Montgomery County Council on Aging Inc.

Part X : FIN48 Footnote

“The Council evaluates all significant tax positions as required by generally accepted accounting principles in the United States. These rules prescribe when to recognize and how to measure the financial statement effects of income tax positions taken or expected to be taken on its income tax returns. These rules require management to evaluate the likelihood that, upon examination by relevant taxing jurisdictions, those income tax positions would be sustained. Based on that evaluation, the Council only recognizes the maximum benefit of each income tax position that is more-likely-than-not of being sustained. To the extent that all or a portion of the benefits of an income tax position are not recognized, a liability would be recognized for the unrecognized benefits, along with any interest and penalties that would result from disallowance of the position. Should any such penalties and interest be incurred, they would be recognized as administrative expenses.As of June 30, 2017, the Council does not believe that it has taken any tax positions that would require the recording of any tax liability nor does it believe that there are any unrealized tax benefits that would either increase or decrease within the next twelve months. Consequently, no liability is recognized in the accompanying statement of financial position for unrecognized income tax positions. Further, no interest or penalties have been accrued or charged to expense as of June 30, 2017 or for the year then ended. The federal income tax returns of the Council for 2016, 2015, and 2014 are subject to examination by the taxing authority, generally for three years after due date.”