IRS Lists Corrected Bond Factor Amounts For Low-Income Housing Credit.

Rev. Rul. 2003-22

[1] In Rev. Rul. 90-60, 1990-2 C.B. 3, the Internal Revenue Service provided guidance to taxpayers concerning the general methodology used by the Treasury Department in computing the bond factor amounts used in calculating the amount of bond considered satisfactory by the Secretary under § 42(j)(6) of the Internal Revenue Code. It further announced that the Secretary would publish in the Internal Revenue Bulletin a table of bond factor amounts for dispositions occurring during each calendar month.

[2] Rev. Proc. 99-11, 1999-1 C.B. 275, established a collateral program as an alternative to providing a surety bond for taxpayers to avoid or defer recapture of low-income housing tax credits under § 42(j)(6). Under this program, taxpayers may establish a Treasury Direct Account and pledge certain United States Treasury securities to the Internal Revenue Service as security.

[3] This revenue ruling provides in Table 1 the bond factor amounts for calculating the amount of bond considered satisfactory under § 42(j)(6) or the amount of United States Treasury securities to pledge in a Treasury Direct Account under Rev. Proc. 99-11 for dispositions of qualified low-income buildings or interests therein during the period January through March 2003.

[4] Due to a miscalculation, Rev. Rul. 2003-2, 2003-2 I.R.B. 251, is in error regarding dispositions of qualified low-income buildings or interests therein during the period January through March 2003. The present revenue ruling provides the corrected bond factor amounts.

[5] Under the authority of § 7805(b), taxpayers that posted bonds and taxpayers that established Treasury Direct Accounts under Rev. Proc. 99-11, based upon the above mentioned bond factor amounts may continue to rely on those figures. Taxpayers that choose to amend their previously posted bonds by using the corrected bond factor amounts listed in this revenue ruling may do so by submitting an amended Form 8693, Low-Income Housing Tax Credit Disposition Bond, to the Internal Revenue Service Center, Philadelphia, PA 19255. The amended form may be submitted either by the taxpayer or the surety. Taxpayers that choose to amend the amount of securities pledged in their previously established Treasury Direct Account by using the corrected bond factor amounts listed in this revenue ruling should contact the Bureau of Public Debt, Division of Customer Service, IRS Collateral Desk at (304) 480-6158 for further information.

                                Table 1

EFFECT ON OTHER REVENUE

DRAFTING INFORMATION

[8] The principal author of this revenue ruling is Gregory N. Doran of the Office of Associate Chief Counsel (Passthroughs and Special Industries). For further information regarding this revenue ruling, contact Mr. Doran at (202) 622-3040 (not a toll-free call).