WASHINGTON - The Internal Revenue Service has charged that the Riverside County, Calif., Housing Authority issued more bonds than authorized, approved a blank arbitrage certificate, and failed to investigate the feasibility of the housing project that the 1985 Whitewater Garden bond issue was to finance.

The allegations are made in a document filed by the IRS last week in the first U.S. Tax Court case brought by a bondholder challenging the IRS' right to collect taxes on interest from bonds that have become taxable because of tax law violations.

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