Remedial Actions for Tax Credit Bonds
Prior the release of Revenue Procedure 2018-26 , there were no specific remedial actions for tax credit bonds such as “ build America bonds ” and other qualified tax credit bonds ( e . g ., qualified school construction bonds and qualified energy conservation bonds ). The provisions of Revenue Procedure 2018-26 fill this gap by providing issuers with the option to remediate by either making a downward adjustment to the federal subsidy that would otherwise be received ( for direct pay bonds only ), redeeming or defeasing nonqualified bonds , or making alternative “ good ” use of any disposition proceeds within a two-year period .
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