Dealing with Schedule UTP Disclosure Requirements

Tips for Small and Medium-Sized Entities

J. Hennig Cherie, PhD, CPA, and R. D. Mautz, PhD, CPA, and L. Evans Allison, PhD, CPA

Much of the current economic and political debate in the United States has focused on the role of small businesses in creating jobs. Reducing the regulatory burden is accepted by many as integral to encourage economic growth—but a new IRS reporting requirement actually increases the regulatory burden on small and medium-sized entities. Federal corporate tax returns that meet an asset threshold test must file Form 1120, Uncertain Tax Position Statement (i.e., Schedule UTP), to identify, describe, and quan-tify the impact of “uncertain” tax positions—that is, those that might not withstand the scrutiny of an IRS audit.