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Tax Law Committee

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This Committee advises the Board regarding developments in federal tax law (including developments pertaining to the US Department of Treasury and the Internal Revenue Service) and prepares on behalf of NABL, at the direction of the Board, comment letters, informative memoranda, and other written materials pertaining to tax law.

 

Christie Lombard Martin,Chair
(617) 348-1769
Brian P. Teaff,Vice-Chair
(713) 221-1367
Matthias M. Edrich,Board Liaison
(303) 292-7887

Cinderella Bonds

With the demise of advance refunding bonds, issuers have looked for ways to take advantage of historically low interest rates. One structure that seems to be gaining traction is a Cinderella bond structure in which bonds are issued on a taxable basis and “convert” to tax exempt at some future date. The project involves making recommendations regarding pricing safe harbors for Cinderella bonds. 

Status: In process.

Expanding the Floating Equity Approach of PLR 201847001

On November 23, 2018, the IRS released a private letter ruling allowing an issuer to use a floating equity approach to address compliance with the rule in Section 147(e) of the Code that prohibits the use of proceeds of tax-exempt private activity bonds for a business the principal purpose of which is the sale of alcoholic beverages for consumption off premises. NABL believes that additional guidance to expand the approach in this PLR to other areas of the law governing private activity bonds might be helpful.  

Status: In process.

Suggestions to IRS Regarding Relief from Certain Tax Requirements in Times of Emergency

This project is a request to extend relief provided in Notice 2020-53 for 142(d) transition period and rehab expenditure period, as well as requesting to expand the list of “time-sensitive acts” in Rev. Proc. 2018-58 to include additional tax-exempt bond compliance actions that can be suspended upon IRS guidance in connection with a federally declared disaster or terroristic or military action.

 

Status: In process.

 

Comments to Rev. Proc. 2020-44 related to LIBOR transition 


On October 9, 2019, IRS and Treasury released proposed regulations that provide guidance on the tax consequences of the transition away from LIBOR. Rev. Proc. 2020-44, released October 9, 2020, provides interim guidance in advance of finalizing the proposed regulations. It provides that modification of existing contracts resulting from the adoption of the ARRC fallback language or the ISDA protocol language will not be treated as a reissuance under the reissuance regulations. At the Tax Law Committee meeting at the Institute, David Cholst requested that NABL begin a comment project to suggest modifications to the Rev. Proc.   


Status: In beginning stages. 

To access all projects, visit our Research tab.