Hocking Valley Industries Inc

Schedule D, Page 3, Part X

“The organization follows accounting rules that prescribe when to recognize and how to measure the financial effects, if any, of income tax positions taken or expected to be taken on its income tax returns, including the position that the organization continues to qualify to be treated as a non-profit organization exempt from income tax provisions. Management is required to evaluate the likelihood that, upon examination by relevant taxing jurisdictions, those income tax positions would be sustained. The organization is a not-for-profit voluntary organization exempt from income taxes under section 501(c)(3) of the internal revenue code. Accordingly, no provision for federal income taxes has been made in the financial statements. The organization's informational returns for tax years 2019 and beyond remain subject to examination by the internal revenue service. The organization did not have unrecognized tax benefits as of december 31, 2022 and 2021 and does not expect this to change significantly over the next 12 months. The organization will recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. As of december 31, 2022 and 2021, the organization has not accrued interest or penalties related to uncertain tax positions. During 2021, the organization received funds for leasing space that they own. Section 512 of the internal revenue code defines this type of income as "unrelated business taxable income." an exempt organization that has 1,000 or more of gross income from an unrelated business must file a form 990t. For the years ended december 31, 2022 and 2021, the organization received 0 and 9,825, respectively, in debt-financed rental income and recognized 0 and 161,055, respectively, in gain on sale of debt-financed rental property. Accordingly, the organization filed form 990t for the year ended december 31, 2021. Unrelated business income tax expense (recovery) for the years ended december 31, 2022 and 2021 was (153) and 28,259, respectively.”