Understanding IRS Form 1097-BTC, Bond Tax Credits

IRS Form 1097-BTC, Bond Tax Credit, is a document for issuers and recipients of tax credit bonds, and is used to report bond tax credits accurately. This form details issuer and recipient information, bond type, and credit amounts.

What is Form 1097-BTC? 

Issuers of certain tax credit bonds and recipients of the form must file the form for each tax credit bond distributed. A form is distributed for the following types of tax credit bonds: 

• New clean renewable energy bonds.
• Qualified energy conservation bonds.
• Qualified zone academy bonds.
• Qualified school construction bonds.
• Clean renewable energy bonds.
• Build America bonds (Tax Credit).

What information is required?

Form 1097-BTC is a fairly simply form, only requiring the following information: 

• Issuer name, address, and TIN
• Recipient name, address, and TIN
• Type of bond issuer (checkbox)
• The total amount of credits for the calendar year
• The unique identification number code
• The unique identification number, such as CUSIP number, account number, etc.
• The type of bond
• The amount of credit monthly

Deadlines & Penalties

This form must be filed to the IRS by issuers before March 31 (if e-filing). A statement must be furnished to the recipient quarterly for each credit amount indicated. The deadline for Form 1097-BTC is on or before the 15th day of the 2nd calendar month after the close of the quarter for the credit. 

Reporting period:	To recipient (on or before):
1st Quarter: January–March	May 15*
2nd Quarter: April–June	August 15*
3rd Quarter: July–September	November 15*
Annual/4th Quarter: October–December	February 15*

Failing to file Form 1097-BTC by the due date may result in penalties. These are as follows: 

• $60 per form if filed within 30 days of the deadline
• $130 per form if filed after the due date, but before August 1
• $330 per form if filed after August 1 or you do not file. 

Intentional disregard of filing or furnishing requirements may lead to additional penalties: 

• Intentional disregard of filing requirements –  up to $660 per form with no maximum penalty.
• Intentional disregard of recipient statement furnishing requirements – up to $660 per form with no maximum penalty.

Since January 1, 2024, filers with a total of more than 10 forms are required to e-file. Failing to file electronically could lead to penalties of up to $330 per return. However, this only applies to the number of forms over 10. 

Conclusion

Form 1097-BTC is important for issuers and recipients of tax credit bonds. It reports the amount of tax credit bonds distributed throughout the calendar year. Failing to file on time could lead to significant penalties, so it’s important that filers remain aware of all deadlines.

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