Mtconnect Institute

Liability for Uncertain Tax Position (ASC 740)

“SCHEDULE D, PART X, LINE 2 MTCONNECT INSTITUTE IS A SUBSIDIARY OF THE ASSOCIATION FOR MANUFACTURING TECHNOLOGY (AMT). AS A SUBSIDIARY, MTCONNECT IS CONSOLIDATED INTO AMT'S AUDITED FINANCIAL STATEMENTS. THE APPLICABLE INCOME TAX DISCLSOURE FOOTNOTE FOR THE CONSOLIDATED FINANCIAL STATEMENTS IS AS FOLLOWS: THE ASSOCIATION and MTConnect Institute are EXEMPT FROM FEDERAL INCOME TAX UNDER IRC SECTION 501(C)(6) and machine tool institute is exempt from federal income tax under IRC section 501(c)(3), though they are SUBJECT TO TAX ON INCOME UNRELATED TO ITS EXEMPT PURPOSE, UNLESS THAT INCOME IS OTHERWISE EXCLUDED BY THE CODE. REVENUE FROM ADVERTISING, AFFINITY PROGRAMS, AND PARTICULAR SERVICES TO MEMBERS IS TAXABLE AS UNRELATED BUSINESS INCOME. THE ASSOCIATION HAS PROCESSES PRESENTLY IN PLACE TO ENSURE THE MAINTENANCE OF ITS TAX-EXEMPT STATUS; TO IDENTIFY AND REPORT UNRELATED INCOME; TO DETERMINE ITS FILING AND TAX OBLIGATIONS IN JURISDICTIONS FOR WHICH IT HAS NEXUS; AND TO IDENTIFY AND EVALUATE OTHER MATTERS THAT MAY BE CONSIDERED TAX POSITIONS. THE TAX YEARS ENDING DECEMBER 31, 2016, 2015, 2014 AND 2013 ARE STILL OPEN TO AUDIT FOR BOTH FEDERAL AND STATE PURPOSES. THE ASSOCIATION HAS DETERMINED THAT THERE ARE NO MATERIAL UNCERTAIN TAX POSITIONS THAT REQUIRE RECOGNITION OR DISCLOSURE IN THE FINANCIAL STATEMENTS. THE ASSOCIATION FOLLOWS GUIDANCE THAT CLARIFIES THE ACCOUNTING FOR UNCERTAINTY IN TAX POSITIONS TAKEN OR EXPECTED TO BE TAKEN IN A TAX RETURN, INCLUDING ISSUES RELATING TO FINANCIAL STATEMENT RECOGNITION AND MEASUREMENT. THIS GUIDANCE PROVIDES THAT THE TAX EFFECTS FROM AN UNCERTAIN TAX POSITION CAN ONLY BE RECOGNIZED IN THE FINANCIAL STATEMENTS IF THE POSITION IS "MORE-LIKELY-THAN-NOT" TO BE SUSTAINED IF THE POSITION WERE TO BE CHALLENGED BY A TAXING AUTHORITY. THE ASSESSMENT OF THE TAX POSITION IS BASED SOLELY ON THE TECHNICAL MERITS OF THE POSITION, WITHOUT REGARD TO THE LIKELIHOOD THAT THE TAX POSITION MAY BE CHALLENGED.”