
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC852]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                        Subtitle A--Income Taxes
 
                  CHAPTER 1--NORMAL TAXES AND SURTAXES
 
Subchapter M--Regulated Investment Companies and Real Estate Investment 
                                 Trusts
 
                 PART I--REGULATED INVESTMENT COMPANIES
 
Sec. 852. Taxation of regulated investment companies and their 
        shareholders
        

(a) Requirements applicable to regulated investment companies

    The provisions of this part (other than subsection (c) of this 
section) shall not be applicable to a regulated investment company for a 
taxable year unless--
        (1) the deduction for dividends paid during the taxable year (as 
    defined in section 561, but without regard to capital gain 
    dividends) equals or exceeds the sum of--
            (A) 90 percent of its investment company taxable income for 
        the taxable year determined without regard to subsection 
        (b)(2)(D); and
            (B) 90 percent of the excess of (i) its interest income 
        excludable from gross income under section 103(a) over (ii) its 
        deductions disallowed under sections 265, 171(a)(2), and

        (2) either--
            (A) the provisions of this part applied to the investment 
        company for all taxable years ending on or after November 8, 
        1983, or
            (B) as of the close of the taxable year, the investment 
        company has no earnings and profits accumulated in any taxable 
        year to which the provisions of this part (or the corresponding 
        provisions of prior law) did not apply to it.

The Secretary may waive the requirements of paragraph (1) for any 
taxable year if the regulated investment company establishes to the 
satisfaction of the Secretary that it was unable to meet such 
requirements by reason of distributions previously made to meet the 
requirements of section 4982.

(b) Method of taxation of companies and shareholders

       (1) Imposition of tax on regulated investment companies

        There is hereby imposed for each taxable year upon the 
    investment company taxable income of every regulated investment 
    company a tax computed as provided in section 11, as though the 
    investment company taxable income were the taxable income referred 
    to in section 11. In the case of a regulated investment company 
    which is a personal holding company (as defined in section 542) or 
    which fails to comply for the taxable year with regulations 
    prescribed by the Secretary for the purpose of ascertaining the 
    actual ownership of its stock, such tax shall be computed at the 
    highest rate of tax specified in section 11(b).

                (2) Investment company taxable income

        The investment company taxable income shall be the taxable 
    income of the regulated investment company adjusted as follows:
            (A) There shall be excluded the amount of the net capital 
        gain, if any.
            (B) The net operating loss deduction provided in section 172 
        shall not be allowed.
            (C) The deductions for corporations provided in part VIII 
        (except section 248) in subchapter B (section 241 and following, 
        relating to the deduction for dividends received, etc.) shall 
        not be allowed.
            (D) the \1\ deduction for dividends paid (as defined in 
        section 561) shall be allowed, but shall be computed without 
        regard to capital gain dividends and exempt-interest dividends.
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    \1\ So in original. Probably should be capitalized.
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            (E) The taxable income shall be computed without regard to 
        section 443(b) (relating to computation of tax on change of 
        annual accounting period).
            (F) The taxable income shall be computed without regard to 
        section 454(b) (relating to short-term obligations issued on a 
        discount basis) if the company so elects in a manner prescribed 
        by the Secretary.

                          (3) Capital gains

        (A) Imposition of tax

            There is hereby imposed for each taxable year in the case of 
        every regulated investment company a tax, determined as provided 
        in section 1201(a), on the excess, if any, of the net capital 
        gain over the deduction for dividends paid (as defined in 
        section 561) determined with reference to capital gain dividends 
        only.

        (B) Treatment of capital gain dividends by shareholders

            A capital gain dividend shall be treated by the shareholders 
        as a gain from the sale or exchange of a capital asset held for 
        more than 1 year.

        (C) Definition of capital gain dividend

            For purposes of this part, a capital gain dividend is any 
        dividend, or part thereof, which is designated by the company as 
        a capital gain dividend in a written notice mailed to its 
        shareholders not later than 60 days after the close of its 
        taxable year; except that, if there is an increase in the excess 
        described in subparagraph (A) of this paragraph for such year 
        which results from a determination (as defined in section 
        860(e)), such designation may be made with respect to such 
        increase at any time before the expiration of 120 days after the 
        date of such determination. If the aggregate amount so 
        designated with respect to a taxable year of the company 
        (including capital gains dividends paid after the close of the 
        taxable year described in section 855) is greater than the net 
        capital gain of the taxable year, the portion of each 
        distribution which shall be a capital gain dividend shall be 
        only that proportion of the amount so designated which such net 
        capital gain bears to the aggregate amount so designated. For 
        purposes of this subparagraph, the amount of the net capital 
        gain for a taxable year (to which an election under section 
        4982(e)(4) does not apply) shall be determined without regard to 
        any net capital loss or net long-term capital loss attributable 
        to transactions after October 31 of such year, and any such net 
        capital loss or net long-term capital loss shall be treated as 
        arising on the 1st day of the next taxable year. To the extent 
        provided in regulations, the preceding sentence shall apply also 
        for purposes of computing the taxable income of the regulated 
        investment company.

        (D) Treatment by shareholders of undistributed capital gains

            (i) Every shareholder of a regulated investment company at 
        the close of the company's taxable year shall include, in 
        computing his long-term capital gains in his return for his 
        taxable year in which the last day of the company's taxable year 
        falls, such amount as the company shall designate in respect of 
        such shares in a written notice mailed to its shareholders at 
        any time prior to the expiration of 60 days after close of its 
        taxable year, but the amount so includible by any shareholder 
        shall not exceed that part of the amount subjected to tax in 
        subparagraph (A) which he would have received if all of such 
        amount had been distributed as capital gain dividends by the 
        company to the holders of such shares at the close of its 
        taxable year.
            (ii) For purposes of this title, every such shareholder 
        shall be deemed to have paid, for his taxable year under clause 
        (i), the tax imposed by subparagraph (A) on the amounts required 
        by this subparagraph to be included in respect of such shares in 
        computing his long-term capital gains for that year; and such 
        shareholder shall be allowed credit or refund, as the case may 
        be, for the tax so deemed to have been paid by him.
            (iii) The adjusted basis of such shares in the hands of the 
        shareholder shall be increased, with respect to the amounts 
        required by this subparagraph to be included in computing his 
        long-term capital gains, by the difference between the amount of 
        such includible gains and the tax deemed paid by such 
        shareholder in respect of such shares under clause (ii).
            (iv) In the event of such designation the tax imposed by 
        subparagraph (A) shall be paid by the regulated investment 
        company within 30 days after close of its taxable year.
            (v) The earnings and profits of such regulated investment 
        company, and the earnings and profits of any such shareholder 
        which is a corporation, shall be appropriately adjusted in 
        accordance with regulations prescribed by the Secretary.

     (4) Loss on sale or exchange of stock held 6 months or less

        (A) Loss attributable to capital gain dividend

            If--
                (i) subparagraph (B) or (D) of paragraph (3) provides 
            that any amount with respect to any share is to be treated 
            as long-term capital gain, and
                (ii) such share is held by the taxpayer for 6 months or 
            less,

        then any loss (to the extent not disallowed under subparagraph 
        (B)) on the sale or exchange of such share shall, to the extent 
        of the amount described in clause (i), be treated as a long-term 
        capital loss.

        (B) Loss attributable to exempt-interest dividend

            If--
                (i) a shareholder of a regulated investment company 
            receives an exempt-interest dividend with respect to any 
            share, and
                (ii) such share is held by the taxpayer for 6 months or 
            less,

        then any loss on the sale or exchange of such share shall, to 
        the extent of the amount of such exempt-interest dividend, be 
        disallowed.

        (C) Determination of holding periods

            For purposes of this paragraph, the rules of paragraphs (3) 
        and (4) of section 246(c) shall apply in determining the period 
        for which the taxpayer has held any share of stock; except that 
        ``6 months'' shall be substituted for each number of days 
        specified in subparagraph (B) \2\ of section 246(c)(3).
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    \2\ See References in Text note below.
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        (D) Losses incurred under a periodic liquidation plan

            To the extent provided in regulations, subparagraphs (A) and 
        (B) shall not apply to losses incurred on the sale or exchange 
        of shares of stock in a regulated investment company pursuant to 
        a plan which provides for the periodic liquidation of such 
        shares.

        (E) Authority to shorten required holding period

            In the case of a regulated investment company which 
        regularly distributes at least 90 percent of its net tax-exempt 
        interest, the Secretary may by regulations prescribe that 
        subparagraph (B) (and subparagraph (C) to the extent it relates 
        to subparagraph (B)) shall be applied on the basis of a holding 
        period requirement shorter than 6 months; except that such 
        shorter holding period requirement shall not be shorter than the 
        greater of 31 days or the period between regular distributions 
        of exempt-interest dividends.

                    (5) Exempt-interest dividends

        If, at the close of each quarter of its taxable year, at least 
    50 percent of the value (as defined in section 851(c)(4)) of the 
    total assets of the regulated investment company consists of 
    obligations described in section 103(a), such company shall be 
    qualified to pay exempt-interest dividends, as defined herein, to 
    its shareholders.

        (A) Definition

            An exempt-interest dividend means any dividend or part 
        thereof (other than a capital gain dividend) paid by a regulated 
        investment company and designated by it as an exempt-interest 
        dividend in a written notice mailed to its shareholders not 
        later than 60 days after the close of its taxable year. If the 
        aggregate amount so designated with respect to a taxable year of 
        the company (including exempt-interest dividends paid after the 
        close of the taxable year as described in section 855) is 
        greater than the excess of--
                (i) the amount of interest excludable from gross income 
            under section 103(a), over
                (ii) the amounts disallowed as deductions under sections 
            265 and 171(a)(2),

        the portion of such distribution which shall constitute an 
        exempt-interest dividend shall be only that proportion of the 
        amount so designated as the amount of such excess for such 
        taxable year bears to the amount so designated.

        (B) Treatment of exempt-interest dividends by shareholders

            An exempt-interest dividend shall be treated by the 
        shareholders for all purposes of this subtitle as an item of 
        interest excludable from gross income under section 103(a). Such 
        purposes include but are not limited to--
                (i) the determination of gross income and taxable 
            income,
                (ii) the determination of distributable net income under 
            subchapter J,
                (iii) the allowance of, or calculation of the amount of, 
            any credit or deduction, and
                (iv) the determination of the basis in the hands of any 
            shareholder of any share of stock of the company.

      (6) Section 311(b) not to apply to certain distributions

        Section 311(b) shall not apply to any distribution by a 
    regulated investment company to which this part applies, if such 
    distribution is in redemption of its stock upon the demand of the 
    shareholder.

            (7) Time certain dividends taken into account

        For purposes of this title, any dividend declared by a regulated 
    investment company in October, November, or December of any calendar 
    year and payable to shareholders of record on a specified date in 
    such a month shall be deemed--
            (A) to have been received by each shareholder on December 31 
        of such calendar year, and
            (B) to have been paid by such company on December 31 of such 
        calendar year (or, if earlier, as provided in section 855).

    The preceding sentence shall apply only if such dividend is actually 
    paid by the company during January of the following calendar year.

     (8) Special rule for treatment of certain foreign currency 
                                   losses

        To the extent provided in regulations, the taxable income of a 
    regulated investment company (other than a company to which an 
    election under section 4982(e)(4) applies) shall be computed without 
    regard to any net foreign currency loss attributable to transactions 
    after October 31 of such year, and any such net foreign currency 
    loss shall be treated as arising on the 1st day of the following 
    taxable year.

    (9) Dividends treated as received by company on ex-dividend 
                                    date

        For purposes of this title, if a regulated investment company is 
    the holder of record of any share of stock on the record date for 
    any dividend payable with respect to such stock, such dividend shall 
    be included in gross income by such company as of the later of--
            (A) the date such share became ex-dividend with respect to 
        such dividend, or
            (B) the date such company acquired such share.

      (10) Special rule for certain losses on stock in passive 
                         foreign investment company

        To the extent provided in regulations, the taxable income of a 
    regulated investment company (other than a company to which an 
    election under section 4982(e)(4) applies) shall be computed without 
    regard to any net reduction in the value of any stock of a passive 
    foreign investment company with respect to which an election under 
    section 1296(k) is in effect occurring after October 31 of the 
    taxable year, and any such reduction shall be treated as occurring 
    on the first day of the following taxable year.

(c) Earnings and profits

                           (1) In general

        The earnings and profits of a regulated investment company for 
    any taxable year (but not its accumulated earnings and profits) 
    shall not be reduced by any amount which is not allowable as a 
    deduction in computing its taxable income for such taxable year. For 
    purposes of this subsection, the term ``regulated investment 
    company'' includes a domestic corporation which is a regulated 
    investment company determined without regard to the requirements of 
    subsection (a).

          (2) Coordination with tax on undistributed income

        For purposes of applying this chapter to distributions made by a 
    regulated investment company with respect to any calendar year, the 
    earnings and profits of such company shall be determined without 
    regard to any net capital loss (or net foreign currency loss) 
    attributable to transactions after October 31 of such year, without 
    regard to any net reduction in the value of any stock of a passive 
    foreign investment company with respect to which an election under 
    section 1296(k) is in effect occurring after October 31 of such 
    year, and with such other adjustments as the Secretary may by 
    regulations prescribe. The preceding sentence shall apply--
            (A) only to the extent that the amount distributed by the 
        company with respect to the calendar year does not exceed the 
        required distribution for such calendar year (as determined 
        under section 4982 by substituting ``100 percent'' for each 
        percentage set forth in section 4982(b)(1)), and
            (B) except as provided in regulations, only if an election 
        under section 4982(e)(4) is not in effect with respect to such 
        company.

        (3) Distributions to meet requirements of subsection 
                                  (a)(2)(B)

        Any distribution which is made in order to comply with the 
    requirements of subsection (a)(2)(B)--
            (A) shall be treated for purposes of this subsection and 
        subsection (a)(2)(B) as made from earnings and profits which, 
        but for the distribution, would result in a failure to meet such 
        requirements (and allocated to such earnings on a first-in, 
        first-out basis), and
            (B) to the extent treated under subparagraph (A) as made 
        from accumulated earnings and profits, shall not be treated as a 
        distribution for purposes of subsection (b)(2)(D) and section 
        855.

(d) Distributions in redemption of interests in unit investment trusts

    In the case of a unit investment trust--
        (1) which is registered under the Investment Company Act of 1940 
    (15 U.S.C. 80a-1 and following) and issues periodic payment plan 
    certificates (as defined in such Act), and
        (2) substantially all of the assets of which consist of 
    securities issued by a management company (as defined in such Act),

section 562(c) (relating to preferential dividends) shall not apply to a 
distribution by such trust to a holder of an interest in such trust in 
redemption of part or all of such interest, with respect to the capital 
gain net income of such trust attributable to such redemption.

(e) Procedures similar to deficiency dividend procedures made applicable

                           (1) In general

        If--
            (A) there is a determination that the provisions of this 
        part do not apply to an investment company for any taxable year 
        (hereinafter in this subsection referred to as the ``non-RIC 
        year''), and
            (B) such investment company meets the distribution 
        requirements of paragraph (2) with respect to the non-RIC year,

    for purposes of applying subsection (a)(2) to subsequent taxable 
    years, the provisions of this part shall be treated as applying to 
    such investment company for the non-RIC year. If the determination 
    under subparagraph (A) is solely as a result of the failure to meet 
    the requirements of subsection (a)(2), the preceding sentence shall 
    also apply for purposes of applying subsection (a)(2) to the non-RIC 
    year and the amount referred to in paragraph (2)(A)(i) shall be the 
    portion of the accumulated earnings and profits which resulted in 
    such failure.

                    (2) Distribution requirements

        (A) In general

            The distribution requirements of this paragraph are met with 
        respect to any non-RIC year if, within the 90-day period 
        beginning on the date of the determination (or within such 
        longer period as the Secretary may permit), the investment 
        company makes 1 or more qualified designated distributions and 
        the amount of such distributions is not less than the excess 
        of--
                (i) the portion of the accumulated earnings and profits 
            of the investment company (as of the date of the 
            determination) which are attributable to the non-RIC year, 
            over
                (ii) any interest payable under paragraph (3).

        (B) Qualified designated distribution

            For purposes of this paragraph, the term ``qualified 
        designated distribution'' means any distribution made by the 
        investment company if--
                (i) section 301 applies to such distribution, and
                (ii) such distribution is designated (at such time and 
            in such manner as the Secretary shall by regulations 
            prescribe) as being taken into account under this paragraph 
            with respect to the non-RIC year.

        (C) Effect on dividends paid deduction

            Any qualified designated distribution shall not be included 
        in the amount of dividends paid for purposes of computing the 
        dividends paid deduction for any taxable year.

                         (3) Interest charge

        (A) In general

            If paragraph (1) applies to any non-RIC year of an 
        investment company, such investment company shall pay interest 
        at the underpayment rate established under section 6621--
                (i) on an amount equal to 50 percent of the amount 
            referred to in paragraph (2)(A)(i),
                (ii) for the period--
                    (I) which begins on the last day prescribed for 
                payment of the tax imposed for the non-RIC year 
                (determined without regard to extensions), and
                    (II) which ends on the date the determination is 
                made.

        (B) Coordination with subtitle F

            Any interest payable under subparagraph (A) may be assessed 
        and collected at any time during the period during which any tax 
        imposed for the taxable year in which the determination is made 
        may be assessed and collected.

           (4) Provision not to apply in the case of fraud

        The provisions of this subsection shall not apply if the 
    determination contains a finding that the failure to meet any 
    requirement of this part was due to fraud with intent to evade tax.

                          (5) Determination

        For purposes of this subsection, the term ``determination'' has 
    the meaning given to such term by section 860(e). Such term also 
    includes a determination by the investment company filed with the 
    Secretary that the provisions of this part do not apply to the 
    investment company for a taxable year.

(f) Treatment of certain load charges

                           (1) In general

        If--
            (A) the taxpayer incurs a load charge in acquiring stock in 
        a regulated investment company and, by reason of incurring such 
        charge or making such acquisition, the taxpayer acquires a 
        reinvestment right,
            (B) such stock is disposed of before the 91st day after the 
        date on which such stock was acquired, and
            (C) the taxpayer subsequently acquires stock in such 
        regulated investment company or in another regulated investment 
        company and the otherwise applicable load charge is reduced by 
        reason of the reinvestment right,

    the load charge referred to in subparagraph (A) (to the extent it 
    does not exceed the reduction referred to in subparagraph (C)) shall 
    not be taken into account for purposes of determining the amount of 
    gain or loss on the disposition referred to in subparagraph (B). To 
    the extent such charge is not taken into account in determining the 
    amount of such gain or loss, such charge shall be treated as 
    incurred in connection with the acquisition referred to in 
    subparagraph (C) (including for purposes of reapplying this 
    paragraph).

                  (2) Definitions and special rules

        For purposes of this subsection--

        (A) Load charge

            The term ``load charge'' means any sales or similar charge 
        incurred by a person in acquiring stock of a regulated 
        investment company. Such term does not include any charge 
        incurred by reason of the reinvestment of a dividend.

        (B) Reinvestment right

            The term ``reinvestment right'' means any right to acquire 
        stock of 1 or more regulated investment companies without the 
        payment of a load charge or with the payment of a reduced 
        charge.

        (C) Nonrecognition transactions

            If the taxpayer acquires stock in a regulated investment 
        company from another person in a transaction in which gain or 
        loss is not recognized, the taxpayer shall succeed to the 
        treatment of such other person under this subsection.

(Aug. 16, 1954, ch. 736, 68A Stat. 271; July 11, 1956, ch. 573, 
Sec. 2(a), 70 Stat. 530; Pub. L. 85-866, title I, Secs. 39(a), 101(a), 
(b), Sept. 2, 1958, 72 Stat. 1638, 1674; Pub. L. 86-779, Sec. 10(b)(2), 
(3), Sept. 14, 1960, 74 Stat. 1009; Pub. L. 88-272, title II, 
Sec. 229(a)(1), (2), (b), Feb. 26, 1964, 78 Stat. 99; Pub. L. 91-172, 
title V, Sec. 511(c)(2), Dec. 30, 1969, 83 Stat. 637; Pub. L. 94-455, 
title XIV, Sec. 1402(b)(1)(N), (2), title XIX, Secs. 1901(a)(110)(A), 
(B)(i), (C), (b)(1)(V), (6)(B), (33)(I), (J), (N), 1906(b)(13)(A), title 
XXI, Sec. 2137(a)-(c), Oct. 4, 1976, 90 Stat. 1732, 1783, 1792, 1794, 
1801, 1802, 1834, 1930, 1931; Pub. L. 95-600, title III, 
Secs. 301(b)(11), 362(c), title VII, Sec. 701(s)(2), Nov. 6, 1978, 92 
Stat. 2822, 2851, 2911; Pub. L. 96-222, title I, Sec. 104(a)(3)(B), Apr. 
1, 1980, 94 Stat. 215; Pub. L. 97-424, title V, Sec. 547(b)(2), Jan. 6, 
1983, 96 Stat. 2199; Pub. L. 98-369, div. A, title I, Sec. 55(a), title 
X, Secs. 1001(b)(11), (e), 1071(a)(2)-(4), (b)(1), July 18, 1984, 98 
Stat. 571, 1011, 1012, 1049, 1050, 1052; Pub. L. 99-514, title III, 
Sec. 311(b)(1), title VI, Secs. 631(e)(11), 651(b)(1)(A), (2), (3), 
655(a)(1), (2), title XI, Sec. 1173(b)(1)(B), title XV, Sec. 1511(c)(6), 
title XVIII, Secs. 1804(c)(1)-(5), 1878(j), Oct. 22, 1986, 100 Stat. 
2219, 2274, 2296, 2298, 2299, 2515, 2745, 2799, 2800, 2905; Pub. L. 100-
647, title I, Secs. 1006(l)(1)(A), (3), (4), (7)-(10), 1011B(h)(4), 
1018(p), Nov. 10, 1988, 102 Stat. 3413-3415, 3491, 3585; Pub. L. 101-
239, title VII, Sec. 7204(b)(1), (c)(1), Dec. 19, 1989, 103 Stat. 2334, 
2335; Pub. L. 103-66, title XIII, Sec. 13221(c)(1), Aug. 10, 1993, 107 
Stat. 477; Pub. L. 104-188, title I, Sec. 1602(b)(3), Aug. 20, 1996, 110 
Stat. 1833; Pub. L. 105-34, title XI, Sec. 1122(c)(2), (3), title XII, 
Sec. 1254(b)(2), Aug. 5, 1997, 111 Stat. 977, 1033; Pub. L. 106-170, 
title V, Sec. 566(a)(1), (c), Dec. 17, 1999, 113 Stat. 1950.)

                       References in Text

    Section 246(c)(3) of this title, referred to in subsec. (b)(4)(C), 
was amended by Pub. L. 105-34, title X, Sec. 1015(b)(2), Aug. 5, 1997, 
111 Stat. 922, to strike out subpar. (B) and redesignate subpar. (C) as 
(B).
    The Investment Company Act of 1940, referred to in subsec. (d), is 
title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789, as amended, which 
is classified generally to subchapter I (Sec. 80a-1 et seq.) of chapter 
2D of Title 15, Commerce and Trade. For complete classification of this 
Act to the Code, see section 80a-51 of Title 15 and Tables.


                               Amendments

    1999--Subsec. (c)(3). Pub. L. 106-170, Sec. 566(a)(1), added par. 
(3).
    Subsec. (e)(1). Pub. L. 106-170, Sec. 566(c), inserted at end ``If 
the determination under subparagraph (A) is solely as a result of the 
failure to meet the requirements of subsection (a)(2), the preceding 
sentence shall also apply for purposes of applying subsection (a)(2) to 
the non-RIC year and the amount referred to in paragraph (2)(A)(i) shall 
be the portion of the accumulated earnings and profits which resulted in 
such failure.''
    1997--Subsec. (b)(3)(D)(iii). Pub. L. 105-34, Sec. 1254(b)(2), 
substituted ``by the difference between the amount of such includible 
gains and the tax deemed paid by such shareholder in respect of such 
shares under clause (ii).'' for ``by 65 percent of so much of such 
amounts as equals the amount subject to tax in accordance with section 
1201(a).''
    Subsec. (b)(10). Pub. L. 105-34, Sec. 1122(c)(2), added par. (10).
    Subsec. (c)(2). Pub. L. 105-34, Sec. 1122(c)(3), inserted ``, 
without regard to any net reduction in the value of any stock of a 
passive foreign investment company with respect to which an election 
under section 1296(k) is in effect occurring after October 31 of such 
year,'' after ``October 31 of such year''.
    1996--Subsec. (b)(5)(C). Pub. L. 104-188 struck out subpar. (C). 
Prior to amendment, subpar. (C) read as follows:
    ``(C) Interest on certain loans used to acquire employer 
securities.--For purposes of this section--
        ``(i) 50 percent of the amount of any loan of the regulated 
    investment company which qualifies as a securities acquisition loan 
    (as defined in section 133) shall be treated as an obligation 
    described in section 103(a), and
        ``(ii) 50 percent of the interest received on such loan shall be 
    treated as interest excludable from gross income under section 
    103.''
    1993--Subsec. (b)(3)(D)(iii). Pub. L. 103-66 substituted ``65 
percent'' for ``66 percent''.
    1989--Subsec. (b)(9). Pub. L. 101-239, Sec. 7204(c)(1), added par. 
(9).
    Subsec. (f). Pub. L. 101-239, Sec. 7204(b)(1), added subsec. (f).
    1988--Subsec. (a). Pub. L. 100-647, Sec. 1006(l)(8), inserted at end 
``The Secretary may waive the requirements of paragraph (1) for any 
taxable year if the regulated investment company establishes to the 
satisfaction of the Secretary that it was unable to meet such 
requirements by reason of distributions previously made to meet the 
requirements of section 4982.''
    Subsec. (b)(3)(C). Pub. L. 100-647, Sec. 1006(l)(4), substituted 
``net capital loss or net long-term capital loss'' for ``net capital 
loss'' in two places in third sentence, and ``computing the taxable 
income of the regulated investment company'' for ``computing regulated 
investment company taxable income'' in fourth sentence.
    Subsec. (b)(5)(C). Pub. L. 100-647, Sec. 1011B(h)(4), substituted 
``section'' for ``paragraph''.
    Subsec. (b)(6). Pub. L. 100-647, Sec. 1006(l)(1)(A), redesignated 
par. (6), relating to time certain dividends are taken into account, as 
(7).
    Subsec. (b)(7). Pub. L. 100-647, Sec. 1006(l)(9), substituted ``in 
October, November, or December'' for ``in December'' and ``in such a 
month'' for ``in such month'', in introductory text, ``on December 31 of 
such calendar year'' for ``on such date'' in subpars. (A) an (B), and 
``during January'' for ``before February 1'' in last sentence.
    Pub. L. 100-647, Sec. 1006(l)(1)(A), redesignated par. (6), relating 
to time certain dividends are taken into account, as (7).
    Subsec. (b)(8). Pub. L. 100-647, Sec. 1006(l)(7), added par. (8).
    Subsec. (c)(2). Pub. L. 100-647, Sec. 1006(l)(3), amended par. (2) 
generally. Prior to amendment, par. (2) read as follows: ``A regulated 
investment company shall be treated as having sufficient earnings and 
profits to treat as a dividend any distribution (other than in a 
redemption to which section 302(a) applies) which is treated as a 
dividend by such company. The preceding sentence shall not apply to the 
extent that the amount distributed during any calendar year by the 
company exceeds the required distribution for such calendar year (as 
determined under section 4982).''
    Subsec. (e)(1). Pub. L. 100-647, Secs. 1006(l)(10), 1018(p), amended 
par. (1) identically, substituting ``subsection (a)(2)'' for 
``subsection (a)(3)'' in last sentence.
    1986--Subsec. (a)(2), (3). Pub. L. 99-514, Sec. 1878(j)(1), 
redesignated par. (3) as (2) and struck out former par. (2) which read 
as follows: ``the investment company complies for such year with 
regulations prescribed by the Secretary for the purpose of ascertaining 
the actual ownership of its outstanding stock, and''.
    Subsec. (b)(1). Pub. L. 99-514, Sec. 1878(j)(2), substituted last 
sentence for former last sentence which read as follows: ``In the case 
of a regulated investment company which is a personal holding company 
(as defined in section 542), that tax shall be computed at the highest 
rate of tax specified in section 11(b).''
    Subsec. (b)(3)(C). Pub. L. 99-514, Sec. 655(a)(1), substituted ``60 
days'' for ``45 days''.
    Pub. L. 99-514, Sec. 651(b)(3), inserted provision for determination 
of the amount of the net capital gain for a taxable year (to which an 
election under section 4982(e)(4) does not apply) and made such 
provision applicable also for purposes of computing regulated investment 
company taxable income.
    Subsec. (b)(3)(D)(i). Pub. L. 99-514, Sec. 655(a)(1), substituted 
``60 days'' for ``45 days''.
    Subsec. (b)(3)(D)(iii). Pub. L. 99-514, Sec. 311(b)(1), substituted 
``66 percent'' for ``72 percent''.
    Subsec. (b)(4). Pub. L. 99-514, Sec. 1804(c)(5), substituted ``6 
months or less'' for ``less than 31 days'' in heading.
    Subsec. (b)(4)(B)(ii). Pub. L. 99-514, Sec. 1804(c)(1), substituted 
``6 months or less'' for ``less than 31 days''.
    Subsec. (b)(4)(C). Pub. L. 99-514, Sec. 1804(c)(2), amended subpar. 
(C) generally. Prior to amendment, subpar. (C) read as follows: ``For 
purposes of this paragraph, the rules of paragraphs (3) and (4) of 
section 246(c) shall apply in determining the period for which the 
taxpayer held any share of stock; except that for the number of days 
specified in subparagraph (B) of section 246(c)(3) there shall be 
substituted--
        ``(i) `6 months' for purposes of subparagraph (A), and
        ``(ii) `30 days' for purposes of subparagraph (B).''
    Subsec. (b)(4)(D). Pub. L. 99-514, Sec. 1804(c)(3), substituted 
``subparagraphs (A) and (B)'' for ``subparagraph (A)''.
    Subsec. (b)(4)(E). Pub. L. 99-514, Sec. 1804(c)(4), added subpar. 
(E).
    Subsec. (b)(5)(A). Pub. L. 99-514, Sec. 655(a)(2), substituted ``60 
days'' for ``45 days''.
    Subsec. (b)(5)(C). Pub. L. 99-514, Sec. 1173(b)(1)(B), added subpar. 
(C).
    Subsec. (b)(6). Pub. L. 99-514, Sec. 651(b)(1)(A), added par. (6) 
relating to time certain dividends are taken into account.
    Pub. L. 99-514, Sec. 631(e)(11), added par. (6) relating to 
inapplicability of section 311(b) to certain distributions.
    Subsec. (c). Pub. L. 99-514, Sec. 651(b)(2), amended subsec. (c) 
generally, designating existing provisions as par. (1), inserting 
heading, and adding par. (2).
    Subsec. (e)(3)(A). Pub. L. 99-514, Sec. 1511(c)(6), substituted 
``the underpayment rate established under section 6621'' for ``the 
annual rate established under section 6621''.
    1984--Subsec. (a)(3). Pub. L. 98-369, Sec. 1071(a)(3), added par. 
(3).
    Subsec. (b)(1). Pub. L. 98-369, Sec. 1071(a)(2), inserted provision 
that in the case of a regulated investment company which is a personal 
holding company (as defined in section 542), that tax shall be computed 
at the highest rate of tax specified in section 11.
    Subsec. (b)(2)(F). Pub. L. 98-369, Sec. 1071(b)(1), added subpar. 
(F).
    Subsec. (b)(3)(B). Pub. L. 98-369, Sec. 1001(b)(11), (e), 
substituted ``6 months'' for ``1 year'', applicable to property acquired 
after June 22, 1984, and before Jan. 1, 1988. See Effective Date of 1984 
Amendment note below.
    Subsec. (b)(4)(A)(i). Pub. L. 98-369, Sec. 55(a)(1), substituted 
``subparagraph (B) or (D) of paragraph (3) provides that any amount with 
respect to any share is to be treated as long-term capital gain'' for 
``under subparagraph (B) or (D) of paragraph (3) a shareholder of a 
regulated investment company is required, with respect to any share, to 
treat any amount as a long-term capital gain''.
    Subsec. (b)(4)(A)(ii). Pub. L. 98-369, Sec. 55(a)(1), substituted 
``6 months or less'' for ``less than 31 days''.
    Subsec. (b)(4)(C). Pub. L. 98-369, Sec. 55(a)(2), substituted ``the 
rules of paragraphs (3) and (4) of section 246(c) shall apply in 
determining the period for which the taxpayer held any share of stock;'' 
for ``the rules of section 246(c)(3) shall apply in determining whether 
any share of stock has been held for less than 31 days;'' and 
substituted provisions dealing with the applicable number of days for 
former provisions which set forth different applicable days.
    Subsec. (b)(4)(D). Pub. L. 98-369, Sec. 55(a)(3), added subpar. (D).
    Subsec. (e). Pub. L. 98-369, Sec. 1071(a)(4), added subsec. (e).
    1983--Subsec. (b)(5). Pub. L. 97-424 substituted ``section 103(a)'' 
for ``section 103(a)(1)'' wherever appearing.
    1980--Subsec. (b)(3)(D)(iii). Pub. L. 96-222 substituted ``72 
percent'' for ``70 percent''.
    1978--Subsec. (b)(1). Pub. L. 95-600, Sec. 301(b)(11), substituted 
``a tax'' for ``a normal tax and surtax''.
    Subsec. (b)(3)(C). Pub. L. 95-600, Sec. 362(c), inserted ``, except 
that, if there is an increase in the excess described in subparagraph 
(A) of this paragraph for such year which results from a determination 
(as defined in section 860(e)), such designation may be made with 
respect to such increase at any time before the expiration of 120 days 
after the date of such determination'' after ``amount so designated''.
    Subsec. (b)(4). Pub. L. 95-600, Sec. 701(s)(2), designated first 
sentence, including subpars. (A) and (B), as subpar. (A), cls. (i) and 
(ii); added subpar. (A) heading and substituted ``shall, to the extent 
of the amount described in clause (i), be treated as a long-term capital 
loss'' for ``shall, to the extent of the amount described in 
subparagraph (A) of this paragraph, be treated as loss from the sale or 
exchange of a capital asset held for more than 1 year''; added subpar. 
(B); and designated second sentence as subpar. (C).
    1976--Subsec. (a)(1). Pub. L. 94-455, Secs. 1901(b)(6)(B), 2137(a), 
designated existing provisions as introductory material and subpar. (A) 
and added subpar. (B).
    Subsec. (a)(2). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out ``or 
his delegate'' after ``Secretary''.
    Subsec. (b)(1). Pub. L. 94-455, Sec. 1901(b)(1)(V), struck out 
provision relating to the computation of the normal tax under section 11 
of this title.
    Subsec. (b)(2)(A). Pub. L. 94-455, Sec. 1901(b)(33)(I), substituted 
``the amount of the net capital gain, if any'' for ``the excess, if any, 
of the net long-term capital gain over the short-term capital loss''.
    Subsec. (b)(2)(D). Pub. L. 94-455, Sec. 2137(b), inserted reference 
to exempt-interest dividends.
    Subsec. (b)(3)(A). Pub. L. 94-455, Sec. 1901(b)(33)(J)(i), among 
other changes, struck out reference to the sum of the net short-term 
capital loss.
    Subsec. (b)(3)(B). Pub. L. 94-455, Sec. 1402(b)(2), provided that 
``9 months'' would be changed to ``1 year''.
    Pub. L. 94-455, Sec. 1402(b)(1)(N), provided that ``6 months'' would 
be changed to ``9 months'' for taxable years beginning in 1977.
    Subsec. (b)(3)(C). Pub. L. 94-455, Sec. 1901(a)(110)(A), 
(b)(33)(J)(ii), substituted ``net capital gain'' for ``excess of the net 
long-term capital gain over the net short-term capital loss'' in two 
places and struck out provision requiring for purpose of the deduction 
for capital gains dividends paid, the deductions shall in the case of a 
taxable year beginning before Jan. 1, 1975, first be made from the 
amount subject to tax in accordance with section 1201(a)(1)(B), to the 
extent thereof, and then from the amount subject to tax in accordance 
with section 1201(a)(1)(A).
    Subsec. (b)(3)(D)(iii). Pub. L. 94-455, Sec. 1901(a)(110)(B)(i), 
struck out ``by 75 percent of so much of such amounts as equals the 
amount subject to tax in accordance with section 1201(a)(1)(A) and'' 
after ``his long term capital gains,'' and ``(72 percent in the case of 
a taxable year beginning after December 31, 1969, and before January 1, 
1971)'' after ``by 70 percent'' and substituted ``section 1201(a)'' for 
``section 1201(a)(1)(B) or (2)''.
    Subsec. (b)(3)(D)(v). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck 
out ``or his delegate'' after ``Secretary''.
    Subsec. (b)(4). Pub. L. 94-455, Sec. 1402(b)(2), provided that ``9 
months'' would be changed to ``1 year''.
    Pub. L. 94-455, Sec. 1402(b)(1)(N), provided that ``6 months'' would 
be changed to ``9 months'' for taxable years beginning in 1977.
    Subsec. (b)(5). Pub. L. 94-455, Sec. 2137(c), added par. (5).
    Subsec. (d). Pub. L. 94-455, Sec. 1901(a)(110)(C), (b)(33)(N), 
inserted in par. (1) ``(15 U.S.C. 80a-1 and following)'' after 
``Investment company Act of 1940'' and substituted in provision 
following par. (2) ``capital gain net income'' for ``net capital gain''.
    1969--Subsec. (b)(3)(A). Pub. L. 91-172, Sec. 511(c)(2)(A), 
substituted ``determined as provided in section 1201(a), on'' for ``of 
25 percent of''.
    Subsec. (b)(3)(C). Pub. L. 91-172, Sec. 511(c)(2)(B), inserted 
provision requiring for the purposes of the deduction for capital gains 
dividends paid the deduction shall, in the case of a taxable year 
beginning before Jan. 1, 1975, first be made from the amount subject to 
tax in accordance with section 1201(a)(1)(B), to the extent thereof, and 
then from the amount subject to tax in accordance with section 
1201(a)(1)(A).
    Subsec. (b)(3)(D). Pub. L. 91-172, Sec. 511(c)(2)(C), (D), struck 
out ``of 25 percent'' in cl. (ii), substituted reference in cl. (iii) to 
the increase of the adjusted basis of shares in the hands of the 
shareholder, with respect to the amounts required by this subpar., by 75 
percent of so much of such amounts as equals the amount subject to tax 
in accordance with section 1201(a)(1)(A) and by 70 percent (72 percent 
in the case of a taxable year beginning after Dec. 31, 1969, and before 
Jan. 1, 1971) of so much of such amounts as equals the amount subject to 
tax in accordance with section 1201(a)(1)(B) or (2), for reference to 
the increase of the adjusted basis of shares in the hand of the 
shareholder by 75 percent of the amounts required by this subpar. to be 
included in computing his long-term capital gains.
    1964--Subsec. (b)(3)(C), (D)(i). Pub. L. 88-272, Sec. 229(a)(1), 
(2), substituted ``45 days'' for ``30 days''.
    Subsec. (d). Pub. L. 88-272, Sec. 229(b), added subsec. (d).
    1960--Subsec. (a). Pub. L. 86-779, Sec. 10(b)(2), substituted ``this 
part'' for ``this subchapter''.
    Subsec. (b)(3)(C). Pub. L. 86-779, Sec. 10(b)(3), substituted ``For 
purposes of this part, a capital gain dividend is'' for ``A capital gain 
dividend means''.
    1958--Subsec. (a). Pub. L. 85-866, Sec. 101(a), inserted ``(other 
than subsection (c) of this section)''.
    Subsec. (b)(4). Pub. L. 85-866, Sec. 39(a), added par. (4).
    Subsec. (c). Pub. L. 85-866, Sec. 101(b), inserted sentence defining 
regulated investment company.
    1956--Subsec. (b)(3)(D). Act July 11, 1956, added subpar. (D).


                    Effective Date of 1999 Amendment

    Pub. L. 106-170, title V, Sec. 566(d), Dec. 17, 1999, 113 Stat. 
1950, provided that: ``The amendments made by this section [amending 
this section and section 857 of this title] shall apply to distributions 
after December 31, 2000.''


                    Effective Date of 1997 Amendment

    Amendment by section 1122(c)(2), (3) of Pub. L. 105-34 applicable to 
taxable years of United States persons beginning after Dec. 31, 1997, 
and to taxable years of foreign corporations ending with or within such 
taxable years of United States persons, see section 1124 of Pub. L. 105-
34, set out as a note under section 532 of this title.
    Section 1263 of title XII of Pub. L. 105-34 provided that: ``The 
amendments made by this part [probably means subtitle D (Secs. 1251-
1263) of title XII of Pub. L. 105-34, amending this section and sections 
856 and 857 of this title] shall apply to taxable years beginning after 
the date of the enactment of this Act [Aug. 5, 1997].''


                    Effective Date of 1996 Amendment

    Amendment by section 1602(b)(1) of Pub. L. 104-188 applicable to 
loans made after Aug. 20, 1996, with exception and provisions relating 
to certain refinancings, see section 1602(c) of Pub. L. 104-188, set out 
as an Effective Date of Repeal note under former section 133 of this 
title.


                    Effective Date of 1993 Amendment

    Amendment by Pub. L. 103-66 applicable to taxable years beginning on 
or after Jan. 1, 1993, see section 13221(d) of Pub. L. 103-66 set out as 
a note under section 11 of this title.


                    Effective Date of 1989 Amendment

    Section 7204(b)(2) of Pub. L. 101-239 provided that: ``The amendment 
made by paragraph (1) [amending this section] shall apply to charges 
incurred after October 3, 1989, in taxable years ending after such 
date.''
    Section 7204(c)(2) of Pub. L. 101-239 provided that: ``The amendment 
made by paragraph (1) [amending this section] shall apply to dividends 
in cases where the stock becomes ex-dividend after the date of the 
enactment of this Act [Dec. 19, 1989].''


                    Effective Date of 1988 Amendment

    Section 1006(l)(9) of Pub. L. 100-647 provided that the amendment 
made by that section is effective with respect to dividends declared in 
1988 and subsequent calendar years.
    Amendment by sections 1006(l)(1)(A), (3), (4), (7), (8), (10), 
1011B(h)(4), and 1018(p) of Pub. L. 100-647 effective, except as 
otherwise provided, as if included in the provision of the Tax Reform 
Act of 1986, Pub. L. 99-514, to which such amendment relates, see 
section 1019(a) of Pub. L. 100-647, set out as a note under section 1 of 
this title.


                    Effective Date of 1986 Amendment

    Amendment by section 311(b)(1) of Pub. L. 99-514 applicable to 
taxable years beginning after Dec. 31, 1986, see section 311(c) of Pub. 
L. 99-514, set out as a note under section 1201 of this title.
    Amendment by section 631(e)(11) of Pub. L. 99-514 applicable to any 
distribution in complete liquidation, and any sale or exchange, made by 
a corporation after July 31, 1986, unless such corporation is completely 
liquidated before Jan. 1, 1987, any transaction described in section 338 
of this title for which the acquisition date occurs after Dec. 31, 1986, 
and any distribution, not in complete liquidation, made after Dec. 31, 
1986, with exceptions and special and transitional rules, see section 
633 of Pub. L. 99-514, set out as an Effective Date note under section 
336 of this title.
    Amendment by section 651(b)(1)(A), (2), (3) of Pub. L. 99-514 
applicable to calendar years beginning after Dec. 31, 1986, see section 
651(d) of Pub. L. 99-514, set out as an Effective Date note under 
section 4982 of this title.
    Section 655(b) of Pub. L. 99-514 provided that: ``The amendments 
made by subsection (a) [amending this section and sections 853 to 855 of 
this title] shall apply to taxable years beginning after the date of the 
enactment of this Act [Oct. 22, 1986].''
    Section 1173(c)(2)(A) of Pub. L. 99-514 provided that: ``The 
amendments made by subsection (b)(1) [amending this section and former 
section 133 of this title] shall apply to loans used to acquire employer 
securities after the date of the enactment of this Act [Oct. 22, 1986], 
including loans used to refinance loans used to acquire employer 
securities before such date if such loans were used to acquire employer 
securities after May 23, 1984.''
    Amendment by section 1511(c)(6) of Pub. L. 99-514 applicable for 
purposes of determining interest for periods after Dec. 31, 1986, see 
section 1511(d) of Pub. L. 99-514, set out as a note under section 47 of 
this title.
    Section 1804(c)(6) of Pub. L. 99-514 provided that: ``The amendments 
made by this subsection [amending this section] shall apply to stock 
with respect to which the taxpayer's holding period begins after March 
28, 1985.''
    Amendment by section 1878(j) of Pub. L. 99-514 effective, except as 
otherwise provided, as if included in the provisions of the Tax Reform 
Act of 1984, Pub. L. 98-369, div. A, to which such amendment relates, 
see section 1881 of Pub. L. 99-514, set out as a note under section 48 
of this title.


                    Effective Date of 1984 Amendment

    Section 55(c) of Pub. L. 98-369 provided that: ``The amendments made 
by this section [amending this section and section 857 of this title] 
shall apply to losses incurred with respect to shares of stock and 
beneficial interests with respect to which the taxpayer's holding period 
begins after the date of the enactment of this Act [July 18, 1984].''
    Amendment by section 1001(b)(11) of Pub. L. 98-369 applicable to 
property acquired after June 22, 1984, and before Jan. 1, 1988, see 
section 1001(e) of Pub. L. 98-369, set out as a note under section 166 
of this title.
    Section 1071(a)(5) of Pub. L. 98-369, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(A) In general.--Except as otherwise provided in this paragraph, 
the amendments made by this subsection [amending this section and 
section 851 of this title] shall apply to taxable years beginning after 
December 31, 1982.
    ``(B) Investment companies which were regulated investment companies 
for years ending before november 8, 1983.--In the case of any investment 
company to which the provisions of part I of subchapter M of chapter 1 
of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] applied for 
any taxable year ending before November 8, 1983, for purposes of section 
852(a)(3)(B) of the Internal Revenue Code of 1986 (as amended by this 
subsection), no earnings and profits accumulated in any taxable year 
ending before January 1, 1984, shall be taken into account.
    ``(C) Investment companies beginning business in 1983.--In the case 
of an investment company which began business in 1983 (and was not a 
successor corporation), earnings and profits accumulated during its 
first taxable year shall not be taken into account for purposes of 
section 852(a)(3)(B) of such Code (as so amended).
    ``(D) Investment companies registering before november 8, 1983.--In 
the case of any investment company--
        ``(i) which, during the period after December 31, 1981, and 
    before November 8, 1983--
            ``(I) was engaged in the active conduct of a trade or 
        business,
            ``(II) sold substantially all of its operating assets, and
            ``(III) registered under the Investment Company Act of 1940 
        [15 U.S.C. Sec. 80a-1 et seq.] as either a management company or 
        a unit investment trust, and
        ``(ii) to which the provisions of part I of subchapter M of 
    chapter 1 of the Internal Revenue Code of 1986 applied for its first 
    taxable year beginning after November 8, 1983,
for purposes of section 852(a)(3)(A) of such Code (as amended by 
paragraph (3)), the provisions of part I of subchapter M of chapter 1 of 
such Code shall be treated as applying to such investment company for 
its first taxable year ending after November 8, 1983. For purposes of 
the preceding sentence, all members of an affiliated group (as defined 
in section 1504(a) of such Code) filing a consolidated return shall be 
treated as 1 taxpayer.''
    Section 1071(b)(2) of Pub. L. 98-369 provided that: ``The amendment 
made by paragraph (1) [amending this section] shall apply to taxable 
years beginning after December 31, 1978.''


                    Effective Date of 1980 Amendment

    Amendment by Pub. L. 96-222 effective, except as otherwise provided, 
as if it had been included in the provisions of the Revenue Act of 1978, 
Pub. L. 95-600, to which such amendment relates, see section 201 of Pub. 
L. 96-222, set out as a note under section 32 of this title.


                    Effective Date of 1978 Amendment

    Amendment by section 301(b)(11) of Pub. L. 95-600 applicable to 
taxable years beginning after Dec. 31, 1978, see section 301(c) of Pub. 
L. 95-600, set out as a note under section 11 of this title.
    Amendment by section 362(c) of Pub. L. 95-600 applicable with 
respect to determinations (as defined in section 860(e) of this title) 
after Nov. 6, 1978, see section 362(e) of Pub. L. 95-600, set out as an 
Effective Date note under section 860 of this title.
    Amendment by section 701(s)(2) of Pub. L. 95-600 applicable to 
taxable years beginning after Dec. 31, 1975, see section 701(s)(3) of 
Pub. L. 95-600, set out as a note under section 851 of this title.


                    Effective Date of 1976 Amendment

    Section 1402(b)(1) of Pub. L. 94-455 provided that the amendment 
made by that section is effective with respect to taxable years 
beginning in 1977.
    Section 1402(b)(2) of Pub. L. 94-455 provided that the amendment 
made by that section is effective with respect to taxable years 
beginning after Dec. 31, 1977.
    Amendment by section 1901(a)(110)(A), (C), (b)(1)(V), (6)(B), 
(33)(I), (J), (N) of Pub. L. 94-455 effective for taxable years 
beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94-455, 
set out as an Effective Date of 1976 Amendment note under section 2 of 
this title.
    Section 1901(a)(110)(B)(ii) of Pub. L. 94-455, as amended by Pub. L. 
99-514, Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``The 
amendment made by clause (i) [amending this section] shall not be 
considered to affect the amount of any increase in the basis of stock 
under the provisions of section 852(b)(3)(D)(iii) of the Internal 
Revenue Code of 1986 [formerly I.R.C. 1954] which is based upon amounts 
subject to tax under section 1201 of such Code [section 1201 of this 
title] in taxable years beginning before January 1, 1975.''
    Section 2137(e) of Pub. L. 94-455 provided that: ``The amendments 
made by this section [amending this section and sections 103 and 265 of 
this title] shall apply to taxable years beginning after December 31, 
1975.''


                    Effective Date of 1969 Amendment

    Amendment by Pub. L. 91-172 applicable with respect to taxable years 
beginning after Dec. 31, 1969, see section 511(d) of Pub. L. 91-172, set 
out as an Effective Date note under section 1201 of this title.


                    Effective Date of 1964 Amendment

    Section 229(c) of Pub. L. 88-272 provided that: ``The amendments 
made by subsection (a) [amending this section and sections 853, 854, and 
855 of this title] shall apply to taxable years of regulated investment 
companies ending on or after the date of the enactment of this Act [Feb. 
26, 1964]. The amendment made by subsection (b) [amending this section] 
shall apply to taxable years of regulated investment companies ending 
after December 31, 1963.''


                    Effective Date of 1960 Amendment

    Amendment of section by Pub. L. 86-779 applicable with respect to 
taxable years of real estate investment trusts beginning after Dec. 31, 
1960, see section 10(k) of Pub. L. 86-779, set out as an Effective Date 
note under section 856 of this title.


                    Effective Date of 1958 Amendment

    Section 39(b) of Pub. L. 85-866 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply with respect to 
taxable years ending after December 31, 1957, but only with respect to 
shares of stock acquired after December 31, 1957.''
    Section 101(c) of Pub. L. 85-866 provided that: ``The amendments 
made by this section [amending this section] shall apply with respect to 
taxable years of regulated investment companies beginning on or after 
March 1, 1958.''


                    Effective Date of 1956 Amendment

    Section 2(b) of act July 11, 1956, provided that: ``The amendment 
made by this section [amending this section] shall apply only with 
respect to taxable years of regulated investment companies beginning 
after December 31, 1956.''


           Plan Amendments Not Required Until January 1, 1989

    For provisions directing that if any amendments made by subtitle A 
or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or title XVIII 
[Secs. 1800-1899A] of Pub. L. 99-514 require an amendment to any plan, 
such plan amendment shall not be required to be made before the first 
plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. 
L. 99-514, as amended, set out as a note under section 401 of this 
title.

                  Section Referred to in Other Sections

    This section is referred to in sections 57, 443, 774, 853, 854, 855, 
860, 891, 1201, 4982 of this title.
