In related news, the tax-exempt status of tobacco bonds sold by New York City last fall may be in jeopardy. The Internal Revenue Service has been brought into question the $709 million sale.
The IRS has requested information about the sale from New York City. Also in question by the IRS are tobacco settlements completed by both Nassau and Westchester counties. It is still unknown whether or not this new inquiry about the bonds may potentially freeze any other tobacco offerings that are in the works.
Although tax and legal issues regarding the bonds were thoroughly examined prior to the sale, it is said that the groundbreaking aspect of the offerings have caught the attention of the IRS.