Meadows Mental Health Policy Institute

“As of december 31, 2024, the institute has three donor-restricted endowment funds: the student and interns endowment fund, which provides funding to support the work of students and interns engaged by the institute; the hackett center endowment fund which provides funding to support the operations of the hackett center for mental health in houston, texas; and the linda perryman evans presidential chair endowment fund, which provides funding to ensure the leadership of the institute and carry out policy initiatives. The institute's endowment funds are restricted to investment in perpetuity, the income from which is available to support the programs identified by the donors. For the linda perryman evans presidential chair endowment fund and the students and interns endowment fund, any earnings may be appropriated to support the designated purpose. All net earnings on the hackett center endowment fund are available for appropriation, with a minimum of 70% required to be used to support the hackett center staff and its defined program of work in the houston region. The institute is permitted by the gift instrument with the donors to appropriate any remaining net earnings form the hackett center endowment fund to fund statewide policy and program activities and overhead expenses of the institute.”

“The Institute is exempt from federal income tax as an organization described in section 501(c)(3) of the Code and has not been classified as a private foundation as defined in the Code. Income generated from activities not substantially related to the Institutes exempt purposes is subject to tax under Code Section 511. The Institute had unrelated business income totaling approximately $904,000 for the year ended December 31, 2024. The Institute has accrued for estimated taxes of approximately $101,000 for the year ended December 31, 2024.The Affiliate is a for-profit corporation and utilizes the asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the period in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. The Affiliate did not have financial activity during the year ended December 31, 2024 and accordingly, no income tax effect has been recorded. THE INSTITUTE'S UNRELATED BUSINESS INCOME TAX RETURNS AND THE AFFILIATES FEDERAL AND STATE INCOME TAX RETURNS ARE SUBJECT TO POSSIBLE EXAMINATION BY THE TAXING AUTHORITIES UNTIL THE EXPIRATION OF THE RELATED STATUTES OF LIMITATIONS ON THOSE TAX RETURNS. IN GENERAL, THE FEDERAL, STATE, AND UNRELATED BUSINESS INCOME TAX RETURNS HAVE A THREE YEAR STATUTE OF LIMITATIONS. GAAP requires the evaluation of tax positions taken in the course of preparing the Institutes tax returns and recognition of a tax liability (or asset) if the Institute has taken an uncertain position that more likely than not would not be sustained upon examination by the Internal Revenue Service. Management has analyzed the tax positions taken by the Institute, and has concluded that as of December 31, 2024, there are no uncertain tax positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the consolidated financial statements.”