[Code of Federal Regulations]
[Title 26, Volume 2]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.142(f)(4)-1]

[Page 672-673]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.142(f)(4)-1  Manner of making election to terminate tax-exempt 
bond financing.

    (a) Overview. Section 142(f)(4) permits a person engaged in the 
local furnishing of electric energy or gas (a local furnisher) that uses 
facilities financed with exempt facility bonds under section 142(a)(8) 
and that expands its service area in a manner inconsistent with the 
requirements of sections 142(a)(8) and (f) to make an election to ensure 
that those bonds will continue to be treated as exempt facility bonds. 
The election must meet the requirements of paragraphs (b) and (c) of 
this section.
    (b) Time for making election--(1) In general. An election under 
section 142(f)(4)(B) must be filed with the Internal Revenue Service on 
or before 90 days after the date of the service area expansion that 
causes bonds to cease to meet the requirements of sections 142(a)(8) and 
(f).
    (2) Date of service area expansion. For the purposes of this 
section, the date of the service area expansion is the first date on 
which the local furnisher is authorized to collect revenue for the 
provision of service in the expanded area.
    (c) Manner of making election. An election under section 
142(f)(4)(B) must be captioned ``ELECTION TO TERMINATE TAX-EXEMPT BOND 
FINANCING'', must be signed under penalties of perjury by a person who 
has authority to sign on behalf of the local furnisher, and must contain 
the following information--
    (1) The name of the local furnisher;
    (2) The tax identification number of the local furnisher;
    (3) The complete address of the local furnisher;
    (4) The date of the service area expansion;
    (5) Identification of each bond issue subject to the election, 
including the complete name of each issue, the tax identification number 
of each issuer, the report number of the information return filed under 
section 149(e) for each issue, the issue date of each issue, the CUSIP 
number (if any) of the bond

[[Page 673]]

with the latest maturity of each issue, the issue price of each issue, 
the adjusted issue price of each issue as of the date of the election, 
the earliest date on which the bonds of each issue may be redeemed, and 
the principal amount of bonds of each issue to be redeemed on the 
earliest redemption date;
    (6) A statement that the local furnisher making the election agrees 
to the conditions stated in section 142(f)(4)(B); and
    (7) A statement that each issuer of the bonds subject to the 
election has received written notice of the election.
    (d) Effect on section 150(b). Except as provided in paragraph (e) of 
this section, if a local furnisher files an election within the period 
specified in paragraph (b) of this section, section 150(b) does not 
apply to bonds identified in the election during and after that period.
    (e) Effect of failure to meet agreements. If a local furnisher fails 
to meet any of the conditions stated in an election pursuant to 
paragraph (c)(6) of this section, the election is invalid.
    (f) Corresponding provisions of the Internal Revenue Code of 1954. 
Section 103(b)(4)(E) of the Internal Revenue Code of 1954 set forth 
corresponding requirements for the exclusion from gross income of the 
interest on bonds issued for facilities for the local furnishing of 
electric energy or gas. For the purposes of this section any reference 
to sections 142(a)(8) and (f) of the Internal Revenue Code of 1986 
includes a reference to the corresponding portion of section 
103(b)(4)(E) of the Internal Revenue Code of 1954.
    (g) Effective dates. This section applies to elections made on or 
after January 19, 2001.

[T.D. 8941, 66 FR 4671, Jan. 18, 2001]