WASHINGTON -- The Internal Revenue Service has notified the Trinity Housing Finance Corp. that its $27 million Overton Ridge Square multifamily housing issue is no longer tax-exempt and that bondholders will be taxed if all or a portion of the deal's arbitrage profits are not rebated to the federal government by Sept. 30.

The IRS made the warning made in an Aug. 8 letter sent to officials with the Trinity housing authority, saying the bond issue was one of about two dozen deals Matthews & Wright Inc. closed in a sham manner.

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