115 STAT. 78 PUBLIC LAW 107-16-JUNE 7, 2001 interest passing to the surviving spouse shall not be considered as an interest which will terminate or fail on the death of such spouse if— "(i) such death will cause a termination or failure of such interest only if it occurs within a period not exceeding 6 months after the decedent's death, or only if it occurs as a result of a common disaster resulting in the death of the decedent and the surviving spouse, or only if it occurs in the case of either such event, and "(ii) such termination or failure does not in fact occur. "(5) QUALIFIED TERMINABLE INTEREST PROPERTY.—For purposes of this subsection— "(A) IN GENERAL.— The term 'qualified terminable interest property' means property— "(i) which passes from the decedent, and "(ii) in which the surviving spouse has a qualifying income interest for life. "(B) QUALIFYING INCOME INTEREST FOR LIFE. —The surviving spouse has a qualifying income interest for life if— "(i) the surviving spouse is entitled to all the income from the property, payable annually or at more frequent intervals, or has a usufruct interest for life in the property, and "(ii) no person has a power to appoint any part of the property to any person other than the surviving spouse. Clause (ii) shall not apply to a power exercisable only at or after the death of the surviving spouse. To the extent provided in regulations, an annuity shall be treated in a manner similar to an income interest in property (regardless of whether the property from which the annuity is payable can be separately identified). "(C) PROPERTY INCLUDES INTEREST THEREIN. —The term 'property' includes an interest in property. " (D) SPECIFIC PORTION TREATED AS SEPARATE PROP- ERTY. —^A specific portion of property shall be treated as separate property. For purposes of the preceding sentence, the term 'specific portion' only includes a portion determined on a fractional or percentage basis. " (d) DEFINITIONS AND SPECIAL RULES FOR APPLICATION OF SUB- SECTIONS (b) AND (c).— "(1) PROPERTY TO WHICH SUBSECTIONS (b) AND (O APPLY.— "(A) IN GENERAL.—The basis of property acquired from a decedent may be increased under subsection (b) or (c) only if the property was owned by the decedent at the time of death. " (B) RULES RELATING TO OWNERSHIP.— "(i) JOINTLY HELD PROPERTY.—In the case of property which was owned by the decedent and another person as joint tenants with right of survivorship or tenants by the entirety— "(I) if the only such other person is the surviving spouse, the decedent shall be treated as the owner of only 50 percent of the property.