IRS Launches Compliance Project on Governmental Bond Financings

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January 29, 2009

The IRS has sent a questionnaire to approximately 200 governmental entities that issued tax-exempt bonds in 2005. The purpose of this new compliance project is to evaluate the post-issuance and record retention practices of governmental issuers of tax exempt bonds, including:

record retention requirements;
qualified use of bond-financed property requirements;
arbitrage yield restriction and rebate requirements;
debt management policies and procedures; and
awareness of voluntary compliance and educational resources.

The questionnaires were sent out on Monday, January 26, 2009, and recipients will have 90 days to respond. According to IRS, respondents may be granted up to 30 additional days to respond in individual cases based upon facts and circumstances. The IRS press release describes the bonds compliance project and a copy of the questionnaire and related materials. You can also view the IRS Governmental Bonds Financings Compliance Check Questionnaire.