Georgia-Pacific Questions IRS's Taxation of Solid Waste Bonds

Date: June 23, 2005

Source: News Room

Georgia-Pacific Corp. intends to compensate holders of solid waste disposal facility bonds for any federal tax liabilities if the company is unable to reverse an Internal Revenue Service ruling that the bonds are subject to tax. The bonds were sold as tax-exempt debt to finance six waste paper facilities, and totaled nearly $230 million. The IRS said the solid waste disposal investigations involve facilities where a manufacturer purchases waste or recyclable material; since the IRS defines waste for tax exemption purposes as material having no value, a resold material would imply value and therefore be taxable.
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