26 U.S.C. § 644 — Taxable year of trusts

Page 1826 TITLE 26—INTERNAL REVENUE CODE § 644 the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 301(b)(7) of Pub. L. 99–514 ap- plicable to taxable years beginning after Dec. 31, 1986, see section 301(c) of Pub. L. 99–514, set out as a note under section 62 of this title. Amendment by section 612(b)(4) of Pub. L. 99–514 ap- plicable to taxable years beginning after Dec. 31, 1986, see section 612(c) of Pub. L. 99–514, set out as a note under section 301 of this title. Pub. L. 99–514, title XIV, § 1404(d), Oct. 22, 1986, 100 Stat. 2714, provided that: ‘‘The amendments made by this section [amending this section and sections 6215, 6601, and 6654 of this title and repealing section 6152 of this title] shall apply to taxable years beginning after December 31, 1986.’’ Amendment by section 1806(a), (c) of Pub. L. 99–514 ef- fective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98–369, div. A, title I, § 81(b), July 18, 1984, 98 Stat. 598, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ‘‘(1) IN GENERAL.—The amendment made by sub- section (a) [amending this section] shall apply to dis- tributions after June 1, 1984, in taxable years ending after such date. ‘‘(2) TIME FOR MAKING ELECTION.—In the case of any distribution before the date of the enactment of this Act [July 18, 1984]— ‘‘(A) the time for making an election under section 643(d)(3) of the Internal Revenue Code of 1986 [for- merly I.R.C. 1954] (as added by this section) shall not expire before January 1, 1985, and ‘‘(B) the requirement that such election be made on the return of the estate or trust shall not apply.’’ Pub. L. 98–369, div. A, title I, § 82(b), July 18, 1984, 98 Stat. 598, as amended by Pub. L. 99–514, title XVIII, § 1806(b), Oct. 22, 1986, 100 Stat. 2811, provided that: ‘‘The amendment made by subsection (a) [amending this sec- tion] shall apply to taxable years beginning after March 1, 1984; except that, in the case of a trust which was irrevocable on March 1, 1984, such amendment shall so apply only to that portion of the trust which is at- tributable to contributions to corpus after March 1, 1984.’’ Pub. L. 98–369, div. A, title VII, § 722(h)(5), July 18, 1984, 98 Stat. 976, provided that: ‘‘(A) Except as provided in this paragraph, the amendments made by this subsection [amending this section and sections 3405, 3406, and 6041 of this title] shall apply as if included in the amendments made by the Interest and Dividend Tax Compliance Act of 1983 [Pub. L. 98–67]. ‘‘(B) The amendments made by paragraph (4) [amend- ing sections 3405 and 6041 of this title] shall apply to payments or distributions after December 31, 1984, un- less the payor elects to have such amendments apply to payments or distributions before January 1, 1985.’’ EFFECTIVE DATE OF 1983 AMENDMENT Amendment by Pub. L. 97–448 effective, except as oth- erwise provided, as if it had been included in the provi- sion of the Economic Recovery Tax Act of 1981, Pub. L. 97–34, to which such amendment relates, see section 109 of Pub. L. 97–448, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1981 AMENDMENT Amendment by section 301(b)(4) of Pub. L. 97–34 appli- cable to taxable years ending after Sept. 30, 1981, and amendment by section 301(b)(6)(A) of Pub. L. 97–34 ap- plicable to taxable years beginning after Dec. 31, 1981, see section 301(d) of Pub. L. 97–34, set out as a note under section 265 of this title. EFFECTIVE AND TERMINATION DATES OF 1980 AMENDMENT Amendment by Pub. L. 96–223 applicable with respect to taxable years beginning after Dec. 31, 1980, and be- fore Jan. 1, 1982, see section 404(c) of Pub. L. 96–223, set out as a note under section 265 of this title. EFFECTIVE DATE OF 1976 AMENDMENT For effective date of amendment by section 1013(e)(2) of Pub. L. 94–455, see section 1013(f)(1) of Pub. L. 94–455, set out as an Effective Date note under section 679 of this title. Pub. L. 94–455, title X, § 1013(f)(2), Oct. 4, 1976, 90 Stat. 1617, provided that: ‘‘The amendments made by sub- section (c) [amending this section] shall apply to tax- able years beginning after December 31, 1975.’’ EFFECTIVE DATE OF 1962 AMENDMENT Pub. L. 87–834, § 7(j), Oct. 16, 1962, 76 Stat. 989, pro- vided that: ‘‘The amendments made by this section [amending this section and sections 665, 666, and 668 of this title and enacting section 669 of this title] (other than by subsections (f), (g) and (h) [enacting sections 6048 and 6677 of this title and amending section 7701 of this title]), shall apply with respect to distributions made after December 31, 1962.’’ TREATMENT AS SINGLE TRUST Pub. L. 100–647, title X, § 1018(e), Nov. 10, 1988, 102 Stat. 3581, provided that: ‘‘If— ‘‘(1) on a return for the 1st taxable year of the trusts involved beginning after March 1, 1984, 2 or more trusts were treated as a single trust for pur- poses of the tax imposed by chapter 1 of the Internal Revenue Code of 1954 [now 1986], ‘‘(2) such trusts would have been required to be so treated but for the amendment made by section 1806(b) of the Reform Act [Pub. L. 99–514, which amended provisions set out as an Effective Date of 1984 Amendment note above], and ‘‘(3) such trusts did not accumulate any income during such taxable year and did not make any accu- mulation distributions during such taxable year, then, notwithstanding the amendment made by section 1806(b) of the Reform Act, such trusts shall be treated as one trust for purposes of such taxable year.’’ 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. § 644. Taxable year of trusts (a) In general For purposes of this subtitle, the taxable year of any trust shall be the calendar year. (b) Exception for trusts exempt from tax and charitable trusts Subsection (a) shall not apply to a trust ex- empt from taxation under section 501(a) or to a trust described in section 4947(a)(1). Page 1827 TITLE 26—INTERNAL REVENUE CODE § 645 (Added Pub. L. 99–514, title XIV, § 1403(a), Oct. 22, 1986, 100 Stat. 2713, § 645; renumbered § 644, Pub. L. 105–34, title V, § 507(b)(1), Aug. 5, 1997, 111 Stat. 856.) Editorial Notes PRIOR PROVISIONS A prior section 644, added Pub. L. 94–455, title VII, § 701(e)(1), Oct. 4, 1976, 90 Stat. 1578; amended Pub. L. 95–600, title VII, § 701(p)(1)–(3), Nov. 6, 1978, 92 Stat. 2908; Pub. L. 96–471, § 2(b)(4), Oct. 19, 1980, 94 Stat. 2254; Pub. L. 99–514, title XV, § 1511(c)(5), Oct. 22, 1986, 100 Stat. 2745, related to special rule for gain on property trans- ferred to trust at less than fair market value, prior to repeal by Pub. L. 105–34, title V, § 507(b)(1), Aug. 5, 1997, 111 Stat. 856. AMENDMENTS 1997—Pub. L. 105–34 renumbered section 645 of this title as this section. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1997 AMENDMENT Pub. L. 105–34, title V, § 507(c)(2), Aug. 5, 1997, 111 Stat. 857, provided that: ‘‘The amendments made by sub- section (b) [amending section 706 of this title, repealing section 644 of this title, and renumbering section 645 of this title as this section] shall apply to sales or ex- changes after the date of the enactment of this Act [Aug. 5, 1997].’’ EFFECTIVE DATE; TRANSITION RULE Pub. L. 99–514, title XIV, § 1403(c), Oct. 22, 1986, 100 Stat. 2713, provided that: ‘‘(1) EFFECTIVE DATE.—The amendments made by this section [enacting this section] shall apply to taxable years beginning after December 31, 1986. ‘‘(2) TRANSITION RULE.—With respect to any trust ben- eficiary who is required to include in gross income amounts under sections 652(a) or 662(a) of the Internal Revenue Code of 1986 in the 1st taxable year of the ben- eficiary beginning after December 31, 1986, by reason of any short taxable year of the trust required by the amendments made by this section, such income shall be ratably included in the income of the trust beneficiary over the 4-taxable year period beginning with such tax- able year.’’ APPLICATION OF TRANSITION RULES TO TRUST BENEFICIARIES TO WHICH SECTION 664 APPLIES Pub. L. 100–647, title I, § 1014(c), Nov. 10, 1988, 102 Stat. 3559, provided that: ‘‘(1) If a beneficiary of a trust to which section 664 of the 1986 Code applies elects (at such time and in such manner as the Secretary of the Treasury or his dele- gate may prescribe) to have this paragraph apply, such beneficiary shall be entitled to the benefits of section 1403(c)(2) of the Reform Act [Pub. L. 99–514, set out as an Effective Date; Transition Rule note above] with re- spect to amounts included in gross income under sec- tion 664(b) of the 1986 Code in the same manner as if such amounts were included in gross income under sec- tion 652(a) of the 1986 Code. ‘‘(2) Any trust beneficiary may elect (at such time and in such manner as the Secretary of the Treasury or his delegate may prescribe) to waive the benefits of sec- tion 1403(c)(2) of the Reform Act. ‘‘(3)(A) For purposes of determining the gross income of any pass-thru entity, such pass-thru entity shall not be allowed the benefits of section 806(e)(2)(C) [Pub. L. 99–514, set out as an Effective Date of 1986 Amendment note under section 1378 of this title] (other than with respect to income from a common trust fund) or 1403(c)(2) of the Reform Act if such pass-thru entity is required to change its taxable year by reason of the amendments made by section 806 or 1403 of the Reform Act [Pub. L. 99–514, which enacted this section and amended sections 267, 441, 706, and 1378 of this title]. ‘‘(B) For purposes of subparagraph (A), the term ‘pass-thru entity’ means any trust, partnership, S cor- poration, or common trust fund. ‘‘(4) If any trust was required to change its taxable year by the amendments made by section 1403 of the Reform Act [Pub. L. 99–514, which enacted this section], such change shall be treated as initiated by such trust and approved by the Secretary of the Treasury or his delegate.’’ § 645. Certain revocable trusts treated as part of estate (a) General rule For purposes of this subtitle, if both the ex- ecutor (if any) of an estate and the trustee of a qualified revocable trust elect the treatment provided in this section, such trust shall be treated and taxed as part of such estate (and not as a separate trust) for all taxable years of the estate ending after the date of the decedent’s death and before the applicable date. (b) Definitions For purposes of subsection (a)— (1) Qualified revocable trust The term ‘‘qualified revocable trust’’ means any trust (or portion thereof) which was treat- ed under section 676 as owned by the decedent of the estate referred to in subsection (a) by reason of a power in the grantor (determined without regard to section 672(e)). (2) Applicable date The term ‘‘applicable date’’ means— (A) if no return of tax imposed by chapter 11 is required to be filed, the date which is 2 years after the date of the decedent’s death, and (B) if such a return is required to be filed, the date which is 6 months after the date of the final determination of the liability for tax imposed by chapter 11. (c) Election The election under subsection (a) shall be made not later than the time prescribed for fil- ing the return of tax imposed by this chapter for the first taxable year of the estate (determined with regard to extensions) and, once made, shall be irrevocable. (Added Pub. L. 105–34, title XIII, § 1305(a), Aug. 5, 1997, 111 Stat. 1040, § 646; renumbered § 645, Pub. L. 105–206, title VI, § 6013(a)(1), July 22, 1998, 112 Stat. 819.) Editorial Notes PRIOR PROVISIONS A prior section 645 was renumbered section 644 of this title. AMENDMENTS 1998—Pub. L. 105–206 renumbered section 646 of this title as this section. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Pub. L. 105–34, title XIII, § 1305(d), Aug. 5, 1997, 111 Stat. 1041, provided that: ‘‘The amendments made by