102 STAT. 3422
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26 USC 860G >^ot®.
PUBLIC LAW 100-647—NOV. 10, 1988 "(1) IN GENERAL.—Except as provided in paragraph (2), if any amount is contributed to a REMIC after the startup day, there is hereby imposed a tax for the taxable year of the REMIC in which the contribution is received equal to 100 percent of the amount of such contribution. "(2) EXCEPTIONS.—Parg^aph (1) shall not apply to any contribution which is made in cash and is describcKl in any of the following subparagraphs: "(A) Any contribution to facilitate a clean-up call (as defined in r^ulations) or a qualified liquidation. "(B) Any pa3anent in the nature of a guarantee. "(C) Any contribution during the 3-month period beginning on the startup day. "(D) Any contribution to a qualified reserve fund by any holder of a residual interest in the REMIC. "(E) Any other contribution permitted in regulations." (B) The amendment made by subparagraph (A) shall not apply to any REMIC where the startup day (as defined in section 860G<aX9) of the 1986 Code as in effect on the day before the date of the enactment of this Act) is before July 1, 1987. (10) Subsection (e) of section 860G of the 1986 Code (as redesignated by paragraph (9)) is amended by striking out "and" at the end of paragraph (2), by striking out the period at the end of paragraph (3) and inserting in lieu thereof a comma, and by adding at the end thereof the following new paragraphs: "(4) providing appropriate rules for treatment of transfers of qualified replacement mortgages to the REMIC where the transferor holds any interest in the REMIC, and "(5) providing that a mortgage will be treated as a qualified replacement mortgage only if it is part of a bona fide replacement (and not part of a swap of mortgages)." (11) Paragraph (6) of section 856(c) of the 1986 Code is amended by redesignating the last subparagraph as subparagraph (F) and by striking out the subparagraph (D) added by section 671(b)(l) of the Reform Act and inserting in lieu thereof the following: "(E) A regular or residual interest in a REMIC shall be treated as a real estate asset, and any amount includible in gross income with respect to such an interest shall be treated as interest on an obligation secured by a mortgage on real property; except that, if less than 95 percent of the assets of such REMIC are real estate assets (determined as if the real estate investment trust held such assets), such real estate investment trust shall be treated as holding directly (and as receiving directly) its proportionate share of the assets and income of the REMIC. For purposes of determining whether any interest in a REMIC qualifies under the preceding sentence, any interest held by such REMIC in another REMIC shall be treated as a real estate asset under principles similar to the principles of the preceding sentence, except that, if such REMIC's are part of a tiered structure, they shall be treated as one REMIC for purposes of this subparagraph." (12) Clause (xi) of section 7701(a)(19)(C) of the 1986 Code is amended by striking out "are loans described" and inserting in lieu thereof "are assets described".
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