Description of Bills Relating to the Tax Treatment of Mortgage Related and Other Asset Backed Securities (S. 1959 and S. 1978) and Environmental Zones (S. 1839): Scheduled for a Hearing Before the Subcommittee on Taxation and Debt Management of the Senate Committee on Finance on January 31, 1986
U.S. Government Printing Office, 1986 - Asset-backed financing - 27 pages
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accrued ACRS activities addition adjusted allocated allowed amount apply areas arrangement assets association backed basis beneficiaries bill capital gain carry cash certain CMSs collateral conduit corporation cost debt obligations deduction depletion depreciable designated determined distributed dividends effect elect entity environmental zone excess exchange expenditures expense extent facilities financial instruments gain grantor trust held holder holding income income producing assets income tax individual interest investment issue price issuer less limited maturity ment method mortgage related mortgages obligations issued OID rules original issue discount owner ownership paid partnership pass-through payments percent percentage period person portion prepayments present law principal qualified obligations real property received recovered recovery regular regulations REIT requirements respect rules securities Senator Senator Chafee shares tax credit Tax Treatment taxable taxation taxpayer timber tion trade transfer transferor treated treatment types underlying
Page 7 - partnership" Includes a syndicate, group, pool, joint venture, or other unincorporated organization, through or by means of which any business, financial operation, or venture is carried on, and which is not, within the meaning of this title, a trust or estate or a corporation; and the term "partner" includes a member in such a syndicate, group, pool, joint venture, or organization.
Page 8 - The six characteristics are: (1) Associates; (2) An objective to carry on business and divide the gains therefrom; (3) Continuity of life; (4) Centralization of management; (5) Liability for corporate debts limited to corporate property; and (6) Free transferability of interests.
Page 9 - ... common to trusts and corporations, the determination of whether a trust which has such characteristics is to be treated for tax purposes as a trust or as an association depends on whether there are associates and an objective to carry on business and divide the gains therefrom.
Page 7 - December 31, 1941; (2) at least 90 percent of its gross income is derived from dividends, interest, and gains from the sale or other disposition of stock or securities; (3) less than 30 percent of its gross income is derived from the sale or other disposition of stock or securities held for less than 3 months...
Page 8 - Classification rules. — Treasury regulations provide that whether a particular entity is classified as an association taxable as a corporation or as a partnership, trust, or some other entity not taxable as a corporation is determined by taking into account the presence or absence of certain characteristics associated with corporations. These characteristics are (1) the presence of associates, (2) an objective to carry on business and divide the gains therefrom, (3) continuity of life, (4) centralization...
Page 9 - ... power under the trust agreement to vary the investment of the certificate holders. See Commissioner v. North American Bond Trust (CCA 2d 1941) 122 F.
Page 11 - If at the time of original issue there was an Intention to call the bond or other evidence of Indebtedness before maturity, any gain realized on the sale or exchange thereof which does not exceed an amount equal to the original issue discount...
Page 10 - Code sections 1272-1275 and section 163(e) (the "OID rules") generally require the holder of a debt instrument issued at a discount (provided that such discount is not less than a certain de minimis amount) to include annually in income a portion of the original issue discount ("OID") on the instrument, and allow the issuer of such an instrument to deduct a corresponding amount, irrespective of the methods of accounting that the...