Private Business Use: Applying the Third-Party Use Limitations to Tax-Exempt Debt-Financed Projects

On-Demand Webinar | Recorded on April 9, 2025

Private Business Use: Applying the Third-Party Use Limitations to Tax-Exempt Debt-Financed Projects

The Internal Revenue Code imposes “private business use” limitations on property financed with tax-exempt debt. Private business use of bond-financed property can arise in a number of situations, including leases, management or operating agreements, sales, research contracts or other arrangements granting a third party a priority or preference right.

In this one hour session, we will provide an overview of the private business use limitations for “governmental bonds” and “qualified 501(c)(3) bonds,” including what constitutes private business use, the permissible amount of private business use, how to measure private business use and exceptions to the general rules.

The goal of the presentation is to provide participants with a fundamental understanding of the private business use rules and enable participants to identify instances of third-party involvement with tax-exempt debt-financed property that could create federal tax issues.

Key Topics:

• Definition of private business use
• Limitations on the amount of private business use and exceptions
• Identifying common arrangements that raise private business use issues

Speaker Info:

Michael Larsen is a Partner at Parker Poe. His practice is focused on the tax issues related to public finance transactions. Read more. 

CPE Credit:

Please be aware this is a recording from a live webinar where CPE credit was offered. No CPE credit will be provided for viewing this recording.

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