Example:

The agreement must specify, as applicable, the date on which bonds are no longer treated as outstanding for purposes of calculating future credits or any other changes to the terms of the bonds on which such calculations will be based.

The issuer modifies the debt service schedule that they originally filed with the information return to reflect the agreement between the issuer and IRS to modify future allowable credits per IRM 4.70.14.2.1.5.9.8, TEB - Computation of Credit Maintenance Amount. Attach the modified debt service schedule as an exhibit to the closing agreement. See IRM 8.13.1.3.16, Attachment to Agreements, for attachment guidance.

The issuer represents that it will not request credits for any portion of interest payments on bonds which it has agreed to exclude from calculations of credits.

The closing agreement provides that the issuer’s ability to claim future credits depends on future compliance with applicable law and the terms of the closing agreement.

For closing agreements that provide that the issuer isn’t entitled to a credit for interest paid on the bonds after the effective date of the agreement, include the following in the closing agreement:

The bonds aren’t qualified bonds for purposes of IRC 6431.

The issuer isn’t entitled to a refund of a credit under IRC 6431 for the bonds.

The issuer includes a representation that it won’t request a refund of the credit.

For closing agreements that provide that the issuer may not treat a portion of an issue of direct pay bonds as tax-advantaged bonds, include the following in the closing agreement:

The portion of each maturity of outstanding bonds that is considered qualified on the effective date of the closing agreement.

How the IRS and issuer treated principal payments or other adjustments affecting the outstanding amount of each maturity of bonds for determining the qualified bonds in each maturity.

The portion of each maturity of outstanding bonds that is considered nonqualified on the effective date of the closing agreement.

For closing agreements under which credits are calculated by treating the bonds as if a change in bond terms other than that described in paragraph (3) above had occurred (for example, a change in the interest rate for one or more maturities of bonds or the rate of credit), include the following in the closing agreement:

The specific term(s) for calculations.

The specific bonds affected by this change.