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26 U.S.C. § 685 — Treatment of funeral trusts
Federal law — U.S. Code and appendices · legal_authorities
**(a) In general** In the case of a qualified funeral trust—
(1) subparts B, C, D, and E shall not apply, and
(2) no deduction shall be allowed by section 642(b).
**(b) Qualified funeral trust** For purposes of this subsection, the term “qualified funeral trust” means any trust (other than a foreign trust) if—
(1) the trust arises as a result of a contract with a person engaged in the trade or business of providing funeral or burial services or property necessary to provide such services,
(2) the sole purpose of the trust is to hold, invest, and reinvest funds in the trust and to use such funds solely to make payments for such services or property for the benefit of the beneficiaries of the trust,
(3) the only beneficiaries of such trust are individuals with respect to whom such services or property are to be provided at their death under contracts described in paragraph (1),
(4) the only contributions to the trust are contributions by or for the benefit of such beneficiaries,
(5) the trustee elects the application of this subsection, and
(6) the trust would (but for the election described in paragraph (5)) be treated as owned under subpart E by the purchasers of the contracts described in paragraph (1).
A trust shall not fail to be treated as meeting the requirement of paragraph (6) by reason of the death of an individual but only during the 60-day period beginning on the date of such death.
**(c) Application of rate schedule** Section 1(e) shall be applied to each qualified funeral trust by treating each beneficiary’s interest in each such trust as a separate trust.
**(d) Treatment of amounts refunded to purchaser on cancellation** No gain or loss shall be recognized to a purchaser of a contract described in subsection (b)(1) by reason of any payment from s
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Stable record: federal_law:legal_authorities:record_usc_80850b39e4d29f3bf009ebae
Source file: Laws/federal/codes/united-states-code/title-26/section-685-treatment-of-funeral-trusts--f5c4567880.md
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Source location: Title 26, Chapter 1, § 685; chapter-001-normal-taxes-and-surtaxes.md
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**(a) In general** In the case of a qualified funeral trust—
(1) subparts B, C, D, and E shall not apply, and
(2) no deduction shall be allowed by section 642(b).
**(b) Qualified funeral trust** For purposes of this subsection, the term “qualified funeral trust” means any trust (other than a foreign trust) if—
(1) the trust arises as a result of a contract with a person engaged in the trade or business of providing funeral or burial services or property necessary to provide such services,
(2) the sole purpose of the trust is to hold, invest, and reinvest funds in the trust and to use such funds solely to make payments for such services or property for the benefit of the beneficiaries of the trust,
(3) the only beneficiaries of such trust are individuals with respect to whom such services or property are to be provided at their death under contracts described in paragraph (1),
(4) the only contributions to the trust are contributions by or for the benefit of such beneficiaries,
(5) the trustee elects the application of this subsection, and
(6) the trust would (but for the election described in paragraph (5)) be treated as owned under subpart E by the purchasers of the contracts described in paragraph (1).
A trust shall not fail to be treated as meeting the requirement of paragraph (6) by reason of the death of an individual but only during the 60-day period beginning on the date of such death.
**(c) Application of rate schedule** Section 1(e) shall be applied to each qualified funeral trust by treating each beneficiary’s interest in each such trust as a separate trust.
**(d) Treatment of amounts refunded to purchaser on cancellation** No gain or loss shall be recognized to a purchaser of a contract described in subsection (b)(1) by reason of any payment from such trust to such purchaser by reason of cancellation of such contract. If any payment referred to in the preceding sentence consists of property other than money, the basis of such property in the hands of such purchaser shall be the same as the trust’s basis in such property immediately before the payment.
**(e) Simplified reporting** The Secretary may prescribe rules for simplified reporting of all trusts having a single trustee and of trusts terminated during the year.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Married individuals filing joint returns and surviving spouses** There is hereby imposed on the taxable income of—
(1) every married individual (as defined in section 7703) who makes a single return jointly with his spouse under section 6013, and
(2) every surviving spouse (as defined in section 2(a)),
a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $36,90015% of taxable income. Over $36,900 but not over $89,150$5,535, plus 28% of the excess over $36,900. Over $89,150 but not over $140,000$20,165, plus 31% of the excess over $89,150. Over $140,000 but not over $250,000$35,928.50, plus 36% of the excess over $140,000. Over $250,000$75,528.50, plus 39.6% of the excess over $250,000.
**(b) Heads of households** There is hereby imposed on the taxable income of every head of a household (as defined in section 2(b)) a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $29,60015% of taxable income. Over $29,600 but not over $76,400$4,440, plus 28% of the excess over $29,600. Over $76,400 but not over $127,500$17,544, plus 31% of the excess over $76,400. Over $127,500 but not over $250,000$33,385, plus 36% of the excess over $127,500. Over $250,000$77,485, plus 39.6% of the excess over $250,000.
**(c) Unmarried individuals (other than surviving spouses and heads of households)** There is hereby imposed on the taxable income of every individual (other than a surviving spouse as defined in section 2(a) or the head of a household as defined in section 2(b)) who is not a married individual (as defined in section 7703) a tax determined in accordance with the following table: If taxable income is:The tax is: Not over $22,10015% of taxable income. Over $22,100 but not over $53,50
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Federal law — U.S. Code and appendices · legal_authorities
**(a) In General.—** The following definitions apply in this title:
(1) The term “United States”, in a geographic sense, means the States and the District of Columbia.
(2) Repealed. Pub. L. 109–163, div. A, title X, § 1057(a)(1), Jan. 6, 2006, 119 Stat. 3440.]
(3) The term “possessions” includes the Virgin Islands, Guam, American Samoa, and the Guano Islands, so long as they remain possessions, but does not include any Commonwealth.
(4) The term “armed forces” means the Army, Navy, Air Force, Marine Corps, Space Force, and Coast Guard.
(5) The term “uniformed services” means—
(A) the armed forces;
(B) the commissioned corps of the National Oceanic and Atmospheric Administration; and
(C) the commissioned corps of the Public Health Service.
(6) The term “department”, when used with respect to a military department, means the executive part of the department and all field headquarters, forces, reserve components, installations, activities, and functions under the control or supervision of the Secretary of the department. When used with respect to the Department of Defense, such term means the executive part of the department, including the executive parts of the military departments, and all field headquarters, forces, reserve components, installations, activities, and functions under the control or supervision of the Secretary of Defense, including those of the military departments.
(7) The term “executive part of the department” means the executive part of the Department of Defense, Department of the Army, Department of the Navy, or Department of the Air Force, as the case may be, at the seat of government.
(8) The term “military departments” means the Department of the Army, the Department of the Navy, and the Department of the Air Force.
(9) The term
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Federal law — U.S. Code and appendices · legal_authorities
For the purpose of this title—
(1) “veteran” means an individual who—
(A) served on active duty in the armed forces during a war, in a campaign or expedition for which a campaign badge has been authorized, or during the period beginning April 28, 1952, and ending July 1, 1955;
(B) served on active duty as defined by [section 101(21) of title 38](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title38-section101/21&num=0&edition=prelim) at any time in the armed forces for a period of more than 180 consecutive days any part of which occurred after January 31, 1955, and before October 15, 1976, not including service under [section 12103(d) of title 10](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title10-section12103/d&num=0&edition=prelim) pursuant to an enlistment in the Army National Guard or the Air National Guard or as a Reserve for service in the Army Reserve, Navy Reserve, Air Force Reserve, Marine Corps Reserve, or Coast Guard Reserve;
(C) served on active duty as defined by [section 101(21) of title 38](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title38-section101/21&num=0&edition=prelim) in the armed forces during the period beginning on August 2, 1990, and ending on January 2, 1992; or
(D) served on active duty as defined by [section 101(21) of title 38](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title38-section101/21&num=0&edition=prelim) at any time in the armed forces for a period of more than 180 consecutive days any part of which occurred during the period beginning on September 11, 2001, and ending on the date prescribed by Presidential proclamation or by law as the last date of Operation Iraqi Freedom;
and, except as provided under section 2108a, who has been discharged or rel
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Federal law — U.S. Code and appendices · legal_authorities
Page 1855
TITLE 26—INTERNAL REVENUE CODE
§ 685
Editorial Notes
AMENDMENTS
1976—Pub. L. 94–455 substituted provisions relating to
use of trust as an exchange fund for provisions setting
forth rule that this part applies only to taxable years
beginning after Dec. 31, 1953, and ending after the date
of the enactment of this title and exceptions thereto.
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE OF 1976 AMENDMENT
Amendment of section by Pub. L. 94–455 effective on
Apr. 8, 1976, in taxable years ending on or after such
date, see section 2131(f)(6) of Pub. L. 94–455, set out as
a note under section 584 of this title.
§ 684. Recognition of gain on certain transfers to
certain foreign trusts and estates
(a) In general
Except as provided in regulations, in the case
of any transfer of property by a United States
person to a foreign estate or trust, for purposes
of this subtitle, such transfer shall be treated as
a sale or exchange for an amount equal to the
fair market value of the property transferred,
and the transferor shall recognize as gain the
excess of—
(1) the fair market value of the property so
transferred, over
(2) the adjusted basis (for purposes of deter-
mining gain) of such property in the hands of
the transferor.
(b) Exception
Subsection (a) shall not apply to a transfer to
a trust by a United States person to the extent
that any person is treated as the owner of such
trust under section 671.
(c) Treatment of trusts which become foreign
trusts
If a trust which is not a foreign trust becomes
a foreign trust, such trust shall be treated for
purposes of this section as having transferred,
immediately before becoming a foreign trust, all
of its assets to a foreign trust.
(Added Pub. L. 105–34, title XI, § 1131(b), Au
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 685
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