PUBLIC LAW 94-455—OCT. 4, 1976 %;'•
90 STAT. 1751
" (A) stock or securities held for less than 6 months; " (B) section 1221(1) property (other than foreclosure property); and " (C) real property (including interests in real property and interests in mortgages on real property) held for less than 4 years other than — " (i) property compulsorily or involuntarily converted within the meaning of section 1033, and " ( i i) property which is foreclosure property within the definition of section 856(e); and".
(e)
OPTIONS To PURCHASE R E A L PROPERTY TREATED AS INTERESTS
IN REAL PROPERTY.—Section 856(c)(6)(C) (relating to limitations) is 26 USC 856. amended to read as follows: " (C) The term 'interests in real property ' includes fee own- "Interests in real ership and co-ownership of land or improvements thereon, property." leaseholds of land or improvements thereon, options to acquire land or improvements thereon, and options to acquire leaseholds of land or improvements thereon, but does not include mineral, oil, or gas royalty interests." (f)
R E A L ESTATE INVESTMENT TRUSTS M A Y B E INCORPORATED.—
(1) IN GENERAL.—So much of subsection (a) of section 856 (defining real estate investment t r u s t) as precedes paragraph (3) thereof is amended to read as follows: " (a) IN GENERAL.—For purposes of this title, the term 'real estate "Real estate investment investment t r u s t ' means a corporation, trust, or association— " (1) which is managed by one or more trustees or directors; trust," " (2) the beneficial ownership of which is evidenced by transferable shares, or by transferable certificates of beneficial interest;". (2) EXCEPTION FOR FINANCIAL INSTITUTIONS AND INSURANCE COM-
PANIES.—Section 856(a) (defining real estate investment trust) Ante, p. 1748 is amended by inserting after paragraph (3) the following new paragraph: " (4) which is neither (A) a financial institution to which section 585, 586, or 593 applies, nor (B) an insurance company to which subchapter L applies;". 26 USC 801. (3) CONFORMING AMENDMENTS.—
(A) So much of section 856(c) (relating to limitations) as precedes paragraph (1) thereof is amended by striking out " A t r u s t or association" and inserting in lieu thereof " A corporation, trust, or association". (B) The second sentence of section 857(d) (relating to 26 USC 857. earnings and profits) is amended by striking out "a domestic unincorporated t r u s t " and inserting in lieu thereof "a domestic corporation, trust,". (g) INTEREST.—Section 856 (relating to definition of real estate investment trust) is amended by adding after subsection (e) the following new subsection: " (f) INTEREST.—For purposes of paragraph s (2)(B) and (3)(B) of "Interest." subsection (c), the term 'interest' does not include any amount received or accrued, directly or indirectly, if the determination of such amount depends in whole or in part on the income or profits of any person except that: " (1) any amount so received or accrued shall not be excluded from the term 'interest' solely by reason of being based on a fixed percentage or percentages of receipts or sales, and " (2) where a real estate investment t r u s t receives or accrues any amount which would be excluded from the term 'interest'
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