WASHINGTON — The Internal Revenue Service is auditing $51 million of auction-rate securities that were issued in a conduit deal in 2005 by the Orange County, Fla., Health Facilities Authority to current-refund bonds and finance a hospital project.

But the ARS were retired on May 1, 2008, so that the IRS would only have until April 15, 2012, to complete its audit because of a three-year statute of limitations on tax matters. The year 2012 would be three years after 2009, when bondholders filed tax returns for 2008 referencing the bonds.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.