National Community Renaissance Development Corporation

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“The Corporation has applied for and received a determination letter from the Internal Revenue Service ("IRS") to be treated as a tax exempt entity pursuant to Section 501(c)(3) of the Internal Revenue Code and did not have any unrelated business income for the year ended December 31, 2016. Due to its tax exempt status, the Corporation is not subject to income taxes. The Corporation is required to file tax returns with the IRS and other taxing authorities. Accordingly, these financial statements do not reflect a provision for income taxes and the Corporation has no other tax positions which must be considered for disclosure. Income tax returns filed by the Corporation are subject to examination by the IRS for a period of three years. While no income tax returns are currently being examined by the IRS, tax years since 2013 are subject to review by the IRS. The limited partnerships and limited liability companies in which the Corporation holds a minority ownership interest are pass-through entities for income tax purposes and, are not subject to income taxes. All items of taxable income, deductions and tax credits are passed through to and are reported by their owners on their respective income tax returns. The limited partnerships and limited liability companies' federal tax status as pass-through entities is based on their legal status as partnerships and limited liability companies. The limited partnerships and limited liability companies are required to file tax returns with the Internal Revenue Service and other taxing authorities. Accordingly, these financial statements do not reflect a provision for income taxes and the limited partnerships and limited liability companies have no other tax positions which must be considered for disclosure. While no income tax returns are currently being examined by the Internal Revenue Service, tax years since 2013 are subject to review by the IRS.”