The U.S. Treasury Department and IRS today released for publication in the Federal Register final regulations (T.D. 9854) concerning the arbitrage investment restrictions under section 148 that apply with regard to tax-exempt bonds and other tax-advantaged bonds issued by state and local governments.
In June 2018, regulations were proposed in an effort to clarify existing regulations regarding the definition of “investment-type property” covered by arbitrage restrictions. The proposed regulations expressly provided an exception for investments in capital projects that are used in furtherance of the public purposes of the bonds. The regulations, therefore, concerned state and local governmental issuers of these bonds and potential investors in capital projects financed with these bonds. Read TaxNewsFlash
The final regulations [PDF 225 KB] released today adopt the June 2018 proposed regulations “without substantive change.”
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.