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IRS Audit Service and Arbitrage

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Miller Canfield offers IRS audit and arbitrage compliance services as part of its comprehensive public finance practice. We have decades of experience representing tax-exempt bond issuers faced with IRS audits scrutinizing the tax-exempt status of such bonds, and have successfully defended more than 60 audits for our clients.

As the IRS continues to strengthen its audit program, it is critical that tax-exempt bond issuers focus on compliance with the federal tax rules well after the debt is issued. We have extensive experience in reviewing clients’ compliance with arbitrage yield restrictions and rebate requirements, as well as compliance with the private activity rules applicable to tax-exempt bonds. In the event that either the issuer or counsel identifies a compliance issue, we have also represented countless issuers as they seek to remedy compliance issues through either self-remediation or settlement agreements with the IRS pursuant to the IRS’ Voluntary Closing Agreement Program.

Miller Canfield has broad experience with all types of bond audits:

  • Schools
  • State
  • Pooled financings
  • Cash flow financings
  • Student loan bonds
  • County, city and smaller units of government
  • Universities
  • Building authorities
  • Airports
  • Hospitals
  • Regional authorities
  • Tax increment districts
  • Downtown developmental authorities
  • Private activity bonds
  • State revolving fund

Our VCAP experience is more than 130 separate, closed issues and several private ruling requests. We average more than 150 rebate/yield compliance reviews per year, including very complex student loan computations, pooled deal computations, and integrated swaps. We also assist with Schedule K (Form 990) questions. and advanced refunding escrow compliance. 

Miller Canfield is one of the only firms to have utilized the 97-15 process.