Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues

Instructions for Form 8038

Department of the Treasury
Internal Revenue Service

(Rev. April 2011)

Information Return for
Tax-Exempt Private Activity Bond Issues
Section references are to the Internal
Revenue Code unless otherwise noted.

General Instructions
Purpose of Form
Form 8038 is used by the issuers of
tax-exempt private activity bonds to
provide the IRS with the information
required by section 149 and to monitor
the requirements of sections 141
through 150.
Note. Information on tax credit and
specified tax credit bonds must be
reported on Form 8038-TC.

Who Must File
Issuers must file a separate Form 8038
for each issue of the following
tax-exempt private activity bonds
issued after 1986:
• Exempt facility bonds,
• Qualified mortgage bonds,
• Qualified veterans’ mortgage bonds,
• Qualified small issue bonds,
• Qualified student loan bonds,
• Qualified redevelopment bonds,
• Qualified hospital bonds,
• Qualified 501(c)(3) bonds,
• Nongovernmental output property
bonds, and
• All other tax-exempt private activity
bonds.

When To File
File Form 8038 by the 15th day of the
2nd calendar month after the close of
the calendar quarter in which the bond
was issued. Form 8038 may not be
filed before the issue date and must be
completed based on the facts as of the
issue date.
Late filing. An issuer may be granted
an extension of time to file Form 8038
under section 3 of Rev. Proc. 2002-48,
2002-37 I.R.B. 531, if it is determined
that the failure to file timely is not due to
willful neglect. Type or print at the top
of the form, “Request for Relief under
section 3 of Rev. Proc. 2002-48.”
Attach to the Form 8038 a letter
explaining why Form 8038 was not filed
on time. Also indicate whether the bond
issue in question is under examination
by the IRS. Do not submit copies of the
trust indenture or other bond
documents. See Where To File next.

Where To File
File Form 8038 and any attachments
with Department of the Treasury,
Internal Revenue Service Center,
Ogden, UT 84201.
Private delivery services. You can
use certain private delivery services
designated by the IRS to meet the
“timely mailing as timely filing/paying”
rule for tax returns and payments.
These private delivery services include
only the following:
• DHL Express (DHL): DHL Same Day
Service.
• Federal Express (FedEx): FedEx
Priority Overnight, FedEx Standard
Overnight, FedEx 2Day, FedEx
International Priority, and FedEx
International First.
• United Parcel Service (UPS): UPS
Next Day Air, UPS Next Day Air Saver,
UPS 2nd Day Air, UPS 2nd Day Air
A.M., UPS Worldwide Express Plus,
and UPS Worldwide Express.
The private delivery service can tell
you how to get written proof of the
mailing date.
Private delivery services cannot
deliver items to P.O. boxes. You
CAUTION
must use the U.S. Postal
Service to mail any item to an IRS P.O.
box address.

!

Other Forms That May Be
Required
For tax-exempt bonds other than
private activity bonds, use Form
8038-G, Information Return for
Tax-Exempt Governmental Obligations,
or Form 8038-GC, Information Return
for Small Tax-Exempt Governmental
Bond Issues, Leases, and Installment
Sales.
Qualified forestry conservation
bonds, new clean renewable energy
bonds, qualified energy conservation
bonds, qualified zone academy bonds,
qualified school construction bonds,
clean renewable energy bonds, and
Midwestern tax credit bonds must be
filed on Form 8038-TC, Information
Return for Tax Credit Bonds and
Specified Tax Credit Bonds. Build
America bonds (Direct Pay), build
America bonds (Tax Credit), and
recovery zone economic development
bonds must be filed on Form 8038-B,
Information Return for Build America
Cat. No. 49974V

Bonds and Recovery Zone Economic
Development Bonds.
Bonds described in section 1312(c)
of the Tax Reform Act of 1986 to which
the transitional rules in section 1312 or
1313 apply are not private activity
bonds for purposes of information
reporting. Report them on Form 8038-G
or Form 8038-GC.
For rebating arbitrage or paying a
penalty in lieu of arbitrage rebate to the
Federal Government, use Form 8038-T,
Arbitrage Rebate, Yield Reduction and
Penalty in Lieu of Arbitrage Rebate.

Rounding Off to Whole
Dollars
You may show the money items on this
return as whole-dollar amounts. To do
so, drop any amount less than 50 cents
and increase any amount from 50 to 99
cents to the next higher dollar.

Questions on Filing Form
8038
For specific questions on how to file
Form 8038, send an email to the IRS at
TaxExemptBondQuestions@irs.gov
and put “Form 8038 Question” in the
subject line. In the email include a
description of your question, a return
email address, the name of a contact
person, and a telephone number.

Definitions
Tax-exempt bond. This is any
obligation on which the interest is
excluded from gross income under
section 103.
Private activity bond. This includes
an obligation issued as part of an issue
in which:
• More than 10% of the proceeds are
to be used for any private business
use, and
• More than 10% of the payment of
principal or interest of the issue is
either (a) secured by an interest in
property to be used for a private
business use (or payments for such
property), or (b) to be derived from
payments for property (or borrowed
money) used for a private business
use.
It also includes a bond, the proceeds
of which (a) are to be used (directly or
indirectly) to make or finance loans
(other than loans described in section

141(c)(2)) to persons other than
governmental units and (b) exceeds the
lesser of 5% of the proceeds or $5
million.
Exempt facility bond. This is part of
an issue of which 95% or more of the
net proceeds are to be used to finance
an exempt facility listed in sections
142(a)(1) through (15). Exempt facility
bonds include qualified enterprise zone
facility bonds for use in empowerment
zones, enterprise communities, New
York Liberty bonds, qualified Gulf
Opportunity Zone bonds, qualified
Midwestern disaster area bonds, and
qualified Hurricane Ike disaster area
bonds under sections 1400N(a)(1)(A)
and 1400N(a)(2)(A)(i), and recovery
zone facility bonds.
Qualified mortgage bond. This is
part of an issue:
1. Of which all proceeds (except
issuance costs and reasonably required
reserves) are to be used to finance
owner-occupied residences,
2. That meets the requirements of
subsections (c) through (i) and (m)(7) of
section 143,
3. That does not meet the private
business tests of sections 141(b)(1)
and (2), and
4. For which repayments of principal
on financing provided by the issue (that
are received more than 10 years after
the date of issuance) are used to
redeem bonds that are part of the
issue. Amounts of less than $250,000
need not be used to redeem bonds
under this requirement.
5. Qualified mortgage bonds include
qualified Gulf Opportunity Zone bonds,
qualified Midwestern disaster area
bonds, and qualified Hurricane Ike
disaster area bonds under sections
1400N(a)(1)(B) and 1400N(a)(2)(A)(ii).
Qualified veterans’ mortgage bond.
This is part of an issue:
1. Of which 95% or more of the net
proceeds are to be used to provide
residences for veterans,
2. For which the payment of the
principal and interest is secured by the
general obligation of a state,
3. That meets the requirements of
subsections (c), (g), (i)(1), and (l) of
section 143, and
4. That does not meet the private
business tests of sections 141(b)(1)
and (2).
Qualified small issue bond. This is
part of an issue not exceeding $1
million of which 95% or more of the net
proceeds are to be used to finance (a)
land, (b) depreciable property, or (c) a
redemption of a prior issue of (a) or (b).
The $1 million limit can be increased to
$10 million if an election is made to
take certain capital expenditures into
account. See section 144(a).

Qualified student loan bond. This is
part of an issue of which:
1. 90% or more of the net proceeds
are to be used to make or finance
student loans under a program of
general application to which the Higher
Education Act of 1965 applies (see
section 144(b)(1)(A) for additional
requirements), or
2. 95% or more of the net proceeds
are to be used to make or finance
student loans under a program of
general application approved by the
state (see section 144(b)(1)(B) for
additional requirements).
Qualified redevelopment bond. This
is generally part of an issue of which
95% or more of the net proceeds are to
be used to finance certain specified real
property acquisition and redevelopment
in blighted areas. See section 144(c)
for other requirements.
Qualified 501(c)(3) bond. This is any
private activity bond that meets the
following conditions:
1. All property financed by the net
proceeds of the bond issue is to be
owned by a section 501(c)(3)
organization or a governmental unit,
and
2. The bond would not be a private
activity bond if (a) section 501(c)(3)
organizations were treated as
governmental units with respect to their
activities that do not constitute
unrelated trades or businesses
(determined by applying section 513),
and (b) the private activity bond
definition was applied using a 5%
threshold (instead of 10%) for the
private use, security, and/or payment
tests, and the activities that constitute
unrelated trades or businesses are
aggregated with any other private use,
security, or payment and by substituting
“net proceeds” (instead of proceeds)
each place it appears.
a:

A qualified 501(c)(3) bond includes

• Qualified hospital bond that is part of

an issue of which 95% or more of the
net proceeds are to be used for a
hospital.
• Qualified nonhospital bond that is
other than a qualified hospital bond. In
general, an organization cannot have
more than $150 million of qualified
501(c)(3) nonhospital bonds; see
section 145(b). However, the limit does
not apply to bonds issued after August
5, 1997, if 95% or more of the net
proceeds of the issue are to be used
solely for capital expenditures incurred
after that date.
Restrictions apply to the use of
qualified 501(c)(3) bonds (both hospital
and nonhospital) to provide residential
rental housing. See section 145(d).

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Issue price. The issue price of bonds
is generally determined under
Regulations section 1.148-1(b). Thus,
when issued for cash, the issue price is
the first price at which a substantial
amount of the bonds are sold to the
public. To determine the issue price of
an obligation issued for property, see
sections 1273 and 1274 and the related
regulations.
Note. The issue price does not include
interest from the date the bonds are
dated to the date of issue.
Issue. Generally, bonds are treated as
part of the same issue if they are
issued by the same issuer, on the same
date, and in a single transaction, or
series of related transactions.
Arbitrage rebate. Generally, interest
on a state or local bond is not tax
exempt unless the issuer of the bond
rebates to the United States arbitrage
profits earned from investing proceeds
of the bond in higher yielding
nonpurpose investments. See section
148(f).
Construction issue. This is an issue
of tax-exempt bonds that meets both of
the following conditions:
1. At least 75% of the available
construction proceeds are to be used
for construction expenditures with
respect to property to be owned by a
governmental unit or a section
501(c)(3) organization, and
2. All the bonds that are part of the
issue are qualified 501(c)(3) bonds,
bonds that are not private activity
bonds, or private activity bonds issued
to finance property to be owned by a
governmental unit or a section
501(c)(3) organization.
In lieu of rebating any arbitrage that
may be owed to the United States, the
issuer of a construction issue may
make an irrevocable election to pay a
penalty. The penalty is equal to 11/2% of
the amount of construction proceeds
that do not meet certain spending
requirements. See section 148(f)(4)(C)
and the Instructions for Form 8038-T.

Specific Instructions
Part I—Reporting Authority
Amended return. An issuer may file
an amended return to change or add to
the information reported on a previously
filed return for the same date of issue. If
you are filing to correct errors or
change a previously filed return, check
the “Amended Return” box in the
heading of the form.
The amended return must provide all
the information reported on the original
return, in addition to the new or
corrected information. Attach an

explanation of the reason for the
amended return.
Line 1. The issuer’s name is the name
of the entity issuing the bonds, not the
name of the entity receiving the benefit
of the financing.
Line 2. An issuer that does not have
an employer identification number (EIN)
should apply for one on Form SS-4,
Application for Employer Identification
Number. You can get this form on the
IRS Website at IRS.gov or by calling
1-800-TAX-FORM (1-800-829-3676).
You may receive an EIN by telephone
by following the instructions for Form
SS-4.
Line 3a. If the issuer wishes to
authorize a person other than an officer
or other employee of the issuer
(including a legal representative or paid
preparer) to communicate with the IRS
and whom the IRS may contact with
respect to this return (including in
writing or by telephone), enter the
name of such person here. The person
listed in line 3a must be an individual.
Do not enter the name and title of an
officer or other employee of the issuer
here (use line 10a for that purpose).
Note. By authorizing a person other
than an authorized officer or other
employee of the issuer to communicate
with the IRS and whom the IRS may
contact with respect to this return, the
issuer authorizes the IRS to
communicate directly with the individual
entered on line 3a and consents to
disclose the issuer’s return information
to that individual, as necessary, in order
to process this return.
Lines 4 and 6. If you listed in line 3a,
a person other than an officer or other
employee of the issuer (including a
legal representative or paid preparer) to
communicate with the IRS and whom
the IRS may contact with respect to this
return, enter the number and street (or
P.O. Box if mail is not delivered to
street address), city, town, or post
office, state, and ZIP code of that
person. Otherwise, enter the issuer’s
number and street (or P.O. Box if mail
is not delivered to street address), city,
town, or post office, state, and ZIP
code.
Note. The address entered on lines 4
and 6 is the address the IRS will use for
all written communications regarding
the processing of this return, including
any notices.
Line 5. This line is for IRS use only.
Do not make an entry.
Line 7. The date of issue is generally
the date on which the issuer physically
exchanges the bonds for the
underwriter’s (or other purchaser’s)
funds.

Line 8. If there is no name of the
issue, please provide other
identification of the issue.
Line 9. Enter the CUSIP (Committee
on Uniform Securities Identification
Procedures) number of the bond with
the latest maturity. If the issue does not
have a CUSIP number, write “None.”
Line 10a. Enter the name and title of
the officer or other employee of the
issuer whom the IRS may call for more
information. If the issuer wishes to
designate a person other than an
officer or other employee of the issuer
(including a legal representative or paid
preparer) whom the IRS may call for
more information with respect to the
return, enter the name, title, and
telephone number of such person on
lines 3a and 3b.

!

CAUTION

Complete lines 10a and 10b
even if you complete lines 3a
and 3b.

Part II—Type of Issue

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CAUTION

Elections referred to in Part II
are made on the original bond
documents, not on this form.

You must identify the type of bonds
issued by entering the corresponding
issue price (see Issue price under
Definitions earlier).
Line 11f. After entering the issue
price, check the appropriate box for the
percentage test elected by the issuer at
the time of issuance of the bonds.
Then, check the appropriate box to
show whether an election was made for
deep rent skewing. See Rev. Rul.
94-57, 1994-2 C.B. 5, for guidance on
computing the income limits applicable
to these bonds.
Line 11h. Bonds issued to finance
certain facilities may also qualify as
exempt facility bonds if they were (a)
permitted as exempt facility bonds
under prior law and (b) issued under
one of the transitional rules of the Tax
Reform Act of 1986 (the 1986 Act).
These facilities
include...

As described in
former section...

A sports facility

103(b)(4)(B)

A convention or trade
show facility

103(b)(4)(C)

A parking facility

103(b)(4)(D)

A pollution control facility

103(b)(4)(F)

A hydroelectric facility

103(b)(4)(H)

An industrial park

103(b)(5)

If one of the above applies, indicate
the facility type and then give the

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specific provision of the 1986 Act
pertaining to the facility on line 11h.
Line 11i. Enter the issue price if the
bonds are part of any issue 95% or
more of the net proceeds of which are
to be used to provide any enterprise
zone facility in an empowerment zone
or enterprise community. See section
1394.
Line 11j. Enter the issue price if the
bonds are: (a) issued after August 5,
1997, and (b) part of any issue 95% or
more of the net proceeds of which are
to be used to provide any
empowerment zone facility. See section
1394(f).
The updated information on the
designated urban empowerment zones
is available at www.hud.gov; for the
designated rural empowerment zones,
go to www.rurdev.usda.gov/rbs/ezec/.
Line 11o. This line is for IRS use only.
Do not make an entry.
Line 11q. On the space provided,
enter the facility type if applicable.
Issuers of recovery zone facility bonds
issued under section 1400U-3 should
complete line 11q, Other, by writing
“recovery zone facility bonds” in the
space provided for the bond description
and entering the issue price of the
recovery zone facility bonds in the issue
price column. Issuers of qualified Gulf
Opportunity Zone exempt facility bonds,
qualified Midwestern disaster area
exempt facility bonds, and qualified
Hurricane Ike disaster area exempt
facility bonds (sections 1400N(a)(1)(A)
and 1400N(a)(2)(A)(i)) should complete
line 11q, Other, by writing in the type of
bond in the space provided for the bond
description and entering the issue price
of the bonds in the issue price column.
Facility types include...

As described
in section...

Mass commuting facilities

142(a)(3) and
142(c)

Local district heating or
cooling facilities

142(a)(9) and
142(g)

Environmental enhancements
of hydroelectric generating
142(a)(12) and
facilities
142(j)
High-speed intercity rail
facilities*

142(a)(11),
142(c), and
142(i)

*Note. Proceeds of an exempt bond may not be used
for this type of facility if there is a nongovernmental
owner of the facility unless that owner makes an
irrevocable election not to claim (1) depreciation
under section 167 or 168, or (2) any credit against its
income tax with respect to the property financed with
the net proceeds of the issue.

Line 12b. Issuers of qualified Gulf
Opportunity Zone mortgage bonds,
qualified Midwestern disaster area
mortgage bonds, and qualified

Hurricane Ike disaster area mortgage
bonds (sections 1400N(a)(1)(B) and
1400N(a)(2)(A)(ii)) should complete line
12b, Other, by writing the type of bond
in the space provided for the bond
description and entering the issue price
of the bonds in the issue price column.
Line 13. Check the box if the issuer
has elected, in the bond indenture or
related document, to pay to the United
States the amount described in section
143(g)(3)(D).
Line 14. Enter the issue price if the
bond issue is an exempt issue of $10
million or less for which an election
under section 144(a)(4) has been made
by the issuer at or before the time of
issuance on the bonds or in its records.
See section 144(a). Check the box if
the $10 million small issue exemption
applies.
Line 17. Attach a schedule listing the
name and EIN for each section
501(c)(3) organization benefiting from
these qualified hospital bonds.
Line 18. Enter the total amount of
qualified nonhospital bonds described
in section 145(b)(2) that are a part of
this issue. For each section 501(c)(3)
organization benefiting from these
qualified nonhospital bonds, attach a
schedule listing:
1. The name of the organization,
2. Its EIN,
3. The amount of this issue of
bonds benefiting the organization, and
4. If the box for line 18 is not
checked, the amount of all other
nonhospital bonds outstanding as of
the date of this issue that benefit the
organization.
Note. The amount in item 4 above
plus line 18 cannot exceed $150 million
with respect to bonds issued: (a) prior
to August 6, 1997, and (b) after August
5, 1997, if used for noncapital
expenditures. The $150 million limit
does not apply to bonds issued after
August 5, 1997, if 95% or more of the
net proceeds are used solely for capital
expenditures incurred after that date.
Line 19. Enter the issue price if the
bonds are used to acquire
nongovernmental output property,
which is property used by a
nongovernmental person in connection
with an output facility (such as an
electric or gas power project).
Line 20a. For IRS use only. Do not
make an entry.
Line 20b. Enter the issue price if the
bonds are New York Liberty Zone
advance refunding bonds under section
1400L(e).
Line 20c. Enter the issue price only if
none of the lines above apply and you
are required to file an information return
for a private activity bond. Enter a

description of the bond type. Issuers of
Gulf Opportunity Zone advance
refunding bonds (section 1400N(b)(1))
should complete line 20(c), Other, by
writing the type of bond in the space
provided for the bond description and
entering the issue price of the bonds in
the issue price column.

Part III—Description of
Bonds
Line 21. For column (a), the final
maturity date is the last date the issuer
must redeem the entire issue.
For column (b), see Issue price
under Definitions earlier.
For column (c), the stated
redemption price at maturity of the
entire issue is the sum of the stated
redemption prices at maturity of each
bond issued as part of the issue.
For column (d), the weighted
average maturity is the sum of the
products of the issue price of each
maturity and the number of years to
maturity (determined separately for
each maturity and by taking into
account mandatory redemptions),
divided by the issue price of the entire
issue (from line 21, column (b)).
For column (e), the yield, as defined
in section 148(h), is the discount rate
that, when used to compute the present
value of all payments of principal and
interest to be paid on the obligation,
produces an amount equal to the
purchase price, including accrued
interest. See Regulations section
1.148-4 for specific rules to compute
the yield on an issue. If the issue is a
variable rate issue, write “VR” as the
yield of the issue. For other than
variable rate issues, carry the yield out
to four decimal places (for example,
5.3125%).

Part IV—Uses of Proceeds of
Issue
Line 22. Enter the amount of proceeds
that will be used to pay interest from
the date the bonds are dated to the
date of issue.
Line 24. Enter the amount of the
proceeds that will be used to pay bond
issuance costs, including fees for
trustees and bond counsel. If no bond
proceeds have been used to pay bond
issuance costs, enter zero. Do not
leave this line blank.
Line 25. Enter the amount of the
proceeds that will be used to pay fees
for credit enhancement that are taken
into account in determining the yield on
the issue for purposes of section 148(h)
(for example, bond insurance premiums
and certain fees for letters of credit).

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Line 26. Enter the amount of the
proceeds that will be allocated to such
a fund.
Line 27. Enter the amount of the
proceeds that will be used to pay
principal, interest, or call premium on
any other issue of bonds within 90 days
of the date of issue.
Line 28. Enter the amount of the
proceeds that will be used to pay
principal, interest, or call premium on
any other issue of bonds after 90 days
of the date of issue, including proceeds
that will be used to fund an escrow
account for this purpose.
Note. Line 28 is only applicable for
qualified 501(c)(3) bonds, and certain
New York Liberty Zone advance
refunding bonds (under section
1400L(e)).

Part V—Description of
Property Financed by
Nonrefunding Proceeds
Line 31. Enter the amount of the
nonrefunding bond proceeds received
by the issuer and used to finance real
or depreciable personal property. If the
amounts are not available at the time of
issuance, make a reasonable proration
between the land, buildings, and
equipment.
Note. Under section 147(c), a private
activity bond is not a qualified bond if
25% or more of the proceeds are used
for the acquisition of land or if any of
the proceeds are used to acquire farm
land (other than an amount of proceeds
not in excess of $450,000 to be used
by a first-time farmer). An exception to
this general rule is for land acquired for
certain environmental purposes. See
section 147(c)(3). Also, a bond is not a
qualified bond if the proceeds are used
for the acquisition of used property
(other than land), except in the case of
certain rehabilitations. See section
147(d).
For items that do not readily fit within
categories 31a, b, c, or d, enter the
amount of those proceeds in category
31e, Other, and briefly describe them
on the line.
Line 32. For each project to be
financed by the issue, enter the
corresponding:
• Six-digit North American Industry
Classification System (NAICS) code
that best describes the project, and
• Face amount of the project.
If there are more than four projects
to be financed by the issue, attach a
separate sheet of paper stating the
NAICS codes and face amount of each
project.
For the purpose of determining
NAICS codes where the project fits into
more than one category, the ultimate

use of the facility determines the NAICS
code number. For example, an
investment partnership financing a
manufacturing facility should use the
relevant manufacturing NAICS code,
not the partnership’s financial activities
code.
The NAICS codes are available on
the U.S. Census Bureau Website at
www.census.gov/eos/www/naics/.

Part VI—Description of
Refunded Bonds
Complete this part only if the bonds are
to be used to refund a prior issue of
tax-exempt private activity bonds.
Lines 33 and 34. The remaining
weighted average maturity is
determined without regard to the
refunding. The weighted average
maturity is determined in the same
manner as for line 21, column (d).
Line 35. Enter the last date on which
any of the bonds being refunded will be
called.
Line 36. If more than a single issue of
bonds will be refunded, enter the date
of issue of each of the issues.

Part VII—Miscellaneous
Line 37. Under the rules of section
147(f), private activity bonds are not tax
exempt unless they receive public
approval by certain officials or voter
referendums. Enter the name of the
governmental unit(s) approving the
issue. Enter also the date of approval
by the applicable elected
representatives and the date of the
public hearing. In the alternative, enter
the date of the voter referendum.
If, under the rules of section 147(f),
no approval is needed because the
issue meets an exception to the public
approval requirement, write “No
approval needed” on line 37. Also enter
on line 37 the provision of section
147(f) under which the issue is
excepted (for example, “section
147(f)(2)(D)”), or if under any
transitional rule write “Transitional rule”
and the applicable Act (for example,
“Tax Reform Act of 1986”) and section.
Line 39. Check this box if the issue is
a construction issue and an irrevocable
election to pay a penalty in lieu of
arbitrage rebate has been made on or
before the date the bonds were issued.
The penalty is payable with a Form
8038-T for each 6-month period after
the date the bonds are issued. Do not
make any payment of penalty in lieu of
arbitrage rebate with this form. See
Rev. Proc. 92-22, 1992-1 C.B. 736 for
rules regarding the “election document.”
Line 40a. Check this box if the issuer
has identified a hedge on its books and
records in accordance with Regulation
sections 1.148-4(h)(2)(viii) and

1.148-4(h)(5) that permit an issuer of
tax-exempt bonds to identify a hedge
for it to be included in yield calculations
for computing arbitrage.
Line 41. In determining if the issuer
has super-integrated a hedge, apply
the rules of Regulations section
1.148-4(h)(4). If the hedge is
super-integrated, check the box.
Line 42a. If any portion of the gross
proceeds of the issue are or will be
invested in a guaranteed investment
contract, as defined in Regulations
section 1.148-1(b), enter the amount of
the gross proceeds so invested.
Line 42b. Enter the final maturity date
of the GIC.
Line 42c. Enter the name of the GIC
provider.
Line 43. If there are applicable
provisions under either the Code or
Regulations to ensure that all
nonqualified bonds of this issue are
remediated and the issuer has
established written procedures to
comply with such remedial provisions,
check the box. For example, remedial
provisions under Regulation section
1.142-2 apply to exempt facility bonds;
Regulation section 1.144-2 applies
section 1.142-2 to qualified small issue
bonds; Regulation section 1.145-2
applies section 1.141-12 to qualified
501(c)(3) bonds; section 142(f)(2)(B)
applies to bonds issued to finance
facilities for the local furnishing of
electric energy or gas.
Line 44. Check the box if the issuer
has established written procedures to
monitor compliance with the arbitrage,
yield restriction, and rebate
requirements of section 148.
Line 45a. Determine and enter the
amount of the proceeds of the issue
used to reimburse the issuer for
amounts paid for a qualified purpose
prior to the issuance of the bonds. See
Regulations section 1.150-2.
Line 45b. Subject to certain
exceptions under Regulations section
1.150-2(f), an issuer must adopt an
official intent, as described in
Regulations section 1.150-2(e), to
reimburse itself for preissuance
expenditures within 60 days after
payment of the original expenditure.
Enter the date the official intent was
adopted.

-5-

Line 46. Check this box if:
The issue
is
comprised
of ...

As
described
in section ...

Qualified
redevelopment bonds 144(c)
Qualified small issue
bonds
Exempt facilities
bonds

144(a)
142(a)(4) through
142(a)(11), 142(a)(13)
through 142(a)(15),
and 1394

Recovery zone facility
bonds
1400U-3

If one of the above applies, then
enter the name and EIN of the primary
private user. A “primary private user” is
the nongovernmental entity that meets
the private business tests of section
141(b) or private loan financing test of
section 141(c).

Part VIII—Volume Caps
Line 47. Enter the amount of volume
cap allocated to the issuer. Attach a
copy of the state certification, if
applicable. The appropriate state official
must certify that the issue meets the
requirements of section 146 (relating to
volume cap on private activity bonds).
See the regulations under section
149(e). The certification must also
include the information requested by
lines 1, 2, and 7 through 9 on page 1 of
Form 8038, as well as the title of the
certifying official.
For recovery zone facility bonds, do
not enter an amount on either line 47 or
48. However, you must attach a copy of
the certification of the volume cap
allocated to the issuer for the bond
issue being reported on this form.
Failure to attach the certification with
the information described in the
paragraph above may result in a delay
in processing this form.
Line 48. Enter the amount of the issue
subject to the unified state volume cap
for private activity bonds under section
146. If, under section 141, the
nonqualified amount of an issue
exceeds $15 million, but does not
exceed the amount that would cause a
bond which is part of an issue to be
treated as a private activity bond, the
issuer must allocate a part of its volume
cap to the nonqualified amount over
$15 million.

Line 49a. Enter the amount of any
bond issued as part of an issue to
finance exempt facilities that are not
subject to the volume cap. These
facilities include:
• Airports.
• Docks.
• Wharves.
• Environmental enhancements of
hydroelectric generating facilities.
• Qualified public educational facilities.
• Qualified green building and
sustainable design projects.
• Qualified highway or surface freight
transfer facilities.
• Solid waste facilities.
Note. These facilities may have to be
governmentally owned. See section
146(h).
• High-speed intercity rail facilities.
Note. Only 75% of any exempt facility
bond for these facilities is not subject to
the volume cap; however, no volume
cap applies if all the bond-financed
property is governmentally owned. See
sections 146(g) and 142(b)(1)(B).
Line 49b. If any part of the issue is
issued under a carryforward election,
enter the amount of the bonds being
issued under that election. Attach a
copy of the applicable Form 8328,
Carryforward Election of Unused
Private Activity Bond Volume Cap.
Line 49c. If any part of the issue is not
subject to the volume cap under a
transitional rule of the Tax Reform Act
of 1986, enter the appropriate section
of the Act and then the amount of the
bonds excepted from the volume cap
by that rule.
Line 49d. Any bond that is issued to
currently refund another bond is not
subject to the volume cap to the extent
that the amount of such bond does not
exceed the outstanding amount of the
refunded bond. See section 146(i) and
section 1313(a) of the Tax Reform Act
of 1986. Enter the amount not subject
to the volume cap.
Line 50b. Enter the state limit on
qualified veterans’ mortgage bonds for
the calendar year under section
143(l)(3).
Line 51a. Enter the amount of volume
cap allocated to the issuer. Attach a
copy of the government’s certification.
The official must certify that the issue

meets the requirements, including the
applicable volume cap under section
1394(f). The certification must also
include the information requested by
lines 1, 2, and 7 through 9 on page 1 of
Form 8038, as well as the title of the
certifying official.
Line 51b. Enter the name of the
empowerment zone. See the
instructions for line 11j on where to get
the names of the empowerment zones.
Line 52. Enter the amount of volume
cap allocated to the issuer. Attach a
copy of the state certification, if
applicable. The appropriate state official
must certify that the issue meets the
volume cap requirements of section
142(k)(5). The certification must also
include the information requested by
lines 1, 2, and 7 through 9 on page 1 of
Form 8038, as well as the title of the
certifying official.

Signature and Consent
An authorized representative of the
issuer must sign Form 8038 and any
applicable certification. Also print the
name and title of the person signing
Form 8038. The authorized
representative of the issuer signing this
form must have the authority to consent
to the disclosure of the issuer’s return
information, as necessary to process
this return, to the person(s) that has
been designated in Form 8038.
Note. If the issuer in Part 1, lines 3a
and 3b authorizes the IRS to
communicate (including in writing and
by telephone) with a person other than
an officer or other employee of the
issuer, by signing this form, the issuer’s
authorized representative consents to
the disclosure of the issuer’s return
information, as necessary to process
this return, to such person.

Paid Preparer
If an authorized officer of the issuer
filled in this return, the paid preparer’s
space should remain blank. Anyone
who prepares the return but does not
charge the organization should not sign
the return. Certain others who prepare
the return should not sign. For
example, a regular, full-time employee
of the issuer, such as a clerk, secretary,
etc., should not sign.

-6-

Generally, anyone who is paid to
prepare a return must sign it and fill in
the other blanks in the Paid Preparer
Use Only area of the return. The paid
preparer must:
• Sign the return in the space provided
for the preparer’s signature,
• Enter the preparer information, and
• Give a copy of the return to the
issuer.
Paperwork Reduction Act Notice.
We ask for the information on this form
to carry out the Internal Revenue laws
of the United States. You are required
to give us the information. We need it to
ensure that you are complying with
these laws and to allow us to figure and
collect the right amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records
relating to a form or its instructions
must be retained as long as their
contents may become material in the
administration of any Internal Revenue
law. Generally, tax returns and return
information are confidential, as required
by section 6103.
The time needed to complete and
file this form will vary depending on
individual circumstances. The
estimated average time is:
Recordkeeping . . . . . . . . .

20 hr., 34 min.

Learning about the law or
the form . . . . . . . . . . . . . .

15 hr., 21 min.

Preparing, copying,
assembling, and sending the
form to the IRS . . . . . . . . . . 17 hr., 34 min.

If you have comments concerning
the accuracy of these time estimates or
suggestions for making this form
simpler, we would be happy to hear
from you. You can write to Internal
Revenue Service, Tax Products
Coordinating Committee,
SE:W:CAR:MP:T:T:SP, 1111
Constitution Ave. NW, IR-6526,
Washington, DC 20224. Do not send
Form 8038 to this address. Instead, see
Where To File, earlier.