Taxable bonds do not qualify for federal income tax exemption and may be issued without several size limitations imposed on tax-exempt bonds.
- Taxable bonds are not subject to many of the restrictions imposed on tax-exempt IDBs.
- Taxable bonds are not restricted when financing previously-used facilities.
- Taxable bonds do not have the same limitations on and rebate of the investment of funds borrowed as do tax-exempt IDBs.
- Tax-exempt IDBs involve public hearing and approval, state volume cap, allocation and IRS reporting proceedings that are not required for Taxable Bonds
When portions of a project do not comply with the requirements applicable to a tax-exempt bond, a combination of tax-exempt and taxable bonds might be used to finance the entire project.
Contact AIDEA for more details.