Arbitrage Compliance

The United States Internal Revenue Code requires, generally, that any earnings over the yield of a tax-exempt bond must be rebated to the Federal Government. The calculation to determine the rebate amount must be performed at least once every five years over the life of an issue.

BNY Mellon, a recognized leader in the public debt market with a long tradition of providing customized solutions to meet client-specific needs, has a team of professionals devoted exclusively to arbitrage compliance services for tax-exempt bond issuers and conduit borrowers. The team was established following the acquisition of Pinnacle Arbitrage Compliance, LLC, one of the largest independent providers of arbitrage compliance services in the United States, in October 2009.

The Right Calculation Approach

Our extensive experience and research-oriented approach enable us to recognize and apply different methodologies permitted by arbitrage regulations, maximizing allowable investment returns on bond funds and often minimizing or eliminating a client's arbitrage liability.

Arbitrage Compliance Services include:

• Arbitrage Rebate Calculations
• Spending Exception Analyses
• Yield Reduction Calculations
• Yield Reduction Payment Determinations
• IRS Form 8038-T Preparation
• Overpayment Refund Requests
• Assistance with IRS Examinations
• Escrow Monitoring Services

For more information, please contact Mark Brown at 770 698 5183 or mark.p.brown@bnymellon.com.