either 2019 or 2018. The tax years open to examination by federal and state taxing authorities are 2016 through 2019. The tax cuts and jobs act (act) was enacted on december 22, 2017. The act reduces the federal corporate tax rate from 35% to 21%. For tax-exempt entities, the act also requires organizations to categorize certain fringe benefit expenses as a source of unrelated business income, pay an excise tax on renumeration above certain thresholds that is paid to executives by the organization, and report income or loss from unrelated business activities on an activity-by-activity basis, among other provisions. The system is subject to income tax on any income from unrelated business activities, and has adopted the relevant provisions of the act for the years ended december 31, 2019 and 2018. At december 31, 2018, the system has a gross deferred tax asset of approximately $312,000, which relates to net operating losses available for income tax purposes. The losses expire in varying amounts through 2037, and a valuation allowance is recorded against deferred tax assets when there is uncertainty regarding use in future periods. The system has a net deferred tax asset and income tax benefit of approximately $101,000, included in other long-term assets on the consolidated balance sheet and other revenue on the consolidated statement of operations and changes in net assets, respectively, as of and for the year ended december 31, 2018. In 2019, the taxpayer certainty and disaster tax relief act of 2019 was enacted that repealed certain aspects of the tax cuts and jobs act that related to tax-exempt organizations, particularly the disallowance on fringe benefits expense. This resulted in the reversal of the net deferred tax asset of approximately $306,000 and the reversal of income tax benefits of approximately $101,000 as of and for the year ended december 31, 2019.”