Brandywine Red Clay Alliance

“Conservation easement revenues and expenses are reported as seperate line items on the statement of activities and statement of functional expenses, respectively. Conservation easement revenues and expense follow the reporting framework of generally accepted accounting principles of the united states; revenues are recognized in the period when earned and expenses are recorded when a liability is incurred.”

“Brandywine red clay alliance is exempt from federal and state income taxes under the provisions of section 501(c)(3) of the internal revenue code; therefore, no provision for income taxes has been made in the financial statements. In addition, the organization has been classified as one that is not a private foundation within the meaning of section 509 (a) of the internal revenue code and qualifies for deductible contributions as provided in section 170(b)(1)(a)(vi). Although the organization is not subject to federal and state income taxes, the organization is required to apply the provisions of asc 740 "accounting for income taxes", which applies to all entities including those that are tax exempt under 501(c)(3). Asc 740 clarifies the accounting and reporting for income taxes where interpretation of the tax law may be uncertain. Asc 740 prescribes a comprehensive model for the financial statements recognition, measurement, presentation and disclosure of income tax uncertainties with respect to positions taken or expected to be taken in income tax returns. Management has reviewed its current and past federal income tax positions and has determined, based on clear and unambiguous tax law and regulations, that the tax positions taken are certain and that there is no likelihood that a material tax assessment would be made if the respective government agency examined tax returns subject to audit. Accordingly, no provision for the effects of uncertain tax positions has been recorded. Currently, the december 31, 2021, 2022, and 2023, tax years are open and subject to examination by the internal revenue service; however, the organization is not currently under audit nor has the organization been contacted by this jurisdiction. Any interest and penalties related to income taxes would be recorded as income tax expenses. There are no interest and penalties as of december 31, 2024 and 2023.”