The Service Announces the Release of New and Revised Tax Exempt Bond Forms
The Service released new Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds, its schedules, and its instructions. The Service also released revisions to Form 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds, Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues and Form 8038-G, Information Return for Tax-Exempt Governmental Entities and their instructions.
Form 8038-TC was created to assist issuers in reporting these unique tax credit bonds and direct pay tax credit bonds (specified tax credit bonds). The new form must be used by issuers to report the new issuance of qualified forestry conservation bonds, new clean renewable energy bonds, qualified energy conservation bonds, qualified zone academy bonds, qualified school construction bonds, clean renewable energy bonds, Midwestern tax credit bonds, and all other qualified tax credit bonds, including all issuances of specified tax credit bonds. Note, however, that build America tax credit bonds are still reported on Form 8038-B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds.
Beginning June 21, 2010 all issues of tax credit bonds (other than build America bonds) must be reported on the new Form 8038-TC, including bonds issued prior to June 21, 2010 if not previously reported on Form 8038.
All issues of specified tax credit bonds, regardless of the date issued, must be reported on Form 8038-TC. If an issuer has reported a specified tax credit bond on Form 8038, it must refile its report on Form 8038-TC in order for the refundable credit, on the related Form 8038-CP to be processed. See Notice 2010-35.
The revised Form 8038-CP is to be used by issuers of build America bonds (Direct Pay), recovery zone economic development bonds, and specified tax credit bonds to request credit payments under section 6431 of the Code. Beginning June 21, 2010, all requests for credit payments must be filed on revised Form 8038-CP in order to process the refundable credit. See Notice 2010-35 for further guidance.
The revised Form 8038 no longer allows the reporting of tax credit bond issues on this form. This reporting requirement was moved to the new Form 8038-TC. In addition, the form and instructions were updated to reflect current laws and regulations and to add a paid preparer section to the return.
The revised Form 8038-G and instructions were updated to reflect current laws and regulations and to add a paid preparer section to the return.
The Food, Conservation, and Energy Act of 2008 that created qualified tax credit bonds (Code section 54A) also created the qualified forestry conservation bonds (Code section 54B). The Energy Improvement and Extension Act of 2008 created the new clean renewable energy bonds (Code section 54C) and the qualified energy conservation bonds (Code section 54D). The Tax Extenders and Alternative Minimum Tax Relief Act of 2008 created the qualified zone academy bonds (Code section 54E) which revised program provisions for QZABs in lieu of the existing provision under Code section 1397E. The American Recovery and Reinvestment Act of 2009 created the qualified school construction bonds (Code section 54F).
The HIRE Act of 2010 added section 6431(f) to provide the issuer of a tax credit bond that is a qualified zone academy bond, qualified school construction bond, qualified energy conservation bond, or a new clean renewable energy bond the option to irrevocably elect to receive a credit payment subsidy from the Federal government. Bondholders of these specified tax credit bonds will receive a taxable interest payment from the issuer instead of a tax credit.
“ Frequently Asked Questions on Qualified Tax Credit Bonds and Specified Tax Credit Bonds,” a set of questions and answers (but not formal guidance), is offered on the TEB website to assist issuers with questions regarding tax credit bonds and specified tax credit bonds. The Questions and Answers will be updated periodically and may be changed by subsequent IRS or Treasury guidance or Congressional action.
Previously posted on the IRS web site, “ Frequently Asked Questions on Build America Bonds and Recovery Zone Economic Development Bonds” and “ Frequently asked Questions on Filing Requirements for Build America Bonds and Recovery Zone Economic Development Bonds” were also updated.
Copies of new forms and instructions, as well as the Questions & Answers, are available at the links below:
Instructions for Form 8038-TC
Instructions for Form 8038-CP
Instructions for Form 8038
Instructions for Form 8038-G
Frequently Asked Questions on Qualified Tax Credit Bonds and Specified Tax Credit Bonds
Frequently Asked Questions on Filing Requirements for Build America Bonds, Recovery Zone Economic Development Bonds and Specified Tax Credit Bonds
Frequently Asked Questions on Build America Bonds and Recovery Zone Economic Development Bonds