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Treasury Regulations · 26 CFR

§ 1.860C-1. Taxation of holders of residual interests.

In effect eCFR current as of October 15, 2026

Regulation text, no changes From the eCFR, current as of October 15, 2026. The eCFR is an authoritative but unofficial editorial compilation of the Code of Federal Regulations; the official text is the annual CFR on govinfo. Compare it with this section on ecfr.gov (external site) or the official annual CFR on govinfo (external site).

Regulation under 26 U.S.C. § 860C

Cite as 26 CFR § 1.860C-1

At a glance

Read from the text and its source citation. Not part of the regulation.

Status
In the current eCFR
Issued
December 24, 1992 by T.D. 8458
Last amended
May 11, 2004 by T.D. 9128
Issued under
26 U.S.C. § 860C
Length
291 words · about 1 min to read
Cross-references
cites 2 Code sections and 1 regulation; cited by 0
(a) Pass-thru of income or loss. Any holder of a residual interest in a REMIC must take into account the holder's daily portion of the taxable income or net loss of the REMIC for each day during the taxable year on which the holder owned the residual interest.
(b) Adjustments to basis of residual interests—
(1) Increase in basis. A holder's basis in a residual interest is increased by—
(i) The daily portions of taxable income taken into account by that holder under section 860C(a) with respect to that interest; and
(ii) The amount of any contribution described in section 860G(d)(2) made by that holder.
(2) Decrease in basis. A holder's basis in a residual interest is reduced (but not below zero) by—
(i) First, the amount of any cash or the fair market value of any property distributed to that holder with respect to that interest; and
(ii) Second, the daily portions of net loss of the REMIC taken into account under section 860C(a) by that holder with respect to that interest.
(3) Adjustments made before disposition. If any person disposes of a residual interest, the adjustments to basis prescribed in paragraph (b)(1) and (2) of this section are deemed to occur immediately before the disposition.
(c) Counting conventions. For purposes of determining the daily portion of REMIC taxable income or net loss under section 860C(a)(2), any reasonable convention may be used. An example of a reasonable convention is “30 days per month/90 days per quarter/360 days per year.”
(d) For rules on the proper accounting for income from inducement fees, see § 1.446-6.

[T.D. 8458, 57 FR 61301, Dec. 24, 1992, as amended by T.D. 9128, 69 FR 26041, May 11, 2004]

Other regulations under § 860C

Cross-references

Computed from the citations in the text of 26 CFR.

Code sections it cites

Regulations it cites

Amendment history

From the source citation at the end of the section, newest first. T.D. is a Treasury decision; FR is the Federal Register.

  1. Amended by T.D. 9128 (69 FR 26041)
  2. Issued by T.D. 8458 (57 FR 61301)

Where it sits in 26 CFR

  1. Subchapter A Income tax
  2. Part 1 Income taxes
  3. Real Estate Investment Trusts

Nearby sections