Orrick Tax Talk 13: Management Contracts - New 2017 Rules

Management contracts and other use agreements with outside parties may give rise to private business use if occurring in bond financed facilities. In early 2017, for the second time in 6 months, the IRS released updated guidance (Rev Proc 2017-13) with respect to the safe harbor requirements for contracts for services performed in tax-exempt bond-financed facilities. While this new revenue procedure is generally helpful, issuers and borrowers will need to carefully navigate these principle-based concepts to help minimize the impact that these contracts have on their private business use percentage. In this video, Ed and Larry review Rev Proc 2017-13 and how its application will impact the determination of private business use. Specific techniques and guidance for structuring contracts and agreements to be “safe harbor” compliant are also discussed.

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Other Tax Talk Videos
1. The ABC’s of Governmental Bonds
2. The ABC’s of 501(c)(3) Bonds
3. Private Business Use
4. Private Payments
5. Management Contracts (video removed – see video #13)
6. Sponsored Research Contracts
7. Private Activity Bonds
8. Tax Credit Bonds (video removed as tax credit bonds can no longer be issued)
9. Post-Issuance Tax Compliance
10. Change in Use/VCAP
11. IRS Audits
12. Allocation of Bond Proceeds and Floating Equity
13. Management Contracts – New 2017 Rules