A bond originally delivered by its issuer on or after August 8, 1986, with more than 10% of proceeds subject to private use or benefit. Private activity bond income is taxable, unless bonds are issued for a qualified purpose (see Qualified Private Activity).
a municipal bond which is either used entirely or partially for private purposes and is given federal tax-exempt status
a state or local bond issued to provide funds for private, nongovernmental activities such as building a sports stadium, industrial development, student loan financing, or low-income housing
A term used in the Tax Reform Act of 1986 to describe bonds, the proceeds of which are used in a trade or business of a private entity or secured by revenues from a private entity, and includes 501(c)(3) bonds as well as classic Industrial Development Bonds (IDB).
A bond in which more than 10 percent of the proceeds are secured by the interest in the property of a private business or used in a nonpublic business. A PAB can still be tax-exempt if used (at least 95 percent) for qualified investments, such as waste-to-energy facilities, and provided that State allocation caps are not exceeded.
A bond that is part of a state or local government bond issue of which: More than 10% of the proceeds are to be used for a private business use, and More than 10% of the payment of the principal or interest is: Secured by an interest in property to be used for a private business use (or payments for the property), or Derived from payments for property (or borrowed money) used for a private business use.
A taxable municipal bond issued to finance some private-sector purpose.
In general, a private activity bond is a bond issued by or on behalf of local or state government for the purpose of financing the project of a private user.