26 U.S.C. § 6048 — Information with respect to certain for-

Page 3371 TITLE 26—INTERNAL REVENUE CODE § 6048 see section 1501(d) of Pub. L. 94–455, set out as a note under section 62 of this title. EFFECTIVE DATE OF 1974 AMENDMENT Amendment by section 1031(c)(3) of Pub. L. 93–406 ef- fective Sept. 2, 1974, see section 1034 of Pub. L. 93–406, set out as an Effective Date note under section 6057 of this title. Amendment by section 2002(g)(8) of Pub. L. 93–406 ef- fective Jan. 1, 1975, see section 2002(i)(2) of Pub. L. 93–406, set out as an Effective Date note under section 4973 of this title. EFFECTIVE DATE Section applicable to taxable years beginning after Dec. 31, 1962, see section 8 of Pub. L. 87–792, set out as a note under section 22 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1998 For provisions directing that if any amendments made by subtitle D [§§ 1401–1465] of title I of Pub. L. 104–188 require an amendment to any plan or annuity contract, such amendment shall not be required to be made before the first day of the first plan year begin- ning on or after Jan. 1, 1998, see section 1465 of Pub. L. 104–188, set out as a note under section 401 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1994 For provisions directing that if any amendments made by subtitle B [§§ 521–523] of title V of Pub. L. 102–318 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1994, see section 523 of Pub. L. 102–318, set out as a note under section 401 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989 For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title. § 6048. Information with respect to certain for- eign trusts (a) Notice of certain events (1) General rule On or before the 90th day (or such later day as the Secretary may prescribe) after any re- portable event, the responsible party shall provide written notice of such event to the Secretary in accordance with paragraph (2). (2) Contents of notice The notice required by paragraph (1) shall contain such information as the Secretary may prescribe, including— (A) the amount of money or other property (if any) transferred to the trust in connec- tion with the reportable event, and (B) the identity of the trust and of each trustee and beneficiary (or class of bene- ficiaries) of the trust. (3) Reportable event For purposes of this subsection— (A) In general The term ‘‘reportable event’’ means— (i) the creation of any foreign trust by a United States person, (ii) the transfer of any money or prop- erty (directly or indirectly) to a foreign trust by a United States person, including a transfer by reason of death, and (iii) the death of a citizen or resident of the United States if— (I) the decedent was treated as the owner of any portion of a foreign trust under the rules of subpart E of part I of subchapter J of chapter 1, or (II) any portion of a foreign trust was included in the gross estate of the dece- dent. (B) Exceptions (i) Fair market value sales Subparagraph (A)(ii) shall not apply to any transfer of property to a trust in ex- change for consideration of at least the fair market value of the transferred prop- erty. For purposes of the preceding sen- tence, consideration other than cash shall be taken into account at its fair market value and the rules of section 679(a)(3) shall apply. (ii) Deferred compensation and charitable trusts Subparagraph (A) shall not apply with respect to a trust which is— (I) described in section 402(b), 404(a)(4), or 404A, or (II) determined by the Secretary to be described in section 501(c)(3). (4) Responsible party For purposes of this subsection, the term ‘‘responsible party’’ means— (A) the grantor in the case of the creation of an inter vivos trust, (B) the transferor in the case of a report- able event described in paragraph (3)(A)(ii) other than a transfer by reason of death, and (C) the executor of the decedent’s estate in any other case. (b) United States owner of foreign trust (1) In general If, at any time during any taxable year of a United States person, such person is treated as the owner of any portion of a foreign trust under the rules of subpart E of part I of sub- chapter J of chapter 1, such person shall sub- mit such information as the Secretary may prescribe with respect to such trust for such year and shall be responsible to ensure that— (A) such trust makes a return for such year which sets forth a full and complete ac- counting of all trust activities and oper- ations for the year, the name of the United States agent for such trust, and such other information as the Secretary may prescribe, and (B) such trust furnishes such information as the Secretary may prescribe to each United States person (i) who is treated as the owner of any portion of such trust or (ii) who receives (directly or indirectly) any dis- tribution from the trust. Page 3372 TITLE 26—INTERNAL REVENUE CODE § 6048 (2) Trusts not having United States agent (A) In general If the rules of this paragraph apply to any foreign trust, the determination of amounts required to be taken into account with re- spect to such trust by a United States per- son under the rules of subpart E of part I of subchapter J of chapter 1 shall be deter- mined by the Secretary. (B) United States agent required The rules of this paragraph shall apply to any foreign trust to which paragraph (1) ap- plies unless such trust agrees (in such man- ner, subject to such conditions, and at such time as the Secretary shall prescribe) to au- thorize a United States person to act as such trust’s limited agent solely for purposes of applying sections 7602, 7603, and 7604 with re- spect to— (i) any request by the Secretary to exam- ine records or produce testimony related to the proper treatment of amounts re- quired to be taken into account under the rules referred to in subparagraph (A), or (ii) any summons by the Secretary for such records or testimony. The appearance of persons or production of records by reason of a United States person being such an agent shall not subject such persons or records to legal process for any purpose other than determining the correct treatment under this title of the amounts required to be taken into account under the rules referred to in subparagraph (A). A for- eign trust which appoints an agent described in this subparagraph shall not be considered to have an office or a permanent establish- ment in the United States, or to be engaged in a trade or business in the United States, solely because of the activities of such agent pursuant to this subsection. (C) Other rules to apply Rules similar to the rules of paragraphs (2) and (4) of section 6038A(e) shall apply for purposes of this paragraph. (c) Reporting by United States beneficiaries of foreign trusts (1) In general If any United States person receives (di- rectly or indirectly) during any taxable year of such person any distribution from a foreign trust, such person shall make a return with re- spect to such trust for such year which in- cludes— (A) the name of such trust, (B) the aggregate amount of the distribu- tions so received from such trust during such taxable year, and (C) such other information as the Sec- retary may prescribe. (2) Inclusion in income if records not provided (A) In general If adequate records are not provided to the Secretary to determine the proper treat- ment of any distribution from a foreign trust, such distribution shall be treated as an accumulation distribution includible in the gross income of the distributee under chapter 1. To the extent provided in regula- tions, the preceding sentence shall not apply if the foreign trust elects to be subject to rules similar to the rules of subsection (b)(2)(B). (B) Application of accumulation distribution rules For purposes of applying section 668 in a case to which subparagraph (A) applies, the applicable number of years for purposes of section 668(a) shall be 1⁄2 of the number of years the trust has been in existence. (d) Special rules (1) Determination of whether United States person makes transfer or receives distribu- tion For purposes of this section, in determining whether a United States person makes a trans- fer to, or receives a distribution from, a for- eign trust, the fact that a portion of such trust is treated as owned by another person under the rules of subpart E of part I of sub- chapter J of chapter 1 shall be disregarded. (2) Domestic trusts with foreign activities To the extent provided in regulations, a trust which is a United States person shall be treated as a foreign trust for purposes of this section and section 6677 if such trust has sub- stantial activities, or holds substantial prop- erty, outside the United States. (3) Time and manner of filing information Any notice or return required under this sec- tion shall be made at such time and in such manner as the Secretary shall prescribe. (4) Modification of return requirements The Secretary is authorized to suspend or modify any requirement of this section if the Secretary determines that the United States has no significant tax interest in obtaining the required information. (5) United States person’s return must be con- sistent with trust return or Secretary noti- fied of inconsistency Rules similar to the rules of section 6034A(c) shall apply to items reported by a trust under subsection (b)(1)(B) and to United States per- sons referred to in such subsection. (Added Pub. L. 87–834, § 7(f), Oct. 16, 1962, 76 Stat. 987; amended Pub. L. 94–455, title X, § 1013(d)(1), (e)(3), (4), title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1616, 1834; Pub. L. 97–248, title III, § 341(b), Sept. 3, 1982, 96 Stat. 635; Pub. L. 104–188, title I, § 1901(a), Aug. 20, 1996, 110 Stat. 1904; Pub. L. 105–34, title X, § 1027(b), title XVI, § 1601(i)(1), Aug. 5, 1997, 111 Stat. 926, 1092; Pub. L. 111–147, title V, § 534(a), Mar. 18, 2010, 124 Stat. 114.) Editorial Notes AMENDMENTS 2010—Subsec. (b)(1). Pub. L. 111–147 inserted ‘‘shall submit such information as the Secretary may pre- scribe with respect to such trust for such year and’’ be- fore ‘‘shall be responsible to ensure’’ in introductory provisions. 1997—Subsec. (b). Pub. L. 105–34, § 1601(i)(1), sub- stituted ‘‘owner’’ for ‘‘grantor’’ in heading. Page 3373 TITLE 26—INTERNAL REVENUE CODE § 6049 Subsec. (d)(5). Pub. L. 105–34, § 1027(b), added par. (5). 1996—Pub. L. 104–188 amended section generally, sub- stituting provisions calling for improved information reporting on foreign trusts for provisions calling for the filing of returns as to foreign trusts, prescribing the form and contents of such returns, and requiring annual returns for foreign trusts with one or more United States beneficiaries. 1982—Subsec. (a). Pub. L. 97–248 inserted ‘‘(or on or before such later day as the Secretary may by regula- tions prescribe)’’ after ‘‘the 90th day’’. 1976—Pub. L. 94–455, § 1013(e)(4), struck out ‘‘creation of or transfer to’’ after ‘‘Returns as to’’ in section catchline. Subsec. (b). Pub. L. 94–455, § 1906(b)(13)(A), struck out ‘‘or his delegate’’ after ‘‘Secretary’’. Subsecs. (c), (d). Pub. L. 94–455, § 1013(d)(1), (e)(3), added subsec. (c), redesignated former subsec. (c) as (d), and in subsec. (d) struck out cross reference to section 643(d) for definition of ‘‘foreign trust created by a United States person’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Pub. L. 111–147, title V, § 534(b), Mar. 18, 2010, 124 Stat. 115, provided that: ‘‘The amendment made by this sec- tion [amending this section] shall apply to taxable years beginning after the date of the enactment of this Act [Mar. 18, 2010].’’ EFFECTIVE DATE OF 1997 AMENDMENT Amendment by section 1027(b) of Pub. L. 105–34 appli- cable to returns of beneficiaries and owners filed after Aug. 5, 1997, see section 1027(c) of Pub. L. 105–34, set out as a note under section 6034A of this title. Amendment by section 1601(i)(1) of Pub. L. 105–34 ef- fective as if included in the provisions of the Small Business Job Protection Act of 1996, Pub. L. 104–188, to which it relates, see section 1601(j) of Pub. L. 105–34, set out as a note under section 23 of this title. EFFECTIVE DATE OF 1996 AMENDMENT Pub. L. 104–188, title I, § 1901(d), Aug. 20, 1996, 110 Stat. 1908, provided that: ‘‘(1) REPORTABLE EVENTS.—To the extent related to subsection (a) of section 6048 of the Internal Revenue Code of 1986, as amended by this section, the amend- ments made by this section [amending this section and sections 6677 and 6724 of this title] shall apply to report- able events (as defined in such section 6048) occurring after the date of the enactment of this Act [Aug. 20, 1996]. ‘‘(2) GRANTOR TRUST REPORTING.—To the extent re- lated to subsection (b) of such section 6048, the amend- ments made by this section shall apply to taxable years of United States persons beginning after December 31, 1995. ‘‘(3) REPORTING BY UNITED STATES BENEFICIARIES.—To the extent related to subsection (c) of such section 6048, the amendments made by this section shall apply to distributions received after the date of the enactment of this Act.’’ EFFECTIVE DATE OF 1982 AMENDMENT Amendment by Pub. L. 97–248 applicable to returns filed after Sept. 3, 1982, see section 341(c) of Pub. L. 97–248, set out as a note under section 6046 of this title. § 6049. Returns regarding payments of interest (a) Requirement of reporting Every person— (1) who makes payments of interest (as de- fined in subsection (b)) aggregating $10 or more to any other person during any calendar year, or (2) who receives payments of interest (as so defined) as a nominee and who makes pay- ments aggregating $10 or more during any cal- endar year to any other person with respect to the interest so received, shall make a return according to the forms or regulations prescribed by the Secretary, setting forth the aggregate amount of such payments and the name and address of the person to whom paid. (b) Interest defined (1) General rule For purposes of subsection (a), the term ‘‘in- terest’’ means— (A) interest on any obligation— (i) issued in registered form, or (ii) of a type offered to the public, other than any obligation with a maturity (at issue) of not more than 1 year which is held by a corporation, (B) interest on deposits with persons car- rying on the banking business, (C) amounts (whether or not designated as interest) paid by a mutual savings bank, sav- ings and loan association, building and loan association, cooperative bank, homestead association, credit union, industrial loan as- sociation or bank, or similar organization, in respect of deposits, investment certifi- cates, or withdrawable or repurchasable shares, (D) interest on amounts held by an insur- ance company under an agreement to pay in- terest thereon, (E) interest on deposits with brokers (as defined in section 6045(c)), (F) interest paid on amounts held by in- vestment companies (as defined in section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a–3)) and on amounts invested in other pooled funds or trusts, and (G) to the extent provided in regulations prescribed by the Secretary, any other inter- est (which is not described in paragraph (2)). (2) Exceptions For purposes of subsection (a), the term ‘‘in- terest’’ does not include— (A) interest on any obligation issued by a natural person, (B) except to the extent otherwise pro- vided in regulations— (i) any amount paid to any person de- scribed in paragraph (4), or (ii) any amount described in paragraph (5), and (C) except to the extent otherwise provided in regulations, any amount not described in subparagraph (B) of this paragraph which is income from sources outside the United States or which is paid by— (i) a foreign government or international organization or any agency or instrumen- tality thereof, (ii) a foreign central bank of issue, (iii) a foreign corporation not engaged in a trade or business in the United States, (iv) a foreign corporation, the interest payments of which would be exempt from withholding under subchapter A of chapter 3 if paid to a person who is not a United States person, or