Form 8038-GC Information Return for Small Tax-Exempt Governmental Bon

Form

8038-GC

Information Return for Small Tax-Exempt
Governmental Bond Issues, Leases, and Installment Sales

(Rev. November 2000)
Department of the Treasury
Internal Revenue Service

Part I

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OMB No. 1545-0720

Under Internal Revenue Code section 149(e)

Caution: If the issue price of the issue is $100,000 or more, use Form 8038-G.

Reporting Authority

Check box if Amended Return

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1

Issuer’s name

2 Issuer’s employer identification number

3

Number and street (or P.O. box if mail is not delivered to street address)

4

City, town, or post office, state, and ZIP code

5 Report number

6

Name and title of officer or legal representative whom the IRS may call for more information

7 Telephone number of officer or legal representative

Room/suite

5
(

Part II
8a
b
9
a
b
10
11
12

Description of Obligations Check if reporting: a single issue

)

or on a consolidated basis

.

8a
Issue price of obligation(s) (see instructions)
Issue date (single issue) or calendar year (consolidated) (see instructions) 䊳
Amount of the reported obligation(s) on line 8a:
9a
Used to refund prior issue(s)
9b
Representing a loan from the proceeds of another tax-exempt obligation (e.g., bond bank)
If the issuer has designated any issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check this box
If any obligation is in the form of a lease or installment sale, check this box
If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check this box

Sign
Here

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䊳
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Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge
and belief, they are true, correct, and complete.

䊳

Issuer’s authorized representative

General Instructions
Section references are to the Internal
Revenue Code unless otherwise noted.

Purpose of Form
Form 8038-GC is used by the issuers of
tax-exempt governmental obligations to
provide the IRS with the information required
by section 149(e) and to monitor the
requirements of sections 141 through 150.

Who Must File
Issuers of tax-exempt governmental
obligations with issue prices of less than
$100,000 must file Form 8038-GC.
Issuers of a tax-exempt governmental
obligation with an issue price of $100,000 or
more must file Form 8038-G, Information
Return for Tax-Exempt Governmental
Obligations.
Filing a separate return. Issuers have the
option to file a separate Form 8038-GC for
any tax-exempt governmental obligation with
an issue price of less than $100,000.
An issuer of a tax-exempt bond used to
finance construction expenditures must file a
separate Form 8038-GC for each issue to
give notice to the IRS that an election was
made to pay a penalty in lieu of arbitrage
rebate (see the line 12 instructions).
Filing a consolidated return. For all
tax-exempt governmental obligations with
issue prices of less than $100,000 that are
not reported on a separate Form 8038-GC,
an issuer must file a consolidated information
return including all such issues issued within
the calendar year.

Date

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Type or print name and title

Thus, an issuer may file a separate Form
8038-GC for each of a number of small
issues and report the remainder of small
issues issued during the calendar year on one
consolidated Form 8038-GC. However, a
separate Form 8038-GC must be filed to give
the IRS notice of the election to pay a penalty
in lieu of arbitrage rebate.

Other Forms That May Be Required

When To File

Rounding to Whole Dollars

To file a separate return, file Form 8038-GC
on or before the 15th day of the second
calendar month after the close of the
calendar quarter in which the issue is issued.
To file a consolidated return, file Form
8038-GC on or before February 15th of the
calendar year following the year in which the
issue is issued.
Late filing. An issuer may be granted an
extension of time to file Form 8038-GC under
Section 3 of Rev. Proc. 88-10, 1988-1 C.B.
635, if it is determined that the failure to file
on time is not due to willful neglect. Type or
print at the top of the form, “This Statement
Is Submitted in Accordance with Rev. Proc.
88-10.” Attach to the Form 8038-GC a letter
briefly stating why the form was not
submitted to the IRS on time. Also indicate
whether the obligation in question is under
examination by the IRS. Do not submit copies
of any bond documents, leases, or installment
sale documents. See Where To File below.

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.

Where To File
File Form 8038-GC, and any attachments,
with the Internal Revenue Service Center,
Ogden, UT 84201.

Cat. No. 64108B

For rebating arbitrage (or paying a penalty in
lieu of arbitrage rebate) to the Federal
government, use Form 8038-T, Arbitrage
Rebate and Penalty in Lieu of Arbitrage
Rebate. For private activity bonds, use Form
8038, Information Return for Tax-Exempt
Private Activity Bond Issues.

Definitions
Obligations. This refers to a single
tax-exempt governmental obligation if Form
8038-GC is used for separate reporting or to
multiple tax-exempt governmental obligations
if the form is used for consolidated reporting.
Tax-exempt obligation. This is a bond,
installment purchase agreement, or financial
lease, on which the interest is excluded from
income under section 103.
Tax-exempt governmental obligation. A
tax-exempt obligation that is not a private
activity bond (see below) is a tax-exempt
governmental obligation. This includes a bond
issued by a qualified volunteer fire
department under section 150(e).
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 activity business use,
and
Form

8038–GC

(Rev. 11-2000)

Form 8038-GC (Rev. 11-2000)

● 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 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.
Issue. Generally, obligations are treated as
part of the same issue only if they are issued
by the same issuer, on the same date, and as
part of a single transaction, or a series of
related transactions. However, obligations
issued during the same calendar year (a)
under a loan agreement under which amounts
are to be advanced periodically (a
“draw-down loan”) or (b) with a term not
exceeding 270 days, may be treated as part
of the same issue if the obligations are
equally and ratably secured under a single
indenture or loan agreement and are issued
under a common financing arrangement (e.g.,
under the same official statement periodically
updated to reflect changing factual
circumstances). Also, for obligations issued
under a draw-down loan that meets the
requirements of the preceding sentence,
obligations issued during different calendar
years may be treated as part of the same
issue if all of the amounts to be advanced
under the draw-down loan are reasonably
expected to be advanced within 3 years of
the date of issue of the first obligation.
Likewise, obligations (other than private
activity bonds) issued under a single
agreement that is in the form of a lease or
installment sale may be treated as part of the
same issue if all of the property covered by
that agreement is reasonably expected to be
delivered within 3 years of the date of issue
of the first obligation.
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 of the issue are to be
used for construction expenditures with
respect to property to be owned by a
governmental unit or a 501(c)(3) organization,
and
2. All of 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 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.

Page

Specific Instructions
In general, a Form 8038-GC must be
completed on the basis of available
information and reasonable expectations as
of the date the issue is issued. However,
forms that are filed on a consolidated basis
may be completed on the basis of information
readily available to the issuer at the close of
the calendar year to which the form relates,
supplemented by estimates made in good
faith.

Part I—Reporting Authority
Amended return. If this is an amended Form
8038-GC, check the amended return box.
Complete Part I and only those lines of Form
8038-GC that are being amended. Do not
amend estimated amounts previously
reported once the actual amounts are
determined. (See the Part II instructions
below.)
Line 1. The issuer’s name is the name of the
entity issuing the obligations, not the name of
the entity receiving the benefit of the
financing. In the case of a lease or installment
sale, the issuer is the lessee or purchaser.
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. This form
may be obtained at Social Security
Administration offices or by calling
1-800-TAX-FORM. If the EIN has not been
received by the due date for Form 8038-GC,
write “Applied for” in the space for the EIN.
Line 5. After the preprinted 5, enter two
self-designated numbers. Number reports
consecutively during any calendar year (e.g.,
534, 535, etc.).

Part II—Description of
Obligations
Line 8a. The issue price of obligations is
generally determined under Regulations
section 1.148-1(b). Thus, when issued for
cash, the issue price is the price at which a
substantial amount of the obligations 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.
Line 8b. For a single issue, enter the date of
issue, generally the date on which the issuer
physically exchanges the bonds that are part
of the issue for the underwriter’s (or other
purchaser’s) funds; for a lease or installment
sale, enter the date interest starts to accrue.
For issues reported on a consolidated basis,
enter the calendar year during which the
obligations were issued.

2

Lines 9a and 9b. For line 9a, enter the
amount of the proceeds that will be used to
pay principal, interest, or call premium on any
other issue of bonds, including proceeds that
will be used to fund an escrow account for
this purpose. Both line 9a and 9b may apply
to a particular obligation. For example, report
on line 9a and 9b obligations used to refund
prior issues which represent loans from the
proceeds of another tax-exempt obligation.
Line 11. Check this box if property other than
cash is exchanged for the obligation, e.g.,
acquiring a police car, a fire truck, or
telephone equipment through a series of
monthly payments. (This type of obligation is
sometimes referred to as a “municipal lease.”)
Also check this box if real property is directly
acquired in exchange for an obligation to
make periodic payments of interest and
principal. Do not check this box if the
proceeds of the obligation are received in the
form of cash, even if the term “lease” is used
in the title of the issue.
Line 12. 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 rebate
with Form 8038-GC. See Rev. Proc. 92-22,
1992-1 C.B. 736, for rules regarding the
“election document.”

Paperwork Reduction Act Notice
We ask for the information on this form to
carry out the Internal Revenue laws of the
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You are not required to provide the
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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 varies depending on individual
circumstances. The estimated average time
is:
Learning about the
law or the form

1 hr., 58 min.

Preparing the form

3 hr., 3 min.

Copying, assembling, and
sending the form to the IRS

16 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 the Tax Forms Committee, Western
Area Distribution Center, Rancho Cordova,
CA 95743-0001. Do not send the form to this
address. Instead, see Where To File on
page 1.