Page:United States Statutes at Large Volume 90 Part 2.djvu/276

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PUBLIC LAW 94-455—OCT. 4, 1976 " (d) D E F I C I E N C T DIVIDENDS.—

'"' 26 USC 561.

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" (1) DEFINITION. — For purposes of this section, the term 'deficiency dividends' means a distribution of property made by the real estate investment t r u s t on or after the date of the determination and before filing claim under subsection (e), which would have been includible in the computation of the deduction for dividends paid under section 561 for the taxable year with respect to which the liability for tax resulting from the determination exists, if distributed during such taxable year. N o distribution of property shall be considered as deficiency dividends for purposes of subsection (a) unless distributed within 90 days after the determination, and unless a claim for a deficiency dividend deduction with respect to such distribution is filed pursuant to subsection (e). ^ " (2) LIMITATIONS.—

"(A)

ORDINARY DIVIDENDS.—The amount of

deficiency

dividends (other than deficiency dividends qualifying as capital gain dividends) paid by a real estate investment t r u s t for the taxable year with respect to which the liability for tax resulting from the determination exists shall not exceed the sum of— " (i) the excess of the amount of increase referred to in subparagraph (A) of subsection (b)(1) over the amount of any increase i n the deduction for dividends paid (computed without regard to capital gain dividends) for such taxable year which results from such determination, and " ( i i) the amount of decrease referred to i n subparagraph (C) of subsection (b)(1). " (B) CAPITAL GAIN DIVIDENDS.—The a m o u n t of deficiency

dividends qualifying as capital gain dividends paid by a real estate investment t r u s t for the taxable year with respect to which the liability for tax resulting from the determination exists shall not exceed the amount by which (i) the increase referred to in subparagraph (B) of subsection (b)(1) exceeds (ii) the amount of any dividends paid during such taxable year which are designated as capital gain dividends after such determination. " (3) E F F E C T ON DIVIDENDS PAID DEDUCTION.— " (A) FOR TAXABLE YEAR I N W H I C H

PAID.—Deficiency

dividends p a i d i n any taxable year shall not be included i n the amount of dividends paid for such year for purposes of computing the dividends paid deduction for such year. " (B) FOR PRIOR TAXABLE YEAR.—Deficiency dividends p a i d

in any taxable year shall not be allowed for purposes of section 858(a) in the computation of the dividends p a i d deduction for the taxable year preceding the taxable year i n which paid. " (e) CLAIM REQUIRED.—No deficiency dividend deduction shall be allowed under subsection (a) unless (under regulations prescribed by the Secretary) claim therefor is filed within 120 days after the date of the determination. " (f) SUSPENSION OF STATUTE OF LIMITATIONS AND S T A Y OF COLLECTION.— " (1) SUSPENSION OF R U N N I N G OF STATUTE.—If the r e a l estate

investment t r u s t files a claim as provided i n subsection (e), the

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