Oops! Amazing the trivia one can learn when reading the Not-for-profit audit risk alert. Realized the following idea isn’t the only thing I missed after reading the risk alert. (Aha, the point of constant learning is to figure out what you missed and fill in the gaps!)
TIS 5250.15 says that NPOs without any uncertain tax positions under FIN 48 still have to disclose open tax years in the same way as for-profit organizations. That TIS is not available on-line so I can’t provide a link to an authoritative source. And yes, I know that FIN 48 is actually now found in ASC 740-10, but FIN 48 registers in my brain easier that ASC 740-10.
So, if you have an NPO client, there should be something along the lines of the following comment from ASC 740-10-55-217:
The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-US income tax examinations by tax authorities for years prior to 20×1.
Here’s what I will use for my NPO clients:
The organization files information tax returns in the US and various states. (or with the U.S. and California governments.) With few exceptions, the organization is no longer subject to US federal and state income tax examinations by tax authorities for years before 2008.
Modify as you wish for your client situations.
Update 5-12: Revised for a different conclusion for churches here.
Update -13: Garbled sentence corrected.