Public Law 119-73 (01/23/2026)

26 U.S.C. § 859

Adoption of annual accounting period

(a)

General rule

For purposes of this subtitle—
(1)
a real estate investment trust shall not change to any accounting period other than the calendar year, and
(2)
a corporation, trust, or association may not elect to be a real estate investment trust for any taxable year beginning after , unless its accounting period is the calendar year.
Paragraph (2) shall not apply to a corporation, trust, or association which was considered to be a real estate investment trust for any taxable year beginning on or before .
(b)

Change of accounting period without approval

Notwithstanding section 442, an entity which has not engaged in any active trade or business may change its accounting period to a calendar year without the approval of the Secretary if such change is in connection with an election under section 856(c).

Pub. L. 94–455, title XVI, § 1604(i)(1)90 Stat. 1752Pub. L. 95–600, title III, § 362(d)(6)92 Stat. 2852Pub. L. 99–514, title VI, § 661(c)100 Stat. 2300(Added , , , § 860; renumbered § 859 and amended , title VII, § 701(t)(1), , , 2911; , , .)

Editorial Notes

Prior Provisions

Pub. L. 94–455, title XVI, § 1601(a)(1)90 Stat. 1742Pub. L. 95–600, title VII, § 701(t)(4)92 Stat. 2912Pub. L. 95–600, title III, § 362(d)(6)92 Stat. 2852section 860 of this titleA prior section 859, added , , ; amended , , , related to a deduction for deficiency dividends, prior to repeal by , , . See .

Amendments

Pub. L. 99–5141986— designated existing provisions as subsec. (a) and added subsec. (b).

Pub. L. 95–600, § 701(t)(1)1978—, designated existing provisions as par. (1), substituted “change to any accounting period” for “change to or adopt any annual accounting period”, and added par. (2) and provision for nonapplicability of par. (2) to a real estate investment trust for any taxable year beginning on or before .

Statutory Notes and Related Subsidiaries

Effective Date of 1986 Amendment

Pub. L. 99–514section 669 of Pub. L. 99–514section 856 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

Effective Date of 1978 Amendment

section 859 of this titlesection 860 of this titlesection 362(d)(6) of Pub. L. 95–600section 860(e) of this titlesection 362(e) of Pub. L. 95–600section 860 of this titleRepeal of prior and redesignation of as this section by applicable with respect to determinations (as defined in ) after , see , set out as an Effective Date note under .

Pub. L. 95–600, title VII, § 701(t)(5)92 Stat. 2912

“The amendments made by this subsection [amending this section and sections 275, 856, 6212, and 6501 of this title] shall take effect on .”
, , , provided that: