IRS Closes Audit of $650M of Bonds With No Change to Tax Status

The Internal Revenue Service has closed its audit of $650 million of general obligation limited tax school bonds issued in 2007 by Clark County, Nev. School District without changing their tax-exempt status.

The district disclosed the closure of the audit in an event notice filed with the Municipal Securities Rulemaking Board’s EMMA system.

The notice included the IRS’ May 29 letter that notified the district of the no-change position on the bonds.

The letter also said, “Please note; if the need arises to open another examination of the bonds, any change resulting from the future examination may affect all on years of the beneficial owners of the bonds.”

Jeffrey K. Weiler, deputy superintendent and chief financial officer, could not be reached for comment.

The IRS had opened the audit in October 2012, saying it had no reason to believe the bonds failed to comply with any of the applicable tax requirements.

The bonds were to be used to finance the cost of acquiring, constructing. improving and equipping school facilities, according to the official statement.

Roughly $250 million of the bonds were unwritten by Merrill Lynch & Co., now Bank of America Merrill Lynch, and $400 million were unwritten by the now defunct Lehman Brothers.

Swendseid & Stern, a member of Sherman & Howard in Las Vegas, was bond counsel and NSB Public Finance in Las Vegas was financial advisor.

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Tax Nevada
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