The IRS issued Notice 2012-3 to provide guidance on current refunding issues for outstanding prior bond issues that qualify for tax-exempt bond financing under disaster relief bond programs including Gulf Opportunity Zone Bonds (GO Zone Bonds), qualified Midwestern disaster area bonds and Hurricane Ike disaster area bonds under the Heartland Disaster Act. More specifically, projects originally financed with tax-exempt GO Zone Bonds may be refinanced on a tax-exempt basis after December 31, 2011, the date on which authority to issue GO Zone Bonds expires. This notice applies to all qualified bonds if the following requirements are met:

  • The qualified bonds were issued before the deadline under the applicable statutory provision;
  • The issue price of the refunding issue is no greater than the outstanding stated principal amount of the refunded bonds;
  • The refunding issue meets all other applicable requirements for the issuance of tax-exempt private activity bonds.

To read the Notice, click here.