Handmaker Foundation

Part X, Line 2:

“Handmaker is an Internal Revenue Code ("IRC") Section 501(c)(3) organization, exempt from taxes by application of IRC Section 501(a) and is a public charity by application of IRC Section 509(a)(1). Accordingly, no provision for federal or state income taxes is recorded in the accompanying financial statements. Income from certain activities not directly related to Handmaker's tax-exempt purpose, however may be subject to taxation as unrelated business income. Management has considered its tax positions in accordance with the accounting standard for uncertainty in income taxes and believes that all of the positions taken in its federal and state exempt organization tax returns are more likely than not to be sustained upon examination. Handmaker's returns are subject to examination by federal and state taxing authorities, generally for three years and four years, respectively, after they are filed. Furthermore, in the opinion of management, any liability resulting from taxing authorities imposing income taxes on the net taxable income from activities deemed to be unrelated to Handmaker's non-taxable status is not expected to have a material effect on the Handmaker's financial position or results of operations. Accordingly, no provision is made for uncertain income tax positions in the accompanying consolidated financial statements. Handmaker recognizes interest and penalties related to unrecognized tax benefits in general and administrative expenses in the accompanying consolidated financial statements. During the year ended December 31, 2016 and 2015, the Organization did not recognize any interest and penalties.”