Alternate Permitted Method for Filing Form 8038-CP for Certain Specified Tax Credit Bonds
The Internal Revenue Service will process certain Forms 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds
(“Form 8038-CP”), filed in accordance with the requirements described below. Under the alternate permitted filing method, issuers may file one Form 8038-CP covering all maturities of an issue of qualified school construction bonds or qualified zone academy bonds for each interest payment date. The method applies to Forms 8038-CP filed to request payment of refundable credits allowed under section 6431 of the Internal Revenue Code of 1986, as amended (“section 6431”), with respect to interest payments on issues of qualified school construction bonds and qualified zone academy bonds with multiple maturities. Use of this method is available to simplify the process by which issuers request refundable credit payments under section 6431 in case of issues with multiple maturities.
Notification of the alternate permitted method and related requirements is being mailed to identified eligible issuers. The form of the notification letter is available here.
The alternate permitted method is not available to request payment of credits allowed under section 6431 with respect to interest payments on issues of new clean renewable energy bonds or qualified energy conservation bonds, which must be filed in accordance with the instructions to Form 8038-CP. Additionally, this method does not alter general requirements relating to the allowance or the amount of the refundable credit under section 6431 with respect to bonds, including the limitation under section 6431(f)(1)(C) on the maximum amount of credit allowable with respect to each bond of the issue. Except as otherwise permitted, requirements described in the form instructions continue to apply.
To use the alternate permitted method to request refundable credit payments for an issue of qualified school construction bonds or qualified zone academy bonds on any interest payment date, issuers should file a single Form 8038-CP covering interest payments on all maturities of the issue of qualified school construction bonds or qualified zone academy bonds for the interest payment date in accordance with the form instructions as modified by the following specific changes to the form instructions:
Line 19a: Enter the aggregate amount of interest payable to the holders of the bonds on the interest payment date for all qualified school construction bonds or qualified zone academy bonds of the issue.
Line 19b: Enter the applicable credit rate in accordance with the Instructions.
Line 19c: Enter the aggregate of the amounts determined for each bond to be the lesser of:
(i) interest payable under the bond on the interest payment date; or
(ii) interest that would be payable under the bond on such date if such interest were determined at the applicable
credit rate with respect to such bond.
This aggregate amount is the maximum allowable credit for all qualified school construction bonds or qualified zone academy bonds of the issue for the interest payment date.
Line 20e: For qualified zone academy bonds, enter 100% of line 19c.
- Line 20f: For qualified school construction bonds, enter 100% of line 19c
The Service will continue to process separate Forms 8038-CP filed in accordance with the form instructions to request refundable credit payments for each maturity of an issue of qualified school construction bonds or qualified zone academy bonds with multiple maturities.
For questions about the alternate permitted method, recipients of the notification letter and others may contact the Service by sending an email to TaxExemptBondQuestions@irs.gov with “Alternate Permitted Method – Multiple Maturities” in the subject line.