Us Code § 860B - Taxation of holders of regular interests
Full text of Us Code United States Code § 860B — Taxation of holders of regular interests, with citation guidance and answers to common questions.
§ 860B. Taxation of holders of regular interests
(a) General rule
In determining the tax under this chapter of any holder of a regular interest in a REMIC, such interest (if not otherwise a debt instrument) shall be treated as a debt instrument.
(b) Holders must use accrual method
The amounts includible in gross income with respect to any regular interest in a REMIC shall be determined under the accrual method of accounting.
(c) Portion of gain treated as ordinary income
Gain on the disposition of a regular interest shall be treated as ordinary income to the extent such gain does not exceed the excess (if any) of—
(1) the amount which would have been includible in the gross income of the taxpayer with respect to such interest if the yield on such interest were 110 percent of the applicable Federal rate (as defined in section 1274(d) without regard to paragraph (2) thereof) as of the beginning of the taxpayer's holding period, over
(2) the amount actually includible in gross income with respect to such interest by the taxpayer.
(d) Cross reference
For special rules in determining inclusion of original issue discount on regular interests, see section 1272(a)(6).
(Added Pub. L. 99–514, title VI, §671(a), Oct. 22, 1986, 100 Stat. 2309.)
About This Section
26 U.S.C. § 860B is part of Title 26 of the United States Code. The United States Code is the official codification of federal statutes maintained by the Office of the Law Revision Counsel of the U.S. House of Representatives. Congress amends the Code through new public laws, which are eventually incorporated into the relevant title.
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