31 U.S.C. § 3124 — Exemption from taxation

Page 229 TITLE 31—MONEY AND FINANCE § 3124 in a foreign currency stated in the bond, note, or certificate. The Secretary may dispose of the bonds, notes, and certificates at a price that is at least par value without complying with sec- tion 3102(b)–(d) of this title. (2) In determining the dollar amount of bonds, notes, and certificates of indebtedness that may be issued under this chapter, the dollar equiva- lent of the amount of bonds, notes, and certifi- cates payable in a foreign currency is deter- mined by the par of the exchange value on the date of issue of the bonds, notes, or certificates as published by the Secretary under section 5151 of this title. (3) The Secretary may designate depositaries in foreign countries in which any part of the proceeds of bonds, notes, or certificates of in- debtedness payable in the foreign currency may be deposited. (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 945.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 3123(a) ..... 31:731. R.S. § 3693. 31:753(d)(2d sen- tence). Sept. 24, 1917, ch. 56, 40 Stat. 288, § 18(d)(2d sentence); added Mar. 3, 1919, ch. 100, § 1, 40 Stat. 1310. 31:768(words before semicolon). Feb. 4, 1910, ch. 25, § 1(words before semicolon), 36 Stat. 192. 3123(b) ..... 31:732. R.S. § 3698. 31:733(words before semicolon). R.S. § 3699(words before semi- colon); restated Jan. 30, 1934, ch. 6, § 9, 48 Stat. 341. 3123(c) ..... 31:766. Sept. 24, 1917, ch. 56, 40 Stat. 288, § 16; added Apr. 4, 1918, ch. 44, § 6, 40 Stat. 505; Nov. 13, 1966, Pub. L. 89–809, § 401, 80 Stat. 1590. In subsection (a), the words ‘‘legal tender’’ are sub- stituted for ‘‘in coin or its equivalent’’ in 31:731 and ‘‘gold coin of the present standard of value’’ in section 1 of the Act of Feb. 1, 1910, and section 18(d)(2d sen- tence) of the Second Liberty Bond Act because of sec- tion 1 of the Act of June 5, 1933 (ch. 48, 48 Stat. 113). The words ‘‘obligations of the Government’’ are substituted for 31:731(1st sentence 18th–last words), ‘‘thereof’’ in 31:753(d), and 31:768(1st 17 words) for clarity and consist- ency and to eliminate unnecessary words. The text of 31:731(last sentence) is omitted as executed. In subsection (b), the words ‘‘cause to be’’, ‘‘out of any money in the Treasury not otherwise appro- priated’’, ‘‘falling’’, ‘‘any portion of’’, and ‘‘authorized by law’’ in 31:732 are omitted as surplus. The text of 31:733(words between semicolon and colon) is omitted as unnecessary because of chapter 53 of the revised title. The text of 31:733(words after colon) is omitted as su- perseded by the Bretton Woods Agreement Act (22 U.S.C. 286 et seq.) and sections 6 and 9 of the Act of Oct. 19, 1976 (Pub. L. 94–564, 90 Stat. 2661), repealing 31:449 that provided for parity of the dollar on terms of gold and special drawing rights. In subsection (c), the word ‘‘currency’’ is substituted for ‘‘money or . . . moneys’’ for clarity and because of 1:1. In subsection (c)(1), the words ‘‘but not also in United States gold coin’’ and ‘‘in such manner’’ are omitted as surplus. In subsection (c)(2), the words ‘‘dollar’’ before ‘‘amount’’, and ‘‘value’’, are added for clarity. The words ‘‘estimated by the Director of the Mint, and’’ are omitted because of the source provisions restated in section 321(c) of the revised title. The word ‘‘published’’ is substituted for ‘‘proclaimed’’ for clarity. In subsection (c)(3), the words ‘‘as he may determine’’ are omitted as surplus. § 3124. Exemption from taxation (a) Stocks and obligations of the United States Government are exempt from taxation by a State or political subdivision of a State. The exemption applies to each form of taxation that would require the obligation, the interest on the obligation, or both, to be considered in com- puting a tax, except— (1) a nondiscriminatory franchise tax or an- other nonproperty tax instead of a franchise tax, imposed on a corporation; and (2) an estate or inheritance tax. (b) The tax status of interest on obligations and dividends, earnings, or other income from evidences of ownership issued by the Govern- ment or an agency and the tax treatment of gain and loss from the disposition of those obliga- tions and evidences of ownership is decided under the Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.). An obligation that the Federal Housing Administration had agreed, under a contract made before March 1, 1941, to issue at a future date, has the tax exemption privileges provided by the authorizing law at the time of the contract. This subsection does not apply to obligations and evidences of ownership issued by the District of Columbia, a territory or posses- sion of the United States, or a department, agency, instrumentality, or political subdivision of the District, territory, or possession. (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 945; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 3124(a) ..... 31:742. R.S. § 3701; Sept. 22, 1959, Pub. L. 86–346, § 105(a), 73 Stat. 622. 3124(b) ..... 31:742a. Feb. 19, 1941, ch. 7, § 4, 55 Stat. 9; Mar. 28, 1942, ch. 205, § 6, 56 Stat. 190; restated June 25, 1947, ch. 147, 61 Stat. 180; Sept. 22, 1959, Pub. L. 86–346, § 202, 73 Stat. 624. In subsection (a), before clause (1), the words ‘‘Except as otherwise provided by law, all . . . bonds, Treasury notes, and other’’ are omitted as surplus. The words ‘‘political subdivision of a State’’ are substituted for ‘‘municipal or local authority’’ for clarity and consist- ency. The word ‘‘applies’’ is substituted for ‘‘extends’’ for clarity. The words ‘‘directly or indirectly’’ are omitted as surplus. In clause (1), the word ‘‘instead’’ is substituted for ‘‘in lieu’’ for clarity. In subsection (b), the words ‘‘shares, certificates, stock, or other’’ and ‘‘sale or other’’ are omitted as sur- plus. The words ‘‘The tax status of . . . and the tax treatment of . . . is decided under the Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.)’’ are substituted for ‘‘shall not have any exemption, as such . . . shall not have any special treatment, as such, except as provided under the Internal Revenue Code of 1954’’ for clarity. The words ‘‘on or after March 28, 1942’’ and 31:742a(a)(1st sentence words after semicolon related to the United States Maritime Commission) are omitted as executed. The last sentence is substituted for 31:742a(a)(last sentence) for clarity. The words ‘‘any po- litical subdivision thereof’’ are omitted as included in ‘‘agency or instrumentality’’. The text of 31:742a(b) and (c) is omitted as unnecessary. Page 230 TITLE 31—MONEY AND FINANCE § 3125 Editorial Notes AMENDMENTS 1986—Subsec. (b). Pub. L. 99–514 substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue Code of 1954’’. § 3125. Relief for lost, stolen, destroyed, muti- lated, or defaced obligations (a) In this section, ‘‘obligation’’ means a di- rect obligation of the United States Government issued under law for valuable consideration, in- cluding bonds, notes, certificates of indebted- ness, Treasury bills, and interim certificates issued for an obligation. (b) The Secretary of the Treasury may provide relief for the loss, theft, destruction, mutilation, or defacement of an obligation identified by number and description. (c)(1) An indemnity bond is required as a con- dition of relief if the obligation is payable to bearer or assigned so as to become payable to bearer and is not proven clearly to have been de- stroyed. The Secretary may prescribe for the in- demnity bond the form, amount, and surety or security requirements. (2) Relief for interest coupons claimed to have been attached to an obligation may be provided only if the Secretary is satisfied that the cou- pons have not been paid and are destroyed or will not become the basis of a valid claim against the Government. (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 946.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 3125(a) ..... 31:738a(d). July 8, 1937, ch. 444, § 8(a)–(d), 50 Stat. 481; Aug. 10, 1939, ch. 665, § 4, 53 Stat. 1359; Nov. 8, 1945, ch. 453, § 153, 59 Stat. 574; restated May 27, 1971, Pub. L. 92–19, 85 Stat. 74. 3125(b) ..... 31:738a(a). 3125(c)(1) 31:738a(b). 3125(c)(2) 31:738a(c). In the section, the word ‘‘obligation’’ is substituted for ‘‘security’’ in the defined term for consistency in the chapter and the revised title and to eliminate using the word ‘‘security’’ in 2 different ways in the same sec- tion. In subsection (b), the words ‘‘Under such regulations as he may deem necessary for the administration of this section’’ are omitted as unnecessary because of section 321(b) of the revised title. In subsection (c)(1), the words ‘‘whether before, at, or after maturity’’ and ‘‘in effect’’ are omitted as surplus. § 3126. Losses and relief from liability related to redeeming savings bonds and notes (a) Under regulations prescribed by the Sec- retary of the Treasury, a loss resulting from a payment related to redeeming a savings bond or savings note shall be replaced out of the fund es- tablished by section 17303(a) of title 40. A Fed- eral reserve bank, a paying agent allowed to make payments in redeeming a bond or note, or an officer or employee of the Department of the Treasury is relieved from liability to the United States Government for the loss when the Sec- retary decides that the loss did not result from the fault or negligence of the bank, paying agent, officer, or employee. The Secretary shall relieve the bank, agent, officer, or employee from liability when the Secretary decides that written notice of liability or potential liability has not been given to the bank, agent, officer, or employee by the Government within 10 years from the date of the erroneous payment. How- ever, the Secretary may not relieve a paying agent of an assumed unconditional liability to the Government. (b) Section 17304(c) of title 40 applies to a deci- sion of the Secretary made under this section. A recovery or repayment of a loss for which re- placement is made out of the fund shall be cred- ited to the fund and is available for the purposes for which the fund was established. (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 946; Pub. L. 107–217, § 3(h)(4), Aug. 21, 2002, 116 Stat. 1299.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 3126(a) ..... 31:757c(i)(1st–4th sentences). Sept. 24, 1917, ch. 56, 40 Stat. 288, § 22(i)(1st–6th sen- tences); added Apr. 11, 1943, ch. 52, § 3, 57 Stat. 63; re- stated Apr. 3, 1945, ch. 51, § 3, 59 Stat. 47; Sept. 22, 1959, Pub. L. 86–346, § 103, 31 Stat. 622; Oct. 17, 1968, Pub. L. 90–595, § 2, 82 Stat. 1155. 3126(b) ..... 31:757c(i)(5th, 6th sentences). In subsection (a), the words ‘‘qualified’’ and ‘‘author- ized or’’ are omitted as surplus. The words ‘‘officer or employee of the Department of the Treasury’’ are sub- stituted for ‘‘Treasury of the United States’’ and ‘‘Treasurer’’ because of the source provisions restated in section 321 of the revised title and for consistency with other titles of the United States Code. The text of 31:757c(i)(3d sentence) is omitted as surplus because of 39:410. The words ‘‘under regulations prescribed by him’’ are omitted as unnecessary. Editorial Notes AMENDMENTS 2002—Subsec. (a). Pub. L. 107–217, § 3(h)(4)(A), sub- stituted ‘‘section 17303(a) of title 40’’ for ‘‘section 2 of the Government Losses in Shipment Act (40 U.S.C. 722)’’. Subsec. (b). Pub. L. 107–217, § 3(h)(4)(B), substituted ‘‘Section 17304(c) of title 40’’ for ‘‘Section 3 of the Gov- ernment Losses in Shipment Act (40 U.S.C. 723) (related to finality of decisions of the Secretary)’’. § 3127. Credit to officers, employees, and agents for stolen Treasury notes When an officer, employee, or agent of the United States Government authorized to re- ceive, redeem, or cancel Treasury notes receives or pays a note that was stolen and put in cir- culation after it had been received or redeemed by an officer, employee, or agent authorized to receive or redeem the note, the Secretary of the Treasury may allow the officer, employee, or agent receiving or paying the stolen note a cred- it for the amount of the note. The Secretary may allow the credit only if the Secretary is satisfied that the note was received or paid in good faith and in exercising ordinary prudence. (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 947.)