Del Norte Neighborhood Development

PART X, LINE 2:

“Dnndc is exempt from federal income taxes under irc section 501(c)(3). In addition, dnndc qualifies for the charitable contribution deduction under section 170(b)(1)(a) and has been classified as an organization other than a private foundation under section 509(a)(2). However, income from certain activities not directly related to dnndc's tax-exempt purpose is subject to taxation as unrelated business income. 35th avenue, dnbt, dnchc, dnhd, 1421, and vh are for-profit entities. Activities unrelated to the mission of dnndc and its affiliates could result in unrelated business income tax liability. Ac's activity constituted unrelated business loss of $21,030 and $54,891, for the years ended december 31, 2024 and 2023, respectively. The activities of ccdlb, avgp, vallejo, ac, chesney, and emfgp are presented in dnndc's income tax return. Income taxes on partnership (and limited liability company treated as a partnership for tax) income are levied on the partners (and members) in their individual capacity. Accordingly, all profits and losses of the limited partnerships are recognized by each partner (and member) on its respective tax return. The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the united states of america requires the organization to report information regarding its exposure to various tax positions taken by the organization. The organization has determined whether any tax positions have met the recognition threshold and have measured the organization's exposure to those tax positions. Management believes that the organization has adequately addressed all relevant tax positions and that there are no unrecorded tax liabilities. Federal and state tax authorities generally have the right to examine and audit the previous three years of tax returns filed. Any interest or penalties assessed to the organization are recorded in operating expenses. No interest or penalties from federal or state tax authorities were recorded in the accompanying consolidated financial statements.”