§ 584. Common trust funds

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1954

   Aug. 16, 1954, ch. 736, 68A Stat. 203 · 68A Stat. 203

   Enacted · 26 U.S.C. § 584

   Aug. 16, 1954, ch. 736, 68A Stat. 203

   Source evidence

   Code source credit
   Aug. 16, 1954, ch. 736, 68A Stat. 203

2. 1962

   Pub. L. 87–722 § 4 · 76 Stat. 668

   Inserted · 26 U.S.C. § 584(a)(2)

   Pub. L. 87–722 inserted “or the Comptroller of the Currency” after “the Board of Governors of the Federal Reserve System”

   Source evidence

   Code amendment note
   Subsec. (a)(2). Pub. L. 87–722 inserted “or the Comptroller of the Currency” after “the Board of Governors of the Federal Reserve System”.

   Enacted provision · exact public law section
   Sec. 4. Paragraph (2) of subsection (a) of section 584 of the Internal 68A Stat. 203. Revenue Code of 1954 is amended by inserting “or the Comptroller of the Currency” immediately after “the Board of Governors of the Federal Reserve System”.

3. 1964

   Revenue Act of 1964

   Pub. L. 88–272 title II § 201(d)(5) · 78 Stat. 19

   Struck · 26 U.S.C. § 584(c)(2)

   Pub. L. 88–272 struck out “section 34 or” before “section 116 applies”

   Source evidence

   Code amendment note
   Subsec. (c)(2). Pub. L. 88–272 struck out “section 34 or” before “section 116 applies”.

   Enacted provision · exact public law section
   (5) Section 584(c) (2) is amended by striking out “section 34 or”.

4. 1976

   Pub. L. 94–414 § 1 · 90 Stat. 1273

   Inserted · 26 U.S.C. § 584(a)

   Pub. L. 94–414 inserted provision relating to treatment of two or more bank members of same affiliated group

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 94–414 inserted provision relating to treatment of two or more bank members of same affiliated group.

   Enacted provision · exact public law section
   (1) In general.— Section 3402(a) of the Internal Revenue Code of 1954 (relating to income tax collected at source) is 26 USC 3402. amended by striking out “September 15, 1976” and inserting in lieu thereof “October 1, 1976”.

5. 1976

   Pub. L. 94–455 § 2138 · 90 Stat. 1520

   1. Amended · 26 U.S.C. § 584(a)(1)

      Pub. L. 94–455, § 2138, designated existing provisions relating to trustee, executor, administrator and guardian as subpar. (A)

   2. Added · 26 U.S.C. § 584(a)(1)

      Pub. L. 94–455, § 2138, added subpar. (B)

   Source evidence

   Code amendment note
   Subsec. (a)(1). Pub. L. 94–455, § 2138, designated existing provisions relating to trustee, executor, administrator and guardian as subpar. (A) and added subpar. (B).

   Enacted provision · exact public law section
   SEC. 2138. COMMON TRUST FUND TREATMENT OF CERTAIN CUSTODIAL ACCOUNTS. (a) In General.— Section 584 (a)(1) (relating to definition of common trust fund) is amended to read as follows: “(1) exclusively for the collective investment and reinvestment of moneys contributed thereto by the bank in its capacity— “(A) as a trustee, executor, administrator, or guardian, or “(B) as a custodian of accounts— “(i) which the Secretary determines are established pursuant to a State law winch is substantially similar to the Uniform Gifts to Minors Act as published by the American Law Institute, and “(ii) with respect to which the bank establishes, to the satisfaction of the Secretary, that it has duties and responsibilities similar to duties and responsibilities of a trustee or guardian; and”.

6. 1976

   Pub. L. 94–455 § 1402(b)(2) · 90 Stat. 1520

   Changed · 26 U.S.C. § 584(c)(1)(A); 26 U.S.C. § 584(c)(1)(B)

   Pub. L. 94–455, § 1402(b)(2), provided that “9 months” would be changed to “1 year” wherever appearing

   Source evidence

   Code amendment note
   Subsec. (c)(1)(A), (B). Pub. L. 94–455, § 1402(b)(2), provided that “9 months” would be changed to “1 year” wherever appearing.

   Enacted provision · exact public law section
   (2) Taxable years beginning after 1977.— Effective with respect to taxable years beginning after December 31, 1977, each provision referred to in paragraph (1) is amended by striking out Ante, p. 1731. “9 months” each place it appears and inserting in lieu thereof “1 year”.

7. 1976

   Pub. L. 94–455 § 1402(b)(1)(H) · 90 Stat. 1520

   Changed · 26 U.S.C. § 584(c)(1)(A); 26 U.S.C. § 584(c)(1)(B)

   Pub. L. 94–455, § 1402(b)(1)(H), provided that “6 months” would be changed to “9 months” for taxable years beginning in 1977

   Target inherited from the preceding amendment note.

   Source evidence

   Code amendment note
   Pub. L. 94–455, § 1402(b)(1)(H), provided that “6 months” would be changed to “9 months” for taxable years beginning in 1977.

   Enacted provision · exact public law section
   (H) Subparagraphs (A) and (B) of section 584(c)(1) (relating to inclusions in taxable income of participants in common trust funds).

8. 1976

   Pub. L. 94–455 § 1901(b)(1)(G) · 90 Stat. 1520

   Struck · 26 U.S.C. § 584(c)(2)

   Pub. L. 94–455, § 1901(b)(1)(G), struck out provisions relating to partially tax exempt interest and election of a common trust fund to amortize premiums on bonds and other obligations

   Source evidence

   Code amendment note
   Subsec. (c)(2). Pub. L. 94–455, § 1901(b)(1)(G), struck out provisions relating to partially tax exempt interest and election of a common trust fund to amortize premiums on bonds and other obligations.

   Enacted provision · exact public law section
   (G) Section 584(c)(2) is amended to read as follows: “(2) Dividends received.— The proportionate share of each participant in the amount of dividends received by the common trust fund and to which section 116 applies shall be considered for purposes of such section as having been received by such participant.”

9. 1976

   Pub. L. 94–455 § 2131(d) · 90 Stat. 1520

   Inserted · 26 U.S.C. § 584(e)

   Pub. L. 94–455, § 2131(d), inserted “The admission of a participant shall be treated with respect to the participant as the purchase of, or exchange for, the participating interest”

   Source evidence

   Code amendment note
   Subsec. (e). Pub. L. 94–455, § 2131(d), inserted “The admission of a participant shall be treated with respect to the participant as the purchase of, or exchange for, the participating interest”.

   Enacted provision · exact public law section
   (d) Common Trust Funds.— Subsection (e) of section 584 (relating to admission to and withdrawal from a common trust fund) is amended by inserting after the first sentence the following new sentence: “The admission of a participant shall be treated with respect to the participant as the purchase of, or an exchange for, the participating interest”

10. 1976

    Pub. L. 94–455 § 1906(b)(13)(A) · 90 Stat. 1520

    Struck · 26 U.S.C. § 584(g)

    Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”

    Source evidence

    Code amendment note
    Subsec. (g). Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”.

    Enacted provision · exact public law section
    (A) The Internal Revenue Code of 1954, as amended by this Act, is amended by striking out “Secretary or his delegate” each place it appears and inserting in lieu thereof “Secretary”.

11. 1977

    Tax Reduction and Simplification Act of 1977

    Pub. L. 95–30 title I § 101(d)(7) · 91 Stat. 126

    Struck · 26 U.S.C. § 584(d)(4)

    Pub. L. 95–30 struck out par. (4) relating to standard deduction

    Source evidence

    Code amendment note
    Subsec. (d)(4). Pub. L. 95–30 struck out par. (4) relating to standard deduction.

    Enacted provision · exact public law section
    (7) Subsection (d) of section 584 (relating to common trust 26 USC 584. funds) is amended— (A) by inserting “and” at the end of paragraph (2), (B) by striking out “; and” at the end of paragraph (3) and inserting in lieu thereof a period, and (C) by striking out paragraph (4).

12. 1980

    Pub. L. 96–223 title IV § 404(b)(3) · 94 Stat. 229

    Inserted · 26 U.S.C. § 584(c)(2)

    Pub. L. 96–223 inserted “or interest” after “dividends” in heading and text

    Source evidence

    Code amendment note
    Subsec. (c)(2). Pub. L. 96–223 inserted “or interest” after “dividends” in heading and text.

    Enacted provision · exact public law section
    (3) Paragraph (2) of section 584(c) (relating to income of participants in fund) is amended by inserting “or interest” after ‘“dividends” each place it appears in the caption and text thereof.

13. 1981

    Economic Recovery Tax Act of 1981

    Pub. L. 97–34 § 301(b)(6)(A) · 95 Stat. 175

    Inserted · 26 U.S.C. § 584(c)(2)

    Pub. L. 97–34, § 301(b)(6)(A), inserted reference to “interest” in heading and text, which continued the amendment made by Pub. L. 96–223

    Source evidence

    Code amendment note
    Subsec. (c)(2). Pub. L. 97–34, § 301(b)(6)(A), inserted reference to “interest” in heading and text, which continued the amendment made by Pub. L. 96–223.

    Enacted provision · exact public law section
    (A) section 584(c)(2),

14. 1981

    Economic Recovery Tax Act of 1981

    Pub. L. 97–34 § 301(b)(3) · 95 Stat. 175

    Inserted · 26 U.S.C. § 584(c)(2)

    Pub. L. 97–34, § 301(b)(3), inserted “or 128” after “section 116”

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 97–34, § 301(b)(3), inserted “or 128” after “section 116”.

    Enacted provision · exact public law section
    (3) Paragraph (2) of section 584(c) (relating to income of participants in common trust funds), as in effect for taxable years beginning in 1981, is amended by inserting “or 128” after 116”.

15. 1983

    Pub. L. 97–448 title I § 103(a)(2) · 96 Stat. 2365

    Changed · 26 U.S.C. § 584(c)(2)

    Pub. L. 97–448 reenacted par. (2) without change

    Source evidence

    Code amendment note
    Subsec. (c)(2). Pub. L. 97–448 reenacted par. (2) without change.

    Enacted provision · exact public law section
    (2) Paragraph (2) of section 584(c) (relating to dividends or 26 USC 584. interest received) is amended to read as follows: “(2) Dividends or interest received.— The proportionate share of each participant in the amount of dividends or interest received by the common trust fund and to which section 116 or 128 applies shall be considered for purposes of such section as having been received by such participant.”

16. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title X § 1001(b)(7) · 98 Stat. 494

    Substituted · 26 U.S.C. § 584(c)(1)(A); 26 U.S.C. § 584(c)(1)(B)

    Pub. L. 98–369 substituted “6 months” for “1 year”, wherever appearing, applicable to property acquired after June 22, 1984, and before Jan. 1, 1988. See Effective Date of 1984 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (c)(1)(A), (B). Pub. L. 98–369 substituted “6 months” for “1 year”, wherever appearing, applicable to property acquired after June 22, 1984, and before Jan. 1, 1988. See Effective Date of 1984 Amendment note below.

    Enacted provision · exact public law section
    (7) Subparagraphs (A) and (B) of section 584(c)(1) (relating to 26 USC 584. inclusions in taxable income of participants in common trust funds).

17. 1986

    Tax Reform Act of 1986

    Pub. L. 99–514 § 612(b)(2)(B) · 100 Stat. 2085

    Substituted · 26 U.S.C. § 584(c)

    Pub. L. 99–514, § 612(b)(2)(B), substituted “1 year” for “6 months” wherever appearing in pars. (1) and (2)

    Source evidence

    Code amendment note
    Subsec. (c). Pub. L. 99–514, § 612(b)(2)(B), substituted “1 year” for “6 months” wherever appearing in pars. (1) and (2).

    Enacted provision · exact public law section
    (B) If the amendments made by section 1001 of the Tax Reform Act of 1984 cease to apply, effective with respect to property to which such amendments do not apply, subsection (c) of section 584 is amended by striking out “6 months” each place it appears and inserting in lieu thereof “1 year”.

18. 1986

    Tax Reform Act of 1986

    Pub. L. 99–514 § 612(b)(2)(A) · 100 Stat. 2085

    1. Amended · 26 U.S.C. § 584(c)

       Pub. L. 99–514, § 612(b)(2)(A), amended subsec. (c) generally, restating subpars. (A) to (C) of former par. (1) as pars. (1) to (3)

    2. Struck · 26 U.S.C. § 584(c)

       Pub. L. 99–514, § 612(b)(2)(A), striking out former par. (2) which read as follows: “The proportionate share of each participant in the amount of dividends or interest received by the common trust fund and to which section 116 or 128 applies shall be considered for purposes of such section as having been received by such participant.”

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 99–514, § 612(b)(2)(A), amended subsec. (c) generally, restating subpars. (A) to (C) of former par. (1) as pars. (1) to (3) and striking out former par. (2) which read as follows: “The proportionate share of each participant in the amount of dividends or interest received by the common trust fund and to which section 116 or 128 applies shall be considered for purposes of such section as having been received by such participant.”

    Enacted provision · exact public law section
    (A) Subsection (c) of section 584 is amended to read as follows: “(c) Income of Participants in Fund.— Each participant in the common trust fund in computing its taxable income shall include, whether or not distributed and whether or not distributable— “(1) as part of its gains and losses from sales or exchanges of capital assets held for not more than 6 months, its proportionate share of the gains and losses of the common trust fund from sales or exchanges of capital assets held for not more than 6 months, “(2) as part of its gains and losses from sales or exchanges of capital assets held for more than 6 months, its proportionate share of the gains and losses of the common trust fund from sales or exchanges of capital assets held for more than 6 months, and “(3) its proportionate share of the ordinary taxable income or the ordinary net loss of the common trust fund, computed as provided in subsection (d).”

19. 1988

    Technical and Miscellaneous Revenue Act of 1988

    Pub. L. 100–647 title I § 1008(e)(5)(A) · 102 Stat. 3342

    Added · 26 U.S.C. § 584(h)

    Pub. L. 100–647 added subsec. (h)

    Source evidence

    Code amendment note
    Subsec. (h). Pub. L. 100–647 added subsec. (h).

    Enacted provision · exact public law section
    (A) Section 584 of the 1986 Code (relating to common trust funds) is amended by adding at the end thereof the following new subsection: “(h) Taxable Year of Common Trust Fund.— For purposes of this subtitle, the taxable year of any common trust fund shall be the calendar year.”

20. 1996

    Small Business Job Protection Act of 1996

    Pub. L. 104–188 title I § 1805(a) · 110 Stat. 1755

    1. Added · 26 U.S.C. § 584(h); 26 U.S.C. § 584(i)

       Pub. L. 104–188 added subsec. (h)

    2. Redesignated · 26 U.S.C. § 584(h); 26 U.S.C. § 584(i)

       Pub. L. 104–188 redesignated former subsec. (h) as (i)

    Source evidence

    Code amendment note
    Subsecs. (h), (i). Pub. L. 104–188 added subsec. (h) and redesignated former subsec. (h) as (i).

    Enacted provision · exact public law section
    (a) General Rule.— Section 584 (relating to common trust funds) is amended by redesignating subsection (h) as subsection (i) and by inserting after subsection (g) the following new subsection: “(h) Nonrecognition Treatment for Certain Transfers to Regulated Investment Companies.— “(1) In general.— If— “(A) a common trust fund transfers substantially all of its assets to one or more regulated investment companies in exchange solely for stock in the company or companies to which such assets are so transferred, and “(B) such stock is distributed by such common trust fund to participants in such common trust fund in exchange solely for their interests in such common trust fund, no gain or loss shall be recognized by such common trust fund by reason of such transfer or distribution, and no gain or loss shall be recognized by any participant in such common trust fund by reason of such exchange. “(2) Basis rules.— “(A) Regulated investment company.— The basis of any asset received by a regulated investment company in a transfer referred to in paragraph (1)(A) shall be the same as it would be in the hands of the common trust fund. “(B) Participants.— The basis of the stock which is received in an exchange referred to in paragraph (1)(B) shall be the same as that of the property exchanged. If stock in more than one regulated investment company is received in such exchange, the basis determined under the preceding sentence shall be allocated among the stock in each such company on the basis of respective fair market values. “(3) Treatment of assumptions of liability.— “(A) In general.— In determining whether the transfer referred to in paragraph (1)(A) is in exchange solely for stock in one or more regulated investment companies, the assumption by any such company of a liability of the common trust fund, and the fact that anyproperty transferred by the common trust fund is subject to a liability, shall be disregarded. “(B) Special rule where assumed liabilities exceed basis.— “(i) In general.— If, in any transfer referred to in paragraph (1)(A), the assumed liabilities exceed the aggregate adjusted bases (in the hands of the common trust fund) of the assets transferred to the regulated investment company or companies— “(I) notwithstanding paragraph (1), gain shall be recognized to the common trust fund on such transfer in an amount equal to such excess, “(II) the basis of the assets received by the regulated investment company or companies in such transfer shall be increased by the amount so recognized, and “(III) any adjustment to the basis of a participant’s interest in the common trust fund as a result of the gain so recognized shall be treated as occurring immediately before the exchange referred to in paragraph (1)(B). If the transfer referred to in paragraph (1)(A) is to two or more regulated investment companies, the basis increase under subclause (II) shall be allocated among such companies on the basis of the respective fair market values of the assets received by each of such companies. “(ii) Assumed liabilities.— For purposes of clause (i), the term ‘assumed liabilities’ means the aggregate of— “(I) any liability of the common trust fund assumed by any regulated investment company in connection with the transfer referred to in paragraph (1)(A), and “(II) any liability to which property so transferred is subject. “(4) Common trust fund must meet diversification rules.— This subsection shall not apply to any common trust fund which would not meet the requirements of section 368(a)(2)(F)(ii) if it were a corporation. For purposes of the preceding sentence, Government securities shall not be treated as securities of an issuer in applying the 25-percent and 50-percent test and such securities shall not be excluded for purposes of determining total assets under clause (iv) of section 368(a)(2)(F).”.

21. 1999

    Miscellaneous Trade and Technical Corrections Act of 1999

    Pub. L. 106–36 § 3001(c)(1)(A) · 113 Stat. 127

    Struck · 26 U.S.C. § 584(h)(3)(A)

    Pub. L. 106–36, § 3001(c)(1)(A), struck out “, and the fact that any property transferred by the common trust fund is subject to a liability,” before “shall be disregarded”

    Source evidence

    Code amendment note
    Subsec. (h)(3)(A). Pub. L. 106–36, § 3001(c)(1)(A), struck out “, and the fact that any property transferred by the common trust fund is subject to a liability,” before “shall be disregarded”.

    Enacted provision · exact public law section
    (A) by striking “, and the fact that any property transferred by the common trust fund is subject to a liability,” in subparagraph (A); and

22. 1999

    Miscellaneous Trade and Technical Corrections Act of 1999

    Pub. L. 106–36 § 3001(c)(1)(B) · 113 Stat. 127

    1. Added · 26 U.S.C. § 584(h)(3)(B)(ii)

       Pub. L. 106–36, § 3001(c)(1)(B), added cl. (ii)

    2. Struck · 26 U.S.C. § 584(h)(3)(B)(ii)

       Pub. L. 106–36, § 3001(c)(1)(B), struck out heading and text of former cl. (ii). Text read as follows: “For purposes of clause (i), the term ‘assumed liabilities’ means the aggregate of—

    Source evidence

    Code amendment note
    Subsec. (h)(3)(B)(ii). Pub. L. 106–36, § 3001(c)(1)(B), added cl. (ii) and struck out heading and text of former cl. (ii). Text read as follows: “For purposes of clause (i), the term ‘assumed liabilities’ means the aggregate of—

    “(I) any liability of the common trust fund assumed by any regulated investment company in connection with the transfer referred to in paragraph (1)(A), and “(II) any liability to which property so transferred is subject.”

    Enacted provision · exact public law section
    (B) by striking clause (ii) of subparagraph (B) and inserting: “(ii) Assumed Liabilities.— For purposes of clause (i), the term ‘assumed liabilities’ means any liability of the common trust fund assumed by any regulated investment company in connection with the transfer referred to in paragraph (1)(A). “(C) Assumption.— For purposes of this paragraph, in determining the amount of any liability assumed, the rules of section 357(d) shall apply.”.

23. 1999

    Miscellaneous Trade and Technical Corrections Act of 1999

    Pub. L. 106–36 § 3001(c)(1)(B) · 113 Stat. 127

    Added · 26 U.S.C. § 584(h)(3)(C)

    Pub. L. 106–36, § 3001(c)(1)(B), added subpar. (C)

    Source evidence

    Code amendment note
    Subsec. (h)(3)(C). Pub. L. 106–36, § 3001(c)(1)(B), added subpar. (C).

    Enacted provision · exact public law section
    (B) by striking clause (ii) of subparagraph (B) and inserting: “(ii) Assumed Liabilities.— For purposes of clause (i), the term ‘assumed liabilities’ means any liability of the common trust fund assumed by any regulated investment company in connection with the transfer referred to in paragraph (1)(A). “(C) Assumption.— For purposes of this paragraph, in determining the amount of any liability assumed, the rules of section 357(d) shall apply.”.

24. 2003

    Pub. L. 108–27 title III § 302(e)(7) · 117 Stat. 752

    Inserted · 26 U.S.C. § 584(c)

    Pub. L. 108–27 inserted concluding provisions

    Source evidence

    Code amendment note
    Subsec. (c). Pub. L. 108–27 inserted concluding provisions.

    Enacted provision · exact public law section
    (7) Section 584(c) is amended by adding at the end the following new flush sentence: “The proportionate share of each participant in the amount of dividends received by the common trust fund and to which section 1(h)(11) applies shall be considered for purposes of such paragraph as having been received by such participant.” .

    Effective date note
    Amendment by Pub. L. 108–27 applicable, except as otherwise provided, to taxable years beginning after Dec. 31, 2002, see section 302(f) of Pub. L. 108–27, set out as an Effective and Termination Dates of 2003 Amendment note under section 1 of this title.

27 of 28 references resolved to an enrolled provision · 1 partial