Instructions for Form
Department of the Treasury
Internal Revenue Service
8038-CP
(Rev. June 2010)
Return for Credit Payments to Issuers of Qualified Bonds
What To File
eligible to elect to receive direct payments
Section references are to the Internal
under section 6431(f).
Revenue Code unless otherwise noted.
The payment requested on Form
8038-CP can only relate to the interest
What’s New
Reminders
paid on a single bond issue. If the issue
Section 301 of P.L. 111-147 (H.R. 2847),
has both fixed rate and variable rate
A direct deposit box was added to the
the Hiring Incentives to Restore
bonds, file a separate Form 8038-CP for
Form 8038-CP to allow issuers of bonds
Employment (HIRE) Act, provides that
each type of bond. If a single bond issue
the choice of having their credit payment
issuers of new clean renewable energy
constitutes both build America bonds
directly deposited into their account.
bonds, qualified energy conservation
(Direct Pay) and recovery zone economic
bonds, qualified zone academy bonds,
General Instructions
development bonds, file a separate Form
and qualified school construction bonds
8038-CP for each type of bond. Each
may elect to apply section 6431(f) to
Purpose of Form
issue consisting of a single maturity of
receive a refundable credit in lieu of tax
specified tax credit bonds must also be
The American Recovery and
credits under section 54A (specified tax
reported on a separate Form 8038-CP.
Reinvestment Act of 2009 (ARRA)
credit bonds). For qualified school
Issuers of specified tax credit bonds with
created build America bonds and
construction bonds and qualified zone
multiple maturities must file a separate
recovery zone economic development
academy bonds the amount of the
Form 8038-CP for each bond maturity. If
bonds. The HIRE Act provides for issuers
refundable credit allowed is equal to the
the information provided on the return
to elect to issue specified tax credit
lesser of:
relates to more than one bond issue, or in
bonds. The ARRA and the HIRE Act are
1. the amount of interest payable
the case of specified tax credit bonds with
referred to throughout these instructions
under such bond on such date, or
multiple maturities relates to more than
as the Acts.
2. the amount of interest which would
one maturity, or if the return is not
Form 8038-CP is used by issuers of
have been payable under such bond on
completed in full, the credit payment may
build America bonds and recovery zone
such date if such interest were
be delayed. In order to process the
economic development bonds who elect
determined at the applicable credit rate
refundable credit payment, the IRS will
to receive a direct payment from the
determined under section 54A(b)(3).
correspond with either the designated
Federal Government equal to a
contact person of the entity listed in Part I
For qualified energy conservation bonds
percentage of the interest payments on
at the address listed in Part I, the issuer,
and new clean renewable energy bonds,
these bonds. For more information, see
or its designee listed in Part II, as
the amount of the refundable credit
Notice 2009-26.
necessary.
allowed is equal to the lesser of:
Form 8038-CP is also used by issuers
When To File
1. the amount of interest payable
of specified tax credit bonds who elect to
under such bond on such date, or
A Form 8038-CP filed with respect to
receive a direct payment from the Federal
2. 70% of the amount of interest
fixed rate bonds must be filed no later
Government equal to a percentage of the
which would have been payable under
than 45 days before the relevant interest
interest payments on these bonds. For
such bond on such date if such interest
payment date. Form 8038-CP may not,
more information see Notice 2010-35.
were determined at the applicable credit
however, be submitted earlier than 90
Issuers of each issue of specified tax
rate determined under section 54A(b)(3).
days before the relevant interest payment
credit bonds must file a separate Form
date.
8038-CP to request payment of a
For specified tax credit bonds with
refundable credit under 6431(f).
multiple bond maturities, the refundable
With respect to variable rate bonds
credit payment is determined separately
when the issuer knows the interest
Note. Each type of specified tax credit
with respect to each maturity. The
payment amount 45 days prior to the
bond must be reported on a separate
refundable credit payment for each
interest payment date, Form 8038-CP
Form 8038-CP. For specified tax credit
maturity must be requested on a separate
may be filed within the same timelines as
bonds with multiple maturities, each
Form 8038-CP. See instructions for Part
fixed rate bonds (45 days before the
maturity must be reported on a separate
III, lines 19a and 19c, if reporting
relevant interest payment date but no
Form 8038-CP.
specified tax credit bonds with multiple
earlier than 90 days before the relevant
This return is to be filed only if, as
maturities.
interest payment date).
!
of the date the form is filed, the
Note. Only issuers of specified tax credit
For variable rate bonds when the
issuer of the outstanding
CAUTION
bonds that qualify for, and have elected to
issuer does not know the interest
obligation(s) with respect to which this
receive, a refundable credit under section
payment amount 45 days prior to the
return is submitted has reasonably
6431(f) may file Form 8038-CP. If the
interest payment date, the issuer must
concluded that the obligation(s) meet all
issuer of a specified tax credit bond
aggregate all credit payments on a
applicable requirements for the payment
makes the election under section 6431(f),
quarterly basis and file a Form 8038-CP
of the requested credit.
the holder of the bond will not then be
for reimbursement in arrears no later than
Who Must File
eligible to receive a tax credit under
45 days after the last interest payment
section 54A.
date within the quarterly period for which
Issuers of qualified build America bonds,
reimbursement is being requested.
Other tax credit bonds, including
recovery zone economic development
qualified forestry conservation bonds,
bonds, and specified tax credit bonds
Effective on its release, issuers of build
clean renewable energy bonds, and
must submit this return to request credit
America bonds, recovery zone economic
Midwestern tax credit bonds, are not
payments payable under the Acts.
development bonds, and specified tax
Cat. No. 52942P