
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC860D]

 
                     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 IV--REAL ESTATE MORTGAGE INVESTMENT CONDUITS
 
Sec. 860D. REMIC defined


(a) General rule

    For purposes of this title, the terms ``real estate mortgage 
investment conduit'' and ``REMIC'' mean any entity--
        (1) to which an election to be treated as a REMIC applies for 
    the taxable year and all prior taxable years,
        (2) all of the interests in which are regular interests or 
    residual interests,
        (3) which has 1 (and only 1) class of residual interests (and 
    all distributions, if any, with respect to such interests are pro 
    rata),
        (4) as of the close of the 3rd month beginning after the startup 
    day and at all times thereafter, substantially all of the assets of 
    which consist of qualified mortgages and permitted investments,
        (5) which has a taxable year which is a calendar year, and
        (6) with respect to which there are reasonable arrangements 
    designed to ensure that--
            (A) residual interests in such entity are not held by 
        disqualified organizations (as defined in section 860E(e)(5)), 
        and
            (B) information necessary for the application of section 
        860E(e) will be made available by the entity.

In the case of a qualified liquidation (as defined in section 
860F(a)(4)(A)), paragraph (4) shall not apply during the liquidation 
period (as defined in section 860F(a)(4)(B)).

(b) Election

                           (1) In general

        An entity (otherwise meeting the requirements of subsection (a)) 
    may elect to be treated as a REMIC for its 1st taxable year. Such an 
    election shall be made on its return for such 1st taxable year. 
    Except as provided in paragraph (2), such an election shall apply to 
    the taxable year for which made and all subsequent taxable years.

                           (2) Termination

        (A) In general

            If any entity ceases to be a REMIC at any time during the 
        taxable year, such entity shall not be treated as a REMIC for 
        such taxable year or any succeeding taxable year.

        (B) Inadvertent terminations

            If--
                (i) an entity ceases to be a REMIC,
                (ii) the Secretary determines that such cessation was 
            inadvertent,
                (iii) no later than a reasonable time after the 
            discovery of the event resulting in such cessation, steps 
            are taken so that such entity is once more a REMIC, and
                (iv) such entity, and each person holding an interest in 
            such entity at any time during the period specified pursuant 
            to this subsection, agrees to make such adjustments 
            (consistent with the treatment of such entity as a REMIC or 
            a C corporation) as may be required by the Secretary with 
            respect to such period,

        then, notwithstanding such terminating event, such entity shall 
        be treated as continuing to be a REMIC (or such cessation shall 
        be disregarded for purposes of subparagraph (A)) whichever the 
        Secretary determines to be appropriate.

(Added Pub. L. 99-514, title VI, Sec. 671(a), Oct. 22, 1986, 100 Stat. 
2311; amended Pub. L. 100-647, title I, Sec. 1006(t)(2)(A), (16)(A), 
(19), Nov. 10, 1988, 102 Stat. 3419, 3423, 3426; Pub. L. 101-508, title 
XI, Sec. 11704(a)(8), Nov. 5, 1990, 104 Stat. 1388-518.)


                               Amendments

    1990--Subsec. (a). Pub. L. 101-508 inserted closing parenthesis 
before period at end.
    1988--Subsec. (a). Pub. L. 100-647, Sec. 1006(t)(19), inserted at 
end ``In the case of a qualified liquidation (as defined in section 
860F(a)(4)(A)), paragraph (4) shall not apply during the liquidation 
period (as defined in section 860F(a)(4)(B).''
    Subsec. (a)(4). Pub. L. 100-647, Sec. 1006(t)(2)(A)(i), substituted 
``3rd month beginning after'' for ``4th month ending after''.
    Pub. L. 100-647, Sec. 1006(t)(2)(A)(ii), substituted ``and at all 
times thereafter'' for ``and each quarter ending thereafter''.
    Subsec. (a)(6). Pub. L. 100-647, Sec. 1006(t)(16)(A), added par. 
(6).


                    Effective Date of 1988 Amendment

    Section 1006(t)(2)(B) of Pub. L. 100-647 provided that: ``The 
amendment made by subparagraph (A)(ii) [amending this section] shall 
take effect on January 1, 1988.''
    Section 1006(t)(16)(D)(i) of Pub. L. 100-647 provided that: ``The 
amendments made by subparagraph (A) [amending this section] shall apply 
in the case of any REMIC where the start-up day (as defined in section 
860G(a)(9) of the 1986 Code, as in effect on the day before the date of 
the enactment of this Act [Nov. 10, 1988]) is after March 31, 1988; 
except that such amendments shall not apply in the case of a REMIC 
formed pursuant to a binding written contract in effect on such date.''
    Amendment by section 1006(t)(2)(A)(i), (19) 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.

                  Section Referred to in Other Sections

    This section is referred to in sections 860G, 860L of this title.
