26 U.S.C. § 854

Editorial Notes

Amendments

Pub. L. 111–325, § 301(e)(1)(A)2010—Subsec. (b)(1)(A). , in concluding provisions, substituted “reported by the regulated investment company as eligible for such deduction in written statements furnished to its shareholders” for “designated under this subparagraph by the regulated investment company”.

Pub. L. 111–325, § 301(e)(1)(B)Subsec. (b)(1)(B)(i). , in concluding provisions, substituted “reported by the regulated investment company as qualified dividend income in written statements furnished to its shareholders” for “designated by the regulated investment company”.

Pub. L. 111–325, § 301(e)(1)(C)Subsec. (b)(1)(C)(i). , substituted “reported” for “designated”.

Pub. L. 111–325, § 301(e)(1)(D)Subsec. (b)(1)(C)(ii). , substituted “reported” for “designated” in introductory provisions.

Pub. L. 111–325, § 301(e)(2)Subsec. (b)(2) to (5). , redesignated pars. (3) to (5) as (2) to (4), respectively, and struck out former par. (2). Prior to amendment, text read as follows: “The amount of any distribution by a regulated investment company which may be taken into account as qualified dividend income for purposes of section 1(h)(11) and as dividends for purposes of the deduction under section 243 shall not exceed the amount so designated by the company in a written notice to its shareholders mailed not later than 60 days after the close of its taxable year.”

Pub. L. 108–311, § 402(a)(5)(A)(ii)2004—Subsec. (b)(1)(B)(i). , reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “If the aggregate dividends received by a regulated investment company during any taxable year are less than 95 percent of its gross income, then, in computing the maximum rate under section 1(h)(11), rules similar to the rules of subparagraph (A) shall apply.”

Pub. L. 108–311, § 402(a)(5)(A)(i)Subsec. (b)(1)(B)(iii), (iv). , struck out cls. (iii) and (iv) which related to dividends from real estate investment trusts and dividends from qualified foreign corporations, respectively.

Pub. L. 108–311, § 402(a)(5)(B)Subsec. (b)(1)(C). , amended heading and text of subpar. (C) generally. Prior to amendment, text read as follows: “The aggregate amount which may be designated as dividends under subparagraph (A) or (B) shall not exceed the aggregate dividends received by the company for the taxable year.”

Pub. L. 108–311, § 402(a)(5)(C)Subsec. (b)(2). , substituted “as qualified dividend income for purposes of section 1(h)(11) and as dividends for purposes of” for “as a dividend for purposes of the maximum rate under section 1(h)(11) and”.

Pub. L. 108–311, § 402(a)(5)(D)Subsec. (b)(5). , amended heading and text of par. (5) generally. Prior to amendment, text read as follows: “For purposes of paragraph (1)(B), an amount shall be treated as a dividend only if the amount is qualified dividend income (within the meaning of section 1(h)(11)(B)).”

Pub. L. 108–27, § 302(c)(1)2003—Subsec. (a). , inserted “section 1(h)(11) (relating to maximum rate of tax on dividends) and” after “For purposes of”.

Pub. L. 108–27, § 302(c)(2)Subsec. (b)(1)(B). , added subpar. (B). Former subpar. (B) redesignated (C).

Pub. L. 108–27, § 302(c)(2)Subsec. (b)(1)(C). , (3), redesignated subpar. (B) as (C) and substituted “subparagraph (A) or (B)” for “subparagraph (A)”.

Pub. L. 108–27, § 302(c)(4)Subsec. (b)(2). , inserted “the maximum rate under section 1(h)(11) and” after “for purposes of”.

Pub. L. 108–27, § 302(c)(5)Subsec. (b)(5). , added par. (5).

Pub. L. 100–6471988—Subsec. (b)(3). substituted “Aggregate dividends” for “Definitions” in heading and amended text generally, substituting subpars. (A) to (C) for former subpars. (A) and (B).

Pub. L. 100–2031987—Subsec. (b)(1)(A). inserted “and such dividend shall be treated as received from a corporation which is not a 20-percent owned corporation” before period at end.

Pub. L. 99–514, § 612(b)(6)(A)1986—Subsec. (a). , which directed that “section 116 (relating to an exclusion for dividends received by individuals), and” be struck out, was executed by striking out “section 116 (relating to an exclusion for dividends received by individuals) and” before “section 243” as the probable intent of Congress.

Pub. L. 99–514, § 612(b)(6)(B)(i)Subsec. (b)(1)(B), (C). , (ii), redesignated subpar. (C) as (B), struck out “or (B)” before “shall not exceed”, and struck out former subpar. (B), exclusion under section 116, which read as follows: “If the aggregate dividends received by a regulated investment company during any taxable year are less than 95 percent of its gross income, then, in computing the exclusion under section 116, rules similar to the rules of subparagraph (A) shall apply.”

Pub. L. 99–514, § 655(a)(4)Subsec. (b)(2). , substituted “60 days” for “45 days”.

Pub. L. 99–514, § 612(b)(6)(B)(iii), struck out “the exclusion under section 116 and” before “the deduction under section 243”.

Pub. L. 99–514, § 612(b)(6)(B)(iv)Subsec. (b)(3)(B). , amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “The term ‘aggregate dividends received’ includes only dividends received from domestic corporations other than dividends described in section 116(b) (relating to dividends excluded from gross income). In determining the amount of any dividend for purposes of this subparagraph, the rules provided in section 116(c) (relating to certain distributions) shall apply.”

Pub. L. 98–369, § 16(a)Pub. L. 97–34, § 302(c)1984—Subsec. (b). , repealed amendments made by . See 1981 Amendment note below.

Pub. L. 98–369, § 52(a)Subsec. (b)(1). , increased the required amount of dividends by substituting provisions directing that in any case in which (i) a dividend is received from a regulated investment company (other than a dividend to which subsection (a) applies), and (ii) such investment company meets the requirements of section 852(a) for the taxable year during which it paid such dividend, then, in computing any deduction under section 243, there shall be taken into account only that portion of such dividend thus designated by the regulated investment company, that if the aggregate dividends received by a regulated investment company during any taxable year are less than 95 percent of its gross income, then, in computing the exclusion under section 116, similar rules applied, and that the aggregate amount which may be designated thus dividends shall not exceed the aggregate dividends received by the company for the taxable year for provisions which had directed that in the case of a dividend received from a regulated investment company (other than a dividend to which subsection (a) applied) (A) if such investment company met the requirements of section 852(a) for the taxable year during which it paid such dividend; and (B) the aggregate dividends received by such company during such taxable year were less than 75 percent of its gross income, then, in computing the exclusion under section 116 and the deduction under section 243, there was taken into account only that portion of the dividend which bore the same ratio to the amount of such dividend as the aggregate dividends received by such company during such taxable year to its gross income for such taxable year.

Pub. L. 98–369, § 52(c)Subsec. (b)(3)(A). , substituted provisions directing that in the case of 1 or more sales or other dispositions of stock and securities, the term “gross income” include only the excess of (i) the net short-term capital gain from such sales or dispositions, over (ii) the net long-term capital loss from such sales or dispositions for provisions which had directed that the term “gross income” not include gain from the sale or other disposition of stock or securities.

Pub. L. 98–369, § 52(b)Subsec. (b)(4). , added par. (4).

Pub. L. 97–34, § 302(c)(4)section 128 of this titleDec. 31, 1984Section 16(a) of Pub. L. 98–369section 302(c) of Pub. L. 97–341981—Subsec. (b). , (d)(1), provided for general amendment of subsec. (b) so as to include provisions relating to taxable interest described in , applicable to taxable years beginning after . , repealed , and provided that this title shall be applied and administered as if section 302(c), and the amendments made by section 302(c), had not been enacted.

Pub. L. 96–223, § 404(b)(6)1980—Subsec. (b). , temporarily substituted “Other dividends and taxable interest” for “Other dividends” in heading, substituted “Deduction under section 243” for “General rule” in heading for par. (1), struck out “the exclusion under section 116 and” after “in computing” in text of par. (1) following subpar. (B), added par. (2), redesignated former pars. (2) and (3) as (3) and (4), respectively, and, in par. (4) as so redesignated, substituted “116(b)(2)” for “116(b)” and “116(c)(2)” for “116(c)” in subpar. (B) and added subpar. (C).

Pub. L. 88–272, § 201(d)(8)1964—Subsec. (a). , struck out “section 34(a) (relating to credit for dividends received by individuals),” before “section 116” and the comma before “and”.

Pub. L. 88–272Subsec. (b). , §§ 201(d)(9), (10), 229(a)(4), substituted “45 days” for “30 days” in par. (2), and struck out “the credit under section 34(a),” before “the exclusion” in par. (1), and “the credit under section 34,” before “the exclusion” in par. (2).

Statutory Notes and Related Subsidiaries

Effective and Termination Dates of 2010 Amendment

Pub. L. 111–325Dec. 22, 2010section 301(h) of Pub. L. 111–325section 852 of this titleAmendment by applicable to taxable years beginning after , see , set out as an Effective Date of 2010 Amendment note under .

Pub. L. 111–325, title III, § 301(i)Dec. 22, 2010124 Stat. 3547

Effective Date of 2004 Amendment

Pub. L. 108–311Pub. L. 108–27section 402(b) of Pub. L. 108–311section 1 of this titleAmendment by effective as if included in section 302 of the Jobs and Growth Tax Relief Reconciliation Act of 2003, , see , set out a note under .

Effective Date of 2003 Amendment

Pub. L. 108–27Dec. 31, 2002section 302(f) of Pub. L. 108–27section 1 of this titleAmendment by applicable, except as otherwise provided, to taxable years beginning after , see , set out as an Effective and Termination Dates of 2003 Amendment note under .

Effective Date of 1988 Amendment

Pub. L. 100–647Pub. L. 99–514section 1019(a) of Pub. L. 100–647section 1 of this titleAmendment by effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, , to which such amendment relates, see , set out as a note under .

Effective Date of 1987 Amendment

Pub. L. 100–203Dec. 31, 1987section 10221(e)(1) of Pub. L. 100–203section 243 of this titleAmendment by applicable to dividends received or accrued after , in taxable years ending after such date, see , set out as a note under .

Effective Date of 1986 Amendment

section 612(b)(6) of Pub. L. 99–514Dec. 31, 1986section 612(c) of Pub. L. 99–514section 301 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

section 655(a)(4) of Pub. L. 99–514Oct. 22, 1986section 655(b) of Pub. L. 99–514section 852 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

Effective Date of 1984 Amendment

section 16(a) of Pub. L. 98–369Dec. 31, 1983section 18(a) of Pub. L. 98–369section 48 of this titleAmendment by applicable to taxable years ending after , see , set out as a note under .

Pub. L. 98–369, div. A, title I, § 52(d)July 18, 198498 Stat. 565

Effective and Termination Dates of 1980 Amendment

Pub. L. 96–223Dec. 31, 1980Jan. 1, 1982section 404(c) of Pub. L. 96–223section 265 of this titleAmendment by applicable with respect to taxable years beginning after , and before , see , set out as a note under .

Effective Date of 1964 Amendment

Pub. L. 88–272Dec. 31, 1964section 201(e) of Pub. L. 88–272section 22 of this titleAmendment by section 201(d)(8)–(10) of applicable to dividends received after , in taxable years ending after such date, see , set out as a note under .

section 229(a)(4) of Pub. L. 88–272Feb. 26, 1964section 229(c) of Pub. L. 88–272section 852 of this titleAmendment by applicable to taxable years of regulated investment companies ending on or after , see , set out as a note under .

Qualified Dividend Notice Period

Pub. L. 108–311, title IV, § 402(a)(5)(F)Oct. 4, 2004118 Stat. 1185