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Subject:
Item Title:
ARBITRAGE REBATE COMPLIANCE
Summary:
Arbitrage rebate compliance has challenged issuers of tax-exempt debt since 1986. With the passing of the Tax Reform Act of 1986, the Federal Government sought to limit the amount of investment income earned on unspent proceeds of tax-exempt financings. The excess earnings, called arbitrage, result from the ability to obtain tax-exempt bond proceeds and invest the funds in higher yielding taxable securities, resulting in a profit.
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