1993-07-15 Resolution 79 - Laserfiche WebLink

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TA% MATTERS In the opinion of Baker & Daniels, South Bend, Indiana, Bond Counsel, interest on the South Bend Redevelopment Authority Taxable Lease Rental Acquisition and Refunding Revenue Bonds of 1993 (Airport Economic Development Area Public Improvement Project) (the "Bonds") is exempt from taxation in the State of Indiana for all purposes except the Indiana financial institutions tax and the Indiana inheritance tax. INTEREST ON THE BONDS IS NOT EXCLUDABLE FROM GROSS INCOME OF THE OWNERS THEREOF FOR FEDERAL INCOME TAX PURPOSES UNDER SECTION 103 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. For federal income tax purposes, the Bonds maturing on August 1 and February 1, beginning on February 1, 2009 through August 1, 2012, (the "Discount Bonds") will be considered to have "original issue discount" equal to the difference between their respective original issue price and the amount payable upon their respective maturities. The original issue price of each Discount Bond will be the initial offering price to the public at which a substantial amount of such Discount Bonds are sold, and the issue date will be the date on which such Discount Bonds are first issued to the public. The original issue discount on a Discount Bond accrued in the hands of a holder is treated for federal income tax purposes as interest which is not excludable pursuant to Section 103 of the Code from gross income. The holder's basis for determining gain or loss on a sale, maturity or other disposition of a Discount Bond generally will be equal to the holder's cost, increased by the original issue discount that is accrued during the period that the Discount Bond is held by such holder. Generally, any gain or loss recognized by a holder on a sale, exchange or payment at maturity of a Discount Bond (based on the holder's basis) will be taxable as capital gain or loss (assuming the Discount Bond is held as a capital asset). A holder will recognize a taxable gain or loss on a Discount Bond called prior to maturity on the difference between the holder's basis and the call price of the Discount Bond. Owners of the Discount Bonds should consult their own tax advisors with respect to the computation for federal income tax purposes of the amounts of original issue discount which accrue during the period in which such Discount Bonds are held. Owners of the Discount Bonds should also consult their own tax advisors with respect to the state and local tax consequences arising from the original issue discount of the Discount Bonds. The foregoing does not purport to be a comprehensive discussion of the tax consequences of owning the Bonds. Prospective owners of the Bonds should consult their own tax advisors with respect to the foregoing and other tax consequences of owning the Bonds. G-3