Apr. 1, 2025 Title 26 Internal Revenue Part 1 (§§ 1.641 to 1.850) Revised as of April 1, 2025 Containing a codification of documents of general applicability and future effect As of April 1, 2025

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 Table of Contents Page Explanation v Title 26: Chapter I—Internal Revenue Service, Department of the Treasury (Continued) 3 Finding Aids: Table of CFR Titles and Chapters 915 Alphabetical List of Agencies Appearing in the CFR 935 Table of OMB Control Numbers 945 List of CFR Sections Affected 963

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The Code of Federal Regulations is a codification of the general and permanent rules published in the Federal Register by the Executive departments and agencies of the Federal Government. The Code is divided into 50 titles which represent broad areas subject to Federal regulation. Each title is divided into chapters which usually bear the name of the issuing agency. Each chapter is further subdivided into parts covering specific regulatory areas.

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April 1, 2025

        THIS TITLE

Title 26— Internal Revenue is composed of twenty-two volumes. The contents of these volumes represent all current regulations codified under this title by the Internal Revenue Service, Department of the Treasury, as of April 1, 2025. The first fifteen volumes comprise part 1 (Subchapter A—Income Tax) and are arranged by sections as follows: §§ 1.0-1.60; §§ 1.61-1.139; §§ 1.140-1.169; §§ 1.170-1.300; §§ 1.301-1.400; §§ 1.401-1.409; §§ 1.410-1.440; §§ 1.441-1.500; §§ 1.501-1.640; §§ 1.641-1.850; §§ 1.851-1.907; §§ 1.908-1.1000; §§ 1.1001-1.1400; §§ 1.1401-1.1550; and § 1.1551 to end of part 1. The sixteenth volume containing parts 2-29, includes the remainder of subchapter A and all of Subchapter B—Estate and Gift Taxes. The last six volumes contain parts 30-39 (Subchapter C—Employment Taxes and Collection of Income Tax at Source); parts 40-49; parts 50-299 (Subchapter D—Miscellaneous Excise Taxes); parts 300-499 (Subchapter F—Procedure and Administration); parts 500-599 (Subchapter G—Regulations under Tax Conventions); and part 600 to end (Subchapter H—Internal Revenue Practice).

The OMB control numbers for title 26 appear in § 602.101 of this chapter. For the convenience of the user, § 602.101 appears in the Finding Aids section of the volumes containing parts 1 to 599.

For this volume, Christine Colaninno was Chief Editor. The Code of Federal Regulations publication program is under the direction of John Hyrum Martinez, assisted by Stephen J. Frattini.

 <LRH>26 CFR Ch. I (4-1-25 Edition)</LRH> <RRH>Internal Revenue Service, Treasury</RRH> <CFRTITLE> <TITLEHD> <PRTPAGE P="1"/> <HD SOURCE="HED">Title 26—Internal Revenue</HD> <P>(This book contains part 1, §§ 1.641 to 1.850)</P> </TITLEHD> <CFRTOC> <PTHD>Part</PTHD> <CHAPTI> <SUBJECT> <E T="04">chapter i</E> —Internal Revenue Service, Department of the Treasury (Continued) </SUBJECT> <PG>1</PG> </CHAPTI> </CFRTOC> </CFRTITLE> <CHAPTER> <TOC> <TOCHD> <PRTPAGE P="3"/> <HD SOURCE="HED">CHAPTER I—INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY (CONTINUED)</HD> </TOCHD> <SUBCHAP> <HD SOURCE="HED">SUBCHAPTER A—INCOME TAX (CONTINUED)</HD> </SUBCHAP> <PTHD>Part</PTHD> <PGHD>Page</PGHD> <CHAPTI> <PT>1</PT> <SUBJECT>Income taxes (Continued)</SUBJECT> <PG>5</PG> </CHAPTI> </TOC> <SUBCHAP TYPE="N"> <PRTPAGE P="5"/> <HD SOURCE="HED">SUBCHAPTER A—INCOME TAX (CONTINUED)</HD> <PART> <EAR>Pt. 1</EAR> <HD SOURCE="HED">PART 1—INCOME TAXES (CONTINUED)</HD> <CONTENTS> <SUBJGRP> <HD SOURCE="HED">Normal Taxes and Surtaxes (CONTINUED)</HD> <HD SOURCE="HD1">ESTATES, TRUSTS, BENEFICIARIES, AND DECEDENTS</HD> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">ESTATES, TRUSTS, AND BENEFICIARIES</HD> <HD SOURCE="HD3">General Rules For Taxation Of Estates And Trusts</HD> <SECHD>Sec.</SECHD> <SECTNO>1.641</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.641(a)-0</SECTNO> <SUBJECT>Scope of subchapter J.</SUBJECT> <SECTNO>1.641(a)-1</SECTNO> <SUBJECT>Imposition of tax; application of tax.</SUBJECT> <SECTNO>1.641(a)-2</SECTNO> <SUBJECT>Gross income of estates and trusts.</SUBJECT> <SECTNO>1.641(b)-1</SECTNO> <SUBJECT>Computation and payment of tax; deductions and credits of estates and trusts.</SUBJECT> <SECTNO>1.641(b)-2</SECTNO> <SUBJECT>Filing of returns and payment of the tax.</SUBJECT> <SECTNO>1.641(b)-3</SECTNO> <SUBJECT>Termination of estates and trusts.</SUBJECT> <SECTNO>1.641(c)-0</SECTNO> <SUBJECT>Table of contents.</SUBJECT> <SECTNO>1.641(c)-1</SECTNO> <SUBJECT>Electing small business trust.</SUBJECT> <SECTNO>1.642(a)(1)-1</SECTNO> <SUBJECT>Partially tax-exempt interest.</SUBJECT> <SECTNO>1.642(a)(2)-1</SECTNO> <SUBJECT>Foreign taxes.</SUBJECT> <SECTNO>1.642(a)(3)-1</SECTNO> <SUBJECT>Dividends received by an estate or trust.</SUBJECT> <SECTNO>1.642(a)(3)-2</SECTNO> <SUBJECT>Time of receipt of dividends by beneficiary.</SUBJECT> <SECTNO>1.642(a)(3)-3</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <SECTNO>1.642(b)-1</SECTNO> <SUBJECT>Deduction for personal exemption.</SUBJECT> <SECTNO>1.642(c)-0</SECTNO> <SUBJECT>Effective dates.</SUBJECT> <SECTNO>1.642(c)-1</SECTNO> <SUBJECT>Unlimited deduction for amounts paid for a charitable purpose.</SUBJECT> <SECTNO>1.642(c)-2</SECTNO> <SUBJECT>Unlimited deduction for amounts permanently set aside for a charitable purpose.</SUBJECT> <SECTNO>1.642(c)-3</SECTNO> <SUBJECT>Adjustments and other special rules for determining unlimited charitable contributions deduction.</SUBJECT> <SECTNO>1.642(c)-4</SECTNO> <SUBJECT>Nonexempt private foundations.</SUBJECT> <SECTNO>1.642(c)-5</SECTNO> <SUBJECT>Definition of pooled income fund.</SUBJECT> <SECTNO>1.642(c)-6</SECTNO> <SUBJECT>Valuation of a remainder interest in property transferred to a pooled income fund.</SUBJECT> <SECTNO>1.642(c)-7</SECTNO> <SUBJECT>Transitional rules with respect to pooled income funds.</SUBJECT> <SECTNO>1.642(d)-1</SECTNO> <SUBJECT>Net operating loss deduction.</SUBJECT> <SECTNO>1.642(e)-1</SECTNO> <SUBJECT>Depreciation and depletion.</SUBJECT> <SECTNO>1.642(f)-1</SECTNO> <SUBJECT>Amortization deductions.</SUBJECT> <SECTNO>1.642(g)-1</SECTNO> <SUBJECT>Disallowance of double deductions; in general.</SUBJECT> <SECTNO>1.642(g)-2</SECTNO> <SUBJECT>Deductions included.</SUBJECT> <SECTNO>1.642(h)-1</SECTNO> <SUBJECT>Unused loss carryovers on termination of an estate or trust.</SUBJECT> <SECTNO>1.642(h)-2</SECTNO> <SUBJECT>Excess deductions on termination of an estate or trust.</SUBJECT> <SECTNO>1.642(h)-3</SECTNO> <SUBJECT>Meaning of “beneficiaries succeeding to the property of the estate or trust”.</SUBJECT> <SECTNO>1.642(h)-4</SECTNO> <SUBJECT>Allocation.</SUBJECT> <SECTNO>1.642(h)-5</SECTNO> <SUBJECT>Example.</SUBJECT> <SECTNO>1.642(i)-1</SECTNO> <SUBJECT>Certain distributions by cemetery perpetual care funds.</SUBJECT> <SECTNO>1.642(i)-2</SECTNO> <SUBJECT>Definitions.</SUBJECT> <SECTNO>1.643(a)-0</SECTNO> <SUBJECT>Distributable net income; deduction for distributions; in general.</SUBJECT> <SECTNO>1.643(a)-1</SECTNO> <SUBJECT>Deduction for distributions.</SUBJECT> <SECTNO>1.643(a)-2</SECTNO> <SUBJECT>Deduction for personal exemption.</SUBJECT> <SECTNO>1.643(a)-3</SECTNO> <SUBJECT>Capital gains and losses.</SUBJECT> <SECTNO>1.643(a)-4</SECTNO> <SUBJECT>Extraordinary dividends and taxable stock dividends.</SUBJECT> <SECTNO>1.643(a)-5</SECTNO> <SUBJECT>Tax-exempt interest.</SUBJECT> <SECTNO>1.643(a)-6</SECTNO> <SUBJECT>Income of foreign trust.</SUBJECT> <SECTNO>1.643(a)-7</SECTNO> <SUBJECT>Dividends.</SUBJECT> <SECTNO>1.643(a)-8</SECTNO> <SUBJECT>Certain distributions by charitable remainder trusts.</SUBJECT> <SECTNO>1.643(b)-1</SECTNO> <SUBJECT>Definition of income.</SUBJECT> <SECTNO>1.643(b)-2</SECTNO> <SUBJECT>Dividends allocated to corpus.</SUBJECT> <SECTNO>1.643(c)-1</SECTNO> <SUBJECT>Definition of “beneficiary”.</SUBJECT> <SECTNO>1.643(d)-1</SECTNO> <SUBJECT>Definition of “foreign trust created by a United States person”.</SUBJECT> <SECTNO>1.643(d)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 643.</SUBJECT> <SECTNO>1.643(f)-1</SECTNO> <SUBJECT>Treatment of multiple trusts.</SUBJECT> <SECTNO>1.643(h)-1</SECTNO> <SUBJECT>Distributions by certain foreign trusts through intermediaries.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Pooled Income Fund Actuarial Tables Applicable Before June 1, 2023</HD> <SECTNO>1.642(c)-6A</SECTNO> <SUBJECT>Valuation of charitable remainder interests for which the valuation date is before June 1, 2023.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Election to treat trust as part of an estate</HD> <SECTNO>1.645-1</SECTNO> <SUBJECT>Election by certain revocable trusts to be treated as part of estate.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Trusts which distribute current income only</HD> <SECTNO>1.651(a)-1</SECTNO> <SUBJECT>Simple trusts; deduction for distributions; in general.</SUBJECT> <SECTNO>1.651(a)-2</SECTNO> <SUBJECT>Income required to be distributed currently.</SUBJECT> <SECTNO>1.651(a)-3</SECTNO> <SUBJECT>Distribution of amounts other than income.</SUBJECT> <SECTNO>1.651(a)-4</SECTNO> <SUBJECT>Charitable purposes.</SUBJECT> <SECTNO>1.651(a)-5</SECTNO> <SUBJECT>Estates.</SUBJECT> <SECTNO>1.651(b)-1</SECTNO> <SUBJECT>Deduction for distributions to beneficiaries.</SUBJECT> <SECTNO>1.652(a)-1</SECTNO> <SUBJECT>Simple trusts; inclusion of amounts in income of beneficiaries.</SUBJECT> <SECTNO>1.652(a)-2</SECTNO> <SUBJECT>Distributions in excess of distributable net income.</SUBJECT> <SECTNO>1.652(b)-1</SECTNO> <SUBJECT>Character of amounts.</SUBJECT> <SECTNO>1.652(b)-2</SECTNO> <SUBJECT>Allocation of income items.</SUBJECT> <SECTNO>1.652(b)-3</SECTNO> <SUBJECT>Allocation of deductions.</SUBJECT> <SECTNO>1.652(c)-1</SECTNO> <SUBJECT>Different taxable years.</SUBJECT> <SECTNO>1.652(c)-2</SECTNO> <SUBJECT>Death of individual beneficiaries.</SUBJECT> <SECTNO>1.652(c)-3</SECTNO> <SUBJECT> Termination of existence of other beneficiaries. <PRTPAGE P="6"/> </SUBJECT> <SECTNO>1.652(c)-4</SECTNO> <SUBJECT>Illustration of the provisions of sections 651 and 652.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">estates and trusts which may accumulate income or which distribute corpus</HD> <SECTNO>1.661(a)-1</SECTNO> <SUBJECT>Estates and trusts accumulating income or distributing corpus; general.</SUBJECT> <SECTNO>1.661(a)-2</SECTNO> <SUBJECT>Deduction for distributions to beneficiaries.</SUBJECT> <SECTNO>1.661(b)-1</SECTNO> <SUBJECT>Character of amounts distributed; in general.</SUBJECT> <SECTNO>1.661(b)-2</SECTNO> <SUBJECT>Character of amounts distributed when charitable contributions are made.</SUBJECT> <SECTNO>1.661(c)-1</SECTNO> <SUBJECT>Limitation on deduction.</SUBJECT> <SECTNO>1.661(c)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 661.</SUBJECT> <SECTNO>1.662(a)-1</SECTNO> <SUBJECT>Inclusion of amounts in gross income of beneficiaries of estates and complex trusts; general.</SUBJECT> <SECTNO>1.662(a)-2</SECTNO> <SUBJECT>Currently distributable income.</SUBJECT> <SECTNO>1.662(a)-3</SECTNO> <SUBJECT>Other amounts distributed.</SUBJECT> <SECTNO>1.662(a)-4</SECTNO> <SUBJECT>Amounts used in discharge of a legal obligation.</SUBJECT> <SECTNO>1.662(b)-1</SECTNO> <SUBJECT>Character of amounts; when no charitable contributions are made.</SUBJECT> <SECTNO>1.662(b)-2</SECTNO> <SUBJECT>Character of amounts; when charitable contributions are made.</SUBJECT> <SECTNO>1.662(c)-1</SECTNO> <SUBJECT>Different taxable years.</SUBJECT> <SECTNO>1.662(c)-2</SECTNO> <SUBJECT>Death of individual beneficiary.</SUBJECT> <SECTNO>1.662(c)-3</SECTNO> <SUBJECT>Termination of existence of other beneficiaries.</SUBJECT> <SECTNO>1.662(c)-4</SECTNO> <SUBJECT>Illustration of the provisions of sections 661 and 662.</SUBJECT> <SECTNO>1.663(a)-1</SECTNO> <SUBJECT>Special rules applicable to sections 661 and 662; exclusions; gifts, bequests, etc.</SUBJECT> <SECTNO>1.663(a)-2</SECTNO> <SUBJECT>Charitable, etc., distributions.</SUBJECT> <SECTNO>1.663(a)-3</SECTNO> <SUBJECT>Denial of double deduction.</SUBJECT> <SECTNO>1.663(b)-1</SECTNO> <SUBJECT>Distributions in first 65 days of taxable year; scope.</SUBJECT> <SECTNO>1.663(b)-2</SECTNO> <SUBJECT>Election.</SUBJECT> <SECTNO>1.663(c)-1</SECTNO> <SUBJECT>Separate shares treated as separate trusts or as separate estates; in general.</SUBJECT> <SECTNO>1.663(c)-2</SECTNO> <SUBJECT>Rules of administration.</SUBJECT> <SECTNO>1.663(c)-3</SECTNO> <SUBJECT>Applicability of separate share rule to certain trusts.</SUBJECT> <SECTNO>1.663(c)-4</SECTNO> <SUBJECT>Applicability of separate share rule to estates and qualified revocable trusts.</SUBJECT> <SECTNO>1.663(c)-5</SECTNO> <SUBJECT>Examples.</SUBJECT> <SECTNO>1.663(c)-6</SECTNO> <SUBJECT>Effective dates.</SUBJECT> <SECTNO>1.664-1</SECTNO> <SUBJECT>Charitable remainder trusts.</SUBJECT> <SECTNO>1.664-2</SECTNO> <SUBJECT>Charitable remainder annuity trust.</SUBJECT> <SECTNO>1.664-3</SECTNO> <SUBJECT>Charitable remainder unitrust.</SUBJECT> <SECTNO>1.664-4</SECTNO> <SUBJECT>Calculation of the fair market value of the remainder interest in a charitable remainder unitrust.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">treatment of excess distributions by trusts applicable to taxable years beginning before January 1, 1969</HD> <SECTNO>1.665(a)-0</SECTNO> <SUBJECT>Excess distributions by trusts; scope of subpart D.</SUBJECT> <SECTNO>1.665(a)-1</SECTNO> <SUBJECT>Undistributed net income.</SUBJECT> <SECTNO>1.665(b)-1</SECTNO> <SUBJECT>Accumulation distributions of trusts other than certain foreign trusts; in general.</SUBJECT> <SECTNO>1.665(b)-2</SECTNO> <SUBJECT>Exclusions from accumulation distributions in the case of trusts (other than a foreign trust created by a U.S. person).</SUBJECT> <SECTNO>1.665(b)-3</SECTNO> <SUBJECT>Exclusions under section 663(a) (1).</SUBJECT> <SECTNO>1.665(c)-1</SECTNO> <SUBJECT>Accumulation distributions of certain foreign trusts; in general.</SUBJECT> <SECTNO>1.665(c)-2</SECTNO> <SUBJECT>Indirect payments to the beneficiary.</SUBJECT> <SECTNO>1.665(d)-1</SECTNO> <SUBJECT>Taxes imposed on the trust.</SUBJECT> <SECTNO>1.665(e)-1</SECTNO> <SUBJECT>Preceding taxable year.</SUBJECT> <SECTNO>1.665(e)-2</SECTNO> <SUBJECT>Application of separate share rule.</SUBJECT> <SECTNO>1.666(a)-1A</SECTNO> <SUBJECT>Amount allocated.</SUBJECT> <SECTNO>1.666(b)-1A</SECTNO> <SUBJECT>Total taxes deemed distributed.</SUBJECT> <SECTNO>1.666(c)-1A</SECTNO> <SUBJECT>Pro rata portion of taxes deemed distributed.</SUBJECT> <SECTNO>1.666(c)-2A</SECTNO> <SUBJECT>Illustration of the provisions of section 666 (a), (b), and (c).</SUBJECT> <SECTNO>1.666(d)-1A</SECTNO> <SUBJECT>Information required from trusts.</SUBJECT> <SECTNO>1.666(a)-1</SECTNO> <SUBJECT>Amount allocated.</SUBJECT> <SECTNO>1.666(b)-1</SECTNO> <SUBJECT>Total taxes deemed distributed.</SUBJECT> <SECTNO>1.666(c)-1</SECTNO> <SUBJECT>Pro rata portion of taxes deemed distributed.</SUBJECT> <SECTNO>1.666(c)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 666.</SUBJECT> <SECTNO>1.667-1</SECTNO> <SUBJECT>Denial of refund to trusts.</SUBJECT> <SECTNO>1.667(a)-1A</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.667(b)-1A</SECTNO> <SUBJECT>Authorization of credit to beneficiary for taxes imposed on the trust.</SUBJECT> <SECTNO>1.668(a)-1A</SECTNO> <SUBJECT>Amounts treated as received in prior taxable years; inclusion in gross income.</SUBJECT> <SECTNO>1.668(a)-2A</SECTNO> <SUBJECT>Allocation among beneficiaries; in general.</SUBJECT> <SECTNO>1.668(a)-3A</SECTNO> <SUBJECT>Determination of tax.</SUBJECT> <SECTNO>1.668(b)-1A</SECTNO> <SUBJECT>Tax on distribution.</SUBJECT> <SECTNO>1.668(b)-2A</SECTNO> <SUBJECT>Special rules applicable to section 668.</SUBJECT> <SECTNO>1.668(b)-3A</SECTNO> <SUBJECT>Computation of the beneficiary's income and tax for a prior taxable year.</SUBJECT> <SECTNO>1.668(b)-4A</SECTNO> <SUBJECT>Information requirements with respect to beneficiary.</SUBJECT> <SECTNO>1.668(a)-1</SECTNO> <SUBJECT>Amounts treated as received in prior taxable years; inclusion in gross income.</SUBJECT> <SECTNO>1.668(a)-2</SECTNO> <SUBJECT>Allocation among beneficiaries; in general.</SUBJECT> <SECTNO>1.668(a)-3</SECTNO> <SUBJECT>Excluded amounts.</SUBJECT> <SECTNO>1.668(a)-4</SECTNO> <SUBJECT>Tax attributable to throwback.</SUBJECT> <SECTNO>1.668(b)-1</SECTNO> <SUBJECT>Credit for taxes paid by the trust.</SUBJECT> <SECTNO>1.668(b)-2</SECTNO> <SUBJECT>Illustration of the provisions of subpart D.</SUBJECT> <SECTNO>1.669(a)-1</SECTNO> <SUBJECT>Limitation on tax.</SUBJECT> <SECTNO>1.669(a)-2</SECTNO> <SUBJECT>Rules applicable to section 669 computations.</SUBJECT> <SECTNO>1.669(a)-3</SECTNO> <SUBJECT>Tax computed by the exact throwback method.</SUBJECT> <SECTNO>1.669(a)-4</SECTNO> <SUBJECT>Tax attributable to short-cut throwback method.</SUBJECT> <SECTNO>1.669(b)-1</SECTNO> <SUBJECT>Information requirements.</SUBJECT> <SECTNO>1.669(b)-2</SECTNO> <SUBJECT>Manner of exercising election.</SUBJECT> </SUBJGRP> <SUBJGRP> <PRTPAGE P="7"/> <HD SOURCE="HED">Unitrust Actuarial Tables Applicable Before June 1, 2023.</HD> <SECTNO>1.664-4A</SECTNO> <SUBJECT>Valuation of charitable remainder interests for which the valuation date is before June 1, 2023.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">treatment of excess distributions of trusts applicable to taxable years beginning on or after January 1, 1969</HD> <SECTNO>1.665(a)-0A</SECTNO> <SUBJECT>Excess distributions by trusts; scope of subpart D.</SUBJECT> <SECTNO>1.665(a)-1A</SECTNO> <SUBJECT>Undistributed net income.</SUBJECT> <SECTNO>1.665(b)-1A</SECTNO> <SUBJECT>Accumulation distributions.</SUBJECT> <SECTNO>1.665(b)-2A</SECTNO> <SUBJECT>Special rules for accumulation distributions made in taxable years beginning before January 1, 1974.</SUBJECT> <SECTNO>1.665(c)-1A</SECTNO> <SUBJECT>Special rule applicable to distributions by certain foreign trusts.</SUBJECT> <SECTNO>1.665(d)-1A</SECTNO> <SUBJECT>Taxes imposed on the trust.</SUBJECT> <SECTNO>1.665(e)-1A</SECTNO> <SUBJECT>Preceding taxable year.</SUBJECT> <SECTNO>1.665(f)-1A</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.665(g)-1A</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.665(g)-2A</SECTNO> <SUBJECT>Application of separate share rule.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">grantors and others treated as substantial owners</HD> <SECTNO>1.671-1</SECTNO> <SUBJECT>Grantors and others treated as substantial owners; scope.</SUBJECT> <SECTNO>1.671-2</SECTNO> <SUBJECT>Applicable principles.</SUBJECT> <SECTNO>1.671-3</SECTNO> <SUBJECT>Attribution or inclusion of income, deductions, and credits against tax.</SUBJECT> <SECTNO>1.671-4</SECTNO> <SUBJECT>Method of reporting.</SUBJECT> <SECTNO>1.671-5</SECTNO> <SUBJECT>Reporting for widely held fixed investment trusts.</SUBJECT> <SECTNO>1.672(a)-1</SECTNO> <SUBJECT>Definition of adverse party.</SUBJECT> <SECTNO>1.672(b)-1</SECTNO> <SUBJECT>Nonadverse party.</SUBJECT> <SECTNO>1.672(c)-1</SECTNO> <SUBJECT>Related or subordinate party.</SUBJECT> <SECTNO>1.672(d)-1</SECTNO> <SUBJECT>Power subject to condition precedent.</SUBJECT> <SECTNO>1.672(f)-1</SECTNO> <SUBJECT>Foreign persons not treated as owners.</SUBJECT> <SECTNO>1.672(f)-2</SECTNO> <SUBJECT>Certain foreign corporations.</SUBJECT> <SECTNO>1.672(f)-3</SECTNO> <SUBJECT>Exceptions to general rule.</SUBJECT> <SECTNO>1.672(f)-4</SECTNO> <SUBJECT>Recharacterization of purported gifts.</SUBJECT> <SECTNO>1.672(f)-5</SECTNO> <SUBJECT>Special rules.</SUBJECT> <SECTNO>1.673(a)-1</SECTNO> <SUBJECT>Reversionary interests; income payable to beneficiaries other than certain charitable organizations; general rule.</SUBJECT> <SECTNO>1.673(b)-1</SECTNO> <SUBJECT>Income payable to charitable beneficiaries (before amendment by Tax Reform Act of 1969).</SUBJECT> <SECTNO>1.673(c)-1</SECTNO> <SUBJECT>Reversionary interest after income beneficiary's death.</SUBJECT> <SECTNO>1.673(d)-1</SECTNO> <SUBJECT>Postponement of date specified for reacquisition.</SUBJECT> <SECTNO>1.674(a)-1</SECTNO> <SUBJECT>Power to control beneficial enjoyment; scope of section 674.</SUBJECT> <SECTNO>1.674(b)-1</SECTNO> <SUBJECT>Excepted powers exercisable by any person.</SUBJECT> <SECTNO>1.674(c)-1</SECTNO> <SUBJECT>Excepted powers exercisable only by independent trustees.</SUBJECT> <SECTNO>1.674(d)-1</SECTNO> <SUBJECT>Excepted powers exercisable by any trustee other than grantor or spouse.</SUBJECT> <SECTNO>1.674(d)-2</SECTNO> <SUBJECT>Limitations on exceptions in section 674 (b), (c), and (d).</SUBJECT> <SECTNO>1.675-1</SECTNO> <SUBJECT>Administrative powers.</SUBJECT> <SECTNO>1.676(a)-1</SECTNO> <SUBJECT>Power to revest title to portion of trust property in grantor; general rule.</SUBJECT> <SECTNO>1.676(b)-1</SECTNO> <SUBJECT>Powers exercisable only after a period of time.</SUBJECT> <SECTNO>1.677(a)-1</SECTNO> <SUBJECT>Income for benefit of grantor; general rule.</SUBJECT> <SECTNO>1.677(b)-1</SECTNO> <SUBJECT>Trusts for support.</SUBJECT> <SECTNO>1.678(a)-1</SECTNO> <SUBJECT>Person other than grantor treated as substantial owner; general rule.</SUBJECT> <SECTNO>1.678(b)-1</SECTNO> <SUBJECT>If grantor is treated as the owner.</SUBJECT> <SECTNO>1.678(c)-1</SECTNO> <SUBJECT>Trusts for support.</SUBJECT> <SECTNO>1.678(d)-1</SECTNO> <SUBJECT>Renunciation of power.</SUBJECT> <SECTNO>1.679-0</SECTNO> <SUBJECT>Outline of major topics.</SUBJECT> <SECTNO>1.679-1</SECTNO> <SUBJECT>U.S. transferor treated as owner of foreign trust.</SUBJECT> <SECTNO>1.679-2</SECTNO> <SUBJECT>Trusts treated as having a U.S. beneficiary.</SUBJECT> <SECTNO>1.679-3</SECTNO> <SUBJECT>Transfers.</SUBJECT> <SECTNO>1.679-4</SECTNO> <SUBJECT>Exceptions to general rule.</SUBJECT> <SECTNO>1.679-5</SECTNO> <SUBJECT>Pre-immigration trusts.</SUBJECT> <SECTNO>1.679-6</SECTNO> <SUBJECT>Outbound migrations of domestic trusts.</SUBJECT> <SECTNO>1.679-7</SECTNO> <SUBJECT>Effective dates.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">miscellaneous</HD> <SECTNO>1.681(a)-1</SECTNO> <SUBJECT>Limitation on charitable contributions deductions of trusts; scope of section 681.</SUBJECT> <SECTNO>1.681(a)-2</SECTNO> <SUBJECT>Limitation on charitable contributions deduction of trusts with trade or business income.</SUBJECT> <SECTNO>1.681(b)-1</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <SECTNO>1.682(a)-1</SECTNO> <SUBJECT>Income of trust in case of divorce, etc.</SUBJECT> <SECTNO>1.682(b)-1</SECTNO> <SUBJECT>Application of trust rules to alimony payments.</SUBJECT> <SECTNO>1.682(c)-1</SECTNO> <SUBJECT>Definitions.</SUBJECT> <SECTNO>1.683-1</SECTNO> <SUBJECT>Applicability of provisions; general rule.</SUBJECT> <SECTNO>1.683-2</SECTNO> <SUBJECT>Exceptions.</SUBJECT> <SECTNO>1.683-3</SECTNO> <SUBJECT>Application of the 65-day rule of the Internal Revenue Code of 1939.</SUBJECT> <SECTNO>1.684-1</SECTNO> <SUBJECT>Recognition of gain on transfers to certain foreign trusts and estates.</SUBJECT> <SECTNO>1.684-2</SECTNO> <SUBJECT>Transfers.</SUBJECT> <SECTNO>1.684-3</SECTNO> <SUBJECT>Exceptions to general rule of gain recognition.</SUBJECT> <SECTNO>1.684-4</SECTNO> <SUBJECT>Outbound migrations of domestic trusts.</SUBJECT> <SECTNO>1.684-5</SECTNO> <SUBJECT>Effective/applicability dates.</SUBJECT> <HD SOURCE="HD1">Income in Respect of Decedents</HD> <SECTNO>1.691(a)-1</SECTNO> <SUBJECT>Income in respect of a decedent.</SUBJECT> <SECTNO>1.691(a)-2</SECTNO> <SUBJECT>Inclusion in gross income by recipients.</SUBJECT> <SECTNO>1.691(a)-3</SECTNO> <SUBJECT>Character of gross income.</SUBJECT> <SECTNO>1.691(a)-4</SECTNO> <SUBJECT>Transfer of right to income in respect of a decedent.</SUBJECT> <SECTNO>1.691(a)-5</SECTNO> <SUBJECT>Installment obligations acquired from decedent.</SUBJECT> <SECTNO>1.691(b)-1</SECTNO> <SUBJECT> Allowance of deductions and credit in respect to decedents. <PRTPAGE P="8"/> </SUBJECT> <SECTNO>1.691(c)-1</SECTNO> <SUBJECT>Deduction for estate tax attributable to income in respect of a decedent.</SUBJECT> <SECTNO>1.691(c)-2</SECTNO> <SUBJECT>Estates and trusts.</SUBJECT> <SECTNO>1.691(d)-1</SECTNO> <SUBJECT>Amounts received by surviving annuitant under joint and survivor annuity contract.</SUBJECT> <SECTNO>1.691(e)-1</SECTNO> <SUBJECT>Installment obligations transmitted at death when prior law applied.</SUBJECT> <SECTNO>1.691(f)-1</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <SECTNO>1.692-1</SECTNO> <SUBJECT>Abatement of income taxes of certain members of the Armed Forces of the United States upon death.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">PARTNERS AND PARTNERSHIPS</HD> <HD SOURCE="HD1">Determination of Tax Liability</HD> <SECTNO>1.701-1</SECTNO> <SUBJECT>Partners, not partnership, subject to tax.</SUBJECT> <SECTNO>1.701-2</SECTNO> <SUBJECT>Anti-abuse rule.</SUBJECT> <SECTNO>1.702-1</SECTNO> <SUBJECT>Income and credits of partner.</SUBJECT> <SECTNO>1.702-2</SECTNO> <SUBJECT>Net operating loss deduction of partner.</SUBJECT> <SECTNO>1.702-3T</SECTNO> <SUBJECT>4-Year spread (temporary).</SUBJECT> <SECTNO>1.703-1</SECTNO> <SUBJECT>Partnership computations.</SUBJECT> <SECTNO>1.704-1</SECTNO> <SUBJECT>Partner's distributive share.</SUBJECT> <SECTNO>1.704-1T</SECTNO> <SUBJECT>Partner's distributive share (temporary).</SUBJECT> <SECTNO>1.704-2</SECTNO> <SUBJECT>Allocations attributable to nonrecourse liabilities.</SUBJECT> <SECTNO>1.704-3</SECTNO> <SUBJECT>Contributed property.</SUBJECT> <SECTNO>1.704-4</SECTNO> <SUBJECT>Distribution of contributed property.</SUBJECT> <SECTNO>1.705-1</SECTNO> <SUBJECT>Determination of basis of partner's interest.</SUBJECT> <SECTNO>1.705-2</SECTNO> <SUBJECT>Basis adjustments coordinating sections 705 and 1032.</SUBJECT> <SECTNO>1.706-0</SECTNO> <SUBJECT>Table of contents.</SUBJECT> <SECTNO>1.706-1</SECTNO> <SUBJECT>Taxable years of partner and partnership.</SUBJECT> <SECTNO>1.706-2</SECTNO> <SUBJECT>Certain allocable cash to as is items. [Reserved]</SUBJECT> <SECTNO>1.706-2T</SECTNO> <SUBJECT>Temporary regulations; question and answer under the Tax Reform Act of 1984.</SUBJECT> <SECTNO>1.706-3</SECTNO> <SUBJECT>Items attributable to interest in lower-tier partnership.</SUBJECT> <SECTNO>1.706-4</SECTNO> <SUBJECT>Determination of distributive share when a partner's interest varies.</SUBJECT> <SECTNO>1.706-5</SECTNO> <SUBJECT>Taxable year determination.</SUBJECT> <SECTNO>1.707-0</SECTNO> <SUBJECT>Table of contents.</SUBJECT> <SECTNO>1.707-1</SECTNO> <SUBJECT>Transactions between partner and partnership.</SUBJECT> <SECTNO>1.707-2</SECTNO> <SUBJECT>Disguised payments for services. [Reserved]</SUBJECT> <SECTNO>1.707-3</SECTNO> <SUBJECT>Disguised sales of property to partnership; general rules.</SUBJECT> <SECTNO>1.707-4</SECTNO> <SUBJECT>Disguised sales of property to partnership; special rules applicable to guaranteed payments, preferred returns, operating cash flow distributions, and reimbursements of preformation expenditures.</SUBJECT> <SECTNO>1.707-5</SECTNO> <SUBJECT>Disguised sales of property to partnership; special rules relating to liabilities.</SUBJECT> <SECTNO>1.707-6</SECTNO> <SUBJECT>Disguised sales of property by partnership to partner; general rules.</SUBJECT> <SECTNO>1.707-7</SECTNO> <SUBJECT>Disguised sales of partnership interests. [Reserved]</SUBJECT> <SECTNO>1.707-8</SECTNO> <SUBJECT>Disclosure of certain information.</SUBJECT> <SECTNO>1.707-9</SECTNO> <SUBJECT>Effective dates and transitional rules.</SUBJECT> <SECTNO>1.708-1</SECTNO> <SUBJECT>Continuation of partnership.</SUBJECT> <SECTNO>1.709-1</SECTNO> <SUBJECT>Treatment of organization and syndication costs.</SUBJECT> <SECTNO>1.709-2</SECTNO> <SUBJECT>Definitions.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Contributions, Distributions, and Transfers</HD> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">contributions to a partnership</HD> <SECTNO>1.721-1</SECTNO> <SUBJECT>Nonrecognition of gain or loss on contribution.</SUBJECT> <SECTNO>1.721(c)-1</SECTNO> <SUBJECT>Overview, definitions, and rules of general application.</SUBJECT> <SECTNO>1.721(c)-2</SECTNO> <SUBJECT>Recognition of gain on certain contributions of property to partnerships with related foreign partners.</SUBJECT> <SECTNO>1.721(c)-3</SECTNO> <SUBJECT>Gain deferral method.</SUBJECT> <SECTNO>1.721(c)-4</SECTNO> <SUBJECT>Acceleration events.</SUBJECT> <SECTNO>1.721(c)-5</SECTNO> <SUBJECT>Acceleration event exceptions.</SUBJECT> <SECTNO>1.721(c)-6</SECTNO> <SUBJECT>Procedural and reporting requirements.</SUBJECT> <SECTNO>1.721(c)-7</SECTNO> <SUBJECT>Examples.</SUBJECT> <SECTNO>1.721-2</SECTNO> <SUBJECT>Noncompensatory options.</SUBJECT> <SECTNO>1.722-1</SECTNO> <SUBJECT>Basis of contributing partner's interest.</SUBJECT> <SECTNO>1.723-1</SECTNO> <SUBJECT>Basis of property contributed to partnership.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">distributions by a partnership</HD> <SECTNO>1.731-1</SECTNO> <SUBJECT>Extent of recognition of gain or loss on distribution.</SUBJECT> <SECTNO>1.731-2</SECTNO> <SUBJECT>Partnership distributions of marketable securities.</SUBJECT> <SECTNO>1.732-1</SECTNO> <SUBJECT>Basis of distributed property other than money.</SUBJECT> <SECTNO>1.732-2</SECTNO> <SUBJECT>Special partnership basis of distributed property.</SUBJECT> <SECTNO>1.732-3</SECTNO> <SUBJECT>Corresponding adjustment to basis of assets of a distributed corporation controlled by a corporate partner.</SUBJECT> <SECTNO>1.733-1</SECTNO> <SUBJECT>Basis of distributee partner's interest.</SUBJECT> <SECTNO>1.734-1</SECTNO> <SUBJECT>Optional adjustment to basis of undistributed partnership property.</SUBJECT> <SECTNO>1.734-2</SECTNO> <SUBJECT>Adjustment after distribution to transferee partner.</SUBJECT> <SECTNO>1.735-1</SECTNO> <SUBJECT>Character of gain or loss on disposition of distributed property.</SUBJECT> <SECTNO>1.736-1</SECTNO> <SUBJECT>Payments to a retiring partner or a deceased partner's successor in interest.</SUBJECT> <SECTNO>1.737-1</SECTNO> <SUBJECT>Recognition of precontribution gain.</SUBJECT> <SECTNO>1.737-2</SECTNO> <SUBJECT>Exceptions and special rules.</SUBJECT> <SECTNO>1.737-3</SECTNO> <SUBJECT>Basis adjustments; recovery rules.</SUBJECT> <SECTNO>1.737-4</SECTNO> <SUBJECT>Anti-abuse rule.</SUBJECT> <SECTNO>1.737-5</SECTNO> <SUBJECT>Effective dates.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">transfers of interests in a partnership</HD> <SECTNO>1.741-1</SECTNO> <SUBJECT> Recognition and character of gain or loss on sale or exchange. <PRTPAGE P="9"/> </SUBJECT> <SECTNO>1.742-1</SECTNO> <SUBJECT>Basis of transferee partner's interest.</SUBJECT> <SECTNO>1.743-1</SECTNO> <SUBJECT>Optional adjustment to basis of partnership property.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">provisions common to part ii, subchapter k, chapter 1 of the code</HD> <SECTNO>1.751-1</SECTNO> <SUBJECT>Unrealized receivables and inventory items.</SUBJECT> <SECTNO>1.752-0</SECTNO> <SUBJECT>Table of contents.</SUBJECT> <SECTNO>1.752-1</SECTNO> <SUBJECT>Treatment of partnership liabilities.</SUBJECT> <SECTNO>1.752-2</SECTNO> <SUBJECT>Partner's share of resource liabilities.</SUBJECT> <SECTNO>1.752-2T</SECTNO> <SUBJECT>Partner's share of resource liabilities (temporary).</SUBJECT> <SECTNO>1.752-3</SECTNO> <SUBJECT>Partner's share of nonrecourse liabilities.</SUBJECT> <SECTNO>1.752-4</SECTNO> <SUBJECT>Special rules.</SUBJECT> <SECTNO>1.752-5</SECTNO> <SUBJECT>Applicability dates and transition rules.</SUBJECT> <SECTNO>1.752-6</SECTNO> <SUBJECT>Partnership assumption of partner's section 358(h)(3) liability after October 18, 1999, and before June 24, 2003.</SUBJECT> <SECTNO>1.752-7</SECTNO> <SUBJECT>Partnership assumption of partner's § 1.752-7 liability on or after June 24, 2003.</SUBJECT> <SECTNO>1.753-1</SECTNO> <SUBJECT>Partner receiving income in respect of decedent.</SUBJECT> <SECTNO>1.754-1</SECTNO> <SUBJECT>Time and manner of making election to adjust basis of partnership property.</SUBJECT> <SECTNO>1.755-1</SECTNO> <SUBJECT>Rules for allocation of basis.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">definitions</HD> <SECTNO>1.761-1</SECTNO> <SUBJECT>Terms defined.</SUBJECT> <SECTNO>1.761-2</SECTNO> <SUBJECT>Exclusion of certain unincorporated organizations from the application of all or part of subchapter K of chapter 1 of the Internal Revenue Code.</SUBJECT> <SECTNO>1.761-3</SECTNO> <SUBJECT>Certain option holders treated as partners.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">effective date for subchapter k, chapter 1 of the code</HD> <SECTNO>1.771-1</SECTNO> <SUBJECT>Effective date.</SUBJECT> <HD SOURCE="HD1">INSURANCE COMPANIES</HD> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Life Insurance Companies</HD> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">definition; tax imposed</HD> <SECTNO>1.801-1</SECTNO> <SUBJECT>Definitions.</SUBJECT> <SECTNO>1.801-2</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.801-3</SECTNO> <SUBJECT>Definitions.</SUBJECT> <SECTNO>1.801-4</SECTNO> <SUBJECT>Life insurance reserves.</SUBJECT> <SECTNO>1.801-5</SECTNO> <SUBJECT>Total reserves.</SUBJECT> <SECTNO>1.801-6</SECTNO> <SUBJECT>Adjustments in reserves for policy loans.</SUBJECT> <SECTNO>1.801-7</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.801-8</SECTNO> <SUBJECT>Contracts with reserves based on segregated asset accounts.</SUBJECT> <SECTNO>1.802(b)-1</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.802-2</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.802-3</SECTNO> <SUBJECT>Tax imposed on life insurance companies.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">investment income</HD> <SECTNO>1.804-3</SECTNO> <SUBJECT>Gross investment income of a life insurance company.</SUBJECT> <SECTNO>1.804-4</SECTNO> <SUBJECT>Investment yield of a life insurance company.</SUBJECT> <SECTNO>1.806-1</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.806-2</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.806-3</SECTNO> <SUBJECT>Certain changes in reserves and assets.</SUBJECT> <SECTNO>1.806-4</SECTNO> <SUBJECT>Change of basis in computing reserves.</SUBJECT> <SECTNO>1.807-1</SECTNO> <SUBJECT>Computation of life insurance reserves.</SUBJECT> <SECTNO>1.807-2</SECTNO> <SUBJECT>Cross-reference.</SUBJECT> <SECTNO>1.807-3</SECTNO> <SUBJECT>Reporting of reserves.</SUBJECT> <SECTNO>1.807-4</SECTNO> <SUBJECT>Adjustment for change in computing reserves.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">gain and loss from operations</HD> <SECTNO>1.809-1—1.809-3</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.809-4</SECTNO> <SUBJECT>Gross amount.</SUBJECT> <SECTNO>1.809-5</SECTNO> <SUBJECT>Deductions.</SUBJECT> <SECTNO>1.809-6</SECTNO> <SUBJECT>Modifications.</SUBJECT> <SECTNO>1.810-1</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.810-2</SECTNO> <SUBJECT>Rules for certain reserves.</SUBJECT> <SECTNO>1.811-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.811-2</SECTNO> <SUBJECT>Dividends to policyholders.</SUBJECT> <SECTNO>1.811-3</SECTNO> <SUBJECT>Cross-reference.</SUBJECT> <SECTNO>1.812-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.812-2</SECTNO> <SUBJECT>Operations loss deduction.</SUBJECT> <SECTNO>1.812-3</SECTNO> <SUBJECT>Computation of loss from operations.</SUBJECT> <SECTNO>1.812-4</SECTNO> <SUBJECT>Operations loss carrybacks and operations loss carryovers.</SUBJECT> <SECTNO>1.812-5</SECTNO> <SUBJECT>Offset.</SUBJECT> <SECTNO>1.812-6</SECTNO> <SUBJECT>New company defined.</SUBJECT> <SECTNO>1.812-7</SECTNO> <SUBJECT>Application of subtitle A and subtitle F.</SUBJECT> <SECTNO>1.812-8</SECTNO> <SUBJECT>Illustration of operations loss carrybacks and carryovers.</SUBJECT> <SECTNO>1.812-9</SECTNO> <SUBJECT>Cross-reference.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">distributions to shareholders</HD> <SECTNO>1.815-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.815-2</SECTNO> <SUBJECT>Distributions to shareholders.</SUBJECT> <SECTNO>1.815-3</SECTNO> <SUBJECT>Shareholders surplus account.</SUBJECT> <SECTNO>1.815-4</SECTNO> <SUBJECT>Policyholders surplus account.</SUBJECT> <SECTNO>1.815-5</SECTNO> <SUBJECT>Other accounts defined.</SUBJECT> <SECTNO>1.815-6</SECTNO> <SUBJECT>Special rules.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">miscellaneous provisions</HD> <SECTNO>1.817-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.817-2</SECTNO> <SUBJECT>Treatment of capital gains and losses.</SUBJECT> <SECTNO>1.817-3</SECTNO> <SUBJECT>Gain on property held on December 31, 1958, and certain substituted property acquired after 1958.</SUBJECT> <SECTNO>1.817-4</SECTNO> <SUBJECT>Special rules.</SUBJECT> <SECTNO>1.817-5</SECTNO> <SUBJECT>Diversification requirements for variable annuity, endowment, and life insurance contracts.</SUBJECT> <SECTNO>1.817A-1</SECTNO> <SUBJECT>Certain modified guaranteed contracts.</SUBJECT> <SECTNO>1.818-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.818-2</SECTNO> <SUBJECT> Accounting provisions. <PRTPAGE P="10"/> </SUBJECT> <SECTNO>1.818-3</SECTNO> <SUBJECT>Amortization of premium and accrual of discount.</SUBJECT> <SECTNO>1.818-4</SECTNO> <SUBJECT>[Reserved]</SUBJECT> <SECTNO>1.818-5</SECTNO> <SUBJECT>Short taxable years.</SUBJECT> <SECTNO>1.818-6</SECTNO> <SUBJECT>Transitional rule for change in method of accounting.</SUBJECT> <SECTNO>1.818-7</SECTNO> <SUBJECT>Denial of double deductions.</SUBJECT> <SECTNO>1.818-8</SECTNO> <SUBJECT>Special rules relating to consolidated returns and certain capital losses.</SUBJECT> <SECTNO>1.819-1</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.819-2</SECTNO> <SUBJECT>Foreign life insurance companies.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Mutual Insurance Companies (Other Than Life and Certain Marine Insurance Companies and Other Than Fire or Flood Insurance Companies Which Operate on Basis of Perpetual Policies or Premium Deposits)</HD> <SECTNO>1.822-3</SECTNO> <SUBJECT>Amortization of premium and accrual of discount.</SUBJECT> <SECTNO>1.822-4</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.822-5</SECTNO> <SUBJECT>Mutual insurance company taxable income.</SUBJECT> <SECTNO>1.822-6</SECTNO> <SUBJECT>Real estate owned and occupied.</SUBJECT> <SECTNO>1.822-7</SECTNO> <SUBJECT>Amortization of premium and accrual of discount.</SUBJECT> <SECTNO>1.822-8</SECTNO> <SUBJECT>Determination of taxable investment income.</SUBJECT> <SECTNO>1.822-9</SECTNO> <SUBJECT>Real estate owned and occupied.</SUBJECT> <SECTNO>1.822-10</SECTNO> <SUBJECT>Amortization of premium and accrual of discount.</SUBJECT> <SECTNO>1.822-11</SECTNO> <SUBJECT>Net premiums.</SUBJECT> <SECTNO>1.822-12</SECTNO> <SUBJECT>Dividends to policyholders.</SUBJECT> <SECTNO>1.826-1</SECTNO> <SUBJECT>Election by reciprocal underwriters and interinsurers.</SUBJECT> <SECTNO>1.826-2</SECTNO> <SUBJECT>Special rules applicable to electing reciprocals.</SUBJECT> <SECTNO>1.826-3</SECTNO> <SUBJECT>Attorney-in-fact of electing reciprocals.</SUBJECT> <SECTNO>1.826-4</SECTNO> <SUBJECT>Allocation of expenses.</SUBJECT> <SECTNO>1.826-5</SECTNO> <SUBJECT>Attribution of tax.</SUBJECT> <SECTNO>1.826-6</SECTNO> <SUBJECT>Credit or refund.</SUBJECT> <SECTNO>1.826-7</SECTNO> <SUBJECT>Examples.</SUBJECT> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Other Insurance Companies</HD> <SECTNO>1.831-1</SECTNO> <SUBJECT>Tax on insurance companies (other than life or mutual), mutual marine insurance companies, and mutual fire insurance companies issuing perpetual policies.</SUBJECT> <SECTNO>1.831-2</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.831-3</SECTNO> <SUBJECT>Tax on insurance companies (other than life or mutual), mutual marine insurance companies, mutual fire insurance companies issuing perpetual policies, and mutual fire or flood insurance companies operating on the basis of premium deposits; taxable years beginning after December 31, 1962.</SUBJECT> <SECTNO>1.832-1</SECTNO> <SUBJECT>Gross income.</SUBJECT> <SECTNO>1.832-2</SECTNO> <SUBJECT>Deductions.</SUBJECT> <SECTNO>1.832-3</SECTNO> <SUBJECT>Taxable years affected.</SUBJECT> <SECTNO>1.832-4</SECTNO> <SUBJECT>Gross income.</SUBJECT> <SECTNO>1.832-5</SECTNO> <SUBJECT>Deductions.</SUBJECT> <SECTNO>1.832-6</SECTNO> <SUBJECT>Policyholders of mutual fire or flood insurance companies operating on the basis of premium deposits.</SUBJECT> <SECTNO>1.833-1</SECTNO> <SUBJECT>Medical loss ratio under section 833(c)(5).</SUBJECT> <SECTNO>1.846-1</SECTNO> <SUBJECT>Application of discount factors.</SUBJECT> <SECTNO>1.848-0</SECTNO> <SUBJECT>Outline of regulations under section 848.</SUBJECT> <SECTNO>1.848-1</SECTNO> <SUBJECT>Definitions and special provisions.</SUBJECT> <SECTNO>1.848-2</SECTNO> <SUBJECT>Determination of net premiums.</SUBJECT> <SECTNO>1.848-3</SECTNO> <SUBJECT>Interim rules for certain reinsurance agreements.</SUBJECT> <SECTNO>1.849-1.850</SECTNO> <SUBJECT>[Reserved]</SUBJECT> </SUBJGRP> </CONTENTS> <AUTH> <HD SOURCE="HED">Authority:</HD> <P>26 U.S.C. 7805, unless otherwise noted.</P> <P>Section 1.642(c)-6 also issued under 26 U.S.C. 642(c)(5).</P> <P>Section 1.642(h)-2 also issued under 26 U.S.C. 642(h).</P> <P>Section 1.642(h)-5 also issued under 26 U.S.C. 642(h).</P> <P>Section 1.643(a)-8 also issued under 26 U.S.C. 643(a)(7).</P> <P>Section 1.643(f)-1 also issued under 26 U.S.C. 643(f).</P> <P>Section 1.643(h)-1 also issued under 26 U.S.C. 643(a)(7).</P> <P>Section 1.642(c)-6A also issued under 26 U.S.C. 642(c)(5).</P> <P>Section 1.645-1 also issued under 26 U.S.C. 645.</P> <P>Sections 1.663(c)-1, 1.663(c)-2, 1.663(c)-3, 1.663(c)-4, 1.663(c)-5, and 1.663(c)-6 also issued under 26 U.S.C. 663(c).</P> <P>Section 1.664-1 also issued under 26 U.S.C. 664(a).</P> <P>Section 1.664-2 also issued under 26 U.S.C. 664(a).</P> <P>Section 1.664-3 also issued under 26 U.S.C. 664(a).</P> <P>Section 1.664-4 also issued under 26 U.S.C. 664(a).</P> <P>Section 1.664-4A also issued under 26 U.S.C. 664(a).</P> <P>Section 1.671-2 also issued under 26 U.S.C. 643(a)(7) and 672(f)(6).</P> <P>Section 1.672(f)-1 also issued under 26 U.S.C. 643(a)(7) and 672(f)(6).</P> <P>Section 1.672(f)-2 also issued under 26 U.S.C. 643(a)(7) and 672(f)(3) and (6).</P> <P>Section 1.672(f)-3 also issued under 26 U.S.C. 643(a)(7) and 672(f)(2) and (6).</P> <P>Section 1.672(f)-4 also issued under 26 U.S.C. 643(a)(7) and 672(f)(4) and (6).</P> <P>Section 1.672(f)-5 also issued under 26 U.S.C. 643(a)(7) and 672(f)(6).</P> <P>Section 1.679-1 also issued under 26 U.S.C. 643(a)(7) and 679(d).</P> <P>Section 1.679-2 also issued under 26 U.S.C. 643(a)(7) and 679(d).</P> <P>Section 1.679-3 also issued under 26 U.S.C. 643(a)(7) and 679(d).</P> <P>Section 1.679-4 also issued under 26 U.S.C. 643(a)(7), 679(a)(3) and 679(d).</P> <P>Section 1.679-5 also issued under 26 U.S.C. 643(a)(7) and 679(d).</P> <P>Section 1.679-6 also issued under 26 U.S.C. 643(a)(7) and 679(d).</P> <P> Section 1.684-1 also issued under 26 U.S.C. 643(a)(7) and 684(a). <PRTPAGE P="11"/> </P> <P>Section 1.684-2 also issued under 26 U.S.C. 643(a)(7) and 684(a).</P> <P>Section 1.684-3 also issued under 26 U.S.C. 643(a)(7) and 684(a).</P> <P>Section 1.684-4 also issued under 26 U.S.C. 643(a)(7) and 684(a).</P> <P>Section 1.684-5 also issued under 26 U.S.C. 643(a)(7) and 684(a).</P> <P>Section 1.701-2 also issued under 26 U.S.C. 701 through 761.</P> <P>Section 1.704-3 also issued under 26 U.S.C. 704(c).</P> <P>Section 1.704-4 also issued under 26 U.S.C. 704(c).</P> <P>Section 1.705-2 also issued under 26 U.S.C. 705 and 1032.</P> <P>Section 1.706-1T also issued under 26 U.S.C. 706(b).</P> <P>Section 1.706-3 also issued under 26 U.S.C. 170(h)(7)(G).</P> <P>Section 1.706-3T also issued under 26 U.S.C. 444(f).</P> <P>Section 1.706-4 also issued under 26 U.S.C. 170(h)(7)(G).</P> <P>Sections 1.707-2 through 1.707-9 also issued under 26 U.S.C. 707(a)(2).</P> <P>Section 1.721-1 also issued under 26 U.S.C. 721.</P> <P>Section 1.721(c)-1 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-2 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-3 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-4 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-5 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-6 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.721(c)-7 also issued under 26 U.S.C. 721(c).</P> <P>Section 1.731-2 also issued under 26 U.S.C. 731(c).</P> <P>Section 1.732-1 also issued under 26 U.S.C. 732.</P> <P>Section 1.732-2 also issued under 26 U.S.C. 732.</P> <P>Section 1.732-3 also issued under 26 U.S.C. 337(d), 732(f)(8), and 1502.</P> <P>Section 1.734-1 also issued under 26 U.S.C. 734.</P> <P>Section 1.743-1 also issued under 26 U.S.C. 743.</P> <P>Section 1.751-1 also issued under 26 U.S.C. 751.</P> <P>Section 1.752-1(a) also issued under Public Law 106-554, 114 Stat. 2763, 2763A-638 (2001).</P> <P>Section 1.752-6 also issued under Public Law 106-554, 114 Stat. 2763, 2763A-638 (2001).</P> <P>Section 1.752-7 also issued under Public Law 106-554, 114 Stat. 2763, 2763A-638 (2001).</P> <P>Section 1.754-1 also issued under 26 U.S.C. 754.</P> <P>Section 1.755-1 also issued under 26 U.S.C. 755.</P> <P>Section 1.755-2 also issued under 26 U.S.C. 755 and 26 U.S.C. 1060.</P> <P>Section 1.761-2 also issued under 26 U.S.C. 446(b), 761(a), 6031(a), 6417(d), and 6417(h).</P> <P>Section 1.807-2 also issued under 26 U.S.C. 817A(e).</P> <P>Section 1.807-3 also issued under 26 U.S.C. 807(e)(6).</P> <P>Section 1.809-10 also issued under 26 U.S.C. 809(b)(2) and (g)(3).</P> <P>Section 1.811-3 also issued under 26 U.S.C. 817A(e).</P> <P>Section 1.812-9 also issued under 26 U.S.C. 817A(e).</P> <P>Section 1.817-5 also issued under 26 U.S.C. 817(h).</P> <P>Section 1.817A-1 also issued under 26 U.S.C. 817A(e).</P> <P>Section 1.832-4 also issued under 26 U.S.C. 832(b)(5)(A).</P> <P>Section 1.846-1 also issued under 26 U.S.C. 846.</P> <P>Section 1.848-2 also issued under 26 U.S.C. 845(b) and 26 U.S.C. 848(d)(4)(B).</P> <P>Section 1.848-3 also issued under 26 U.S.C. 848(d)(4)(B).</P> </AUTH> <SOURCE> <HD SOURCE="HED">Source:</HD> <P>T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, unless otherwise noted.</P> </SOURCE> <SUBJGRP> <HD SOURCE="HED">ESTATES, TRUSTS, BENEFICIARIES, AND DECEDENTS</HD> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Estates, Trusts, and Beneficiaries</HD> <HD SOURCE="HD3">General Rules for Taxation of Estates and Trusts</HD> <SECTION> <SECTNO>§ 1.641</SECTNO> <RESERVED>[Reserved]</RESERVED> </SECTION> <SECTION> <SECTNO>§ 1.641(a)-0</SECTNO> <SUBJECT>Scope of subchapter J.</SUBJECT> <P> (a) <E T="03">In general.</E> Subchapter J (sections 641 and following), chapter 1 of the Code, deals with the taxation of income of estates and trusts and their beneficiaries, and of income in respect of decedents. Part I of subchapter J contains general rules for taxation of estates and trusts (subpart A), specific rules relating to trusts which distribute current income only (subpart B), estates and trusts which may accumulate income or which distribute corpus (subpart C), treatment of excess distributions by trusts (subpart D), grantors and other persons treated as substantial owners (subpart E), and miscellaneous provisions relating to limitations on charitable deductions, income of an estate or trust in case of divorce, and taxable years to which the <PRTPAGE P="12"/> provisions of subchapter J are applicable (subpart F). Part I has no application to any organization which is not to be classified for tax purposes as a trust under the classification rules of §§ 301.7701-2, 301.7701-3, and 301.7701-4 of this chapter (Regulations on Procedure and Administration). Part II of subchapter J relates to the treatment of income in respect of decedents. However, the provisions of subchapter J do not apply to employee trusts subject to subchapters D and F, chapter 1 of the Code, and common trust funds subject to subchapter H, chapter 1 of the Code. </P> <P> (b) <E T="03">Scope of subparts A, B, C, and D.</E> Subparts A, B, C, and D (section 641 and following), part I, subchapter J, chapter 1 of the Code, relate to the taxation of estates and trusts and their beneficiaries. These subparts have no application to any portion of the corpus or income of a trust which is to be regarded, within the meaning of the Code, as that of the grantor or others treated as its substantial owners. See subpart E (section 671 and following), Part I, subchapter J, chapter 1 of the Code, and the regulations thereunder for rules for the treatment of any portion of a trust where the grantor (or another person) is treated as the substantial owner. So-called alimony trusts are treated under subparts A, B, C, and D, except to the extent otherwise provided in section 71 or section 682. These subparts have no application to beneficiaries of nonexempt employees' trusts. See section 402(b) and the regulations thereunder. </P> <P> (c) <E T="03">Multiple trusts.</E> Multiple trusts that have: </P> <P>(1) No substantially independent purposes (such as independent dispositive purposes),</P> <P>(2) The same grantor and substantially the same beneficiary, and</P> <P> (3) The avoidance or mitigation of ( <E T="03">i</E> ) the progressive rates of tax (including mitigation as a result of deferral of tax) or ( <E T="03">ii</E> ) the minimum tax for tax preferences imposed by section 56 as their principal purpose, </P> <FP>shall be consolidated and treated as one trust for the purposes of subchapter J.</FP> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 731, Jan. 17, 1969; T.D. 7204, 37 FR 17158, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.641(a)-1</SECTNO> <SUBJECT>Imposition of tax; application of tax.</SUBJECT> <P>For taxable years beginning after December 31, 1970, section 641 prescribes that the taxes imposed by section 1(d), as amended by the Tax Reform Act of 1969, shall apply to the income of estates or of any kind of property held in trust. For taxable years ending before January 1, 1971, section 641 prescribes that the taxes imposed upon individuals by chapter 1 of the Code apply to the income of estates or of any kind of property held in trust. The rates of tax, the statutory provisions respecting gross income, and, with certain exceptions, the deductions and credits allowed to individuals apply also to estates and trust.</P> <CITA>[T.D. 7117, 36 FR 9421, May 25, 1971]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.641(a)-2</SECTNO> <SUBJECT>Gross income of estates and trusts.</SUBJECT> <P>The gross income of an estate or trust is determined in the same manner as that of an individual. Thus, the gross income of an estate or trust consists of all items of gross income received during the taxable year, including:</P> <P>(a) Income accumulated in trust for the benefit of unborn or unascertained persons or persons with contingent interests;</P> <P>(b) Income accumulated or held for future distribution under the terms of the will or trust;</P> <P>(c) Income which is to be distributed currently by the fiduciary to the beneficiaries, and income collected by a guardian of an infant which is to be held or distributed as the court may direct;</P> <P>(d) Income received by estates of deceased persons during the period of administration or settlement of the estate; and</P> <P>(e) Income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated. The several classes of income enumerated in this section do not exclude others which also may come within the general purposes of section 641.</P> </SECTION> <SECTION> <PRTPAGE P="13"/> <SECTNO>§ 1.641(b)-1</SECTNO> <SUBJECT>Computation and payment of tax; deductions and credits of estates and trusts.</SUBJECT> <P>Generally, the deductions and credits allowed to individuals are also allowed to estates and trusts. However, there are special rules for the computation of certain deductions and for the allocation between the estate or trust and the beneficiaries of certain credits and deductions. See section 642 and the regulations thereunder. In addition, an estate or trust is allowed to deduct, in computing its taxable income, the deductions provided by sections 651 and 661 and regulations thereunder, relating to distributions to beneficiaries.</P> </SECTION> <SECTION> <SECTNO>§ 1.641(b)-2</SECTNO> <SUBJECT>Filing of returns and payment of the tax.</SUBJECT> <P>(a) The fiduciary is required to make and file the return and pay the tax on the taxable income of an estate or of a trust. Liability for the payment of the tax on the taxable income of an estate attaches to the person of the executor or administrator up to and after his discharge if, prior to distribution and discharge, he had notice of his tax obligations or failed to exercise due diligence in ascertaining whether or not such obligations existed. For the extent of such liability, see section 3467 of the Revised Statutes, as amended by section 518 of the Revenue Act of 1934 (31 U. S. C. 192). Liability for the tax also follows the assets of the estate distributed to heirs, devisees, legatees, and distributees, who may be required to discharge the amount of the tax due and unpaid to the extent of the distributive shares received by them. See section 6901. The same considerations apply to trusts.</P> <P>(b) The estate of an infant, incompetent, or other person under a disability, or, in general, of an individual or corporation in receivership or a corporation in bankruptcy is not a taxable entity separate from the person for whom the fiduciary is acting, in that respect differing from the estate of a deceased person or of a trust. See section 6012(b) (2) and (3) for provisions relating to the obligation of the fiduciary with respect to returns of such persons.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6580, 26 FR 11486, Dec. 5, 1961]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.641(b)-3</SECTNO> <SUBJECT>Termination of estates and trusts.</SUBJECT> <P>(a) The income of an estate of a deceased person is that which is received by the estate during the period of administration or settlement. The period of administration or settlement is the period actually required by the administrator or executor to perform the ordinary duties of administration, such as the collection of assets and the payment of debts, taxes, legacies, and bequests, whether the period required is longer or shorter than the period specified under the applicable local law for the settlement of estates. For example, where an executor who is also named as trustee under a will fails to obtain his discharge as executor, the period of administration continues only until the duties of administration are complete and he actually assumes his duties as trustee, whether or not pursuant to a court order. However, the period of administration of an estate cannot be unduly prolonged. If the administration of an estate is unreasonably prolonged, the estate is considered terminated for Federal income tax purposes after the expiration of a reasonable period for the performance by the executor of all the duties of administration. Further, an estate will be considered as terminated when all the assets have been distributed except for a reasonable amount which is set aside in good faith for the payment of unascertained or contingent liabilities and expenses (not including a claim by a beneficiary in the capacity of beneficiary). Notwithstanding the above, if the estate has joined in making a valid election under section 645 to treat a qualified revocable trust, as defined under section 645(b)(1), as part of the estate, the estate shall not terminate under this paragraph prior to the termination of the section 645 election period. See section 645 and the regulations thereunder for rules regarding the termination of the section 645 election period.</P> <P> (b) Generally, the determination of whether a trust has terminated depends upon whether the property held in trust has been distributed to the persons entitled to succeed to the property upon termination of the trust rather than upon the technicality of <PRTPAGE P="14"/> whether or not the trustee has rendered his final accounting. A trust does not automatically terminate upon the happening of the event by which the duration of the trust is measured. A reasonable time is permitted after such event for the trustee to perform the duties necessary to complete the administration of the trust. Thus, if under the terms of the governing instrument, the trust is to terminate upon the death of the life beneficiary and the corpus is to be distributed to the remainderman, the trust continues after the death of the life beneficiary for a period reasonably necessary to a proper winding up of the affairs of the trust. However, the winding up of a trust cannot be unduly postponed and if the distribution of the trust corpus is unreasonably delayed, the trust is considered terminated for Federal income tax purposes after the expiration of a reasonable period for the trustee to complete the administration of the trust. Further, a trust will be considered as terminated when all the assets have been distributed except for a reasonable amount which is set aside in good faith for the payment of unascertained or contingent liabilities and expenses (not including a claim by a beneficiary in the capacity of beneficiary). </P> <P> (c)(1) Except as provided in subparagraph (2) of this paragraph, during the period between the occurrence of an event which causes a trust to terminate and the time when the trust is considered as terminated under this section, whether or not the income and the excess of capital gains over capital losses of the trust are to be considered as amounts required to be distributed currently to the ultimate distributee for the year in which they are received depends upon the principles stated in § 1.651(a)-2. See § 1.663-1 <E T="03">et seq.</E> for application of the separate share rule. </P> <P>(2)(i) Except in cases to which the last sentence of this subdivision applies, for taxable years of a trust ending before September 1, 1957, subparagraph (1) of this paragraph shall not apply and the rule of subdivision (ii) of this subparagraph shall apply unless the trustee elects to have subparagraph (1) of this paragraph apply. Such election shall be made by the trustee in a statement filed on or before April 15, 1959, with the district director with whom such trust's return for any such taxable year was filed. The election provided by this subdivision shall not be available if the treatment given the income and the excess of capital gains over capital losses for taxable years for which returns have been filed was consistent with the provisions of subparagraph (1) of this paragraph.</P> <P>(ii) The rule referred to in subdivision (i) of this subparagraph is as follows: During the period between the occurrence of an event which causes a trust to terminate and the time when a trust is considered as terminated under this section, the income and the excess of capital gains over capital losses of the trust are in general considered as amounts required to be distributed for the year in which they are received. For example, a trust instrument provides for the payment of income to A during her life, and upon her death for the payment of the corpus to B. The trust reports on the basis of the calendar year. A dies on November 1, 1955, but no distribution is made to B until January 15, 1956. The income of the trust and the excess of capital gains over capital losses for the entire year 1955, to the extent not paid, credited, or required to be distributed to A or A's estate, are treated under sections 661 and 662 as amounts required to be distributed to B for the year 1955.</P> <P>(d) If a trust or the administration or settlement of an estate is considered terminated under this section for Federal income tax purposes (as for instance, because administration has been unduly prolonged), the gross income, deductions, and credits of the estate or trust are, subsequent to the termination, considered the gross income, deductions, and credits of the person or persons succeeding to the property of the estate or trust.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 9032, 67 FR 78376, Dec. 24, 2002]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.641(c)-0</SECTNO> <SUBJECT>Table of contents.</SUBJECT> <P>This section lists the major captions contained in § 1.641(c)-1.</P> <EXTRACT> <HD SOURCE="HD2">§ 1.641(c)-1Electing small business trust.</HD> <P>(a) In general.</P> <P> (b) Definitions. <PRTPAGE P="15"/> </P> <P>(1) Grantor portion.</P> <P>(2) S portion.</P> <P>(3) Non-S portion.</P> <P>(c) Taxation of grantor portion.</P> <P>(d) Taxation of S portion.</P> <P>(1) In general.</P> <P>(2) Section 1366 amounts.</P> <P>(3) Gains and losses on disposition of S stock.</P> <P>(4) State and local income taxes and administrative expenses.</P> <P>(e) Tax rates and exemption of S portion.</P> <P>(1) Income tax rate.</P> <P>(2) Alternative minimum tax exemption.</P> <P>(f) Adjustments to basis of stock in the S portion under section 1367.</P> <P>(g) Taxation of non-S portion.</P> <P>(1) In general.</P> <P>(2) Dividend income under section 1368(c)(2).</P> <P>(3) Interest on installment obligations.</P> <P>(4) Charitable deduction.</P> <P>(h) Allocation of state and local income taxes and administration expenses.</P> <P>(i) Treatment of distributions from the trust.</P> <P>(j) Termination or revocation of ESBT election.</P> <P>(k) Effective date.</P> <P>(l) Examples.</P> </EXTRACT> <CITA>[T.D. 8994, 67 FR 34394, May 14, 2002]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.641(c)-1</SECTNO> <SUBJECT>Electing small business trust.</SUBJECT> <P> (a) <E T="03">In general.</E> An electing small business trust (ESBT) within the meaning of section 1361(e) is treated as two separate trusts for purposes of chapter 1 of the Internal Revenue Code. The portion of an ESBT that consists of stock in one or more S corporations is treated as one trust. The portion of an ESBT that consists of all the other assets in the trust is treated as a separate trust. The grantor or another person may be treated as the owner of all or a portion of either or both such trusts under subpart E, part I, subchapter J, chapter 1 of the Internal Revenue Code. The ESBT is treated as a single trust for administrative purposes, such as having one taxpayer identification number and filing one tax return. <E T="03">See</E> § 1.1361-1(m). </P> <P> (b) <E T="03">Definitions</E> —(1) <E T="03">Grantor portion</E> —(i) <E T="03">In general.</E> Subject to paragraph (b)(1)(ii) of this section, the grantor portion of an ESBT is the portion of the trust that is treated as owned by the grantor or another person under subpart E of the Code. </P> <P> (ii) <E T="03">Nonresident alien deemed owner.</E> If, pursuant to section 672(f)(2)(A)(ii), the deemed owner of a grantor portion of the ESBT is a nonresident alien, as defined in section 7701(b)(1)(B) (NRA), the items of income, deduction, and credit from that grantor portion must be reallocated from the grantor portion to the S portion, as defined in paragraph (b)(2) of this section, of the ESBT. </P> <P> (2) <E T="03">S portion</E> —(i) <E T="03">In general.</E> Subject to paragraph (b)(2)(ii) of this section, the S portion of an ESBT is the portion of the trust that consists of S corporation stock and that is not treated as owned by the grantor or another person under subpart E of the Code. </P> <P> (ii) <E T="03">N</E> onresident alien <E T="03"> (NRA) deemed owner of grantor portion.</E> The S portion of an ESBT also includes the grantor portion of the items of income, deduction, and credit reallocated under paragraph (b)(1)(ii) of this section from the grantor portion of the ESBT to the S portion of the ESBT. </P> <P> (3) <E T="03">Non-S portion.</E> The non-S portion of an ESBT is the portion of the trust that consists of all assets other than S corporation stock and that is not treated as owned by the grantor or another person under subpart E. </P> <P> (c) <E T="03">Taxation of grantor portion.</E> The grantor or another person who is treated as the owner of a portion of the ESBT includes in computing taxable income items of income, deductions, and credits against tax attributable to that portion of the ESBT under section 671. </P> <P> (d) <E T="03">Taxation of S portion</E> —(1) <E T="03">In general.</E> The taxable income of the S portion is determined by taking into account only the items of income, loss, deduction, or credit specified in paragraphs (d)(2), (3), and (4) of this section, to the extent not attributable to the grantor portion. </P> <P> (2) <E T="03">Section 1366 amounts</E> —(i) <E T="03">In general.</E> The S portion takes into account the items of income, loss, deduction, or credit that are taken into account by an S corporation shareholder pursuant to section 1366 and the regulations thereunder. Rules otherwise applicable to trusts apply in determining the extent to which any loss, deduction, or credit may be taken into account in determining the taxable income of the S <PRTPAGE P="16"/> portion. <E T="03">See</E> § 1.1361-1(m)(3)(iv) for allocation of those items in the taxable year of the S corporation in which the trust is an ESBT for part of the year and an eligible shareholder under section 1361(a)(2)(A)(i) through (iv) for the rest of the year. </P> <P> (ii) <E T="03">Special rule for charitable contributions.</E> If a deduction described in paragraph (d)(2)(i) of this section is attributable to an amount of the S corporation's gross income that is paid by the S corporation for a charitable purpose specified in section 170(c) (without regard to section 170(c)(2)(A)), the contribution will be deemed to be paid by the S portion pursuant to the terms of the trust's governing instrument within the meaning of section 642(c)(1). The limitations of section 681, regarding unrelated business income, apply in determining whether the contribution is deductible in computing the taxable income of the S portion. </P> <P> (iii) <E T="03">Multiple S corporations.</E> If an ESBT owns stock in more than one S corporation, items of income, loss, deduction, or credit from all the S corporations are aggregated for purposes of determining the S portion's taxable income. </P> <P> (3) <E T="03">Gains and losses on disposition of S stock</E> —(i) <E T="03">In general.</E> The S portion takes into account any gain or loss from the disposition of S corporation stock. No deduction is allowed under section 1211(b)(1) and (2) for capital losses that exceed capital gains. </P> <P> (ii) <E T="03">Installment method.</E> If income from the sale or disposition of stock in an S corporation is reported by the trust on the installment method, the income recognized under this method is taken into account by the S portion. See paragraph (g)(3) of this section for the treatment of interest on the installment obligation. See § 1.1361-1(m)(5)(ii) regarding treatment of a trust as an ESBT upon the sale of all S corporation stock using the installment method. </P> <P> (iii) <E T="03">Distributions in excess of basis.</E> Gain recognized under section 1368(b)(2) from distributions in excess of the ESBT's basis in its S corporation stock is taken into account by the S portion. </P> <P> (4) <E T="03">State and local income taxes and administrative expenses</E> —(i) <E T="03">In general.</E> State and local income taxes and administrative expenses directly related to the S portion and those allocated to that portion in accordance with paragraph (h) are taken into account by the S portion. </P> <P> (ii) <E T="03">Special rule for certain interest.</E> Interest paid by the trust on money borrowed by the trust to purchase stock in an S corporation is allocated to the S portion but is not a deductible administrative expense for purposes of determining the taxable income of the S portion. </P> <P> (e) <E T="03">Tax rates and exemption of S portion</E> —(1) <E T="03">Income tax rate.</E> Except for capital gains, the highest marginal trust rate provided in section 1(e) is applied to the taxable income of the S portion. See section 1(h) for the rates that apply to the S portion's net capital gain. </P> <P> (2) <E T="03">Alternative minimum tax exemption.</E> The exemption amount of the S portion under section 55(d) is zero. </P> <P> (f) <E T="03">Adjustments to basis of stock in the S portion under section 1367.</E> The basis of S corporation stock in the S portion must be adjusted in accordance with section 1367 and the regulations thereunder. If the ESBT owns stock in more than one S corporation, the adjustments to the basis in the S corporation stock of each S corporation must be determined separately with respect to each S corporation. Accordingly, items of income, loss, deduction, or credit of an S corporation that are taken into account by the ESBT under section 1366 can only result in an adjustment to the basis of the stock of that S corporation and cannot affect the basis in the stock of the other S corporations held by the ESBT. </P> <P> (g) <E T="03">Taxation of non-S portion</E> —(1) <E T="03">In general.</E> The taxable income of the non-S portion is determined by taking into account all items of income, deduction, and credit to the extent not taken into account by either the grantor portion or the S portion. The items attributable to the non-S portion are taxed under subparts A through D of part I, subchapter J, chapter 1 of the Internal Revenue Code. The non-S portion may consist of more than one share pursuant to section 663(c). </P> <P> (2) <E T="03">Dividend income under section 1368(c)(2).</E> Any dividend income within <PRTPAGE P="17"/> the meaning of section 1368(c)(2) is includible in the gross income of the non-S portion. </P> <P> (3) <E T="03">Interest on installment obligations.</E> If income from the sale or disposition of stock in an S corporation is reported by the trust on the installment method, the interest on the installment obligation is includible in the gross income of the non-S portion. See paragraph (d)(3)(ii) of this section for the treatment of income from such a sale or disposition. </P> <P> (4) <E T="03">Charitable deduction.</E> For purposes of applying section 642(c)(1) to payments made by the trust for a charitable purpose, the amount of gross income of the trust is limited to the gross income of the non-S portion. See paragraph (d)(2)(ii) of this section for special rules concerning charitable contributions paid by the S corporation that are deemed to be paid by the S portion. </P> <P> (h) <E T="03">Allocation of state and local income taxes and administration expenses.</E> Whenever state and local income taxes or administration expenses relate to more than one portion of an ESBT, they must be allocated between or among the portions to which they relate. These items may be allocated in any manner that is reasonable in light of all the circumstances, including the terms of the governing instrument, applicable local law, and the practice of the trustee with respect to the trust if it is reasonable and consistent. The taxes and expenses apportioned to each portion of the ESBT are taken into account by that portion. </P> <P> (i) <E T="03">Treatment of distributions from the trust.</E> Distributions to beneficiaries from the S portion or the non-S portion, including distributions of the S corporation stock, are deductible under section 651 or 661 in determining the taxable income of the non-S portion, and are includible in the gross income of the beneficiaries under section 652 or 662. However, the amount of the deduction or inclusion cannot exceed the amount of the distributable net income of the non-S portion. Items of income, loss, deduction, or credit taken into account by the grantor portion or the S portion are excluded for purposes of determining the distributable net income of the non-S portion of the trust. </P> <P> (j) <E T="03">Termination or revocation of ESBT election.</E> If the ESBT election of the trust terminates pursuant to § 1.1361-1(m)(5) or the ESBT election is revoked pursuant to § 1.1361-1(m)(6), the rules contained in this section are thereafter not applicable to the trust. If, upon termination or revocation, the S portion has a net operating loss under section 172; a capital loss carryover under section 1212; or deductions in excess of gross income; then any such loss, carryover, or excess deductions shall be allowed as a deduction, in accordance with the regulations under section 642(h), to the trust, or to the beneficiaries succeeding to the property of the trust if the entire trust terminates. </P> <P> (k) <E T="03">Applicability date.</E> This section generally is applicable for taxable years of ESBTs beginning on and after May 14, 2002. However, paragraphs (a), (b), (c), and (l)(1)( <E T="03">Example 1</E> ) of this section are applicable for taxable years of ESBTs that end on and after December 29, 2000. ESBTs may apply paragraphs (d)(4) and (h) of this section for taxable years of ESBTs beginning after December 31, 1996. Paragraphs (b)(1) and (2) of this section, and <E T="03">Example 6</E> in paragraph (l)(6) of this section, apply to all ESBTs after December 31, 2017. </P> <P> (l) <E T="03">Examples.</E> The following examples illustrate the rules of this section: </P> <P> (1) <E T="03">Example 1: Comprehensive example.</E> </P> <P> (i) Trust has a valid ESBT election in effect. Under section 678, <E T="03">B</E> is treated as the owner of a portion of Trust consisting of a 10% undivided fractional interest in Trust. No other person is treated as the owner of any other portion of Trust under subpart E. Trust owns stock in <E T="03">X,</E> an S corporation, and in <E T="03">Y,</E> a C corporation. During 2000, Trust receives a distribution from <E T="03">X</E> of $5,100, of which $5,000 is applied against Trust's adjusted basis in the <E T="03">X</E> stock in accordance with section 1368(c)(1) and $100 is a dividend under section 1368(c)(2). Trust makes no distributions to its beneficiaries during the year. </P> <P>(ii) For 2000, Trust has the following items of income and deduction:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 1 to paragraph (l)(1)(ii)</TTITLE> <ROW> <ENT I="01"> Ordinary income attributable to <E T="03">X</E> under section 1366 </ENT> <ENT>$5,000</ENT> </ROW> <ROW> <ENT I="01"> Dividend income from <E T="03">Y</E> </ENT> <ENT>$900</ENT> </ROW> <ROW> <ENT I="01"> Dividend from <E T="03">X</E> representing C corporation earnings and profits </ENT> <ENT>$100</ENT> </ROW> <ROW> <PRTPAGE P="18"/> <ENT I="01">Total trust income</ENT> <ENT>$6,000</ENT> </ROW> <ROW> <ENT I="01"> Charitable contributions attributable to <E T="03">X</E> under section 1366 </ENT> <ENT>$300</ENT> </ROW> <ROW> <ENT I="01">Trustee fees</ENT> <ENT>$200</ENT> </ROW> <ROW> <ENT I="01">State and local income taxes</ENT> <ENT>$100</ENT> </ROW> </GPOTABLE> <P>(iii) Trust's items of income and deduction are divided into a grantor portion, an S portion, and a non-S portion for purposes of determining the taxation of those items. Income is allocated to each portion as follows:</P> <P> (A) <E T="03">B</E> must take into account the items of income attributable to the grantor portion, that is, 10% of each item, as follows: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 2 to paragraph (l)(1)(iii)(A)</TTITLE> <ROW> <ENT I="01"> Ordinary income from <E T="03">X</E> </ENT> <ENT>$500</ENT> </ROW> <ROW> <ENT I="01"> Dividend income from <E T="03">Y</E> </ENT> <ENT>$90</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01"> Dividend income from <E T="03">X</E> </ENT> <ENT>$10</ENT> </ROW> <ROW> <ENT I="03">Total grantor portion income</ENT> <ENT>$600</ENT> </ROW> </GPOTABLE> <P>(B) The total income of the S portion is $4,500, determined as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 3 to paragraph (l)(1)(iii)(B)</TTITLE> <ROW> <ENT I="01"> Ordinary income from <E T="03">X</E> </ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Grantor portion</ENT> <ENT>($500)</ENT> </ROW> <ROW> <ENT I="03">Total S portion income</ENT> <ENT>$4,500</ENT> </ROW> </GPOTABLE> <P>(C) The total income of the non-S portion is $900 determined as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 4 to paragraph (l)(1)(iii)(C)</TTITLE> <ROW> <ENT I="01"> Dividend income from <E T="03">Y</E> (less grantor portion) </ENT> <ENT>$810</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01"> Dividend income from <E T="03">X</E> (less grantor portion) </ENT> <ENT>$90</ENT> </ROW> <ROW> <ENT I="03">Total non-S portion income</ENT> <ENT>$900</ENT> </ROW> </GPOTABLE> <P>(iv) The administrative expenses and the state and local income taxes relate to all three portions and under state law would be allocated ratably to the $6,000 of trust income. Thus, these items would be allocated 10% (600/6000) to the grantor portion, 75% (4500/6000) to the S portion and 15% (900/6000) to the non-S portion.</P> <P> (v) <E T="03">B</E> must take into account the following deductions attributable to the grantor portion of the trust: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 5 to paragraph (l)(1)(v)</TTITLE> <ROW> <ENT I="01"> Charitable contributions from <E T="03">X</E> </ENT> <ENT>$30</ENT> </ROW> <ROW> <ENT I="01">Trustee fees</ENT> <ENT>$20</ENT> </ROW> <ROW> <ENT I="01">State and local income taxes</ENT> <ENT>$10</ENT> </ROW> </GPOTABLE> <P>(vi) The taxable income of the S portion is $4,005, determined as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 6 to paragraph (l)(1)(vi)</TTITLE> <ROW> <ENT I="01"> Ordinary income from <E T="03">X</E> </ENT> <ENT>$4,500</ENT> </ROW> <ROW> <ENT I="01"> Less: Charitable contributions from <E T="03">X</E> (less grantor portion) </ENT> <ENT>($270)</ENT> </ROW> <ROW> <ENT I="01">75% of trustee fees</ENT> <ENT>($150)</ENT> </ROW> <ROW> <ENT I="01">75% of state and local income taxes</ENT> <ENT>($75)</ENT> </ROW> <ROW> <ENT I="01">Taxable income of S portion</ENT> <ENT>$4,005</ENT> </ROW> </GPOTABLE> <P>(vii) The taxable income of the non-S portion is $755, determined as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,6"> <TTITLE>Table 7 to paragraph (l)(1)(vii)</TTITLE> <ROW> <ENT I="01"> Dividend income from <E T="03">Y</E> </ENT> <ENT>$810</ENT> </ROW> <ROW> <ENT I="01"> Dividend income from <E T="03">X</E> </ENT> <ENT>$90</ENT> </ROW> <ROW> <ENT I="01">Total non-S portion income</ENT> <ENT>$900</ENT> </ROW> <ROW> <ENT I="01">Less: 15% of trustee fees</ENT> <ENT>($30)</ENT> </ROW> <ROW> <ENT I="01">15% state and local income taxes</ENT> <ENT>($15)</ENT> </ROW> <ROW> <ENT I="01">Personal exemption</ENT> <ENT>($100)</ENT> </ROW> <ROW> <ENT I="01">Taxable income of non-S portion</ENT> <ENT>$755</ENT> </ROW> </GPOTABLE> <P> (2) <E T="03">Example 2: Sale of S stock.</E> </P> <P> Trust has a valid ESBT election in effect and owns stock in <E T="03">X,</E> an S corporation. No person is treated as the owner of any portion of Trust under subpart E. In 2003, Trust sells all of its stock in <E T="03">X</E> to a person who is unrelated to Trust and its beneficiaries and realizes a capital gain of $5,000. This gain is taken into account by the S portion and is taxed using the appropriate capital gain rate found in section 1(h). </P> <P> (3) <E T="03">Example 3</E> —(i) <E T="03">Sale of S stock for an installment note.</E> Assume the same facts as in <E T="03">Example 2,</E> in paragraph (l)(2) of this section except that Trust sells its stock in <E T="03">X</E> for a $400,000 installment note payable with stated interest over ten years. After the sale, Trust does not own any S corporation stock. </P> <P> (ii) <E T="03">Loss on installment sale.</E> Assume Trust's basis in its <E T="03">X</E> stock was $500,000. Therefore, Trust sustains a capital loss of $100,000 on the sale. Upon the sale, the S portion terminates and the excess loss, after being netted against the other items taken into account by the S portion, is made available to the entire trust as provided in section 641(c)(4). </P> <P> (iii) <E T="03">Gain on installment sale.</E> Assume Trust's basis in its <E T="03">X</E> stock was $300,000 and that the $100,000 gain will be recognized under the installment method of section 453. Interest income will be recognized annually as part of the installment payments. The portion of the $100,000 gain recognized annually is taken into account by the S portion. However, the annual interest income is includible in the gross income of the non-S portion. </P> <P> (4) <E T="03">Example 4: Charitable lead annuity trust.</E> </P> <P> Trust is a charitable lead annuity trust which is not treated as owned by <PRTPAGE P="19"/> the grantor or another person under subpart E. Trust acquires stock in <E T="03">X,</E> an S corporation, and elects to be an ESBT. During the taxable year, pursuant to its terms, Trust pays $10,000 to a charitable organization described in section 170(c)(2). The non-S portion of Trust receives an income tax deduction for the charitable contribution under section 642(c) only to the extent the amount is paid out of the gross income of the non-S portion. To the extent the amount is paid from the S portion by distributing S corporation stock, no charitable deduction is available to the S portion. </P> <P> (5) <E T="03">Example 5: ESBT distributions.</E> </P> <P> (i) As of January 1, 2002, Trust owns stock in <E T="03">X,</E> a C corporation. No portion of Trust is treated as owned by the grantor or another person under subpart E. <E T="03">X</E> elects to be an S corporation effective January 1, 2003, and Trust elects to be an ESBT effective January 1, 2003. On February 1, 2003, <E T="03">X</E> makes an $8,000 distribution to Trust, of which $3,000 is treated as a dividend from accumulated earnings and profits under section 1368(c)(2) and the remainder is applied against Trust's basis in the <E T="03">X</E> stock under section 1368(b). The trustee of Trust makes a distribution of $4,000 to Beneficiary during 2003. For 2003, Trust's share of <E T="03">X</E> 's section 1366 items is $5,000 of ordinary income. For the year, Trust has no other income and no expenses or state or local taxes. </P> <P>(ii) For 2003, Trust has $5,000 of taxable income in the S portion. This income is taxed to Trust at the maximum rate provided in section 1(e). Trust also has $3,000 of distributable net income (DNI) in the non-S portion. The non-S portion of Trust receives a distribution deduction under section 661(a) of $3,000, which represents the amount distributed to Beneficiary during the year ($4,000), not to exceed the amount of DNI ($3,000). Beneficiary must include this amount in gross income under section 662(a). As a result, the non-S portion has no taxable income.</P> <P> (6) <E T="03">Example 6: NRA as potential current beneficiary.</E> Domestic Trust (DT) has a valid ESBT election in effect. DT owns S corporation stock. The S corporation owns U.S. and foreign assets. The foreign assets produce foreign source income. B, an NRA, is the grantor and the only trust beneficiary and potential current beneficiary of DT. B is not a resident of a country with which the United States has an income tax treaty. Under section 677(a), B is treated as the owner of DT because, under the trust documents, income and corpus may be distributed only to B during B's lifetime. Paragraph (b)(2)(ii) of this section requires that the S corporation income of the ESBT that otherwise would have been allocated to B under the grantor trust rules must be reallocated from B's grantor portion to the S portion of DT. In the example in this paragraph (l)(6), the S portion of DT is treated as including the grantor portion of the ESBT, and thus all of DT's income from the S corporation is taxable to DT. </P> <CITA>[T.D. 8994, 67 FR 34395, May 14, 2002, as amended by T.D. 9868, 84 FR 28215, June 18, 2019]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(a)(1)-1</SECTNO> <SUBJECT>Partially tax-exempt interest.</SUBJECT> <P>An estate or trust is allowed the credit against tax for partially tax-exempt interest provided by section 35 only to the extent that the credit does not relate to interest properly allocable to a beneficiary under section 652 or 662 and the regulations thereunder. A beneficiary of an estate or trust is allowed the credit against tax for partially tax-exempt interest provided by section 35 only to the extent that the credit relates to interest properly allocable to him under section 652 or 662 and the regulations thereunder. If an estate or trust holds partially tax-exempt bonds and elects under section 171 to treat the premium on the bonds as amortizable, the credit allowable under section 35, with respect to the bond interest (whether allowable to the estate or trust or to the beneficiary), is reduced under section 171(a)(3) by reducing the shares of the interest allocable, respectively, to the estate or trust and its beneficiary by the portion of the amortization deduction attributable to the shares.</P> </SECTION> <SECTION> <SECTNO>§ 1.642(a)(2)-1</SECTNO> <SUBJECT>Foreign taxes.</SUBJECT> <P> An estate or trust is allowed the credit against tax for taxes imposed by foreign countries and possessions of the <PRTPAGE P="20"/> United States to the extent allowed by section 901 only for so much of those taxes as are not properly allocable under that section to the beneficiaries. See section 901(b)(4). For purposes of section 901(b)(4), the term <E T="03">beneficiaries</E> includes charitable beneficiaries. </P> </SECTION> <SECTION> <SECTNO>§ 1.642(a)(3)-1</SECTNO> <SUBJECT>Dividends received by an estate or trust.</SUBJECT> <P>An estate or trust is allowed a credit against the tax for dividends received on or before December 31, 1964 (see section 34), only for so much of the dividends as are not properly allocable to any beneficiary under section 652 or 662. Section 642(a)(3), and this section do not apply to amounts received as dividends after December 31, 1964. For treatment of the credit in the hands of the beneficiary see § 1.652(b)-1.</P> <CITA>[T.D. 6777, 29 FR 17808, Dec. 16, 1964]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(a)(3)-2</SECTNO> <SUBJECT>Time of receipt of dividends by beneficiary.</SUBJECT> <P>In general, dividends are deemed received by a beneficiary in the taxable year in which they are includible in his gross income under section 652 or 662. For example, a simple trust, reporting on the basis of a fiscal year ending October 30, receives quarterly dividends on November 3, 1954, and February 3, May 3, and August 3, 1955. These dividends are all allocable to beneficiary A, reporting on a calendar year basis, under section 652 and are deemed received by A in 1955. See section 652(c). Accordingly, A may take all these dividends into account in determining his credit for dividends received under section 34 and his dividends exclusion under section 116. However, solely for purposes of determining whether dividends deemed received by individuals from trusts or estates qualify under the time limitations of section 34(a) or section 116(a), section 642(a)(3) provides that the time of receipt of the dividends by the trust or estate is also considered the time of receipt by the beneficiary. For example, a simple trust reporting on the basis of a fiscal year ending October 30 receives quarterly dividends on December 3, 1953, and March 3, June 3, and September 3, 1954. These dividends are all allocable to beneficiary A, reporting on the calendar year basis, under section 652 and are includible in his income for 1954. However, for purposes of section 34(a) or section 116(a), these dividends are deemed received by A on the same dates that the trust received them. Accordingly, A may take into account in determining the credit under section 34 only those dividends received by the trust on September 3, 1954, since the dividend received credit is not allowed under section 34 for dividends received before August 1, 1954 (or after December 31, 1964). Section 642(a)(3) and this section do not apply to amounts received by an estate or trust as dividends after December 31, 1964. However, the rules in this section relating to time of receipt of dividends by a beneficiary are applicable to dividends received by an estate or trust prior to January 1, 1965, and accordingly, such dividends are deemed to be received by the beneficiary (even though received after December 31, 1964) on the same dates that the estate or trust received them for purposes of determining the credit under section 34 or the exclusion under section 116.</P> <CITA>[T.D. 6777, 29 FR 17808, Dec. 16, 1964]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(a)(3)-3</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <P>See § 1.683-2(c) for examples relating to the treatment of dividends received by an estate or trust during a fiscal year beginning in 1953 and ending in 1954.</P> </SECTION> <SECTION> <SECTNO>§ 1.642(b)-1</SECTNO> <SUBJECT>Deduction for personal exemption.</SUBJECT> <P>In lieu of the deduction for personal exemptions provided by section 151:</P> <P>(a) An estate is allowed a deduction of $600,</P> <P>(b) A trust which, under its governing instrument, is required to distribute currently all of its income for the taxable year is allowed a deduction of $300, and</P> <P>(c) All other trusts are allowed a deduction of $100.</P> <FP> A trust which, under its governing instrument, is required to distribute all of its income currently is allowed a deduction of $300, even though it also distributes amounts other than income in the taxable year and even though it may be required to make distributions which would qualify for the charitable <PRTPAGE P="21"/> contributions deduction under section 642(c) (and therefore does not qualify as a “simple trust” under sections 651-652). A trust for the payment of an annuity is allowed a deduction of $300 in a taxable year in which the amount of the annuity required to be paid equals or exceeds all the income of the trust for the taxable year. For the meaning of the term <E T="03">income required to be distributed currently,</E> see § 1.651(a)-2. </FP> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-0</SECTNO> <SUBJECT>Effective dates.</SUBJECT> <P>The provisions of section 642(c) (other than section 642(c)(5)) and of §§ 1.642 (c)-1 through 1.642(c)-4 apply to amounts paid, permanently set aside, or to be used for a charitable purpose in taxable years beginning after December 31, 1969. The provisions of section 642(c)(5) and of §§ 1.642(c)-5 through 1.642(c)-7 apply to transfers in trust made after July 31, 1969. For provisions relating to amounts paid, permanently set aside, or to be used for a charitable purpose in taxable years beginning before January 1, 1970, see 26 CFR 1.642(c)-1 through 1.642(c)-4 (Rev. as of Jan. 1, 1971).</P> <CITA>[T.D. 7357, 40 FR 23739, June 2, 1975]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-1</SECTNO> <SUBJECT>Unlimited deduction for amounts paid for a charitable purpose.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) Any part of the gross income of an estate, or trust which, pursuant to the terms of the governing instrument is paid (or treated under paragraph (b) of this section as paid) during the taxable year for a purpose specified in section 170(c) shall be allowed as a deduction to such estate or trust in lieu of the limited charitable contributions deduction authorized by section 170(a). In applying this paragraph without reference to paragraph (b) of this section, a deduction shall be allowed for an amount paid during the taxable year in respect of gross income received in a previous taxable year, but only if no deduction was allowed for any previous taxable year to the estate or trust, or in the case of a section 645 election, to a related estate, as defined under § 1.645-1(b), for the amount so paid. </P> <P>(2) In determining whether an amount is paid for a purpose specified in section 170(c)(2) the provisions of section 170(c)(2)(A) shall not be taken into account. Thus, an amount paid to a corporation, trust, or community chest, fund, or foundation otherwise described in section 170(c)(2) shall be considered paid for a purpose specified in section 170(c) even though the corporation, trust, or community chest, fund, or foundation is not created or organized in the United States, any State, the District of Columbia, or any possession of the United States.</P> <P>(3) See section 642(c)(6) and § 1.642(c)-4 for disallowance of a deduction under this section to a trust which is, or is treated under section 4947(a)(1) as though it were a private foundation (as defined in section 509(a) and the regulations thereunder) and not exempt from taxation under section 501(a).</P> <P> (b) <E T="03">Election to treat contributions as paid in preceding taxable year</E> —(1) <E T="03">In general.</E> For purposes of determining the deduction allowed under paragraph (a) of this section, the fiduciary (as defined in section 7701(a)(6)) of an estate or trust may elect under section 642(c)(1) to treat as paid during the taxable year (whether or not such year begins before January 1, 1970) any amount of gross income received during such taxable year or any preceding taxable year which is otherwise deductible under such paragraph and which is paid after the close of such taxable year but on or before the last day of the next succeeding taxable year of the estate or trust. The preceding sentence applies only in the case of payments actually made in a taxable year which is a taxable year beginning after December 31, 1969. No election shall be made, however, in respect of any amount which was deducted for any previous taxable year or which is deducted for the taxable year in which such amount is paid. </P> <P> (2) <E T="03">Time for making election.</E> The election under subparagraph (1) of this paragraph shall be made not later than the time, including extensions thereof, prescribed by law for filing the income tax return for the succeeding taxable year. Such election shall, except as provided in subparagraph (4) of this paragraph, become irrevocable after the last day prescribed for making it. Having made the election for any taxable year, the fiduciary may, within <PRTPAGE P="22"/> the time prescribed for making it, revoke the election without the consent of the Commissioner. </P> <P> (3) <E T="03">Manner of making the election.</E> The election shall be made by filing with the income tax return (or an amended return) for the taxable year in which the contribution is treated as paid a statement which: </P> <P>(i) States the name and address of the fiduciary,</P> <P>(ii) Identifies the estate or trust for which the fiduciary is acting,</P> <P>(iii) Indicates that the fiduciary is making an election under section 642(c)(1) in respect of contributions treated as paid during such taxable year,</P> <P>(iv) Gives the name and address of each organization to which any such contribution is paid, and</P> <P>(v) States the amount of each contribution and date of actual payment or, if applicable, the total amount of contributions paid to each organization during the succeeding taxable year, to be treated as paid in the preceding taxable year.</P> <P> (4) <E T="03">Revocation of certain elections with consent.</E> An application to revoke with the consent of the Commissioner any election made on or before June 8, 1970, must be in writing and must be filed not later than September 2, 1975. </P> <FP>No consent will be granted to revoke an election for any taxable year for which the assessment of a deficiency is prevented by the operation of any law or rule of law. If consent to revoke the election is granted, the fiduciary must attach a copy of the consent to the return (or amended return) for each taxable year affected by the revocation. The application must be addressed to the Commissioner of Internal Revenue, Washington, DC 20224, and must indicate:</FP> <P>(i) The name and address of the fiduciary and the estate or trust for which he was acting,</P> <P>(ii) The taxable year for which the election was made,</P> <P>(iii) The office of the district director, or the service center, where the return (or amended return) for the year of election was filed, and</P> <P>(iv) The reason for revoking the election.</P> <CITA>[T.D. 7357, 40 FR 23739, June 2, 1975; 40 FR 24361, June 6, 1975; T.D. 9032, 67 FR 78376, Dec. 24, 2002]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-2</SECTNO> <SUBJECT>Unlimited deduction for amounts permanently set aside for a charitable purpose.</SUBJECT> <P> (a) <E T="03">Estates.</E> Any part of the gross income of an estate which pursuant to the terms of the will: </P> <P>(1) Is permanently set aside during the taxable year for a purpose specified in section 170(c), or</P> <P>(2) Is to be used (within or without the United States or any of its possessions) exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals, or for the establishment, acquisition, maintenance, or operation of a public cemetery not operated for profit,</P> <FP>shall be allowed as a deduction to the estate in lieu of the limited charitable contributions deduction authorized by section 170(a).</FP> <P> (b) <E T="03">Certain trusts</E> —(1) <E T="03">In general.</E> Any part of the gross income of a trust to which either subparagraph (3) or (4) of this paragraph applies, that by the terms of the governing instrument: </P> <P>(i) Is permanently set aside during the taxable year for a purpose specified in section 170(c), or</P> <P>(ii) Is to be used (within or without the United States or any of its possessions) exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals, or for the establishment, acquisition, maintenance, or operation of a public cemetery not operated for profit,</P> <FP> shall be allowed, subject to the limitation provided in subparagraph (2) of this paragraph, as a deduction to the trust in lieu of the limited charitable contributions deduction authorized by section 170(a). The preceding sentence applied only to a trust which is required by the terms of its governing instrument to set amounts aside. See section 642(c)(6) and § 1.642(c)-4 for disallowance of a deduction under this section to a trust which is, or is treated under section 4947(a)(1) as though it were, a private foundation (as defined <PRTPAGE P="23"/> in section 509(a) and the regulations thereunder) that is not exempt from taxation under section 501(a). </FP> <P> (2) <E T="03">Limitation of deduction.</E> Subparagraph (1) of this paragraph applies only to the gross income earned by a trust with respect to amounts transferred to the trust under a will executed on or before October 9, 1969, and satisfying the requirements of subparagraph (4) of this paragraph or transferred to the trust on or before October 9, 1969. For such purposes, any income, gains, or losses, which are derived at any time from the amounts so transferred to the trust shall also be taken into account in applying subparagraph (1) of this paragraph. If any such amount so transferred to the trust is invested or reinvested at any time, any asset received by the trust upon such investment or reinvestment shall also be treated as an amount which was so transferred to the trust. In the case of a trust to which this paragraph applies which contains (i) amounts transferred pursuant to transfers described in the first sentence of this subparagraph and (ii) amounts transferred pursuant to transfers not so described, subparagraph (1) of this paragraph shall apply only if the amounts described in subdivision (i) of this subparagraph, together with all income, gains, and losses derived therefrom, are separately accounted for from the amounts described in subdivision (ii) of this subparagraph, together with all income, gains, and losses derived therefrom. Such separate accounting shall be carried out consistently with the principles of paragraph (c)(4) of § 53.4947-1 of this chapter (Foundation Excise Tax Regulations), relating to accounting for segregated amounts of split-interest trusts. </P> <P> (3) <E T="03">Trusts created on or before October 9, 1969.</E> A trust to which this subparagraph applies is a trust, testamentary or otherwise, which was created on or before October 9, 1969, and which qualifies under either subdivision (i) or (ii) of this subparagraph. </P> <P> (i) <E T="03">Transfer of irrevocable remainder interest to charity.</E> To qualify under this subdivision the trust must have been created under the terms of an instrument granting an irrevocable remainder interest in such trust to or for the use of an organization described in section 170(c). If the instrument granted a revocable remainder interest but the power to revoke such interest terminated on or before October 9, 1969, without the remainder interest having been revoked, the remainder interest will be treated as irrevocable for purposes of the preceding sentence. </P> <P> (ii) <E T="03">Grantor under a mental disability to change terms of trust.</E> (A) To qualify under this subdivision (ii) the trust must have been created by a grantor who was at all times after October 9, 1969, under a mental disability to change the terms of the trust. The term <E T="03">mental disability</E> for this purpose means mental incompetence to change the terms of the trust, whether or not there has been an adjudication of mental incompetence and whether or not there has been an appointment of a committee, guardian, fiduciary, or other person charged with the care of the person or property of the grantor. </P> <P>(B) If the grantor has not been adjudged mentally incompetent, the trustee must obtain from a qualified physician a certificate stating that the grantor of the trust has been mentally incompetent at all times after October 9, 1969, and that there is no reasonable probability that the grantor's mental capacity will ever improve to the extent that he will be mentally competent to change the terms of the trust. A copy of this certification must be filed with the first return on which a deduction is claimed by reason of this subdivision (ii) and subparagraph (1) of this paragraph. Thereafter, a statement referring to such medical opinion must be attached to any return for a taxable year for which such a deduction is claimed and during which the grantor's mental incompetence continues. The original certificate must be retained by the trustee of the trust.</P> <P> (C) If the grantor has been adjudged mentally incompetent, a copy of the judgment or decree, and any modification thereof, must be filed with the first return on which a deduction is claimed by reason of this subdivision (ii) and subparagraph (1) of this paragraph. Thereafter, a statement referring to such judgment or decree must be attached to any return for a taxable year for which such a deduction is <PRTPAGE P="24"/> claimed and during which the grantor's mental incompetence continues. A copy of such judgment or decree must also be retained by the trustee of the trust. </P> <P>(D) This subdivision (ii) applies even though a person charged with the care of the person or property of the grantor has the power to change the terms of the trust.</P> <P> (4) <E T="03">Testamentary trust established by will executed on or before October 9, 1969.</E> A trust to which this subparagraph applies is a trust which was established by will executed on or before October 9, 1969, and which qualifies under either subdivision (i), (ii), or (iii) of this subparagraph. This subparagraph does not apply, however, to that portion of any trust, not established by a will executed on or before October 9, 1969, which was transferred to such trust by a will executed on or before October 9, 1969. Nor does it apply to that portion of any trust, not established by a will executed on or before October 9, 1969, which was subject to a testamentary power of appointment that fails by reason of the testator's nonexercise of the power in a will executed on or before October 9, 1969. </P> <P> (i) <E T="03">Testator dying within 3 years without republishing his will.</E> To qualify under this subdivision the trust must have been established by the will of a testator who died after October 9, 1969, but before October 9, 1972, without having amended any dispositive provision of the will after October 9, 1969, by codicil or otherwise. </P> <P> (ii) <E T="03">Testator having no right to change his will.</E> To qualify under this subdivision the trust must have been established by the will of a testator who died after October 9, 1969, and who at no time after that date had the right to change any portion of such will pertaining to such trust. This subdivision could apply, for example, where a contract has been entered into for the execution of wills containing reciprocal provisions as well as provisions for the benefit of an organization described in section 170(c) and under applicable local law the surviving testator is prohibited from revoking his will because he has accepted the benefit of the provisions of the will of the other contracting party. </P> <P> (iii) <E T="03">Testator under a mental disability to republish his will.</E> To qualify under this subdivision the trust must have been established by the will of a testator who died after October 8, 1972, without having amended any dispositive provision of such will after October 9, 1969, and before October 9, 1972, by codicil or otherwise, and who is under a mental disability at all times after October 8, 1972, to amend such will, by codicil or otherwise. The provisions of subparagraph (3)(ii) of this paragraph with respect to mental incompetence apply for purposes of this subdivision. </P> <P> (iv) <E T="03">Amendment of dispositive provisions.</E> The provisions of paragraph (e) (4) and (5) of § 20.2055-2 of this chapter (Estate Tax Regulations) are to be applied under subdivisions (i) and (iii) of this subparagraph in determining whether there has been an amendment of a dispositive provision of a will. </P> <P> (c) <E T="03">Pooled income funds.</E> Any part of the gross income of a pooled income fund to which § 1.642(c)-5 applies for the taxable year that is attributable to net long-term capital gain (as defined in section 1222(7)) which, pursuant to the terms of the governing instrument, is permanently set aside during the taxable year for a purpose specified in section 170(c) shall be allowed as a deduction to the fund in lieu of the limited charitable contributions deduction authorized by section 170(a). No amount of net long-term capital gain shall be considered permanently set aside for charitable purposes if, under the terms of the fund's governing instrument and applicable local law, the trustee has the power, whether or not exercised, to satisfy the income beneficiaries' right to income by the payment of either: an amount equal to a fixed percentage of the fair market value of the fund's assets (whether determined annually or averaged on a multiple year basis); or any amount that takes into account unrealized appreciation in the value of the fund's assets. In addition, no amount of net long-term capital gain shall be considered permanently set aside for charitable purposes to the extent the trustee distributes proceeds from the sale or exchange of the fund's assets as income within the meaning of § 1.642(c)-5(a)(5)(i). No deduction shall <PRTPAGE P="25"/> be allowed under this paragraph for any portion of the gross income of such fund which is (1) attributable to income other than net long-term capital gain (2) earned with respect to amounts transferred to such fund before August 1, 1969. However, see paragraph (b) of this section for a deduction (subject to the limitations of such paragraph) for amounts permanently set aside by a pooled income fund which meets the requirements of that paragraph. The principles of paragraph (b) or (2) of this section with respect to investment, reinvestment, and separate accounting shall apply under this paragraph in the case of amounts transferred to the fund after July 31, 1969. </P> <P> (d) <E T="03">Disallowance of deduction for certain amounts not deemed to be permanently set aside for charitable purposes.</E> No amount will be considered to be permanently set aside, or to be used, for a purpose described in paragraph (a) or (b)(1) of this section unless under the terms of the governing instrument and the circumstances of the particular case the possibility that the amount set aside, or to be used, will not be devoted to such purpose or use is so remote as to be negligible. Thus, for example, where there is possibility of the invasion of the corpus of a charitable remainder trust, as defined in § 1.664-1(a)(1)(ii), in order to make payment of the annuity amount or unitrust amount, no deduction will be allowed under paragraph (a) of this section in respect of any amount set aside by an estate for distribution to such a charitable remainder trust. </P> <P> (e) <E T="03">Effective dates.</E> Generally, the second sentence of paragraph (c) of this section, concerning the loss of any charitable deduction for long-term capital gains if the fund's income may be determined by a fixed percentage of the fair market value of the fund's assets or by any amount that takes into account unrealized appreciation in the value of the fund's assets, applies for taxable years beginning after January 2, 2004. In a state whose statute permits income to be determined by reference to a fixed percentage of, or the unrealized appreciation in, the value of the fund's assets, net long-term capital gain of a pooled income fund may be considered to be permanently set aside for charitable purposes if the fund's governing instrument is amended or reformed to eliminate the possibility of determining income in such a manner and if income has not been determined in this manner. For this purpose, a judicial proceeding to reform the fund's governing instrument must be commenced, or a nonjudicial reformation that is valid under state law must be completed, by the date that is nine months after the later of January 2, 2004 or the effective date of the state statute authorizing determination of income in such a manner. </P> <FP>For treatment of distributions by an estate to a charitable remainder trust, see paragraph (a)(5)(iii) of § 1.664-1.</FP> <CITA>[T.D. 7357, 40 FR 23740, June 2, 1975; 40 FR 24361, June 6, 1975, as amended by T.D. 9102, 69 FR 17, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-3</SECTNO> <SUBJECT>Adjustments and other special rules for determining unlimited charitable contributions deduction.</SUBJECT> <P> (a) <E T="03">Income in respect of a decedent.</E> For purposes of §§ 1.642(c)-1 and 1.642(c)-2, an amount received by an estate or trust which is includible in its gross income under section 691(a)(1) as income in respect of a decedent shall be included in the gross income of the estate or trust. </P> <P> (b) <E T="03">Determination of amounts deductible under section 642(c) and the character of such amounts</E> —(1) <E T="03">Reduction of charitable contributions deduction by amounts not included in gross income.</E> If an estate, pooled income fund, or other trust pays, permanently sets aside, or uses any amount of its income for a purpose specified in section 642(c) (1), (2) or (3) and that amount includes any items of estate or trust income not entering into the gross income of the estate or trust, the deduction allowable under § 1.642(c)-1 or § 1.642(c)-2 is limited to the gross income so paid, permanently set aside, or used. In the case of a pooled income fund for which a deduction is allowable under paragraph (c) of § 1.642(c)-2 for amounts permanently set aside, only the gross income of the fund which is attributable to net long-term capital gain (as defined in section 1222(7)) shall be taken into account. <PRTPAGE P="26"/> </P> <P> (2) <E T="03">Determination of the character of an amount deductible under section 642(c).</E> In determining whether the amounts of income so paid, permanently set aside, or used for a purpose specified in section 642(c)(1), (2), or (3) include particular items of income of an estate or trust, whether or not included in gross income, a provision in the governing instrument or in local law that specifically provides the source out of which amounts are to be paid, permanently set aside, or used for such a purpose controls for Federal tax purposes to the extent such provision has economic effect independent of income tax consequences. See § 1.652(b)-2(b). In the absence of such specific provisions in the governing instrument or in local law, the amount to which section 642(c) applies is deemed to consist of the same proportion of each class of the items of income of the estate or trust as the total of each class bears to the total of all classes. See § 1.643(a)-5(b) for the method of determining the allocable portion of exempt income and foreign income. This paragraph (b)(2) is illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A charitable lead annuity trust has the calendar year as its taxable year, and is to pay an annuity of $10,000 annually to an organization described in section 170(c). A provision in the trust governing instrument provides that the $10,000 annuity should be deemed to come first from ordinary income, second from short-term capital gain, third from fifty percent of the unrelated business taxable income, fourth from long-term capital gain, fifth from the balance of unrelated business taxable income, sixth from tax-exempt income, and seventh from principal. This provision in the governing instrument does not have economic effect independent of income tax consequences, because the amount to be paid to the charity is not dependent upon the type of income from which it is to be paid. Accordingly, the amount to which section 642(c) applies is deemed to consist of the same proportion of each class of the items of income of the trust as the total of each class bears to the total of all classes.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>A trust instrument provides that 100 percent of the trust's ordinary income must be distributed currently to an organization described in section 170(c) and that all remaining items of income must be distributed currently to B, a noncharitable beneficiary. This income ordering provision has economic effect independent of income tax consequences because the amount to be paid to the charitable organization each year is dependent upon the amount of ordinary income the trust earns within that taxable year. Accordingly, for purposes of section 642(c), the full amount distributed to charity is deemed to consist of ordinary income.</P> </EXAMPLE> <P> (3) <E T="03">Other examples.</E> For examples showing the determination of the character of an amount deductible under § 1.642(c)-1 or § 1.642(c)-2, see examples 1 and 2 in § 1.662(b)-2 and paragraph (e) of the example in § 1.662(c)-4. </P> <P> (c) <E T="03">Capital gains included in charitable contribution.</E> Where any amount of the income paid, permanently set aside, or used for a purpose specified in section 642(c) (1), (2), or (3), is attributable to net long-term capital gain (as defined in section 1222(7)), the amount of the deduction otherwise allowable under § 1.642(c)-1 or § 1.642(c)-2, must be adjusted for any deduction provided in section 1202 of 50 percent of the excess, if any, of the net long-term capital gain over the net short-term capital loss. For determination of the extent to which the contribution to which § 1.642(c)-1 or § 1.642(c)-2 applies is deemed to consist of net long-term capital gains, see paragraph (b) of this section. The application of this paragraph may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>Under the terms of the trust instrument, the income of a trust described in § 1.642(c)-2 (b)(3)(i) is currently distributable to A during his life and capital gains are allocable to corpus. No provision is made in the trust instrument for the invasion of corpus for the benefit of A. Upon A's death the corpus of the trust is to be distributed to M University, an organization described in section 501(c)(3) which is exempt from taxation under section 501(a). During the taxable year ending December 31, 1970, the trust has long-term capital gains of $100,000 from property transferred to it on or before October 9, 1969, which are permanently set aside for charitable purposes. The trust includes $100,000 in gross income but is allowed a deduction of $50,000 under section 1202 for the long-term capital gains and a charitable contributions deduction of $50,000 under section 642(c)(2) ($100,000 permanently set aside for charitable purposes less $50,000 allowed as a deduction under section 1202 with respect to such $100,000).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> Under the terms of the will, $200,000 of the income (including $100,000 capital gains) for the taxable year 1972 of an estate is distributed, one-quarter to each of two individual beneficiaries and one-half to <PRTPAGE P="27"/> N University, an organization described in section 501(c)(3) which is exempt from taxation under section 501(a). During 1972 the estate has ordinary income of $200,000, long-term capital gains of $100,000, and no capital losses. It is assumed that for 1972 the estate has no other items of income or any deductions other than those discussed herein. The entire capital gains of $100,000 are included in the gross income of the estate for 1972, and N University receives $100,000 from the estate in such year. However, the amount allowable to the estate under section 642(c)(1) is subject to appropriate adjustment for the deduction allowable under section 1202. In view of the distributions of $25,000 of capital gains to each of the individual beneficiaries, the deduction allowable to the estate under section 1202 is limited by such section to $25,000 [($100,000 capital gains less $50,000 capital gains includible in income of individual beneficiaries under section 662) × 50%]. Since the whole of this $25,000 deduction under section 1202 is attributable to the distribution of $50,000 of capital gains to N University, the deduction allowable to the estate in 1972 under section 642(c)(1) is $75,000 [$100,000 (distributed to N) less $25,000 (proper adjustment for section 1202 deduction)]. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>Under the terms of the trust instrument, 30 percent of the gross income (exclusive of capital gains) of a trust described in § 1.642(c)-2(b)(3)(i) is currently distributed to B, the sole income beneficiary. Net capital gains (capital gain net income for taxable years beginning after December 31, 1976) and undistributed ordinary income are allocable to corpus. No provision is made in the trust instrument for the invasion of corpus for the benefit of B. Upon B's death the remainder of the trust is to be distributed to M Church. During the taxable year 1972, the trust has ordinary income of $100,000, long-term capital gains of $15,000, short-term capital gains of $1,000, long-term capital losses of $5,000, and short-term capital losses of $2,500. It is assumed that the trust has no other items of income or any deductions other than those discussed herein. All the ordinary income and capital gains and losses are attributable to amounts transferred to the trust before October 9, 1969. The trust includes in gross income for 1972 the total amount of $116,000 [$100,000 (ordinary income) + $16,000 (total capital gains determined without regard to capital losses)]. Pursuant to the terms of the governing instrument the trust distributes to B in 1972 the amount of $30,000 ($100,000 × 30%). The balance of $78,500 [($116,000 less $7,500 capital losses) −030,000 distribution] is available for the set-aside for charitable purposes. In determining taxable income for 1972 the capital losses of $7,500 ($5,000 + $2,500) are allowable in full under section 1211(b)(1). The net capital gain (capital gain net income for taxable years beginning after December 31, 1976) of $8,500 ($16,000 less $7,500) is the excess of the net long-term capital gain of $10,000 ($15,000 less $5,000) over the net short-term capital loss of $1,500 ($2,500 less $1,000). The deduction under section 1202 is $4,250 ($8,500 × 50%), all of which is attributable to the set-aside for charitable purposes. Accordingly, for 1972 the deduction allowable to the trust under section 642(c)(2) is $74,250 [$78,500 (set-aside for M) less $4,250 (proper adjustment for section 1202 deduction)].</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>During the taxable year a pooled income fund, as defined in § 1.642(c)-5, has in addition to ordinary income long-term capital gains of $150,000, short-term capital gains of $15,000, long-term capital losses of $100,000, and short-term capital losses of $10,000. Under the Declaration of Trust and pursuant to State law net long-term capital gain is allocable to corpus and net short-term capital gain is to be distributed to the income beneficiaries of the fund. All the capital gains and losses are attributable to amounts transferred to the fund after July 31, 1969. In view of the distribution of the net short-term capital gain of $5,000 ($15,000 less $10,000) to the income beneficiaries, the deduction allowed to the fund under section 1202 is limited by such section to $25,000 [($150,000 (long-term capital gains) less $100,000 (long-term capital losses)) × 50%]. Since the whole of this deduction under section 1202 is attributable to the set-aside for charitable purposes, the deduction of $50,000 ($150,000 less $100,000) otherwise allowable under section 642(c)(3) is subject to appropriate adjustment under section 642(c)(4) for the deduction allowable under section 1202. Accordingly, the amount of the set-aside deduction is $25,000 [$50,000 (set-aside for public charity) less $25,000 (proper adjustment for section 1202 deduction)].</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P> The facts are the same as in example 4 except that under the Declaration of Trust and pursuant to State law all the net capital gain (capital gain net income for taxable years beginning after December 31, 1976) for the taxable year is allocable to corpus of the fund. The fund would thus include in gross income total capital gains of $165,000 ($150,000 + $15,000). In determining taxable income for the taxable year the capital losses of $110,000 ($100,000 + $10,000) are allowable in full under section 1211(b)(1). The net capital gain of $55,000 ($165,000 less $110,000) is available for the set-aside for charitable purposes under section 642(c)(3) only in the amount of the net long-term capital gain of $50,000 ($150,000 long-term gains less $100,000 long-term losses). The deduction under section 1202 is $25,000 ($50,000 × 50%), all of which is attributable to the set-aside for charitable purposes. Accordingly, the deduction allowable to the fund under section 642(c)(3) is $25,000 [$50,000 (set-aside for public charity) less $25,000 (proper adjustment for section 1202 deduction)]. The $5,000 balance of net <PRTPAGE P="28"/> capital gain (capital gain net income for taxable years beginning after December 31, 1976) is taken into account in determining taxable income of the pooled income fund for the taxable year. </P> </EXAMPLE> <P> (d) <E T="03">Disallowance of deduction for amounts allocable to unrelated business income.</E> In the case of a trust, the deduction otherwise allowable under § 1.642(c)-1 or § 1.642(c)-2 is disallowed to the extent of amounts allocable to the trust's unrelated business income. See section 681(a) and the regulations thereunder. </P> <P> (e) <E T="03">Disallowance of deduction in certain cases.</E> For disallowance of certain deductions otherwise allowable under section 642(c) (1), (2), or (3), see sections 508(d) and 4948(c)(4). </P> <P> (f) <E T="03">Information returns.</E> For rules applicable to the annual information return that must be filed by trusts claiming a deduction under section 642(c) for the taxable year, see section 6034 and the regulations thereunder. </P> <P> (g) <E T="03">Payments resulting in state or local tax benefits</E> —(1) <E T="03">In general.</E> If the trust or decedent's estate makes a payment of gross income for a purpose specified in section 170(c), and the trust or decedent's estate receives or expects to receive a state or local tax benefit in consideration for such payment, § 1.170A-1(h)(3) applies in determining the charitable contribution deduction under section 642(c). </P> <P> (2) <E T="03">Effective/applicability date.</E> Paragraph (g)(1) of this section applies to payments of gross income after August 27, 2018. </P> <CITA>[T.D. 7357, 40 FR 23741, June 2, 1975; 40 FR 24361, June 6, 1975, as amended by T.D. 7728, 45 FR 72650, Nov. 3, 1980; T.D. 9582, 77 FR 22484, Apr. 16, 2012; T.D. 9864, 84 FR 27530, June 13, 2019]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-4</SECTNO> <SUBJECT>Nonexempt private foundations.</SUBJECT> <P>In the case of a trust which is, or is treated under section 4947(a)(1) as though it were, a private foundation (as defined in section 509(a) and the regulations thereunder) that is not exempt from taxation under section 501(a) for the taxable year, a deduction for amounts paid or permanently set aside, or used for a purpose specified in section 642(c) (1), or (2) shall not be allowed under § 1.642(c)-1 or § 1.642(c)-2, but such trust shall, subject to the provisions applicable to individuals, be allowed a deduction under section 170 for charitable contributions paid during the taxable year. Section 642(c)(6) and this section do not apply to a trust described in section 4947(a)(1) unless such trust fails to meet the requirements of section 508(e). However, if on October 9, 1969, or at any time thereafter, a trust is recognized as being exempt from taxation under section 501(a) as an organization described in section 501(c)(3), if at such time such trust is a private foundation, and if at any time thereafter such trust is determined not to be exempt from taxation under section 501(a) as an organization described in section 501(c)(3), section 642(c)(6) and this section will apply to such trust. See § 1.509 (b)-1 (b).</P> <CITA>[T.D. 7357, 40 FR 23742, June 2, 1975; 40 FR 24362, June 6, 1975]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-5</SECTNO> <SUBJECT>Definition of pooled income fund.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Application of provisions.</E> Section 642(c)(5) prescribes certain rules for the valuation of contributions involving transfers to certain funds described in that section as pooled income funds. This section sets forth the requirements for qualifying as a pooled income fund and provides for the manner of allocating the income of the fund to the beneficiaries. Section 1.642(c)-6 provides for the valuation of a remainder interest in property transferred to a pooled income fund. Section 1.642(c)-7 provides transitional rules under which certain funds may be amended so as to qualify as pooled income funds in respect to transfers of property occurring after July 31, 1969. </P> <P> (2) <E T="03">Tax status of fund and its beneficiaries.</E> Notwithstanding any other provision of this chapter, a fund which meets the requirements of a pooled income fund, as defined in section 642(c)(5) and paragraph (b) of this section, shall not be treated as an association within the meaning of section 7701(a)(3). Such a fund, which need not be a trust under local law, and its beneficiaries shall be taxable under part I, subchapter J, chapter 1 of the Code, but the provisions of subpart E (relating to grantors and others treated as <PRTPAGE P="29"/> substantial owners) of such part shall not apply to such fund. </P> <P> (3) <E T="03">Recognition of gain or loss on transfer to fund.</E> No gain or loss shall be recognized to the donor on the transfer of property to a pooled income fund. In such case, the fund's basis and holding period with respect to property transferred to the fund by a donor shall be determined as provided in sections 1015(b) and 1223(2). If, however, a donor transfers property to a pooled income fund and, in addition to creating or retaining a life income interest therein, receives property from the fund, or transfers property to the fund which is subject to an indebtedness, this subparagraph shall not apply to the gain realized by reason of (i) the receipt of such property or (ii) the amount of such indebtedness, whether or not assumed by the pooled income fund, which is required to be treated as an amount realized on the transfer. For applicability of the bargain sale rules, see section 1011(b) and the regulations thereunder. </P> <P> (4) <E T="03">Charitable contributions deduction.</E> A charitable contributions deduction for the value of the remainder interest, as determined under § 1.642(c)-6, may be allowed under section 170, 2055, 2106, or 2522, where there is a transfer of property to a pooled income fund. For a special rule relating to the reduction of the amount of a charitable contribution of certain ordinary income property or capital gain property, see section 170(e)(1) (A) or (B)(i) and the regulations thereunder. </P> <P> (5) <E T="03">Definitions.</E> For purposes of this section, §§ 1.642(c)-6 and 1.642(c)-7: </P> <P> (i) The term <E T="03">income</E> has the same meaning as it does under section 643(b) and the regulations thereunder, except that income generally may not include any long-term capital gains. However, in conformance with the applicable state statute, income may be defined as or satisfied by a unitrust amount, or pursuant to a trustee's power to adjust between income and principal to fulfill the trustee's duty of impartiality, if the state statute both provides for a reasonable apportionment between the income and remainder beneficiaries of the total return of the trust and meets the requirements of § 1.643(b)-1. In exercising a power to adjust, the trustee must allocate to principal, not to income, the proceeds from the sale or exchange of any assets contributed to the fund by any donor or purchased by the fund at least to the extent of the fair market value of those assets on the date of their contribution to the fund or of the purchase price of those assets purchased by the fund. This definition of income applies for taxable years beginning after January 2, 2004. </P> <P> (ii) The term <E T="03">donor</E> includes a decedent who makes a testamentary transfer of property to a pooled income fund. </P> <P> (iii) The term <E T="03">governing instrument</E> means either the governing plan under which the pooled income fund is established and administered or the instrument of transfer, as the context requires. </P> <P> (iv) The term <E T="03">public charity</E> means an organization described in clause (i) to (vi) of section 170(b)(1)(A). If an organization is described in clause (i) to (vi) of section 170(b)(1)(A) and is also described in clause (viii) of such section, it shall be treated as a public charity. </P> <P> (v) The term <E T="03">fair market value,</E> when used with respect to property, means its value in excess of the indebtedness or charges against such property. </P> <P> (vi) The term <E T="03">determination date</E> means each day within the taxable year of a pooled income fund on which a valuation is made of the property in the fund. The property in the fund shall be valued on the first day of the taxable year of the fund and on at least 3 other days within the taxable year. The period between any two consecutive determination dates within the taxable year shall not be greater than 3 calendar months. In the case of a taxable year of less than 12 months, the property in the fund shall be valued on the first day of such taxable year and on such other days within such year as occur at successive intervals of no greater than 3 calendar months. Where a valuation date falls on a Saturday, Sunday, or legal holiday (as defined in section 7503 and the regulations thereunder), the valuation may be made on either the next preceding day which is not a Saturday, Sunday, or legal holiday or the next succeeding day which is not a Saturday, Sunday, or legal holiday, so long as the next such preceding day or next such succeeding day <PRTPAGE P="30"/> is consistently used where the valuation date falls on a Saturday, Sunday, or legal holiday. </P> <P> (6) <E T="03">Cross references.</E> (i) See section 4947(a)(2) and section 4947(b)(3)(B) for the application to pooled income funds of the provisions relating to private foundations and section 508(e) for rules relating to provisions required in the governing instrument prohibiting certain activities specified in section 4947(a)(2). </P> <P>(ii) For rules for postponing the time for deduction of a charitable contribution of a future interest in tangible personal property, see section 170(a)(3) and the regulations thereunder.</P> <P> (b) <E T="03">Requirements for qualification as a pooled income fund.</E> A pooled income fund to which this section applies must satisfy all of the following requirements: </P> <P> (1) <E T="03">Contribution of remainder interest to charity.</E> Each donor must transfer property to the fund and contribute an irrevocable remainder interest in such property to or for the use of a public charity, retaining for himself, or creating for another beneficiary or beneficiaries, a life income interest in the transferred property. A contingent remainder interest shall not be treated as an irrevocable remainder interest for purposes of this subparagraph. </P> <P> (2) <E T="03">Creation of life income interest.</E> Each donor must retain for himself for life an income interest in the property transferred to such fund, or create an income interest in such property for the life of one or more beneficiaries, each of whom must be living at the time of the transfer of the property to the fund by the donor. The term <E T="03">one or more beneficiaries</E> includes those members of a named class who are alive and can be ascertained at the time of the transfer of the property to the fund. In the event more than one beneficiary of the income interest is designated, such beneficiaries may enjoy their shares of income concurrently, consecutively, or both concurrently and consecutively. The donor may retain the power exercisable only by will to revoke or terminate the income interest of any designated beneficiary other than the public charity. The governing instrument must specify at the time of the transfer the particular beneficiary or beneficiaries to whom the income is payable and the share of income distributable to each person so specified. The public charity to or for the use of which the remainder interest is contributed may also be designated as one of the beneficiaries of an income interest. The donor need not retain or create a life interest in all the income from the property transferred to the fund provided any income not payable under the terms of the governing instrument to an income beneficiary is contributed to, and within the taxable year in which it is received is paid to, the same public charity to or for the use of which the remainder interest is contributed. No charitable contributions deduction shall be allowed to the donor for the value of such income interest of the public charity or for the amount of any such income paid to such organization. </P> <P> (3) <E T="03">Commingling of property required.</E> The property transferred to the fund by each donor must be commingled with, and invested or reinvested with, other property transferred to the fund by other donors satisfying the requirements of subparagraphs (1) and (2) of this paragraph. The governing instrument of the pooled income fund must contain a provision requiring compliance with the preceding sentence. The public charity to or for the use of which the remainder interest is contributed may maintain more than one pooled income fund, provided that each such fund is maintained by the organization and is not a device to permit a group of donors to create a fund which may be subject to their manipulation. The fund must not include property transferred under arrangements other than those specified in section 642(c)(5) and this paragraph. However, a fund shall not be disqualified as a pooled income fund under this paragraph because any portion of its properties is invested or reinvested jointly with other properties, not a part of the pooled income fund, which are held by, or for the use of, the public charity which maintains the fund, as for example, with securities in the general endowment fund of the public charity to or for the use of which the remainder interest is contributed. Where such joint investment or reinvestment of <PRTPAGE P="31"/> properties occurs, records must be maintained which sufficiently identify the portion of the total fund which is owned by the pooled income fund and the income earned by, and attributable to, such portion. Such a joint investment or reinvestment of properties shall not be treated as an association or partnership for purposes of the Code. A bank which serves as trustee of more than one pooled income fund may maintain a common trust fund to which section 584 applies for the collective investment and reinvestment of moneys of such funds. </P> <P> (4) <E T="03">Prohibition against exempt securities.</E> The property transferred to the fund by any donor must not include any securities, the income from which is exempt from tax under subtitle A of the Code, and the fund must not invest in such securities. The governing instrument of the fund must contain specific prohibitions against accepting or investing in such securities. </P> <P> (5) <E T="03">Maintenance by charitable organization required.</E> The fund must be maintained by the same public charity to or for the use of which the irrevocable remainder interest is contributed. The requirement of maintenance will be satisfied where the public charity exercises control directly or indirectly over the fund. For example, this requirement of control shall ordinarily be met when the public charity has the power to remove the trustee or trustees of the fund and designate a new trustee or trustees. A national organization which carries out its purposes through local organizations, chapters, or auxiliary bodies with which it has an identity of aims and purposes may maintain a pooled income fund (otherwise satisfying the requirements of this paragraph) in which one or more local organizations, chapters, or auxiliary bodies which are public charities have been named as recipients of the remainder interests. For example, a national church body may maintain a pooled income fund where donors have transferred property to such fund and contributed an irrevocable remainder interest therein to or for the use of various local churches or educational institutions of such body. The fact that such local organizations or chapters have been separately incorporated from the national organization is immaterial. </P> <P> (6) <E T="03">Prohibition against donor or beneficiary serving as trustee.</E> The fund must not have, and the governing instrument must prohibit the fund from having, as a trustee a donor to the fund or a beneficiary (other than the public charity to or for the use of which the remainder interest is contributed) of an income interest in any property transferred to such fund. Thus, if a donor or beneficiary (other than such public charity) directly or indirectly has general responsibilities with respect to the fund which are ordinarily exercised by a trustee, such fund does not meet the requirements of section 642(c)(5) and this paragraph. The fact that a donor of property to the fund, or a beneficiary of the fund, is a trustee, officer, director, or other official of the public charity to or for the use of which the remainder interest is contributed ordinarily will not prevent the fund from meeting the requirements of section 642(c)(5) and this paragraph. </P> <P> (7) <E T="03">Income of beneficiary to be based on rate of return of fund.</E> Each beneficiary entitled to income of any taxable year of the fund must receive such income in an amount determined by the rate of return earned by the fund for such taxable year with respect to his income interest, computed as provided in paragraph (c) of this section. The governing instrument of the fund shall direct the trustee to distribute income currently or within the first 65 days following the close of the taxable year in which the income is earned. Any such payment made after the close of the taxable year shall be treated as paid on the last day of the taxable year. A statement shall be attached to the return of the pooled income fund indicating the date and amount of such payments after the close of the taxable year. Subject to the provisions of part I, subchapter J, chapter 1 of the Code, the beneficiary shall include in his gross income all amounts properly paid, credited, or required to be distributed to the beneficiary during the taxable year or years of the fund ending within or with his taxable year. The governing instrument shall provide that the income interest of any designated beneficiary shall either terminate with the last <PRTPAGE P="32"/> regular payment which was made before the death of the beneficiary or be prorated to the date of his death. </P> <P> (8) <E T="03">Termination of life income interest.</E> Upon the termination of the income interest retained or created by any donor, the trustee shall sever from the fund an amount equal to the value of the remainder interest in the property upon which the income interest is based. The value of the remainder interest for such purpose may be either (i) its value as of the determination date next succeeding the termination of the income interest or (ii) its value as of the date on which the last regular payment was made before the death of the beneficiary if the income interest is terminated on such payment date. The amount so severed from the fund must either be paid to, or retained for the use of, the designated public charity, as provided in the governing instrument. However, see subparagraph (3) of this paragraph for rules relating to commingling of property. </P> <P> (c) <E T="03">Allocation of income to beneficiary</E> —(1) <E T="03">In general.</E> Every income interest retained or created in property transferred to a pooled income fund shall be assigned a proportionate share of the annual income earned by the fund, such share, or unit of participation, being based on the fair market value of such property on the date of transfer, as provided in this paragraph. </P> <P> (2) <E T="03">Units of participation</E> —(i) <E T="03">Unit plan.</E> ( <E T="03">a</E> ) On each transfer of property by a donor to a pooled income fund, one or more units of participation in the fund shall be assigned to the beneficiary or beneficiaries of the income interest retained or created in such property, the number of units of participation being equal to the number obtained by dividing the fair market value of the property by the fair market value of a unit in the fund at the time of the transfer. </P> <P> ( <E T="03">b</E> ) The fair market value of a unit in the fund at the time of the transfer shall be determined by dividing the fair market value of all property in the fund at such time by the number of units then in the fund. The initial fair market value of a unit in a pooled income fund shall be the fair market value of the property transferred to the fund divided by the number of units assigned to the income interest in that property. The value of each unit of participation will fluctuate with each new transfer of property to the fund in relation to the appreciation or depreciation in the fair market value of the property in the fund, but all units in the fund will always have equal value. </P> <P> ( <E T="03">c</E> ) The share of income allocated to each unit of participation shall be determined by dividing the income of the fund for the taxable year by the outstanding number of units in the fund at the end of such year, except that, consistently with paragraph (b)(7) of this section, income shall be allocated to units outstanding during only part of such year by taking into consideration the period of time such units are outstanding. For this purpose the actual income of such part of the taxable year, or a prorated portion of the annual income, may be used, after making such adjustments as are reasonably necessary to reflect fluctuations during the year in the fair market value of the property in the fund. </P> <P> (ii) <E T="03">Other plans.</E> The governing instrument of the fund may provide any other reasonable method not described in subdivision (i) of this subparagraph for assigning units of participation in the fund and allocating income to such units which reaches a result reasonably consistent with the provisions of such subdivision. </P> <P> (iii) <E T="03">Transfers between determination dates.</E> For purposes of subdivisions (i) and (ii) of this subparagraph, if a transfer of property to the fund by a donor occurs on other than a determination date, the number of units of participation assigned to the income interest in such property may be determined by using the fair market value of the property in the fund on the determination date immediately preceding the date of transfer (determined without regard to the property so transferred), subject, however, to appropriate adjustments on the next succeeding determination date. Such adjustments may be made by any reasonable method, including the use of a method whereby the fair market value of the property in the fund at the time of the transfer is deemed to be the average of the fair market values of the property in the fund on the determination dates immediately preceding and succeeding <PRTPAGE P="33"/> the date of transfer. For purposes of determining such average any property transferred to the fund between such preceding and succeeding dates, or on such succeeding date, shall be excluded. The application of this subdivision may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>The determination dates of a pooled income fund are the first day of each calendar month. On April 1, 1971, the fair market value of the property in the fund is $100,000, at which time 1,000 units of participation are outstanding with a value of $100 each. On April 15, 1971, B transfers property with a fair market value of $50,000 to the fund, retaining for himself for life an income interest in such property. No other property is transferred to the fund after April 1, 1971. On May 1, 1971, the fair market value of the property in the fund, including the property transferred by B, is $160,000. The average of the fair market values of the property in the fund (excluding the property transferred by B) on April 1 and May 1, 1971, is $105,000 ($100,000 + [$160,000−$50,000] ÷ 2). Accordingly, the fair market value of a unit of participation in the fund on April 15, 1971, at the time of B's transfer may be deemed to be $105 ($105,000/1,000 units), and B is assigned 476.19 units of participation in the fund ($50,000/$105).</P> </EXAMPLE> <P> (3) <E T="03">Special rule for partial allocation of income to charity.</E> Notwithstanding subparagraph (2) of this paragraph, the governing instrument may provide that a unit of participation is entitled to share in the income of the fund in a lesser amount than would otherwise be determined under such subparagraph, provided that the income otherwise allocable to the unit under such subparagraph is paid within the taxable year in which it is received to the public charity to or for the use of which the remainder interest is contributed under the governing instrument. </P> <P> (4) <E T="03">Illustrations.</E> The application of this paragraph may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>On July 1, 1970, A and B transfer separate properties with a fair market value of $20,000 and $10,000, respectively, to a newly created pooled income fund which is maintained by Y University and uses as its taxable year the fiscal year ending June 30. A and B each retain in themselves for life an income interest in such property, the remainder interest being contributed to Y University. The pooled income fund assigns an initial value of $100 to each unit of participation in the fund, and under the governing instruments A receives 200 units, and B receives 100 units, in the fund. On October 1, 1970, which is a determination date, C transfers property to the fund with a fair market value of $12,000, retaining in himself for life an income interest in such property and contributing the remainder interest to Y University. The fair market value of the property in the fund at the time of C's transfer is $36,000. The fair market value of A's and B's units at the time of such transfer is $120 each ($36,000 / 300). By reason of his transfer of property C is assigned 100 units of participation in the fund ($12,000 / $120).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Assume that the pooled income fund in example 1 earns $2,600 for its taxable year ending June 30, 1971, and there are no further contributions of property to the fund in such year. Further assume $300 is earned in the first quarter ending September 30, 1970. Therefore, the fund earns $1 per unit for the first quarter ($300 divided by 300 units outstanding) and $5.75 per unit for the remainder of the taxable year ([$2,600 − $300] divided by 400 units outstanding). If the fund distributes its income for the year based on its actual earnings per quarter, the income must be distributed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,r80"> <BOXHD> <CHED H="1"> <E T="03">Beneficiary</E> </CHED> <CHED H="1"> <E T="03">Share of income</E> </CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>$1,350 ([200 × $1] + [200 × $5.75]).</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>$675 ([100 × $1] + [100 × $5.75]).</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>$575 (100 × $5.75).</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>(a) On July 1, 1970, A and B transfer separate properties with a fair market value of $10,000 and $20,000, respectively, to a newly created pooled income fund which is maintained by X University and uses as its taxable year the fiscal year ending June 30. A and B each retain in themselves an income interest for life in such property, the remainder interest being contributed to X University. The governing instrument provides that each unit of participation in the fund shall have a value of not more than its initial fair market value; the instrument also provides that the income allocable to appreciation in the fair market value of such unit (to the extent in excess of its initial fair market value) at the end of each quarter of the fiscal year is to be distributed currently to X University. On October 1, 1970, which is a determination date, C contributes to the fund property with a fair market value of $60,000 and retains in himself an income interest for life in such property, the remainder interest being contributed to X University. The initial fair market value of the units assigned to A, B, and C is $100. A, B, and C's units of participation are as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,r80"> <BOXHD> <CHED H="1"> <E T="03">Beneficiary</E> </CHED> <CHED H="1"> <E T="03">Units of participation</E> </CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>100 ($10,000 divided by $100).</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>200 ($20,000 divided by $100).</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>100 ($10,000 divided by $100).</ENT> </ROW> </GPOTABLE> <PRTPAGE P="34"/> <P>(b) The fair market value of the property in the fund at the time of C's contribution is $40,000. Assuming the fair market value of the property in the fund is $100,000 on December 31, 1970, and that the income of the fund for the second quarter ending December 31, 1970, is $2,000, the income is shared by the income beneficiaries and X University as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,r80"> <BOXHD> <CHED H="1"> <E T="03">Beneficiary</E> </CHED> <CHED H="1"> <E T="03">Allocation of income</E> </CHED> </BOXHD> <ROW> <ENT I="01">A, B, and C</ENT> <ENT>90% ($90,000 divided by $100,000).</ENT> </ROW> <ROW> <ENT I="01">X University</ENT> <ENT>10% ($10,000 divided by $100,000).</ENT> </ROW> </GPOTABLE> <P>(c) For the quarter ending December 31, 1970, each unit of participation is allocated $2 (90 percent × $2,000 divided by 900) of the income earned for that quarter. A, B, C, and X University share in the income as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,r80"> <BOXHD> <CHED H="1"> <E T="03">Beneficiary</E> </CHED> <CHED H="1"> <E T="03">Share of income</E> </CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>$200 (100 × $2).</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>$400 (200 × $2).</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>$1,200 (600 × $2).</ENT> </ROW> <ROW> <ENT I="01">X University</ENT> <ENT>$200 (10% × $2,000).</ENT> </ROW> </GPOTABLE> </EXAMPLE> <CITA>[T.D. 7105, 36 FR 6477, Apr. 6, 1971; 36 FR 7004, Apr. 13, 1971, as amended by T.D. 7125, 36 FR 11032, June 8, 1971; T.D. 7357, 40 FR 23742, June 2, 1975; T.D. 7633, 44 FR 57925, Oct. 9, 1979; T.D. 9102, 69 FR 18, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-6</SECTNO> <SUBJECT>Valuation of a remainder interest in property transferred to a pooled income fund.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) For purposes of sections 170, 2055, 2106, and 2522, the fair market value of a remainder interest in property transferred to a pooled income fund is its present value determined under paragraph (d) of this section. </P> <P>(2) The present value of a remainder interest at the time of the transfer of property to the pooled income fund is determined by computing the present value (at the time of the transfer) of the life income interest and subtracting that value from the fair market value of the transferred property on the valuation date. The fact that the income beneficiary may not receive the last income payment, as provided in paragraph (b)(7) of § 1.642(c)-5, is not taken into account for purposes of determining the value of the life income interest. For purposes of this section, the valuation date is the date on which property is transferred to the fund by the donor except that, for purposes of section 2055 or 2106, it is the alternate valuation date, if elected, under the provisions and limitations set forth in section 2032 and the regulations thereunder.</P> <P>(3) Any claim for a deduction on any return for the value of the remainder interest in property transferred to a pooled income fund must be supported by a statement attached to the return showing the computation of the present value of the interest.</P> <P> (b) <E T="03">Actuarial computations by the Internal Revenue Service.</E> The regulations in this and in related sections provide tables of actuarial factors and examples that illustrate the use of the tables in determining the value of remainder interests in property. Section 1.7520-1(c)(2) refers to government publications that provide additional tables of factors and examples of computations for more complex situations. If the computation requires the use of a factor that is not provided in this section, the Commissioner may supply the factor upon a request for a ruling. A request for a ruling must be accompanied by a recitation of the facts including the pooled income fund's highest yearly rate of return for the 3 taxable years immediately preceding the date of transfer, the date of birth of each measuring life, and copies of the relevant documents. A request for a ruling must comply with the instructions for requesting a ruling published periodically in the Internal Revenue Bulletin (see §§ 601.201 and 601.601(d)(2)(ii)( <E T="03">b</E> ) of this chapter) and include payment of the required user fee. If the Commissioner furnishes the factor, a copy of the letter supplying the factor should be attached to the tax return in which the deduction is claimed. If the Commissioner does not furnish the factor, the taxpayer must furnish a factor computed in accordance with the principles set forth in this section. </P> <P> (c) <E T="03">Computation of pooled income fund's yearly rate of return.</E> (1) For purposes of determining the present value of the life income interest, the yearly rate of return earned by a pooled income fund for a taxable year is the percentage obtained by dividing the amount of income earned by the pooled income fund for the taxable year by an amount equal to— <PRTPAGE P="35"/> </P> <P>(i) The average fair market value of the property in such fund for that taxable year; less</P> <P>(ii) The corrective term adjustment.</P> <P>(2) The average fair market value of the property in a pooled income fund for a taxable year shall be the sum of the amounts of the fair market value of all property held by the pooled income fund on each determination date, as defined in paragraph (a)(5)(vi) of § 1.642(c)-5, of such taxable year divided by the number of determination dates in such taxable year. For such purposes the fair market value of property held by the fund shall be determined without including any income earned by the fund.</P> <P>(3)(i) The corrective term adjustment shall be the sum of the products obtained by multiplying each income payment made by the pooled income fund within its taxable year by the percentage set forth in column (2) of the following table opposite the period within such year, set forth in column (1), which includes the date on which that payment is made:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,10.5"> <TTITLE>Table</TTITLE> <BOXHD> <CHED H="1"> (1) <E T="03">Payment period</E> </CHED> <CHED H="1"> (2) <E T="03">Percentage of payment</E> </CHED> </BOXHD> <ROW> <ENT I="01">Last week of 4th quarter</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">Balance of 4th quarter</ENT> <ENT>25</ENT> </ROW> <ROW> <ENT I="01">Last week of 3d quarter</ENT> <ENT>25</ENT> </ROW> <ROW> <ENT I="01">Balance of 3d quarter</ENT> <ENT>50</ENT> </ROW> <ROW> <ENT I="01">Last week of 2d quarter</ENT> <ENT>50</ENT> </ROW> <ROW> <ENT I="01">Balance of 2d quarter</ENT> <ENT>75</ENT> </ROW> <ROW> <ENT I="01">Last week of 1st quarter</ENT> <ENT>75</ENT> </ROW> <ROW> <ENT I="01">Balance of 1st quarter</ENT> <ENT>100</ENT> </ROW> </GPOTABLE> <P>(ii) If the taxable year of the fund consists of less than 12 months, the corrective term adjustment shall be the sum of the products obtained by multiplying each income payment made by the pooled income fund within such taxable year by the percentage obtained by subtracting from 1 a fraction the numerator of which is the number of days from the first day of such taxable year to the date of such income payment and the denominator of which is 365.</P> <P>(4) A pooled income fund's method of calculating its yearly rate of return must be supported by a full statement attached to the income tax return of the pooled income fund for each taxable year.</P> <P>(5) The application of this paragraph may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(a) The pooled income fund maintained by W University has established determination dates on the first day of each calendar quarter. The pooled income fund is on a calendar-year basis. The pooled income fund earned $5,000 of income during 1971. The fair market value of its property (determined without including any income earned by the fund), and the income paid out, on the first day of each calendar quarter in 1971 are as follows:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s20,8.7,8.7"> <BOXHD> <CHED H="1">Date</CHED> <CHED H="1">Fair market value of property</CHED> <CHED H="1">Income payment</CHED> </BOXHD> <ROW> <ENT I="01">Jan. 1</ENT> <ENT>$100,000</ENT> <ENT>$1,200</ENT> </ROW> <ROW> <ENT I="01">Apr. 1</ENT> <ENT>105,000</ENT> <ENT>1,200</ENT> </ROW> <ROW> <ENT I="01">July 1</ENT> <ENT>95,000</ENT> <ENT>1,200</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Oct. 1</ENT> <ENT>100,000</ENT> <ENT>1,400</ENT> </ROW> <ROW> <ENT I="22"> </ENT> <ENT>400,000</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> <P>(b) The average fair market value of the property in the fund for 1971 is $100,000 ($400,000, divided by 4).</P> <P>(c) The corrective term adjustment for 1971 is $3,050, determined by applying the percentages obtained in column (2) of the table in subparagraph (3) of this paragraph:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s40,8.7"> <BOXHD> <CHED H="1"> <E T="03">Multiplication:</E> </CHED> <CHED H="1"> <E T="03">Product</E> </CHED> </BOXHD> <ROW> <ENT I="02">100% × $1,200</ENT> <ENT>$1,200</ENT> </ROW> <ROW> <ENT I="02">75% × $1,200</ENT> <ENT>900</ENT> </ROW> <ROW> <ENT I="02">50% × $1,200</ENT> <ENT>600</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">25% × $1,400</ENT> <ENT>350</ENT> </ROW> <ROW> <ENT I="03">Sum of products</ENT> <ENT>3,050</ENT> </ROW> </GPOTABLE> <P>(d) The pooled income fund's yearly rate of return for 1971 is 5.157 percent, determined as follows:</P> <FP SOURCE="FP-2">$5,000 ÷ $100,000 − $3,050 = 0.05157</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(a) The pooled income fund maintained by X University has established determination dates on the first day of each calendar quarter. The pooled income fund is on a calendar-year basis. The pooled income fund earned $5,000 of income during 1971 and paid out $3,000 on December 15, 1971, and $2,000 on January 15, 1972, the last amount being treated under paragraph (b)(7) of § 1.642(c)-5 as paid on December 31, 1971. The fair market value of its property (determined without including any income earned by the fund) on the determination dates in 1971 and the income paid out during 1971 are as follows:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s20,8.7,8.7"> <BOXHD> <CHED H="1">Date</CHED> <CHED H="1">Fair market value of property</CHED> <CHED H="1">Income payment</CHED> </BOXHD> <ROW> <ENT I="01">Jan. 1</ENT> <ENT>$125,000</ENT> <ENT/> </ROW> <ROW> <ENT I="01">Apr. 1</ENT> <ENT>125,000</ENT> <ENT/> </ROW> <ROW> <ENT I="01">July 1</ENT> <ENT>75,000</ENT> <ENT/> </ROW> <ROW> <ENT I="01">Oct. 1</ENT> <ENT>75,000</ENT> </ROW> <ROW> <ENT I="01">Dec. 15</ENT> <ENT/> <ENT>$3,000</ENT> </ROW> <ROW RUL="n,s"> <PRTPAGE P="36"/> <ENT I="01">Dec. 31</ENT> <ENT/> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="11"> </ENT> <ENT>400,000</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> <P>(b) The average fair market value of the property in the fund for 1971 is $100,000 ($400,000 divided by 4).</P> <P>(c) The corrective term adjustment for 1971 is $750, determined by applying the percentages obtained in column (2) of the table in subparagraph (3) of this paragraph:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,8.7"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> <E T="03">Product</E> </CHED> </BOXHD> <ROW> <ENT I="11">Multiplication:</ENT> </ROW> <ROW> <ENT I="02">0% × $2,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">25% × $3,000</ENT> <ENT>$750</ENT> </ROW> <ROW> <ENT I="03">Sum of products</ENT> <ENT>750</ENT> </ROW> </GPOTABLE> <P>(d) The pooled income fund's yearly rate of return for 1971 is 5.038 percent, determined as follows:</P> <FP SOURCE="FP-2">$5,000 ÷ $100,000 − $750 = 0.05038</FP> </EXAMPLE> <P> (d) <E T="03">Valuation.</E> The present value of the remainder interest in property transferred to a pooled income fund on or after June 1, 2023, is determined under paragraph (e) of this section. The present value of the remainder interest in property transferred to a pooled income fund for which the valuation date is before June 1, 2023, is determined (subject to paragraph (e)(2) of this section) under the following sections: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,10,15"> <TTITLE> Table 6 to Paragraph ( <E T="01">d</E> ) </TTITLE> <BOXHD> <CHED H="1">Valuation dates</CHED> <CHED H="2">After</CHED> <CHED H="2">Before</CHED> <CHED H="1"> Applicable <LI>regulations</LI> </CHED> </BOXHD> <ROW> <ENT I="22"> </ENT> <ENT>01-01-52</ENT> <ENT>§ 1.642(c)-6A(a)</ENT> </ROW> <ROW> <ENT I="01">12-31-51</ENT> <ENT>01-01-71</ENT> <ENT>1.642(c)-6A(b)</ENT> </ROW> <ROW> <ENT I="01">12-31-70</ENT> <ENT>12-01-83</ENT> <ENT>1.642(c)-6A(c)</ENT> </ROW> <ROW> <ENT I="01">11-30-83</ENT> <ENT>05-01-89</ENT> <ENT>1.642(c)-6A(d)</ENT> </ROW> <ROW> <ENT I="01">04-30-89</ENT> <ENT>05-01-99</ENT> <ENT>1.642(c)-6A(e)</ENT> </ROW> <ROW> <ENT I="01">04-30-99</ENT> <ENT>05-01-09</ENT> <ENT>1.642(c)-6A(f)</ENT> </ROW> <ROW> <ENT I="01">04-30-09</ENT> <ENT>06-01-23</ENT> <ENT>1.642(c)-6A(g)</ENT> </ROW> </GPOTABLE> <P> (e) <E T="03">Present value of the remainder interest in the case of transfers to pooled income funds for which the valuation date is on or after June 1, 2023</E> —(1) <E T="03">In general.</E> In the case of transfers to pooled income funds for which the valuation date is on or after June 1, 2023, the present value of a remainder interest is determined under this section. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). The present value of a remainder interest that is dependent on the termination of the life of one individual is computed by using the formula in § 20.2031-7(d)(2)(ii)(B) of this chapter to derive a remainder factor from the appropriate mortality table to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table S. Table S currently is available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Table S is referenced and explained by IRS Publication 1457, <E T="03">Actuarial Valuations Version 4A,</E> which will be available within a reasonable time after June 1, 2023. For purposes of the computations under this section, the age of an individual is the age at the individual's nearest birthday. </P> <P> (2) <E T="03">Transitional rule for valuation of transfers to pooled income funds.</E> For purposes of section 170, 2055, 2106, 2522, or 2624, in the case of transfers to a pooled income fund for which the valuation date is after April 30, 2019, and on or before June 1, 2023, the present value of the remainder interest under this section is determined by using the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial factors derived from the selected mortality table, either Table 2010CM in § 20.2031-7(d)(7)(ii) of this chapter or Table 2000CM in § 20.2031-7A(g)(4) of this chapter, at the option of the donor or the decedent's executor, as the case may be. If any previously filed income tax return is amended to use the actuarial factors based on Table 2010CM, the amended return must state at the top “AMENDED PURSUANT TO TD 9974.” If any previously filed gift or estate tax return is supplemented to use the actuarial factors based on Table 2010CM, the supplemental return must state at the top “SUPPLEMENTED PURSUANT TO TD 9974.” For the convenience of taxpayers, actuarial factors based on Table 2010CM appear in the current version of Table S, and actuarial factors based on Table 2000CM appear in the previous version of Table S. Both versions of Table S currently are available, at no charge, electronically via <PRTPAGE P="37"/> the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). The donor or decedent's executor must consistently use the same mortality basis with respect to each interest (income, remainder, partial, etc.) in the same property, and with respect to all transfers occurring on the same valuation date. For example, gift and income tax charitable deductions with respect to the same transfer must be determined based on factors with the same mortality basis, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on factors with the same mortality basis. </P> <P> (3) <E T="03">Present value of a remainder interest.</E> The present value of a remainder interest in property transferred to a pooled income fund is computed on the basis of— </P> <P> (i) Life contingencies determined from the values of l <E T="52">X</E> that are set forth in Table 2010CM in § 20.2031-7(d)(7)(ii) of this chapter (see § 20.2031-7A of this chapter for certain prior periods); and </P> <P>(ii) Discount at a rate of interest, compounded annually, equal to the highest yearly rate of return of the pooled income fund for the three taxable years immediately preceding its taxable year in which the transfer of property to the fund is made. For purposes of this paragraph (e), the yearly rate of return of a pooled income fund is determined as provided in paragraph (c) of this section unless the highest rate of return is deemed to be the rate described in paragraph (e)(4) of this section for funds in existence less than 3 taxable years. For purposes of this paragraph (e)(3)(ii), the first taxable year of a pooled income fund is considered a taxable year even though the taxable year consists of less than 12 months. However, appropriate adjustments must be made to annualize the rate of return earned by the fund for that period. Where it appears from the facts and circumstances that the highest yearly rate of return of the fund for the three taxable years immediately preceding the taxable year in which the transfer of property is made has been purposely manipulated to be substantially less than the rate of return that otherwise would be reasonably anticipated with the purpose of obtaining an excessive charitable deduction, that rate of return may not be used. In that case, the highest yearly rate of return of the fund is determined by treating the fund as a pooled income fund that has been in existence for less than three preceding taxable years.</P> <P> (4) <E T="03">Pooled income funds in existence less than three taxable years.</E> If a pooled income fund has been in existence less than three taxable years immediately preceding the taxable year in which the transfer is made to the fund and the transfer to the fund is made on or after May 1, 1989, the highest rate of return is deemed to be the interest rate (rounded to the nearest two-tenths of one percent) that is one percent less than the highest annual average of the monthly section 7520 rates for the three calendar years immediately preceding the calendar year in which the transfer to the pooled income fund is made. The deemed rate of return for transfers to new pooled income funds is recomputed each calendar year using the monthly section 7520 rates for the three year period immediately preceding the calendar year in which each transfer to the fund is made until the fund has been in existence for three taxable years and can compute its highest rate of return for the three taxable years immediately preceding the taxable year in which the transfer of property to the fund is made in accordance with the rules set forth in the first sentence of paragraph (e)(3)(ii) of this section. </P> <P> (5) <E T="03">Computation of value of remainder interest</E> —(i) <E T="03">Factor.</E> The factor that is used in determining the present value of a remainder interest that is dependent on the termination of the life of one individual is the factor obtained through use of the formula in § 20.2031-7(d)(2)(ii)(B) of this chapter to derive a remainder factor from the appropriate mortality table to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table S. Table S currently is available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables.</E> Table S is referenced and explained in IRS Publication 1457, <E T="03"> Actuarial Valuations Version <PRTPAGE P="38"/> 4A, </E> which will be available within a reasonable time after June 1, 2023. In using the section of Table S for the interest rate equal to the appropriate yearly rate of return, the appropriate remainder factor is opposite the number that corresponds to the age of the individual upon whose life the value of the remainder interest is based (See § 1.642(c)-6A for certain prior periods). The tables referenced by IRS Publication 1457, <E T="03">Actuarial Valuations Version 4A,</E> include factors for yearly rates of return from 0.2 to 20 percent, inclusive, in increments of two-tenths of one percent. For other situations, see paragraph (b) of this section. If the yearly rate of return is a percentage that is between the yearly rates of return for which factors are provided by Table S, an exact method of obtaining the applicable factors (such as through software using the actual rate of return and the actuarial formulas provided in § 20.2031-7(d)(2)(ii)(B) of this chapter) or a linear interpolation must be used, provided whichever method used is applied consistently in valuing all interests in the same property. The applicable remainder factors derived by an exact method or by interpolation must be expressed to at least five decimal places. The present value of the remainder interest is determined by multiplying the fair market value of the property on the valuation date by the appropriate remainder factor. </P> <P> (ii) <E T="03">Sample factors from actuarial Table S.</E> For purposes of the example in paragraph (e)(5)(iii) of this section, the following factors from Table S will be used: </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s50,15,15,15"> <TTITLE> Table 7 to Paragraph <E T="01">(e)(5)(ii)</E> </TTITLE> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Annuity</CHED> <CHED H="1">Life estate</CHED> <CHED H="1">Remainder</CHED> </BOXHD> <ROW EXPSTB="03" RUL="s"> <ENT I="21"> <E T="02">Factors from Table S—Based on Table 2010CM</E> </ENT> </ROW> <ROW RUL="s"> <ENT I="21"> <E T="02">Interest at 5.4 Percent</E> </ENT> </ROW> <ROW EXPSTB="00" RUL="s"> <ENT I="01">55</ENT> <ENT>13.2515</ENT> <ENT>0.71558</ENT> <ENT>0.28442</ENT> </ROW> <ROW EXPSTB="03" RUL="s"> <ENT I="21"> <E T="02">Interest at 5.6 Percent</E> </ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">55</ENT> <ENT>12.9710</ENT> <ENT>0.72637</ENT> <ENT>0.27363</ENT> </ROW> </GPOTABLE> <P> (iii) <E T="03">Example of interpolation.</E> After June 1, 2023, A, whose age is 54 years and 8 months, transfers $100,000 to a pooled income fund, and retains a life income interest in the property. The highest yearly rate of return earned by the fund for its 3 preceding taxable years is 5.43 percent. In Table S, the remainder factor opposite 55 years under 5.4 percent is 0.28442 and under 5.6 percent is 0.27363. The present value of the remainder interest is $28,280, computed as illustrated in Figure 1 to this paragraph (e)(5)(iii). </P> <GPH SPAN="2" DEEP="275"> <PRTPAGE P="39"/> <TCAP>Figure 1 to Paragraph (e)(5)(iii)—Illustration of Interpolation Method</TCAP> <GID>ER07JN23.007</GID> </GPH> <P> (6) <E T="03">Actuarial tables.</E> In the case of transfers for which the valuation date is on or after June 1, 2023, the present value of a remainder interest dependent on the termination of one life in the case of a transfer to a pooled income fund is determined by using the formula in § 20.2031-7(d)(2)(ii)(B) of this chapter to derive a remainder factor from the appropriate mortality table to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table S. Table S currently is available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables.</E> Table S is referenced and explained in IRS Publication 1457, <E T="03">Actuarial Valuations Version 4A,</E> which will be available within a reasonable time after June 1, 2023. </P> <P> (f) <E T="03">Applicability date.</E> This section applies on and after June 1, 2023. </P> <CITA>[T.D. 7105, 36 FR 6480, Apr. 6, 1971; 36 FR 9512, May 26, 1971; 36 FR 12290, June 30, 1971, as amended by T.D. 7955, 49 FR 19976, May 11, 1984; T.D. 8540, 59 FR 30105, June 10, 1994; T.D. 8819, 64 FR 23190, Apr. 30, 1999; T.D. 8886, 65 FR 36910, June 12, 2000; T.D. 9448, 74 FR 21440, May 7, 2009; T.D. 9540, 76 FR 49572, Aug. 10, 2011; T.D. 9974, 88 FR 37429, June 7, 2023]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(c)-7</SECTNO> <SUBJECT>Transitional rules with respect to pooled income funds.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Amendment of certain funds.</E> A fund created before May 7, 1971, and not otherwise qualifying as a pooled income fund may be treated as a pooled income fund to which § 1.642(c)-5 applies if on July 31, 1969, or on each date of transfer of property to the fund occurring after July 31, 1969, it possessed the initial characteristics described in paragraph (b) of this section <PRTPAGE P="40"/> and is amended, in the time and manner provided in paragraph (c) of this section, to meet all the requirements of section 642(c)(5) and § 1.642(c)-5. If a fund to which this subparagraph applies is amended in the time and manner provided in paragraph (c) of this section it shall be treated as provided in paragraph (d) of this section for the period beginning on August 1, 1969, or, if later, on the date of its creation and ending the day before the date on which it meets the requirements of section 642(c)(5) and § 1.642(c)-5. </P> <P> (2) <E T="03">Severance of a portion of a fund.</E> Any portion of a fund created before May 7, 1971, which consists of property transferred to such fund after July 31, 1969, may be severed from such fund consistently with the principles of paragraph (c)(2) of this section and established before January 1, 1972, as a separate pooled income fund, provided that on and after the date of severance the severed fund meets all the requirements of section 642(c)(5) and § 1.642(c)-5. A separate fund which is established pursuant to this subparagraph shall be treated as provided in paragraph (d) of this section for the period beginning on the day of the first transfer of property which becomes part of the separate fund and ending the day before the day on which the separate fund meets the requirements of section 642(c)(5) and § 1.642(c)-5. </P> <P> (b) <E T="03">Initial characteristics required.</E> A fund described in paragraph (a)(1) of this section shall not be treated as a pooled income fund to which section 642(c)(5) applies, even though it is amended as provided in paragraph (c) of this section, unless it possessed the following characteristics on July 31, 1969, or on each date of transfer of property to the fund occurring after July 31, 1969: </P> <P>(1) It satisfied the requirements of section 642(c)(5)(A) other than that the fund be a trust;</P> <P>(2) It was constituted in a way to attract and contain commingled properties transferred to the fund by more than one donor satisfying such requirements; and</P> <P>(3) Each beneficiary of a life income interest which was retained or created in any property transferred to the fund was entitled to receive, but not less often than annually, a proportional share of the annual income earned by the fund, such share being based on the fair market value of the property in which such life interest was retained or created.</P> <P> (c) <E T="03">Amendment requirements.</E> (1) A fund described in paragraph (a)(1) of this section and possessing the initial characteristics described in paragraph (b) of this section on the date prescribed therein shall be treated as a pooled income fund if it is amended to meet all the requirements of section 642(c)(5) and § 1.642(c)-5 before January 1, 1972, or, if later, on or before the 30th day after the date on which any judicial proceedings commenced before January 1, 1972, which are required to amend its governing instrument or any other instrument which does not permit it to meet such requirements, become final. However, see paragraph (d) of this section for limitation on the period in which a claim for credit or refund may be filed. </P> <P> (2) In addition, if the transferred property described in paragraph (b)(2) of this section is commingled with other property, the transferred property must be separated on or before the date specified in subparagraph (1) of this paragraph from the other property and allocated to the fund in accordance with the transferred property's percentage share of the fair market value of the total commingled property on the date of separation. The percentage share shall be the ratio which the fair market value of the transferred property on the date of separation bears to the fair market value of the total commingled property on that date and shall be computed in a manner consistent with paragraph (c) of § 1.642(c)-5. The property which is so allocated to the fund shall be treated as property received from transfers which meet the requirements of section 642(c)(5), and such transfers shall be treated as made on the dates on which the properties giving rise to such allocation were transferred to the fund by the respective donors. The property so allocated to the fund must be representative of all the commingled property other than securities the income from which is exempt from tax under subtitle A of the Code; compensating increases in <PRTPAGE P="41"/> other commingled property allocated to the fund shall be made where such tax-exempt securities are not allocated to the fund. The application of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) The trustees of X fund are in the process of amending it in order to qualify as a pooled income fund. The property transferred to the X fund was commingled with other property transferred to the organization by which the fund was established. After taking into account the various transfers and the appreciation in the fair market value of all the properties, the fair market value of the property allocated to the fund on the various transfer dates is set forth in the following schedule and determined in the manner indicated:</P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s80,10.2,8,8,10.2,8.2"> <TDESC> <E T="04">Transfers</E> </TDESC> <BOXHD> <CHED H="1">Date of transfer</CHED> <CHED H="1">Value of all property before transfer</CHED> <CHED H="2">(1)</CHED> <CHED H="1">Trust property</CHED> <CHED H="2">(2)</CHED> <CHED H="1">Other property</CHED> <CHED H="2">(3)</CHED> <CHED H="1">Value of all property after transfer</CHED> <CHED H="2">(4)</CHED> <CHED H="1">Property allocated to fund</CHED> <CHED H="2">(5)</CHED> </BOXHD> <ROW> <ENT I="01">January 1, 1968</ENT> <ENT/> <ENT>$100,000</ENT> <ENT>$100,000</ENT> <ENT>$200,000</ENT> <ENT> <SU>1</SU>  $100,000 </ENT> </ROW> <ROW> <ENT I="01">September 30, 1968</ENT> <ENT>$300,000</ENT> <ENT>100,000</ENT> <ENT/> <ENT>400,000</ENT> <ENT> <SU>2</SU>  250,000 </ENT> </ROW> <ROW> <ENT I="01">January 15, 1969</ENT> <ENT>480,000</ENT> <ENT>60,000</ENT> <ENT/> <ENT>540,000</ENT> <ENT> <SU>3</SU>  360,000 </ENT> </ROW> <ROW> <ENT I="01">November 11, 1969</ENT> <ENT>600,000</ENT> <ENT>200,000</ENT> <ENT/> <ENT>800,000</ENT> <ENT> <SU>4</SU>  600,000 </ENT> </ROW> <TNOTE> <SU>1</SU>  $100,000 = (the amount in column (2)). </TNOTE> <TNOTE> <SU>2</SU>  $250,000 = ([$100,000/$200,000 × $300,000] + $100,000). </TNOTE> <TNOTE> <SU>3</SU>  $360,000 = ([$250,000/$400,000 × $480,000] + $60,000). </TNOTE> <TNOTE> <SU>4</SU>  $600,000 = ([$360,000/$540,000 × $600,000] + $200,000). </TNOTE> </GPOTABLE> <P>(b) On September 30, 1970, the trustees decide to separate the property of X fund from the other property. The fair market value of all the commingled property is $1 million on September 30, 1970, and there were no additional transfers to the fund after November 11, 1969. Accordingly, the fair market value of the property required to be allocated to X fund must be $750,000 ($600,000/$800,000 × $1,000,000), and X fund's percentage share of the commingled property is 75 percent ($750,000/$1,000,000). Accordingly, assuming that the commingled property consists of Y stock with a fair market value of $800,000 and Z bonds with a fair market value of $200,000, there must be allocated to X fund at the close of September 30, 1970, Y stock with a value of $600,000 ($800,000 × 75%) and Z bonds with a value of $150,000 ($200,000 × 75%).</P> </EXAMPLE> <P> (d) <E T="03">Transactions before amendment of or severance from fund.</E> (1) A fund which is amended pursuant to paragraph (c) of this section, or is severed from a fund pursuant to paragraph (a)(2) of this section, shall be treated for all purposes, including the allowance of a deduction for any charitable contribution, as if it were before its amendment or severance a pooled income fund to which section 642(c)(5) and § 1.642(c)-5 apply. Thus, for example, where a donor transferred property in trust to such an amended or severed fund on August 1, 1969, but before its amendment or severance under this section, a charitable contributions deduction for the value of the remainder interest may be allowed under section 170, 2055, 2106, or 2522. The deduction may not be allowed, however, until the fund is amended or severed pursuant to this section and shall be allowed only if a claim for credit or refund is filed within the period of limitation prescribed by section 6511(a). </P> <P> (2) For purposes of determining under § 1.642(c)-6 the highest yearly rate of return earned by a fund (which is amended pursuant to paragraph (c) of this section) for the 3 preceding taxable years, taxable years of the fund preceding its taxable year in which the fund is so amended and qualifies as a pooled income fund under this section shall be used provided that the fund did not at any time during such preceding years hold any investments in securities the income from which is exempt from tax under subtitle A of the Code. If any such tax-exempt securities were held during such period by such amended fund, or if the fund consists of a portion of a fund which is severed pursuant to paragraph (a)(2) of this section, the highest yearly rate of return under § 1.642(c)-6 shall be determined by treating the fund as a pooled income fund which has been in existence for less than 3 taxable years preceding the taxable year in which the transfer of property to the fund is made. <PRTPAGE P="42"/> </P> <P>(3) Property transferred to a fund before its amendment pursuant to paragraph (c) of this section, or before its severance under paragraph (a)(2) of this section, shall be treated as property received from transfers which meet the requirements of section 642(c)(5).</P> <CITA>[T.D. 7105, 36 FR 6486, Apr. 6, 1971, as amended by T.D. 7125, 36 FR 11032, June 8, 1971; T.D. 8540, 59 FR 30102, June 10, 1994]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(d)-1</SECTNO> <SUBJECT>Net operating loss deduction.</SUBJECT> <P>The net operating loss deduction allowed by section 172 is available to estates and trusts generally, with the following exceptions and limitations:</P> <P>(a) In computing gross income and deductions for the purposes of section 172, a trust shall exclude that portion of the income and deductions attributable to the grantor or another person under sections 671 through 678 (relating to grantors and others treated as substantial owners).</P> <P>(b) An estate or trust shall not, for the purposes of section 172, avail itself of the deductions allowed by section 642(c) (relating to charitable contributions deductions) and sections 651 and 661 (relating to deductions for distributions).</P> </SECTION> <SECTION> <SECTNO>§ 1.642(e)-1</SECTNO> <SUBJECT>Depreciation and depletion.</SUBJECT> <P> An estate or trust is allowed the deductions for depreciation and depletion, but only to the extent the deductions are not apportioned to beneficiaries under sections 167(h) and 611(b). For purposes of sections 167(h) and 611(b), the term <E T="03">beneficiaries</E> includes charitable beneficiaries. See the regulations under those sections. </P> <CITA>[T.D. 6712, 29 FR 3655, Mar. 24, 1964]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(f)-1</SECTNO> <SUBJECT>Amortization deductions.</SUBJECT> <P>An estate or trust is allowed amortization deductions with respect to an emergency facility as defined in section 168(d), with respect to a certified pollution control facility as defined in section 169(d), with respect to qualified railroad rolling stock as defined in section 184(d), with respect to certified coal mine safety equipment as defined in section 187(d), with respect to on-the-job training and child-care facilities as defined in section 188(b), and with respect to certain rehabilitations of certified historic structures as defined in section 191, in the same manner and to the same extent as in the case of an individual. However, the principles governing the apportionment of the deductions for depreciation and depletion between fiduciaries and the beneficiaries of an estate or trust (see sections 167(h) and 611(b) and the regulations thereunder) shall be applicable with respect to such amortization deductions.</P> <CITA>[T.D. 7700, 45 FR 38055, June 6, 1980]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(g)-1</SECTNO> <SUBJECT>Disallowance of double deductions; in general.</SUBJECT> <P>Amounts allowable under section 2053(a)(2) (relating to administration expenses) or under section 2054 (relating to losses during administration) as deductions in computing the taxable estate of a decedent are not allowed as deductions in computing the taxable income of the estate unless there is filed a statement, in duplicate, to the effect that the items have not been allowed as deductions from the gross estate of the decedent under section 2053 or 2054 and that all rights to have such items allowed at any time as deductions under section 2053 or 2054 are waived. The statement should be filed with the return for the year for which the items are claimed as deductions or with the district director for the internal revenue district in which the return was filed, for association with the return. The statement may be filed at any time before the expiration of the statutory period of limitation applicable to the taxable year for which the deduction is sought. Allowance of a deduction in computing an estate's taxable income is not precluded by claiming a deduction in the estate tax return, so long as the estate tax deduction is not finally allowed and the statement is filed. However, after a statement is filed under section 642(g) with respect to a particular item or portion of an item, the item cannot thereafter be allowed as a deduction for estate tax purposes since the waiver operates as a relinquishment of the right to have the deduction allowed at any time under section 2053 or 2054.</P> </SECTION> <SECTION> <PRTPAGE P="43"/> <SECTNO>§ 1.642(g)-2</SECTNO> <SUBJECT>Deductions included.</SUBJECT> <P>It is not required that the total deductions, or the total amount of any deduction, to which section 642(g) is applicable be treated in the same way. One deduction or portion of a deduction may be allowed for income tax purposes if the appropriate statement is filed, while another deduction or portion is allowed for estate tax purposes. Section 642(g) has no application to deductions for taxes, interest, business expenses, and other items accrued at the date of a decedent's death so that they are allowable as a deduction under section 2053(a)(3) for estate tax purposes as claims against the estate, and are also allowable under section 691(b) as deductions in respect of a decedent for income tax purposes. However, section 642(g) is applicable to deductions for interest, business expenses, and other items not accrued at the date of the decedent's death so that they are allowable as deductions for estate tax purposes only as administration expenses under section 2053(a)(2). Although deductible under section 2053(a)(3) in determining the value of the taxable estate of a decedent, medical, dental, etc., expenses of a decedent which are paid by the estate of the decedent are not deductible in computing the taxable income of the estate. See section 213(d) and the regulations thereunder for rules relating to the deductibility of such expenses in computing the taxable income of the decedent.</P> </SECTION> <SECTION> <SECTNO>§ 1.642(h)-1</SECTNO> <SUBJECT>Unused loss carryovers on termination of an estate or trust.</SUBJECT> <P>(a) If, on the final termination of an estate or trust, a net operating loss carryover under section 172 or a capital loss carryover under section 1212 would be allowable to the estate or trust in a taxable year subsequent to the taxable year of termination but for the termination, the carryover or carryovers are allowed under section 642(h)(1) to the beneficiaries succeeding to the property of the estate or trust. See § 1.641(b)-3 for the determination of when an estate or trust terminates.</P> <P>(b) The net operating loss carryover and the capital loss carryover are the same in the hands of a beneficiary as in the estate or trust, except that the capital loss carryover in the hands of a beneficiary which is a corporation is a short-term loss irrespective of whether it would have been a long-term or short-term capital loss in the hands of the estate or trust. The net operating loss carryover and the capital loss carryover are taken into account in computing taxable income, adjusted gross income, and the tax imposed by section 56 (relating to the minimum tax for tax preferences). The first taxable year of the beneficiary to which the loss shall be carried over is the taxable year of the beneficiary in which or with which the estate or trust terminates. However, for purposes of determining the number of years to which a net operating loss, or a capital loss under paragraph (a) of § 1.1212-1, may be carried over by a beneficiary, the last taxable year of the estate or trust (whether or not a short taxable year) and the first taxable year of the beneficiary to which a loss is carried over each constitute a taxable year, and, in the case of a beneficiary of an estate or trust that is a corporation, capital losses carried over by the estate or trust to any taxable year of the estate or trust beginning after December 31, 1963, shall be treated as if they were incurred in the last taxable year of the estate or trust (whether or not a short taxable year). For the treatment of the net operating loss carryover when the last taxable year of the estate or trust is the last taxable year to which such loss can be carried over, see § 1.642(h)-2.</P> <P>(c) The application of this section may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A trust distributes all of its assets to A, the sole remainderman, and terminates on December 31, 1954, when it has a capital loss carryover of $10,000 attributable to transactions during the taxable year 1952. A, who reports on the calendar year basis, otherwise has ordinary income of $10,000 and capital gains of $4,000 for the taxable year 1954. A would offset his capital gains of $4,000 against the capital loss of the trust and, in addition, deduct under section 1211(b) $1,000 on his return for the taxable year 1954. The balance of the capital loss carryover of $5,000 may be carried over only to the years 1955 and 1956, in accordance with paragraph (a) of § 1.1212-1 and the rules of this section.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> A trust distributes all of its assets, one-half to A, an individual, and one-half to X, a corporation, who are the sole <PRTPAGE P="44"/> remaindermen, and terminates on December 31, 1966, when it has a short-term capital loss carryover of $20,000 attributable to short-term transactions during the taxable years 1964, 1965, and 1966, and a long-term capital loss carryover of $12,000 attributable to long-term transactions during such years. A, who reports on the calendar year basis, otherwise has ordinary income of $15,000, short-term capital gains of $4,000 and long-term capital gains of $6,000, for the taxable year 1966. A would offset his short-term capital gains of $4,000 against his share of the short-term capital loss carryover of the trust, $10,000 (one-half of $20,000), and, in addition deduct under section 1211(b) $1,000 (treated as a short-term gain for purposes of computing capital loss carryovers) on his return for the taxable year 1966. A would also offset his long-term capital gains of $6,000 against his share of the long-term capital loss carryover of the trust, $6,000 (one-half of $12,000). The balance of A's share of the short-term capital loss carryover, $5,000, may be carried over as a short-term capital loss carryover to the succeeding taxable year and treated as a short-term capital loss incurred in such succeeding taxable year in accordance with paragraph (b) of § 1.1212-1. X, which also reports on the calendar year basis, otherwise has capital gains of $4,000 for the taxable year 1966. X would offset its capital gains of $4,000 against its share of the capital loss carryovers of the trust, $16,000 (the sum of one-half of each the short-term carryover and the long-term carryover of the trust), on its return for the taxable year 1966. The balance of X's share, $12,000, may be carried over as a short-term capital loss only to the years 1967, 1968, 1969, and 1970, in accordance with paragraph (a) of § 1.1212-1 and the rules of this section. </P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6828, 30 FR 7805, June 17, 1965; T.D. 7564, 43 FR 40495, Sept. 12, 1978]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(h)-2</SECTNO> <SUBJECT>Excess deductions on termination of an estate or trust.</SUBJECT> <P> (a) <E T="03">Excess deductions</E> —(1) <E T="03">In general.</E> If, on the termination of an estate or trust, the estate or trust has for its last taxable year deductions (other than the deductions allowed under section 642(b) (relating to the personal exemption) or section 642(c) (relating to charitable contributions)) in excess of gross income, the excess deductions as determined under paragraph (b) of this section are allowed under section 642(h)(2) as items of deduction to the beneficiaries succeeding to the property of the estate or trust. </P> <P> (2) <E T="03">Treatment by beneficiary.</E> A beneficiary may claim all or part of the amount of the deductions provided for in paragraph (a) of this section, as determined after application of paragraph (b) of this section, before, after, or together with the same character of deductions separately allowable to the beneficiary under the Internal Revenue Code for the beneficiary's taxable year during which the estate or trust terminated as provided in paragraph (c) of this section. </P> <P> (b) <E T="03">Character and amount of excess deductions</E> —(1) <E T="03">Character.</E> The character and amount of the excess deductions on termination of an estate or trust will be determined as provided in this paragraph (b). Each deduction comprising the excess deductions under section 642(h)(2) retains, in the hands of the beneficiary, its character (specifically, as allowable in arriving at adjusted gross income, as a non-miscellaneous itemized deduction, or as a miscellaneous itemized deduction) while in the estate or trust. An item of deduction succeeded to by a beneficiary remains subject to any additional applicable limitation under the Internal Revenue Code and must be separately stated if it could be so limited, as provided in the instructions to Form 1041, <E T="03">U.S. Income Tax Return for Estates and Trusts,</E> and the Schedule K-1 (Form 1041), <E T="03">Beneficiary's Share of Income, Deductions, Credit, etc.,</E> or successor forms. </P> <P> (2) <E T="03">Amount.</E> The amount of the excess deductions in the final year is determined as follows: </P> <P>(i) Each deduction directly attributable to a class of income is allocated in accordance with the provisions in § 1.652(b)-(a);</P> <P>(ii) To the extent of any remaining income after application of paragraph (b)(2)(i) of this section, deductions are allocated in accordance with the provisions in § 1.652(b)-3(b) and (d); and</P> <P>(iii) Deductions remaining after the application of paragraph (b)(2)(i) and (ii) of this section comprise the excess deductions on termination of the estate or trust. These deductions are allocated to the beneficiaries succeeding to the property of the estate of or trust in accordance with § 1.642(h)-4.</P> <P> (c) <E T="03">Year of termination</E> —(1) <E T="03">In general.</E> The deductions provided for in paragraph (a) of this section are allowable <PRTPAGE P="45"/> only in the taxable year of the beneficiary in which or with which the estate or trust terminates, whether the year of termination of the estate or trust is of normal duration or is a short taxable year. </P> <P> (2) <E T="03">Example.</E> Assume that a trust distributes all its assets to B and terminates on December 31, Year X. As of that date, it has excess deductions of $18,000, all characterized as allowable in arriving at adjusted gross income under section 67(e). B, who reports on the calendar year basis, could claim the $18,000 as a deduction allowable in arriving at B's adjusted gross income for Year X. However, if the deduction (when added to other allowable deductions that B claims for the year) exceeds B's gross income, the excess may not be carried over to any year subsequent to Year X. </P> <P> (d) <E T="03">Net operating loss carryovers.</E> A deduction based upon a net operating loss carryover will never be allowed to beneficiaries under both paragraphs (1) and (2) of section 642(h). Accordingly, a net operating loss deduction which is allowable to beneficiaries succeeding to the property of the estate or trust under the provisions of paragraph (1) of section 642(h) cannot also be considered a deduction for purposes of paragraph (2) of section 642(h) and paragraph (a) of this section. However, if the last taxable year of the estate or trust is the last year in which a deduction on account of a net operating loss may be taken, the deduction, to the extent not absorbed in that taxable year by the estate or trust, is considered an “excess deduction” under section 642(h)(2) and paragraph (a) of this section. </P> <P> (e) <E T="03">Items included in net operating loss or capital loss carryovers.</E> (c) Any item of income or deduction, or any part thereof, which is taken into account in determining the net operating loss or capital loss carryover of the estate or trust for its last taxable year shall not be taken into account again in determining excess deductions on termination of the trust or estate within the meaning of section 642(h)(2) and paragraph (a) of this section (see example in § 1.642(h)-5). </P> <P> (f) <E T="03">Applicability date.</E> Paragraphs (a) through (c) of this section apply to taxable years beginning after October 19, 2020. The rules applicable to taxable years beginning on or before October 19, 2020 are contained in §  1.642(h)-2 as in effect prior to October 19, 2020 (see 26 CFR part 1 revised as of April 1, 2020). Taxpayers may choose to apply paragraphs (a) through (c) of this section to taxable years beginning after December 31, 2017, and on or before October 19, 2020. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7564, 43 FR 40495, Sept. 12, 1978; 85 FR 66224, Oct. 19, 2020]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(h)-3</SECTNO> <SUBJECT>Meaning of “beneficiaries succeeding to the property of the estate or trust”.</SUBJECT> <P> (a) The phrase <E T="03">beneficiaries succeeding to the property of the estate or trust</E> means those beneficiaries upon termination of the estate or trust who bear the burden of any loss for which a carryover is allowed, or of any excess of deductions over gross income for which a deduction is allowed, under section 642(h). </P> <P>(b) With reference to an intestate estate, the phrase means the heirs and next of kin to whom the estate is distributed, or if the estate is insolvent, to whom it would have been distributed if it had not been insolvent. If a decedent's spouse is entitled to a specified dollar amount of property before any distribution to other heirs and next of kin, and if the estate is less than that amount, the spouse is the beneficiary succeeding to the property of the estate or trust to the extent of the deficiency in amount.</P> <P> (c) In the case of a testate estate, the phrase normally means the residuary beneficiaries (including a residuary trust), and not specific legatees or devisees, pecuniary legatees, or other nonresiduary beneficiaries. However, the phrase does not include the recipient of a specific sum of money even though it is payable out of the residue, except to the extent that it is not payable in full. On the other hand, the phrase includes a beneficiary (including a trust) who is not strictly a residuary beneficiary but whose devise or bequest is determined by the value of the decedent's estate as reduced by the loss or deductions in question. Thus the phrase includes: <PRTPAGE P="46"/> </P> <P>(1) A beneficiary of a fraction of a decedent's net estate after payment of debts, expenses, etc.;</P> <P>(2) A nonresiduary legatee or devisee, to the extent of any deficiency in his legacy or devise resulting from the insufficiency of the estate to satisfy it in full;</P> <P>(3) A surviving spouse receiving a fractional share of an estate in fee under a statutory right of election, to the extent that the loss or deductions are taken into account in determining the share. However, the phrase does not include a recipient of dower or curtesy, or any income beneficiary of the estate or trust from which the loss or excess deduction is carried over.</P> <P>(d) The principles discussed in paragraph (c) of this section are equally applicable to trust beneficiaries. A remainderman who receives all or a fractional share of the property of a trust as a result of the final termination of the trust is a beneficiary succeeding to the property of the trust. For example, if property is transferred to pay the income to A for life and then to pay $10,000 to B and distribute the balance of the trust corpus to C, C and not B is considered to be the succeeding beneficiary except to the extent that the trust corpus is insufficient to pay B $10,000.</P> </SECTION> <SECTION> <SECTNO>§ 1.642(h)-4</SECTNO> <SUBJECT>Allocation.</SUBJECT> <P>The carryovers and excess deductions to which section 642(h) applies are allocated among the beneficiaries succeeding to the property of an estate or trust (see § 1.642(h)-3) proportionately according to the share of each in the burden of the loss or deductions. A person who qualified as a beneficiary succeeding to the property of an estate or trust with respect to one amount and does not qualify with respect to another amount is a beneficiary succeeding to the property of the estate or trust as to the amount with respect to which he qualifies. The application of this section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A decedent's will leaves $100,000 to A, and the residue of his estate equally to B and C. His estate is sufficient to pay only $90,000 to A, and nothing to B and C. There is an excess of deductions over gross income for the last taxable year of the estate or trust of $5,000, and a capital loss carryover of $15,000, to both of which section 642(h) applies. A is a beneficiary succeeding to the property of the estate to the extent of $10,000, and since the total of the excess of deductions and the loss carryover is $20,000, A is entitled to the benefit of one half of each item, and the remaining half is divided equally between B and C.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.642(h)-5</SECTNO> <SUBJECT>Examples.</SUBJECT> <P> Paragraphs (a) and (b) of this section ( <E T="03">Examples 1</E> and <E T="03"> 2</E> ) illustrate the application of section 642(h). </P> <P> (a) <E T="03">Example 1: Computations under section 642(h) when an estate has a net operating loss</E> —(1) <E T="03">Facts.</E> On January 31, 2020, A dies leaving a will that provides for the distribution of all of A's estate equally to B and an existing trust for C. The period of administration of the estate terminates on December 31, 2020, at which time all the property of the estate is distributed to B and the trust. For tax purposes, B and the trust report income on a calendar year basis. During the period of administration, the estate has the following items of income and deductions: </P> <GPOTABLE COLS="2" OPTS="L2,p1,8/9" CDEF="s100,14"> <TTITLE> Table 1 to Paragraph ( <E T="01">a</E> )(1) </TTITLE> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> </CHED> </BOXHD> <ROW> <ENT I="22">Income:</ENT> </ROW> <ROW> <ENT I="03">Taxable interest</ENT> <ENT>$2,500</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Business income</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="05">Total income</ENT> <ENT>5,500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="2" OPTS="L2,p1,8/9" CDEF="s100,14"> <TTITLE> Table 2 to Paragraph ( <E T="01">a</E> )(1) </TTITLE> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> </CHED> </BOXHD> <ROW> <ENT I="22">Deductions:</ENT> </ROW> <ROW> <ENT I="03">Business expenses (including administrative expense allocable to business income)</ENT> <ENT>5,000</ENT> </ROW> <ROW RUL="n,s"> <PRTPAGE P="47"/> <ENT I="03">Administrative expenses not allocable to business income that would not have been incurred if property had not been held in a trust or estate (section 67(e) deductions)</ENT> <ENT>9,800</ENT> </ROW> <ROW> <ENT I="05">Total deductions</ENT> <ENT>14,800</ENT> </ROW> </GPOTABLE> <P> (2) <E T="03">Computation of net operating loss.</E> (i) The amount of the net operating loss carryover is computed as follows: </P> <GPOTABLE COLS="2" OPTS="L2,p1,8/9" CDEF="s100,14"> <TTITLE> Table 3 to Paragraph ( <E T="01">a</E> )(2)( <E T="01">i</E> ) </TTITLE> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> </CHED> </BOXHD> <ROW> <ENT I="01">Gross income</ENT> <ENT>$5,500</ENT> </ROW> <ROW> <ENT I="01">Total deductions</ENT> <ENT>14,800</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Less adjustment under section 172(d)(4) (allowable non-business expenses ($9,800) limited to non-business income ($2,500))</ENT> <ENT>7,300</ENT> </ROW> <ROW RUL="n,d"> <ENT I="01">Deductions as adjusted</ENT> <ENT>7,500</ENT> </ROW> <ROW> <ENT I="03">Net operating loss</ENT> <ENT>2,000</ENT> </ROW> </GPOTABLE> <P> (ii) Under section 642(h)(1), B and the trust are each allocated $1,000 of the $2,000 unused net operating loss carryover of the terminated estate in 2020, with the allowance of any net operating loss carryover to B and the trust determined under section 172. Neither B nor the trust can carry back any of the net operating loss of A's estate made available to them under section 642(h)(1). <E T="03">See</E> §  1.642(h)-1(b). </P> <P> (3) <E T="03">Section 642(h)(2) excess deductions.</E> The $7,300 of non-business deductions not taken into account in determining the net operating loss of the estate are excess deductions on termination of the estate under section 642(h)(2). Under §  1.642(h)-2(b)(1), such deductions retain their character as section 67(e) deductions. Under §  1.642(h)-4, B and the trust each are allocated $3,650 of excess deductions based on B's and the trust's respective shares of the burden of each cost. </P> <P> (4) <E T="03">Consequences for C.</E> The net operating loss carryover and excess deductions are not allowable directly to C, the trust beneficiary. To the extent the distributable net income of the trust is reduced by the net operating loss carryover and excess deductions, however, C may receive an indirect benefit from the carryover and excess deductions. </P> <P> (b) <E T="03">Example 2: Computations under section 642(h)(2)</E> —(1) <E T="03">Facts.</E> D dies in 2019 leaving an estate of which the residuary legatees are E (75%) and F (25%). The estate's income and deductions in its final year are as follows: </P> <GPOTABLE COLS="2" OPTS="L2,p1,8/9" CDEF="s100,14"> <TTITLE> Table 4 to Paragraph ( <E T="01">b</E> )(1) </TTITLE> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> </CHED> </BOXHD> <ROW> <ENT I="22">Income:</ENT> </ROW> <ROW> <ENT I="03">Dividends</ENT> <ENT>$3,000</ENT> </ROW> <ROW> <ENT I="03">Taxable Interest</ENT> <ENT>500</ENT> </ROW> <ROW> <ENT I="03">Rent</ENT> <ENT>2,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Capital Gain</ENT> <ENT>1,000</ENT> </ROW> <ROW> <ENT I="05">Total Income</ENT> <ENT>6,500</ENT> </ROW> </GPOTABLE> <PRTPAGE P="48"/> <GPOTABLE COLS="2" OPTS="L2,p1,8/9" CDEF="s100,14"> <TTITLE> Table 5 to Paragraph ( <E T="01">b</E> )(1) </TTITLE> <BOXHD> <CHED H="1"> </CHED> <CHED H="1"> </CHED> </BOXHD> <ROW> <ENT I="22">Deductions:</ENT> </ROW> <ROW> <ENT I="03" O="xl">Section 62(a)(4) deductions:</ENT> </ROW> <ROW> <ENT I="05">Rental real estate expenses</ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="03" O="xl">Section 67(e) deductions:</ENT> </ROW> <ROW> <ENT I="05">Probate fees</ENT> <ENT>1,500</ENT> </ROW> <ROW> <ENT I="05">Estate tax preparation fees</ENT> <ENT>8,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="05">Legal fees</ENT> <ENT>2,500</ENT> </ROW> <ROW> <ENT I="07">Total Section 67(e) deductions</ENT> <ENT>12,000</ENT> </ROW> <ROW> <ENT I="03" O="xl">Non-miscellaneous itemized deductions:</ENT> </ROW> <ROW RUL="n,s"> <ENT I="05">Personal property taxes</ENT> <ENT>3,500</ENT> </ROW> <ROW> <ENT I="07">Total deductions</ENT> <ENT>17,500</ENT> </ROW> </GPOTABLE> <P> (2) <E T="03">Determination of character.</E> Pursuant to §  1.642(h)-2(b)(2), the character and amount of the excess deductions is determined by allocating the deductions among the estate's items of income as provided under §  1.652(b)-3. Under §  1.652(b)-3(a), the $2,000 of rental real estate expenses is allocated to the $2,000 of rental income. In the exercise of the executor's discretion pursuant to §  1.652(b)-3(b), D's executor allocates $3,500 of personal property taxes and $1,000 of section 67(e) deductions to the remaining income. As a result, the excess deductions on termination of the estate are $11,000, all consisting of section 67(e) deductions. </P> <P> (3) <E T="03">Allocations among beneficiaries.</E> Pursuant to §  1.642(h)-4, the excess deductions are allocated in accordance with E's (75 percent) and F's (25 percent) interests in the residuary estate. E's share of the excess deductions is $8,250, all consisting of section 67(e) deductions. F's share of the excess deductions is $2,750, also all consisting of section 67(e) deductions. </P> <P> (4) <E T="03">Separate statement.</E> If the executor instead allocated $4,500 of section 67(e) deductions to the remaining income of the estate, the excess deductions on termination of the estate would be $11,000, consisting of $7,500 of section 67(e) deductions and $3,500 of personal property taxes. The non-miscellaneous itemized deduction for personal property taxes may be subject to limitation on the returns of both B and C's trust under section 164(b)(6)(B) and would have to be separately stated as provided in §  1.642(h)-2(b)(1). </P> <P> (c) <E T="03">Applicability date.</E> This section is applicable to taxable years beginning after October 19, 2020. Taxpayers may choose to apply this section to taxable years beginning after December 31, 2017, and on or before October 19, 2020. </P> <CITA>[T.D. 9918, 85 FR 66225, Oct. 19, 2020]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(i)-1</SECTNO> <SUBJECT>Certain distributions by cemetery perpetual care funds.</SUBJECT> <P> (a) <E T="03">In general.</E> Section 642 (i) provides that amounts distributed during taxable years ending after December 31, 1963, by a cemetery perpetual care fund trust for the care and maintenance of gravesites shall be treated as distributions solely for purposes of sections 651 and 661. The deduction for such a distribution is allowable only if the fund is taxable as a trust. In addition, the fund must have been created pursuant to local law by a taxable cemetery corporation (as defined in § 1.642 (i)-2 (a)) expressly for the care and maintenance of cemetery property. A care fund will be treated as having been created by a taxable cemetery corporation (“cemetery”) if the distributee cemetery is taxable, even though the care fund was created by the distributee cemetery in a year that it was tax-exempt or by a predecessor of such distributee cemetery which was tax-exempt in the year the fund was established. The deduction is the amount of the distributions during the fund's taxable year to the cemetery corporation for such care and maintenance that would be otherwise allowable under section 651 or 661, but in no event is to exceed the limitations described in paragraphs (b) and (c) of <PRTPAGE P="49"/> this section. The provisions of this paragraph shall not have the effect of extending the period of limitations under section 6511. </P> <P> (b) <E T="03">Limitation on amount of deduction.</E> The deduction in any taxable year may not exceed the product of $5 multiplied by the aggregate number of gravesites sold by the cemetery corporation before the beginning of the taxable year of the trust. In general, the aggregate number of gravesites sold shall be the aggregate number of interment rights sold by the cemetery corporation (including gravesites sold by the cemetery before a care fund trust law was enacted). In addition, the number of gravesites sold shall include gravesites used to make welfare burials. Welfare burials and pre-trust fund law gravesites shall be included only to the extent that the cemetery cares for and maintain such gravesites. For purposes of this section, a gravesite is sold as of the date on which the purchaser acquires interment rights enforceable under local law. The aggregate number of gravesites includes only those gravesites with respect to which the fund or taxable cemetery corporation has an obligation for care and maintenance. </P> <P> (c) <E T="03">Requirements for deductibility of distributions for care and maintenance</E> —(1) <E T="03">Obligation for care and maintenance.</E> A deduction is allowed only for distributions for the care and maintenance of gravesites with respect to which the fund or taxable cemetery corporation has an obligation for care and maintenance. Such obligation may be established by the trust instrument, by local law, or by the cemetery's practice of caring for and maintaining gravesites, such as welfare burial plots or gravesites sold before the enactment of a care fund trust law. </P> <P> (2) <E T="03">Distribution actually used for care and maintenance.</E> The amount of a deduction otherwise allowable for care fund distributions in any taxable year shall not exceed the portion of such distributions expended by the distributee cemetery corporation for the care and maintenance of gravesites before the end of the fund's taxable year following the taxable year in which it makes the distributions. A 6-month extension of time for filing the trust's return may be obtained upon request under section 6081. The failure of a cemetery to expend the care fund's distributions within a reasonable time before the due date for filing the return will be considered reasonable grounds for granting a 6-month extension of time for section 6081. For purposes of this paragraph, any amount expended by the care fund directly for the care and maintenance of gravesites shall be treated as an additional care fund distribution which is expended on the day of distribution by the cemetery corporation. The fund shall be allowed a deduction for such direct expenditure in the fund's taxable year during which the expenditure is made. </P> <P> (3) <E T="03">Example.</E> The application of paragraph (c)(2) of this section is illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A, a calendar-year perpetual care fund trust, meeting the requirements of section 642 (i), makes a $10,000 distribution on December 1, 1978 to X, a taxable cemetery corporation operating on a May 31 fiscal year. From this $10,000 distribution, the cemetery makes the following expenditures for the care and maintenance of gravesites: $2,000 on December 20, 1978; $4,000 on June 1, 1979; $2,000 on October 1, 1979; and $1,000 on April 1, 1980. In addition, as authorized by the trust instrument, A itself makes a direct $1,000 payment to a contractor on September 1, 1979 for qualifying care and maintenance work performed. As a result of these transactions, A will be allowed an $8,000 deduction for its 1978 taxable year attributable to the cemetery's expenditures, and a $1,000 deduction for its 1979 taxable year attributable to the fund's direct payment. A will not be allowed a deduction for its 1978 taxable year for the cemetery's expenditure of either the $1,000 expended on April 1, 1980 or the remaining unspent portion of the original $10,000 distribution. The trustee may request a 6-month extension in order to allow the fund until October 15, 1979 to file its return for 1978.</P> </EXAMPLE> <P> (d) <E T="03">Certified statement made by cemetery officials to fund trustees.</E> A trustee of a cemetery perpetual care fund shall not be held personally liable for civil or criminal penalties resulting from false statements on the trust's tax return to the extent that such false statements resulted from the trustee's reliance on a certified statement made by the cemetery specifying the number of interments sold by the cemetery or <PRTPAGE P="50"/> the amount of the cemetery's expenditures for care and maintenance. The statement must indicate the basis upon which the cemetery determined what portion of its expenditures were made for the care and maintenance of gravesites. The statement must be certified by an officer or employee of the cemetery who has the responsibility to make or account for expenditures for care and maintenance. A copy of this statement shall be retained by the trustee along with the trust's return and shall be made available for inspection upon request by the Secretary. This paragraph does not relieve the care fund trust of its liability to pay the proper amount of tax due and to maintain adequate records to substantiate each of its deductions, including the deduction provided in section 642(i) and this section. </P> <CITA>[T.D. 7651, 44 FR 61596, Oct. 26, 1979]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.642(i)-2</SECTNO> <SUBJECT>Definitions.</SUBJECT> <P> (a) <E T="03">Taxable cemetery corporation.</E> For purposes of section 642(i) and this section, the meaning of the term <E T="03">taxable cemetery corporation</E> is limited to a corporation (within the meaning of section 7701(a)(3)) engaged in the business of owning and operating a cemetery that either (1) is not exempt from Federal tax, or (2) is subject to tax under section 511 with respect to its cemetery activities. </P> <P> (b) <E T="03">Pursuant to local law.</E> A cemetery perpetual care fund is created pursuant to local law if: </P> <P>(1) The governing law of the relevant jurisdiction (State, district, county, parish, etc.) requires or expressly permits the creation of such a fund, or</P> <P>(2) The legally enforceable bylaws or contracts of a taxable cemetery corporation require a perpetual care fund.</P> <P> (c) <E T="03">Gravesite.</E> A gravesite is any type of interment right that has been sold by a cemetery, including, but not limited to, a burial lot, mausoleum, lawn crypt, niche, or scattering ground. For purposes of § 1.642 (i)-1, the term <E T="03">gravesites</E> includes only those gravesites with respect to which the care fund or cemetery has an obligation for care and maintenance within the meaning of § 1.642 (i)-1(c)(1). </P> <P> (d) <E T="03">Care and maintenance.</E> For purposes of section 642(i) and this section, the term <E T="03">care and maintenance of gravesite</E> shall be generally defined in accordance with the definition of such term under the local law pursuant to which the cemetery perpetual care fund is created. If the applicable local law contains no definition, care and maintenance of gravesites may include the upkeep, repair and preservation of those portions of cemetery property in which gravesites (as defined in paragraph (c) of this section) have been sold; including gardening, road maintenance, water line and drain repair and other activities reasonably necessary to the preservation of cemetery property. The costs for care and maintenance include, but are not limited to, expenditures for the maintenance, repair and replacement of machinery, tools, and equipment, compensation of employees performing such work, insurance premiums, reasonable payments for employees' pension and other benefit plans, and the costs of maintaining necessary records of lot ownership, transfers and burials. However, if some of the expenditures of the cemetery corporation, such as officers' salaries, are for both care and maintenance and for other purposes, the expenditures must be properly allocated between care and maintenance of gravesites and the other purposes. Only those expenditures that are properly allocable to those portions of cemetery property in which gravesites have been sold qualify as expenditures for care and maintenance of gravesites. </P> <CITA>[T.D. 7651, 44 FR 61596, Oct. 26, 1979]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-0</SECTNO> <SUBJECT>Distributable net income; deduction for distributions; in general.</SUBJECT> <P> The term <E T="03">distributable net income</E> has no application except in the taxation of estates and trusts and their beneficiaries. It limits the deductions allowable to estates and trusts for amounts paid, credited, or required to be distributed to beneficiaries and is used to determine how much of an amount paid, credited, or required to be distributed to a beneficiary will be includible in his gross income. It is also used to determine the character of distributions to the beneficiaries. Distributable net income means for any taxable year, the taxable income (as <PRTPAGE P="51"/> defined in section 63) of the estate or trust, computed with the modifications set forth in §§ 1.643(a)-1 through 1.643(a)-7. </P> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-1</SECTNO> <SUBJECT>Deduction for distributions.</SUBJECT> <P>The deduction allowable to a trust under section 651 and to an estate or trust under section 661 for amounts paid, credited, or required to be distributed to beneficiaries is not allowed in the computation of distributable net income.</P> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-2</SECTNO> <SUBJECT>Deduction for personal exemption.</SUBJECT> <P>The deduction for personal exemption under section 642(b) is not allowed in the computation of distributable net income.</P> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-3</SECTNO> <SUBJECT>Capital gains and losses.</SUBJECT> <P> (a) <E T="03">In general.</E> Except as provided in § 1.643(a)-6 and paragraph (b) of this section, gains from the sale or exchange of capital assets are ordinarily excluded from distributable net income and are not ordinarily considered as paid, credited, or required to be distributed to any beneficiary. </P> <P> (b) <E T="03">Capital gains included in distributable net income.</E> Gains from the sale or exchange of capital assets are included in distributable net income to the extent they are, pursuant to the terms of the governing instrument and applicable local law, or pursuant to a reasonable and impartial exercise of discretion by the fiduciary (in accordance with a power granted to the fiduciary by applicable local law or by the governing instrument if not prohibited by applicable local law)— </P> <P>(1) Allocated to income (but if income under the state statute is defined as, or consists of, a unitrust amount, a discretionary power to allocate gains to income must also be exercised consistently and the amount so allocated may not be greater than the excess of the unitrust amount over the amount of distributable net income determined without regard to this subparagraph § 1.643(a)-3(b));</P> <P>(2) Allocated to corpus but treated consistently by the fiduciary on the trust's books, records, and tax returns as part of a distribution to a beneficiary; or</P> <P>(3) Allocated to corpus but actually distributed to the beneficiary or utilized by the fiduciary in determining the amount that is distributed or required to be distributed to a beneficiary.</P> <P> (c) <E T="03">Charitable contributions included in distributable net income.</E> If capital gains are paid, permanently set aside, or to be used for the purposes specified in section 642(c), so that a charitable deduction is allowed under that section in respect of the gains, they must be included in the computation of distributable net income. </P> <P> (d) <E T="03">Capital losses.</E> Losses from the sale or exchange of capital assets shall first be netted at the trust level against any gains from the sale or exchange of capital assets, except for a capital gain that is utilized under paragraph (b)(3) of this section in determining the amount that is distributed or required to be distributed to a particular beneficiary. See § 1.642(h)-1 with respect to capital loss carryovers in the year of final termination of an estate or trust. </P> <P> (e) <E T="03">Examples.</E> The following examples illustrate the rules of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>Under the terms of Trust's governing instrument, all income is to be paid to A for life. Trustee is given discretionary powers to invade principal for A's benefit and to deem discretionary distributions to be made from capital gains realized during the year. During Trust's first taxable year, Trust has $5,000 of dividend income and $10,000 of capital gain from the sale of securities. Pursuant to the terms of the governing instrument and applicable local law, Trustee allocates the $10,000 capital gain to principal. During the year, Trustee distributes to A $5,000, representing A's right to trust income. In addition, Trustee distributes to A $12,000, pursuant to the discretionary power to distribute principal. Trustee does not exercise the discretionary power to deem the discretionary distributions of principal as being paid from capital gains realized during the year. Therefore, the capital gains realized during the year are not included in distributable net income and the $10,000 of capital gain is taxed to the trust. In future years, Trustee must treat all discretionary distributions as not being made from any realized capital gains.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except that Trustee intends to follow a regular practice of treating discretionary distributions of principal as being <PRTPAGE P="52"/> paid first from any net capital gains realized by Trust during the year. Trustee evidences this treatment by including the $10,000 capital gain in distributable net income on Trust's federal income tax return so that it is taxed to A. This treatment of the capital gains is a reasonable exercise of Trustee's discretion. In future years Trustee must treat all discretionary distributions as being made first from any realized capital gains. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except that Trustee intends to follow a regular practice of treating discretionary distributions of principal as being paid from any net capital gains realized by Trust during the year from the sale of certain specified assets or a particular class of investments. This treatment of capital gains is a reasonable exercise of Trustee's discretion. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except that pursuant to the terms of the governing instrument (in a provision not prohibited by applicable local law), capital gains realized by Trust are allocated to income. Because the capital gains are allocated to income pursuant to the terms of the governing instrument, the $10,000 capital gain is included in Trust's distributable net income for the taxable year. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except that Trustee decides that discretionary distributions will be made only to the extent Trust has realized capital gains during the year and thus the discretionary distribution to A is $10,000, rather than $12,000. Because Trustee will use the amount of any realized capital gain to determine the amount of the discretionary distribution to the beneficiary, the $10,000 capital gain is included in Trust's distributable net income for the taxable year. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6.</HD> <P>Trust's assets consist of Blackacre and other property. Under the terms of Trust's governing instrument, Trustee is directed to hold Blackacre for ten years and then sell it and distribute all the sales proceeds to A. Because Trustee uses the amount of the sales proceeds that includes any realized capital gain to determine the amount required to be distributed to A, any capital gain realized from the sale of Blackacre is included in Trust's distributable net income for the taxable year.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7.</HD> <P>Under the terms of Trust's governing instrument, all income is to be paid to A during the Trust's term. When A reaches 35, Trust is to terminate and all the principal is to be distributed to A. Because all the assets of the trust, including all capital gains, will be actually distributed to the beneficiary at the termination of Trust, all capital gains realized in the year of termination are included in distributable net income. See § 1.641(b)-3 for the determination of the year of final termination and the taxability of capital gains realized after the terminating event and before final distribution.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8.</HD> <P> The facts are the same as <E T="03">Example 7,</E> except Trustee is directed to pay B $10,000 before distributing the remainder of Trust assets to A. Because the distribution to B is a gift of a specific sum of money within the meaning of section 663(a)(1), none of Trust's distributable net income that includes all of the capital gains realized during the year of termination is allocated to B's distribution. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9.</HD> <P> The facts are the same as <E T="03">Example 7,</E> except Trustee is directed to distribute one-half of the principal to A when A reaches 35 and the balance to A when A reaches 45. Trust assets consist entirely of stock in corporation M with a fair market value of $1,000,000 and an adjusted basis of $300,000. When A reaches 35, Trustee sells one-half of the stock and distributes the sales proceeds to A. All the sales proceeds, including all the capital gain attributable to that sale, are actually distributed to A and therefore all the capital gain is included in distributable net income. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10.</HD> <P> The facts are the same as <E T="03">Example 9,</E> except when A reaches 35, Trustee sells all the stock and distributes one-half of the sales proceeds to A. If authorized by the governing instrument and applicable state statute, Trustee may determine to what extent the capital gain is distributed to A. The $500,000 distribution to A may be treated as including a minimum of $200,000 of capital gain (and all of the principal amount of $300,000) and a maximum of $500,000 of the capital gain (with no principal). Trustee evidences the treatment by including the appropriate amount of capital gain in distributable net income on Trust's federal income tax return. If Trustee is not authorized by the governing instrument and applicable state statutes to determine to what extent the capital gain is distributed to A, one-half of the capital gain attributable to the sale is included in distributable net income. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 11.</HD> <P> The applicable state statute provides that a trustee may make an election to pay an income beneficiary an amount equal to four percent of the fair market value of the trust assets, as determined at the beginning of each taxable year, in full satisfaction of that beneficiary's right to income. State statute also provides that this unitrust amount shall be considered paid first from ordinary and tax-exempt income, then from net short-term capital gain, then from net long-term capital gain, and finally from return of principal. Trust's governing instrument provides that A is to receive each year income as defined under state statute. Trustee makes the unitrust election under state statute. At the beginning of the taxable year, Trust assets are valued at $500,000. During the year, Trust receives $5,000 of dividend income and realizes $80,000 of net long- <PRTPAGE P="53"/> term gain from the sale of capital assets. Trustee distributes to A $20,000 (4% of $500,000) in satisfaction of A's right to income. Net long-term capital gain in the amount of $15,000 is allocated to income pursuant to the ordering rule of the state statute and is included in distributable net income for the taxable year. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 12.</HD> <P> The facts are the same as in <E T="03">Example 11,</E> except that neither state statute nor Trust's governing instrument has an ordering rule for the character of the unitrust amount, but leaves such a decision to the discretion of Trustee. Trustee intends to follow a regular practice of treating principal, other than capital gain, as distributed to the beneficiary to the extent that the unitrust amount exceeds Trust's ordinary and tax-exempt income. Trustee evidences this treatment by not including any capital gains in distributable net income on Trust's Federal income tax return so that the entire $80,000 capital gain is taxed to Trust. This treatment of the capital gains is a reasonable exercise of Trustee's discretion. In future years Trustee must consistently follow this treatment of not allocating realized capital gains to income. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 13.</HD> <P> The facts are the same as in <E T="03">Example 11,</E> except that neither state statutes nor Trust's governing instrument has an ordering rule for the character of the unitrust amount, but leaves such a decision to the discretion of Trustee. Trustee intends to follow a regular practice of treating net capital gains as distributed to the beneficiary to the extent the unitrust amount exceeds Trust's ordinary and tax-exempt income. Trustee evidences this treatment by including $15,000 of the capital gain in distributable net income on Trust's Federal income tax return. This treatment of the capital gains is a reasonable exercise of Trustee's discretion. In future years Trustee must consistently treat realized capital gain, if any, as distributed to the beneficiary to the extent that the unitrust amount exceeds ordinary and tax-exempt income. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 14.</HD> <P>Trustee is a corporate fiduciary that administers numerous trusts. State statutes provide that a trustee may make an election to distribute to an income beneficiary an amount equal to four percent of the annual fair market value of the trust assets in full satisfaction of that beneficiary's right to income. Neither state statutes nor the governing instruments of any of the trusts administered by Trustee has an ordering rule for the character of the unitrust amount, but leaves such a decision to the discretion of Trustee. With respect to some trusts, Trustee intends to follow a regular practice of treating principal, other than capital gain, as distributed to the beneficiary to the extent that the unitrust amount exceeds the trust's ordinary and tax-exempt income. Trustee will evidence this treatment by not including any capital gains in distributable net income on the Federal income tax returns for those trusts. With respect to other trusts, Trustee intends to follow a regular practice of treating any net capital gains as distributed to the beneficiary to the extent the unitrust amount exceeds the trust's ordinary and tax-exempt income. Trustee will evidence this treatment by including net capital gains in distributable net income on the Federal income tax returns filed for these trusts. Trustee's decision with respect to each trust is a reasonable exercise of Trustee's discretion and, in future years, Trustee must treat the capital gains realized by each trust consistently with the treatment by that trust in prior years.</P> </EXAMPLE> <P> (f) <E T="03">Effective date.</E> This section applies for taxable years of trusts and estates ending after January 2, 2004. </P> <CITA>[T.D. 9102, 69 FR 18, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-4</SECTNO> <SUBJECT>Extraordinary dividends and taxable stock dividends.</SUBJECT> <P>In the case solely of a trust which qualifies under subpart B (section 651 and following) as a “simple trust,” there are excluded from distributable net income extraordinary dividends (whether paid in cash or in kind) or taxable stock dividends which are not distributed or credited to a beneficiary because the fiduciary in good faith determines that under the terms of the governing instrument and applicable local law such dividends are allocable to corpus. See section 665(e), paragraph (b) of § 1.665(e)-1, and paragraph (b) of § 1.665(e)-1A for the treatment of such dividends upon subsequent distribution.</P> <CITA>[T.D. 7204, 37 FR 17134, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-5</SECTNO> <SUBJECT>Tax-exempt interest.</SUBJECT> <P>(a) There is included in distributable net income any tax-exempt interest excluded from gross income under section 103, reduced by disbursements allocable to such interest which would have been deductible under section 212 but for the provisions of section 265 (relating to disallowance of deductions allocable to tax-exempt income).</P> <P> (b) If the estate or trust is allowed a charitable contributions deduction under section 642(c), the amounts specified in paragraph (a) of this section and § 1.643(a)-6 are reduced by the portion deemed to be included in income paid, <PRTPAGE P="54"/> permanently set aside, or to be used for the purposes specified in section 642(c). If the governing instrument or local law specifically provides as to the source out of which amounts are paid, permanently set aside, or to be used for such charitable purposes, the specific provision controls for Federal tax purposes to the extent such provision has economic effect independent of income tax consequences. See § 1.652(b)-2(b). In the absence of such specific provisions in the governing instrument or local law, an amount to which section 642(c) applies is deemed to consist of the same proportion of each class of the items of income of the estate or trust as the total of each class bears to the total of all classes. For illustrations showing the determination of the character of an amount deductible under section 642(c), see <E T="03">Examples 1</E> and <E T="03">2</E> of § 1.662(b)-2 and § 1.662(c)-4(e). </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 9582, 77 FR 22485, Apr. 16, 2012]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-6</SECTNO> <SUBJECT>Income of foreign trust.</SUBJECT> <P> (a) <E T="03">Distributable net income of a foreign trust.</E> In the case of a foreign trust (see section 7701(a)(31)), the determination of distributable net income is subject to the following rules: </P> <P>(1) There is included in distributable net income the amounts of gross income from sources without the United States, reduced by disbursements allocable to such foreign income which would have been deductible but for the provisions of section 265 (relating to disallowance of deductions allocable to tax exempt income). See paragraph (b) of § 1.643(a)-5 for rules applicable when an estate or trust is allowed a charitable contributions deduction under section 642(c).</P> <P>(2) In the case of a distribution made by a trust before January 1, 1963, for purposes of determining the distributable net income of the trust for the taxable year in which the distribution is made, or for any prior taxable year;</P> <P>(i) Gross income from sources within the United States is determined by taking into account the provisions of section 894 (relating to income exempt under treaty); and</P> <P>(ii) Distributable net income is determined by taking into account the provisions of section 643(a)(3) (relating to exclusion of certain gains from the sale or exchange of capital assets).</P> <P>(3) In the case of a distribution made by a trust after December 31, 1962, for purposes of determining the distributable net income of the trust for any taxable year, whether ending before January 1, 1963, or after December 31, 1962;</P> <P>(i) Gross income (for the entire foreign trust) from sources within the United States is determined without regard to the provisions of section 894 (relating to income exempt under treaty);</P> <P>(ii) In respect of a foreign trust created by a U.S. person (whether such trust constitutes the whole or only a portion of the entire foreign trust) (see section 643(d) and § 1.643(d)-1), there shall be included in gross income gains from the sale or exchange of capital assets reduced by losses from such sales or exchanges to the extent such losses do not exceed gains from such sales or exchanges, and the deduction under section 1202 (relating to deduction for capital gains) shall not be taken into account; and</P> <P>(iii) In respect of a foreign trust created by a person other than a U.S. person (whether such trust constitutes the whole or only a portion of the entire foreign trust) (see section 643(d) and § 1.643(d)-1), distributable net income is determined by taking into account all of the provisions of section 643 except section 643(a)(6)(C) (relating to gains from the sale or exchange of capital assets by a foreign trust created by a U.S. person).</P> <P> (b) <E T="03">Examples.</E> The application of this section, showing the computation of distributable net income for one of the taxable years for which such a computation must be made, may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> (1) A trust is created in 1952 under the laws of Country X by the transfer to a trustee in Country X of money and property by a U.S. person. The entire trust constitutes a foreign trust created by a U.S. person. The income from the trust corpus is to be accumulated until the beneficiary, a resident citizen of the United States who was born in 1944, reaches the age of 21 years, and upon his reaching that age, the corpus and accumulated income are to be distributed to <PRTPAGE P="55"/> him. The trust instrument provides that capital gains are to be allocated to corpus and are not to be paid, credited, or required to be distributed to any beneficiary during the taxable year or paid, permanently set aside, or to be used for the purposes specified in section 642(c). Under the terms of a tax convention between the United States and Country X, interest income received by the trust from U.S. sources is exempt from U.S. taxation. In 1965 the corpus and accumulated income are distributed to the beneficiary. During the taxable year 1964, the trust has the following items of income, loss, and expense: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s100,8"> <ROW> <ENT I="01">Interest on bonds of a U.S. corporation</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain from U.S. sources</ENT> <ENT>30,000</ENT> </ROW> <ROW> <ENT I="01">Gross income from investments in Country X</ENT> <ENT>40,000</ENT> </ROW> <ROW> <ENT I="01">Net short-term capital loss from U.S. sources</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">Expenses allocable to gross income from investments in Country X</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> <P>(2) The distributable net income for the taxable year 1964 of the foreign trust created by a U.S. person, determined under section 643(a), is $70,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s100,8,8"> <ROW EXPSTB="01"> <ENT I="01">Interest on bonds of a U.S. corporation</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Gross income from investments in Country X</ENT> <ENT>40,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Net long-term capital gain from U.S. sources</ENT> <ENT>$30,000</ENT> </ROW> <ROW RUL="n,d,n"> <ENT I="01">Less: Net short-term capital loss from U.S. sources</ENT> <ENT>5,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Excess of net long-term capital gain over net short-term capital loss</ENT> <ENT>25,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>75,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Expenses allocable to income from investments in Country X</ENT> <ENT>5,000</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Distributable net income</ENT> <ENT>70,000</ENT> </ROW> </GPOTABLE> <P>(3) In determining the distributable net income of $70,000, the taxable income of the trust is computed with the following modifications: No deduction is allowed for the personal exemption of the trust (section 643(a)(2)); the interest received on bonds of a U.S. corporation is included in the trust gross income despite the fact that such interest is exempt from U.S. tax under the provisions of the tax treaty between Country X and the United States (section 643(a)(6) (see H. Con. Res. (B)); the excess of net long-term capital gain over net short-term capital loss allocable to corpus is included in distributable net income, but such excess is not subject to the deduction under section 1202 (section 643(a)(6)(C)); and the amount representing gross income from investments in Country X is included, but such amount is reduced by the amount of the disbursements allocable to such income (section 643(a)(6)(A)).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(1) The facts are the same as in example 1 except that money or property has also been transferred to the trust by a person other than a U.S. person and, pursuant to the provisions of § 1.643(d)-1, during 1964 only 60 percent of the entire trust constitutes a foreign trust created by a U.S. person.</P> <P>(2) The distributable net income for the taxable year 1964 of the foreign trust created by a U.S. person, determined under section 643(a), is $42,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,7,7"> <ROW EXPSTB="01"> <ENT I="01">Interest on bonds of a U.S. corporation (60 percent of $10,000)</ENT> <ENT>$6,000</ENT> </ROW> <ROW> <ENT I="01">Gross income from investments in Country X (60 percent of $40,000)</ENT> <ENT>24,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Net long-term capital gain from U.S. sources (60 percent of $30,000)</ENT> <ENT>$18,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Net short-term capital loss from U.S. sources (60 percent of $5,000)</ENT> <ENT>3,000</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT>15,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT> </ENT> <ENT>45,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Less: Expenses allocable to income from investments in Country X (60 percent of $5,000)</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="03">Distributable net income</ENT> <ENT>42,000</ENT> </ROW> </GPOTABLE> <P>(3) The distributable net income for the taxable year 1964 of the portion of the entire foreign trust which does not constitute a foreign trust created by a U.S. person, determined under section 643(a), is $18,000, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s100,7"> <ROW> <ENT I="01">Interest on bonds of a U.S. corporation (40 percent of $10,000)</ENT> <ENT>$4,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Gross income from investments in Country X (40 percent of $40,000)</ENT> <ENT>16,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Expenses allocable to income from investments in Country X (40 percent of $5,000)</ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="03">Distributable net income</ENT> <ENT>18,000</ENT> </ROW> </GPOTABLE> <P>(4) The distributable net income of the entire foreign trust for the taxable year 1964 is $60,000, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s100,8"> <ROW> <ENT I="01">Distributable net income of the foreign trust created by a U.S. person</ENT> <ENT>$42,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Distributable net income of that portion of the entire foreign trust which does not constitute a foreign trust created by a U.S. person</ENT> <ENT>18,000</ENT> </ROW> <ROW> <ENT I="02">Distributable net income of the entire foreign trust</ENT> <ENT>60,000</ENT> </ROW> </GPOTABLE> <FP>It should be noted that the difference between the $70,000 distributable net income of the foreign trust in example 1 and the $60,000 distributable net income of the entire foreign trust in this example is due to the $10,000 (40 percent of $25,000) net capital gain (capital gain net income for taxable years beginning after December 31, 1976) which under section 643(a)(3) is excluded from the distributable net income of that portion of the foreign trust in example 2 which does not constitute a foreign trust created by a U.S. person.</FP> </EXAMPLE> <CITA>[T.D. 6989, 34 FR 731, Jan. 17, 1969, as amended by T.D. 7728, 45 FR 72650, Nov. 3, 1980]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-7</SECTNO> <SUBJECT>Dividends.</SUBJECT> <P> Dividends excluded from gross income under section 116 (relating to partial exclusion of dividends received) are <PRTPAGE P="56"/> included in distributable net income. For this purpose, adjustments similar to those required by § 1.643(a)-5 with respect to expenses allocable to tax-exempt income and to income included in amounts paid or set aside for charitable purposes are not made. See the regulations under section 642(c). </P> <CITA>[T.D. 7357, 40 FR 23742, June 2, 1975]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(a)-8</SECTNO> <SUBJECT>Certain distributions by charitable remainder trusts.</SUBJECT> <P> (a) <E T="03">Purpose and scope.</E> This section is intended to prevent the avoidance of the purposes of the charitable remainder trust rules regarding the characterizations of distributions from those trusts in the hands of the recipients and should be interpreted in a manner consistent with this purpose. This section applies to all charitable remainder trusts described in section 664 and the beneficiaries of such trusts. </P> <P> (b) <E T="03">Deemed sale by trust.</E> (1) For purposes of section 664(b), a charitable remainder trust shall be treated as having sold, in the year in which a distribution of an annuity or unitrust amount is made from the trust, a pro rata portion of the trust assets to the extent that the distribution of the annuity or unitrust amount would (but for the application of this paragraph (b)) be characterized in the hands of the recipient as being from the category described in section 664(b)(4) and exceeds the amount of the previously undistributed </P> <P>(i) Cash contributed to the trust (with respect to which a deduction was allowable under section 170, 2055, 2106, or 2522); plus</P> <P>(ii) Basis in any contributed property (with respect to which a deduction was allowable under section 170, 2055, 2106, or 2522) that was sold by the trust.</P> <P>(2) Any transaction that has the purpose or effect of circumventing the rules in this paragraph (b) shall be disregarded.</P> <P>(3) For purposes of paragraph (b)(1) of this section, trust assets do not include cash or assets purchased with the proceeds of a trust borrowing, forward sale, or similar transaction.</P> <P>(4) Proper adjustment shall be made to any gain or loss subsequently realized for gain or loss taken into account under paragraph (b)(1) of this section.</P> <P> (c) <E T="03">Examples.</E> The following examples illustrate the rules of paragraph (b) of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Deemed sale by trust.</HD> <P>Donor contributes stock having a fair market value of $2 million to a charitable remainder unitrust with a unitrust amount of 50 percent of the net fair market value of the trust assets and a two-year term. The stock has a total adjusted basis of $400,000. In Year 1, the trust receives dividend income of $20,000. As of the valuation date, the trust's assets have a net fair market value of $2,020,000 ($2 million in stock, plus $20,000 in cash). To obtain additional cash to pay the unitrust amount to the noncharitable beneficiary, the trustee borrows $990,000 against the value of the stock. The trust then distributes $1,010,000 to the beneficiary before the end of Year 1. Under section 664(b)(1), $20,000 of the distribution is characterized in the hands of the beneficiary as dividend income. The rest of the distribution, $990,000, is attributable to an amount received by the trust that did not represent either cash contributed to the trust or a return of basis in any contributed asset sold by the trust during Year 1. Under paragraph (b)(3) of this section, the stock is a trust asset because it was not purchased with the proceeds of the borrowing. Therefore, in Year 1, under paragraph (b)(1) of this section, the trust is treated as having sold $990,000 of stock and as having realized $792,000 of capital gain (the trust's basis in the shares deemed sold is $198,000). Thus, in the hands of the beneficiary, $792,000 of the distribution is characterized as capital gain under section 664(b)(2) and $198,000 is characterized as a tax-free return of corpus under section 664(b)(4). No part of the $990,000 loan is treated as acquisition indebtedness under section 514(c) because the entire loan has been recharacterized as a deemed sale.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Adjustment to trust's basis in assets deemed sold.</HD> <P> The facts are the same as in <E T="03">Example 1.</E> During Year 2, the trust sells the stock for $2,100,000. The trustee uses a portion of the proceeds of the sale to repay the outstanding loan, plus accrued interest. Under paragraph (b)(4) of this section, the trust's adjusted basis in the stock is $1,192,000 ($400,000 plus the $792,000 of gain recognized in Year 1). Therefore, the trust recognizes capital gain (as described in section 664(b)(2)) in Year 2 of $908,000. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Distribution of cash contributions.</HD> <P> Upon the death of D, the proceeds of a life insurance policy on D's life are payable to T, a charitable remainder annuity trust. The terms of the trust provide that, for a period of three years commencing upon D's death, the trust shall pay an annuity amount equal to $x annually to A, the child of D. After the <PRTPAGE P="57"/> expiration of such three-year period, the remainder interest in the trust is to be transferred to charity Z. In Year 1, the trust receives payment of the life insurance proceeds and pays the appropriate pro rata portion of the $x annuity to A from the insurance proceeds. During Year 1, the trust has no income. Because the entire distribution is attributable to a cash contribution (the insurance proceeds) to the trust for which a charitable deduction was allowable under section 2055 with respect to the present value of the remainder interest passing to charity, the trust will not be treated as selling a pro rata portion of the trust assets under paragraph (b)(1) of this section. Thus, the distribution is characterized in A's hands as a tax-free return of corpus under section 664(b)(4). </P> </EXAMPLE> <P> (d) <E T="03">Effective date.</E> This section is applicable to distributions made by a charitable remainder trust after October 18, 1999. </P> <CITA>[T.D. 8926, 66 FR 1037, Jan. 5, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(b)-1</SECTNO> <SUBJECT>Definition of income.</SUBJECT> <P> For purposes of subparts A through D, part I, subchapter J, chapter 1 of the Internal Revenue Code, “income,” when not preceded by the words “taxable,” “distributable net,” “undistributed net,” or “gross,” means the amount of income of an estate or trust for the taxable year determined under the terms of the governing instrument and applicable local law. Trust provisions that depart fundamentally from traditional principles of income and principal will generally not be recognized. For example, if a trust instrument directs that all the trust income shall be paid to the income beneficiary but defines ordinary dividends and interest as principal, the trust will not be considered one that under its governing instrument is required to distribute all its income currently for purposes of section 642(b) (relating to the personal exemption) and section 651 (relating to simple trusts). Thus, items such as dividends, interest, and rents are generally allocated to income and proceeds from the sale or exchange of trust assets are generally allocated to principal. However, an allocation of amounts between income and principal pursuant to applicable local law will be respected if local law provides for a reasonable apportionment between the income and remainder beneficiaries of the total return of the trust for the year, including ordinary and tax-exempt income, capital gains, and appreciation. For example, a state statute providing that income is a unitrust amount of no less than 3% and no more than 5% of the fair market value of the trust assets, whether determined annually or averaged on a multiple year basis, is a reasonable apportionment of the total return of the trust. Similarly, a state statute that permits the trustee to make adjustments between income and principal to fulfill the trustee's duty of impartiality between the income and remainder beneficiaries is generally a reasonable apportionment of the total return of the trust. Generally, these adjustments are permitted by state statutes when the trustee invests and manages the trust assets under the state's prudent investor standard, the trust describes the amount that may or must be distributed to a beneficiary by referring to the trust's income, and the trustee after applying the state statutory rules regarding the allocation of receipts and disbursements to income and principal, is unable to administer the trust impartially. Allocations pursuant to methods prescribed by such state statutes for apportioning the total return of a trust between income and principal will be respected regardless of whether the trust provides that the income must be distributed to one or more beneficiaries or may be accumulated in whole or in part, and regardless of which alternate permitted method is actually used, provided the trust complies with all requirements of the state statute for switching methods. A switch between methods of determining trust income authorized by state statute will not constitute a recognition event for purposes of section 1001 and will not result in a taxable gift from the trust's grantor or any of the trust's beneficiaries. A switch to a method not specifically authorized by state statute, but valid under state law (including a switch via judicial decision or a binding non-judicial settlement) may constitute a recognition event to the trust or its beneficiaries for purposes of section 1001 and may result in taxable gifts from the trust's grantor and beneficiaries, based on the relevant facts and circumstances. In <PRTPAGE P="58"/> addition, an allocation to income of all or a part of the gains from the sale or exchange of trust assets will generally be respected if the allocation is made either pursuant to the terms of the governing instrument and applicable local law, or pursuant to a reasonable and impartial exercise of a discretionary power granted to the fiduciary by applicable local law or by the governing instrument, if not prohibited by applicable local law. This section is effective for taxable years of trusts and estates ending after January 2, 2004. </P> <CITA>[T.D. 9102, 69 FR 19, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(b)-2</SECTNO> <SUBJECT>Dividends allocated to corpus.</SUBJECT> <P>Extraordinary dividends or taxable stock dividends which the fiduciary, acting in good faith, determines to be allocable to corpus under the terms of the governing instrument and applicable local law are not considered “income” for purposes of subpart A, B, C, or D, part I, subchapter J, chapter 1 of the Code. See section 643(a)(4), § 1.643(a)-4, § 1.643(d)-2, section 665(e), paragraph (b) of § 1.665(e)-1, and paragraph (b) of § 1.665(e)-1A for the treatment of such items in the computation of distributable net income.</P> <CITA>[T.D. 7204, 37 FR 17134, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(c)-1</SECTNO> <SUBJECT>Definition of “beneficiary”.</SUBJECT> <P>An heir, legatee, or devisee (including an estate or trust) is a beneficiary. A trust created under a decedent's will is a beneficiary of the decedent's estate. The following persons are treated as beneficiaries:</P> <P>(a) Any person with respect to an amount used to discharge or satisfy that person's legal obligation as that term is used in § 1.662(a)-4.</P> <P>(b) The grantor of a trust with respect to an amount applied or distributed for the support of a dependent under the circumstances specified in section 677(b) out of corpus or out of other than income for the taxable year of the trust.</P> <P>(c) The trustee or cotrustee of a trust with respect to an amount applied or distributed for the support of a dependent under the circumstances specified in section 678(c) out of corpus or out of other than income for the taxable year of the trust.</P> </SECTION> <SECTION> <SECTNO>§ 1.643(d)-1</SECTNO> <SUBJECT>Definition of “foreign trust created by a United States person”.</SUBJECT> <P> (a) <E T="03">In general.</E> For the purpose of part I, subchapter J, chapter 1 of the Internal Revenue Code, the term <E T="03">foreign trust created by a United States person</E> means that portion of a foreign trust (as defined in section 7701(a)(31)) attributable to money or property (including all accumulated earnings, profits, or gains attributable to such money or property) of a U.S. person (as defined in section 7701(a)(30)) transferred directly or indirectly, or under the will of a decedent who at the date of his death was a U.S. citizen or resident, to the foreign trust. A foreign trust created by a person who is not a U.S. person, to which a U.S. person transfers his money or property, is a foreign trust created by a U.S. person to the extent that the fair market value of the entire foreign trust is attributable to money or property of the U.S. person transferred to the foreign trust. The transfer of money or property to the foreign trust may be made either directly or indirectly by a U.S. person. Transfers of money or property to a foreign trust do not include transfers of money or property pursuant to a sale or exchange which is made for a full and adequate consideration. Transfers to which section 643(d) and this section apply are transfers of money or property which establish or increase the corpus of a foreign trust. The rules set forth in this section with respect to transfers by a U.S. person to a foreign trust also are applicable with respect to transfers under the will of a decedent who at the date of his death was a U.S. citizen or resident. For provisions relating to the information returns which are required to be filed with respect to the creation of or transfers to foreign trusts, see section 6048. </P> <P> (b) <E T="03">Determination of a foreign trust created by a U.S. person</E> —(1) <E T="03">Transfers of money or property only by a U.S. person.</E> If all the items of money or property constituting the corpus of a foreign trust are transferred to the trust by a U.S. person, the entire foreign trust is <PRTPAGE P="59"/> a foreign trust created by a U.S. person. </P> <P> (2) <E T="03">Transfers of money or property by both a U.S. person and a person other than a U.S. person; transfers required to be treated as separate funds.</E> Where there are transfers of money or property by both a U.S. person and a person other than a U.S. person to a foreign trust, and it is necessary, either by reason of the provisions of the governing instrument of the trust or by reason of some other requirement such as local law, that the trustee treat the entire foreign trust as composed of two separate funds, one consisting of the money or property (including all accumulated earnings, profits, or gains attributable to such money or property) transferred by the U.S. person and the other consisting of the money or property (including all accumulated earnings, profits, or gains attributable to such money or property) transferred by the person other than the U.S. person, the foreign trust created by a U.S. person shall be the fund consisting of the money or property transferred by the U.S. person. See example 1 in paragraph (c) of this section. </P> <P> (3) <E T="03">Transfers of money or property by both a U.S. person and a person other than a U.S. person; transfers not required to be treated as separate funds.</E> Where the corpus of a foreign trust consists of money or property transferred to the trust (simultaneously or at different times) by a U.S. person and by a person who is not a U.S. person, the foreign trust created by a U.S. person within the meaning of section 643(d) is that portion of the entire foreign trust which, immediately after any transfer of money or property to the trust, the fair market value of money or property (including all accumulated earnings, profits, or gains attributable to such money or property) transferred to the foreign trust by the U.S. person bears to the fair market value of the corpus (including all accumulated earnings, profits, or gains attributable to the corpus) of the entire foreign trust. </P> <P> (c) <E T="03">Examples.</E> The provisions of paragraph (b) of this section may be illustrated by the following examples. Example 1 illustrates the application of paragraph (b)(2) of this section. Example (2) illustrates the application of paragraph (b)(3) of this section in a case where there is no provision in the governing instrument of the trust or elsewhere which would require the trustee to treat the corpus of the trust as composed of more than one fund. </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>On January 1, 1964, the date of the creation of a foreign trust, a U.S. person transfers to it stock of a U.S. corporation with a fair market value of $50,000. On the same day, a person other than a U.S. person transfers to the trust Country X bonds with a fair market value of $25,000. The governing instrument of the trust provides that the income from the stock of the U.S. corporation is to be accumulated until A, a U.S. beneficiary, reaches the age of 21 years, and upon his reaching that age, the stock and income accumulated thereon are to be distributed to him. The governing instrument of the trust further provides that the income from the Country X bonds is to be accumulated until B, a U.S. beneficiary, reaches the age of 21 years, and upon his reaching that age, the bonds and income accumulated thereon are to be distributed to him. To comply with the provisions of the governing instrument of the trust that the income from the stock of the U.S. corporation be accumulated and distributed to A and that the income from the Country X bonds be accumulated and distributed to B, it is necessary that the trustee treat the transfers as two separate funds. The fund consisting of the stock of the U.S. corporation is a foreign trust created by a U.S. person.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>On January 1, 1964, the date of the creation of a foreign trust, a U.S. person transfers to it property having a fair market value of $60,000 and a person other than a U.S. person transfers to it property having a fair market value of $40,000. Immediately after these transfers, the foreign trust created by a U.S. person is 60 percent of the entire foreign trust, determined as follows:</P> <FP SOURCE="FP-2">$60,000 (Value of property transferred by U.S. person) / $100,000 (Value of entire property transferred to trust) = 60 percent</FP> <FP>The undistributed net income for the calendar years 1964 and 1965 is $20,000 which increases the value of the entire foreign trust to $120,000 ($100,000 plus $20,000). Accordingly, as of December 31, 1965, the portion of the foreign trust created by the U.S. person is $72,000 (60 percent of $120,000). On January 1, 1966, the U.S. person transfers property having a fair market value of $40,000 increasing the value of the entire foreign trust to $160,000 ($120,000 plus $40,000) and increasing the value of the portion of the foreign trust created by the U.S. person to $112,000 ($72,000 plus $40,000). Immediately, after this transfer, the foreign trust created by the U.S. person is 70 percent of the entire foreign trust, determined as follows:</FP> <PRTPAGE P="60"/> <FP SOURCE="FP-2">$112,000 (Value of property transferred by U.S. person) / $160,000 (Value of entire property transferred to the trust) = 70 percent</FP> </EXAMPLE> <CITA>[T.D. 6989, 34 FR 732, Jan. 17, 1969, as amended by T.D. 9849, 84 FR 9235, Mar. 14, 2019]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(d)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 643.</SUBJECT> <P>(a) The provisions of section 643 may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(1) Under the terms of the trust instrument, the income of a trust is required to be currently distributed to W during her life. Capital gains are allocable to corpus and all expenses are charges against corpus. During the taxable year the trust has the following items of income and expenses:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Dividends from domestic corporations</ENT> <ENT>$30,000</ENT> </ROW> <ROW> <ENT I="01">Extraordinary dividends allocated to corpus by the trustee in good faith</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="01">Taxable interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Long-term capital gains</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Trustee's commissions and miscellaneous expenses allocable to corpus</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> <P>(2) The “income” of the trust determined under section 643(b) which is currently distributable to W is $50,000, consisting of dividends of $30,000, taxable interest of $10,000, and tax-exempt interest of $10,000. The trustee's commissions and miscellaneous expenses allocable to tax-exempt interest amount to $1,000 (10,000/50,000 × $5,000).</P> <P>(3) The “distributable net income” determined under section 643(a) amounts to $45,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Dividends from domestic corporations</ENT> <ENT>$30,000</ENT> </ROW> <ROW> <ENT I="01">Taxable interest</ENT> <ENT>10,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Nontaxable interest</ENT> <ENT>$10,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Expenses allocable thereto</ENT> <ENT>1,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>9,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>49,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Expenses ($5,000 less $1,000 allocable to tax-exempt interest)</ENT> <ENT>4,000</ENT> </ROW> <ROW> <ENT I="03">Distributable net income</ENT> <ENT>45,000</ENT> </ROW> </GPOTABLE> <FP>In determining the distributable net income of $45,000, the taxable income of the trust is computed with the following modifications: No deductions are allowed for distributions to W and for personal exemption of the trust (section 643(a) (1) and (2)); capital gains allocable to corpus are excluded and the deduction allowable under section 1202 is not taken into account (section 643(a)(3)): the extraordinary dividends allocated to corpus by the trustee in good faith are excluded (sections 643(a)(4)); and the tax- exempt interest (as adjusted for expenses) and the dividend exclusion of $50 are included) section 643(a) (5) and (7)).</FP> </EXAMPLE> <P>(b) See paragraph (c) of the example in § 1.661(c)-2 for the computation of distributable net income where there is a charitable contributions deduction.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960. Redesignated, T.D. 6989, 34 FR 732, Jan. 1, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(f)-1</SECTNO> <SUBJECT>Treatment of multiple trusts.</SUBJECT> <P> (a) <E T="03">General rule.</E> For purposes of subchapter J of chapter 1 of subtitle A of Title 26 of the United States Code, two or more trusts will be aggregated and treated as a single trust if such trusts have substantially the same grantor or grantors and substantially the same primary beneficiary or beneficiaries, and if a principal purpose for establishing one or more of such trusts or for contributing additional cash or other property to such trusts is the avoidance of Federal income tax. For purposes of applying this rule, spouses will be treated as one person. </P> <P> (b) <E T="03">Applicability date.</E> The provisions of this section apply to taxable years ending after August 16, 2018. </P> <CITA>[T.D. 9847, 84 FR 3014, Feb. 8, 2019]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.643(h)-1</SECTNO> <SUBJECT>Distributions by certain foreign trusts through intermediaries.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Principal purpose of tax avoidance.</E> Except as provided in paragraph (b) of this section, for purposes of part I of subchapter J, chapter 1 of the Internal Revenue Code, and section 6048, any property (within the meaning of paragraph (f) of this section) that is transferred to a United States person by another person (an intermediary) who has received property from a foreign trust will be treated as property transferred directly by the foreign trust to the United States person if the intermediary received the property from the foreign trust pursuant to a plan one of the principal purposes of which was the avoidance of United States tax. </P> <P> (2) <E T="03">Principal purpose of tax avoidance deemed to exist.</E> For purposes of paragraph (a)(1) of this section, a transfer will be deemed to have been made pursuant to a plan one of the principal purposes of which was the avoidance of United States tax if the United States person— <PRTPAGE P="61"/> </P> <P>(i) Is related (within the meaning of paragraph (e) of this section) to a grantor of the foreign trust, or has another relationship with a grantor of the foreign trust that establishes a reasonable basis for concluding that the grantor of the foreign trust would make a gratuitous transfer (within the meaning of § 1.671-2(e)(2)) to the United States person;</P> <P>(ii) Receives from the intermediary, within the period beginning twenty-four months before and ending twenty-four months after the intermediary's receipt of property from the foreign trust, either the property the intermediary received from the foreign trust, proceeds from such property, or property in substitution for such property; and</P> <P>(iii) Cannot demonstrate to the satisfaction of the Commissioner that—</P> <P>(A) The intermediary has a relationship with the United States person that establishes a reasonable basis for concluding that the intermediary would make a gratuitous transfer to the United States person;</P> <P>(B) The intermediary acted independently of the grantor and the trustee of the foreign trust;</P> <P>(C) The intermediary is not an agent of the United States person under generally applicable United States agency principles; and</P> <P>(D) The United States person timely complied with the reporting requirements of section 6039F, if applicable, if the intermediary is a foreign person.</P> <P> (b) <E T="03">Exceptions</E> —(1) <E T="03">Nongratuitous transfers.</E> Paragraph (a) of this section does not apply to the extent that either the transfer from the foreign trust to the intermediary or the transfer from the intermediary to the United States person is a transfer that is not a gratuitous transfer within the meaning of § 1.671-2(e)(2). </P> <P> (2) <E T="03">Grantor as intermediary.</E> Paragraph (a) of this section does not apply if the intermediary is the grantor of the portion of the trust from which the property that is transferred is derived. For the definition of <E T="03">grantor,</E> see § 1.671-2(e). </P> <P> (c) <E T="03">Effect of disregarding intermediary</E> —(1) <E T="03">General rule.</E> Except as provided in paragraph (c)(2) of this section, the intermediary is treated as an agent of the foreign trust, and the property is treated as transferred to the United States person in the year the property is transferred, or made available, by the intermediary to the United States person. The fair market value of the property transferred is determined as of the date of the transfer by the intermediary to the United States person. For purposes of section 665(d)(2), the term <E T="03">taxes imposed on the trust</E> includes any income, war profits, and excess profits taxes imposed by any foreign country or possession of the United States on the intermediary with respect to the property transferred. </P> <P> (2) <E T="03">Exception.</E> If the Commissioner determines, or if the taxpayer can demonstrate to the satisfaction of the Commissioner, that the intermediary is an agent of the United States person under generally applicable United States agency principles, the property will be treated as transferred to the United States person in the year the intermediary receives the property from the foreign trust. The fair market value of the property transferred will be determined as of the date of the transfer by the foreign trust to the intermediary. For purposes of section 901(b), any income, war profits, and excess profits taxes imposed by any foreign country or possession of the United States on the intermediary with respect to the property transferred will be treated as having been imposed on the United States person. </P> <P> (3) <E T="03">Computation of gross income of intermediary.</E> If property is treated as transferred directly by the foreign trust to a United States person pursuant to this section, the fair market value of such property is not taken into account in computing the gross income of the intermediary (if otherwise required to be taken into account by the intermediary but for paragraph (a) of this section). </P> <P> (d) <E T="03">Transfers not in excess of $10,000.</E> This section does not apply if, during the taxable year of the United States person, the aggregate fair market value of all property transferred to such person from all foreign trusts either directly or through one or more intermediaries does not exceed $10,000. </P> <P> (e) <E T="03">Related parties.</E> For purposes of this section, a United States person is <PRTPAGE P="62"/> treated as related to a grantor of a foreign trust if the United States person and the grantor are related for purposes of section 643(i)(2)(B), with the following modifications— </P> <P>(1) For purposes of applying section 267 (other than section 267(f)) and section 707(b)(1), “at least 10 percent” is used instead of “more than 50 percent” each place it appears; and</P> <P>(2) The principles of section 267(b)(10), using “at least 10 percent” instead of “more than 50 percent,” apply to determine whether two corporations are related.</P> <P> (f) <E T="03">Definition of property.</E> For purposes of this section, the term <E T="03">property</E> includes cash. </P> <P> (g) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In each example, FT is an irrevocable foreign trust that is not treated as owned by any other person and the fair market value of the property that is transferred exceeds $10,000. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Principal purpose of tax avoidance.</HD> <P>FT was created in 1980 by A, a nonresident alien, for the benefit of his children and their descendants. FT's trustee, T, determines that 1000X of accumulated income should be distributed to A's granddaughter, B, who is a resident alien. Pursuant to a plan with a principal purpose of avoiding the interest charge that would be imposed by section 668, T causes FT to make a gratuitous transfer (within the meaning of § 1.671-2(e)(2)) of 1000X to I, a foreign person. I subsequently makes a gratuitous transfer of 1000X to B. Under paragraph (a)(1) of this section, FT is deemed to have made an accumulation distribution of 1000X directly to B.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. United States person unable to demonstrate that intermediary acted independently.</HD> <P>GM and her daughter, M, are both nonresident aliens. M's daughter, D, is a resident alien. GM creates and funds FT for the benefit of her children. On July 1, 2001, FT makes a gratuitous transfer of XYZ stock to M. M immediately sells the XYZ stock and uses the proceeds to purchase ABC stock. On January 1, 2002, M makes a gratuitous transfer of the ABC stock to D. D is unable to demonstrate that M acted independently of GM and the trustee of FT in making the transfer to D. Under paragraph (a)(2) of this section, FT is deemed to have distributed the ABC stock to D. Under paragraph (c)(1) of this section, M is treated as an agent of FT, and the distribution is deemed to have been made on January 1, 2002.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> United States person demonstrates that specified conditions are satisfied. Assume the same facts as in <E T="03">Example 2,</E> except that M receives 1000X cash from FT instead of XYZ stock. M gives 1000X cash to D on January 1, 2002. Also assume that M receives annual income of 5000X from her own investments and that M has given D 1000X at the beginning of each year for the past ten years. Based on this and additional information provided by D, D demonstrates to the satisfaction of the Commissioner that M has a relationship with D that establishes a reasonable basis for concluding that M would make a gratuitous transfer to D, that M acted independently of GM and the trustee of FT, that M is not an agent of D under generally applicable United States agency principles, and that D timely complied with the reporting requirements of section 6039F. FT will not be deemed under paragraph (a)(2) of this section to have made a distribution to D. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Transfer to United States person less than 24 months before transfer to intermediary.</HD> <P>Several years ago, A, a nonresident alien, created and funded FT for the benefit of his children and their descendants. A has a close friend, C, who also is a nonresident alien. A's granddaughter, B, is a resident alien. On December 31, 2001, C makes a gratuitous transfer of 1000X to B. On January 15, 2002, FT makes a gratuitous transfer of 1000X to C. B is unable to demonstrate that C has a relationship with B that would establish a reasonable basis for concluding that C would make a gratuitous transfer to B or that C acted independently of A and the trustee of FT in making the transfer to B. Under paragraph (a)(2) of this section, FT is deemed to have distributed 1000X directly to B. Under paragraph (c)(1) of this section, C is treated as an agent of FT, and the distribution is deemed to have been made on December 31, 2001.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. United States person receives property in substitution for property transferred to intermediary.</HD> <P>GM and her son, S, are both nonresident aliens. S's daughter, GD, is a resident alien. GM creates and funds FT for the benefit of her children and their descendants. On July 1, 2001, FT makes a gratuitous transfer of ABC stock with a fair market value of approximately 1000X to S. On January 1, 2002, S makes a gratuitous transfer of DEF stock with a fair market value of approximately 1000X to GD. GD is unable to demonstrate that S acted independently of GM and the trustee of FT in transferring the DEF stock to GD. Under paragraph (a)(2) of this section, FT is deemed to have distributed the DEF stock to GD. Under paragraph (c)(1) of this section, S is treated as an agent of FT, and the distribution is deemed to have been made on January 1, 2002.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6. United States person receives indirect loan from foreign trust.</HD> <P> Several years ago, A, a nonresident alien, created and funded FT for the benefit of her children and their <PRTPAGE P="63"/> descendants. A's daughter, B, is a resident alien. B needs funds temporarily while she is starting up her own business. If FT were to loan money directly to B, section 643(i) would apply. FT deposits 500X with FB, a foreign bank, on June 30, 2001. On July 1, 2001, FB loans 400X to B. Repayment of the loan is guaranteed by FT's 500X deposit. B is unable to demonstrate to the satisfaction of the Commissioner that FB has a relationship with B that establishes a reasonable basis for concluding that FB would make a loan to B or that FB acted independently of A and the trustee of FT in making the loan. Under paragraph (a)(2) of this section, FT is deemed to have loaned 400X directly to B on July 1, 2001. Under paragraph (c)(1) of this section, FB is treated as an agent of FT. For the treatment of loans from foreign trusts, see section 643(i). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7. United States person demonstrates that specified conditions are satisfied.</HD> <P>GM, a nonresident alien, created and funded FT for the benefit of her children and their descendants. One of GM's children is M, who is a resident alien. During the year 2001, FT makes a gratuitous transfer of 500X to M. M reports the 500X on Form 3520 as a distribution received from a foreign trust. During the year 2002, M makes a gratuitous transfer of 400X to her son, S, who also is a resident alien. M files a Form 709 treating the gratuitous transfer to S as a gift. Based on this and additional information provided by S, S demonstrates to the satisfaction of the Commissioner that M has a relationship with S that establishes a reasonable basis for concluding that M would make a gratuitous transfer to S, that M acted independently of GM and the trustee of FT, and that M is not an agent of S under generally applicable United States agency principles. FT will not be deemed under paragraph (a)(2) of this section to have made a distribution to S.M</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8. Intermediary as agent of trust; increase in FMV.</HD> <P>A, a nonresident alien, created and funded FT for the benefit of his children and their descendants. On December 1, 2001, FT makes a gratuitous transfer of XYZ stock with a fair market value of 85X to B, a nonresident alien. On November 1, 2002, B sells the XYZ stock to a third party in an arm's length transaction for 100X in cash. On November 1, 2002, B makes a gratuitous transfer of 98X to A's grandson, C, a resident alien. C is unable to demonstrate to the satisfaction of the Commissioner that B acted independently of A and the trustee of FT in making the transfer. Under paragraph (a)(2) of this section, FT is deemed to have made a distribution directly to C. Under paragraph (c)(1) of this section, B is treated as an agent of FT, and FT is deemed to have distributed 98X to C on November 1, 2002.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9. Intermediary as agent of United States person; increase in FMV.</HD> <P> Assume the same facts as in <E T="03">Example 8,</E> except that the Commissioner determines that B is an agent of C under generally applicable United States agency principles. Under paragraph (c)(2) of this section, FT is deemed to have distributed 85X to C on December 1, 2001. C must take the gain of 15X into account in the year 2002. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10. Intermediary as agent of trust; decrease in FMV.</HD> <P> Assume the same facts as in <E T="03">Example 8,</E> except that the value of the XYZ stock on November 1, 2002, is only 80X. Instead of selling the XYZ stock to a third party and transferring cash to C, B transfers the XYZ stock to C in a gratuitous transfer. Under paragraph (c)(1) of this section, FT is deemed to have distributed XYZ stock with a value of 80X to C on November 1, 2002. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 11. Intermediary as agent of United States person; decrease in FMV.</HD> <P> Assume the same facts as in <E T="03">Example 10,</E> except that the Commissioner determines that B is an agent of C under generally applicable United States agency principles. Under paragraph (c)(2) of this section, FT is deemed to have distributed XYZ stock with a value of 85X to C on December 1, 2001. </P> </EXAMPLE> <P> (h) <E T="03">Effective date.</E> The rules of this section are applicable to transfers made to United States persons after August 10, 1999. </P> <CITA>[T.D. 8831, 64 FR 43272, Aug. 10, 1999, as amended by T.D. 8890, 65 FR 41332, July 5, 2000]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Pooled Income Fund Actuarial Tables Applicable Before June 1, 2023</HD> <SECTION> <SECTNO>§ 1.642(c)-6A</SECTNO> <SUBJECT>Valuation of charitable remainder interests for which the valuation date is before June 1, 2023.</SUBJECT> <P> (a) <E T="03">Valuation of charitable remainder interests for which the valuation date is before January 1, 1952.</E> There was no provision for the qualification of pooled income funds under section 642 until 1969. See § 20.2031-7A(a) of this chapter (Estate Tax Regulations) for the determination of the present value of a charitable remainder interest created before January 1, 1952. </P> <P> (b) <E T="03">Valuation of charitable remainder interests for which the valuation date is after December 31, 1951, and before January 1, 1971.</E> No charitable deduction is allowable for a transfer to a pooled income fund for which the valuation date is after the effective dates of the Tax Reform Act of 1969 unless the pooled income fund meets the requirements of section 642(c)(5). See § 20.2031-7A(b) of <PRTPAGE P="64"/> this chapter (Estate Tax Regulations) for the determination of the present value of a charitable remainder interest for which the valuation date is after December 31, 1951, and before January 1, 1971. </P> <P> (c) <E T="03">Present value of remainder interest in the case of transfers to pooled income funds for which the valuation date is after December 31, 1970, and before December 1, 1983.</E> For the determination of the present value of a remainder interest in property transferred to a pooled income fund for which the valuation date is after December 31, 1970, and before December 1, 1983, see § 20.2031-7A(c) of this chapter (Estate Tax Regulations) and former § 1.642(c)-6(e) (as contained in the 26 CFR part 1 edition revised as of April 1, 1994). </P> <P> (d) <E T="03">Present value of remainder interest dependent on the termination of one life in the case of transfers to pooled income funds made after November 30, 1983, for which the valuation date is before May 1, 1989</E> —(1) <E T="03">In general.</E> For transfers to pooled income funds made after November 30, 1983, for which the valuation date is before May 1, 1989, the present value of the remainder interest at the time of the transfer of property to the fund is determined by computing the present value (at the time of the transfer) of the life income interest in the transferred property (as determined under paragraph (d)(2) of this section) and subtracting that value from the fair market value of the transferred property on the valuation date. The present value of a remainder interest that is dependent on the termination of the life of one individual is computed by use of Table G in paragraph (d)(4) of this section. For purposes of the computation under this section, the age of an individual is to be taken as the age of the individual at the individual's nearest birthday. </P> <P> (2) <E T="03">Present value of life income interest.</E> The present value of the life income interest in property transferred to a pooled income fund shall be computed on the basis of: </P> <P> (i) Life contingencies determined from the values of <E T="03">lx</E> that are set forth in Table LN of § 20.2031-7A(d)(6) of this chapter (Estate Tax Regulations); and </P> <P>(ii) Discount at a rate of interest, compounded annually, equal to the highest yearly rate of return of the pooled income fund for the 3 taxable years immediately preceding its taxable year in which the transfer of property to the fund is made. For purposes of this paragraph (d)(2), the yearly rate of return of a pooled income fund is determined as provided in § 1.642(c)-6(c) unless the highest yearly rate of return is deemed to be 9 percent. For purposes of this paragraph (d)(2), the first taxable year of a pooled income fund is considered a taxable year even though the taxable year consists of less than 12 months. However, appropriate adjustments must be made to annualize the rate of return earned by the fund for that period. Where it appears from the facts and circumstances that the highest yearly rate of return for the 3 taxable years immediately preceding the taxable year in which the transfer of property is made has been purposely manipulated to be substantially less than the rate of return that would otherwise be reasonably anticipated with the purpose of obtaining an excessive charitable deduction, that rate of return may not be used. In that case, the highest yearly rate of return of the fund is determined by treating the fund as a pooled income fund that has been in existence for less than 3 preceding taxable years. If a pooled income fund has been in existence less than 3 taxable years immediately preceding the taxable year in which the transfer of property to the fund is made, the highest yearly rate of return is deemed to be 9 percent.</P> <P> (3) <E T="03">Computation of value of remainder interest.</E> The factor which is used in determining the present value of the remainder interest is the factor under the appropriate yearly rate of return in column (2) of Table G opposite the number in column (1) which corresponds to the age of the individual upon whose life the value of the remainder interest is based. If the yearly rate of return is a percentage which is between yearly rates of return for which factors are provided in Table G, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying, by the factor determined under this paragraph (d)(3), the fair market value on the appropriate valuation date. If the <PRTPAGE P="65"/> yearly rate of return is below 2.2 percent or above 14 percent, see § 1.642(c)-6(b). This paragraph (d)(3) may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A, who will be 50 years old on April 15, 1985, transfers $100,000 to a pooled income fund on January 1, 1985, and retains a life income interest in such property. The highest yearly rate of return earned by the fund for its 3 preceding taxable years is 9.9 percent. In Table G the figure in column (2) opposite 50 years under 9.8 percent is .15653 and under 10 percent is .15257. The present value of the remainder interest is $15,455, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s40,7"> <ROW> <ENT I="01">Factor at 9.8 percent for person aged 50</ENT> <ENT>.15653</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Factor at 10 percent for person aged 50</ENT> <ENT>.15257</ENT> </ROW> <ROW> <ENT I="01">Difference</ENT> <ENT>.00396</ENT> </ROW> <ROW> <ENT I="11">Interpolation adjustment:</ENT> </ROW> </GPOTABLE> <MATH SPAN="1" DEEP="24"> <MID>EC14NO91.133</MID> </MATH> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,8"> <ROW> <ENT I="01">Factor at 9.8 percent for person aged 50</ENT> <ENT>0.15653</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Interpolation adjustment</ENT> <ENT>.00198</ENT> </ROW> <ROW RUL="n,d"> <ENT I="02">Interpolated factor</ENT> <ENT>.15455</ENT> </ROW> <ROW> <ENT I="01">Present value of remainder interest ($100,000 × .15455</ENT> <ENT>$15,455</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (4) <E T="03">Actuarial tables.</E> The following tables shall be used in the application of the provisions of this section. </P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">2.2%</CHED> <CHED H="2">2.4%</CHED> <CHED H="2">2.6%</CHED> <CHED H="2">2.8%</CHED> <CHED H="2">3.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.23930</ENT> <ENT>.21334</ENT> <ENT>.19077</ENT> <ENT>.17113</ENT> <ENT>.15401</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.22891</ENT> <ENT>.20224</ENT> <ENT>.17903</ENT> <ENT>.15880</ENT> <ENT>.14114</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.23297</ENT> <ENT>.20610</ENT> <ENT>.18265</ENT> <ENT>.16218</ENT> <ENT>.14429</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.23744</ENT> <ENT>.21035</ENT> <ENT>.18669</ENT> <ENT>.16600</ENT> <ENT>.14787</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.24212</ENT> <ENT>.21485</ENT> <ENT>.19098</ENT> <ENT>.17006</ENT> <ENT>.15171</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.24701</ENT> <ENT>.21955</ENT> <ENT>.19547</ENT> <ENT>.17434</ENT> <ENT>.15577</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.25207</ENT> <ENT>.22442</ENT> <ENT>.20015</ENT> <ENT>.17880</ENT> <ENT>.16001</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.25726</ENT> <ENT>.22944</ENT> <ENT>.20497</ENT> <ENT>.18342</ENT> <ENT>.16441</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.26259</ENT> <ENT>.23461</ENT> <ENT>.20995</ENT> <ENT>.18820</ENT> <ENT>.16898</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.26809</ENT> <ENT>.23995</ENT> <ENT>.21511</ENT> <ENT>.19315</ENT> <ENT>.17373</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.27373</ENT> <ENT>.24544</ENT> <ENT>.22043</ENT> <ENT>.19828</ENT> <ENT>.17865</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.27953</ENT> <ENT>.25110</ENT> <ENT>.22592</ENT> <ENT>.20358</ENT> <ENT>.18375</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.28546</ENT> <ENT>.25690</ENT> <ENT>.23156</ENT> <ENT>.20904</ENT> <ENT>.18902</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.29149</ENT> <ENT>.26280</ENT> <ENT>.23731</ENT> <ENT>.21462</ENT> <ENT>.19440</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.29757</ENT> <ENT>.26877</ENT> <ENT>.24312</ENT> <ENT>.22026</ENT> <ENT>.19986</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.30368</ENT> <ENT>.27476</ENT> <ENT>.24896</ENT> <ENT>.22593</ENT> <ENT>.20535</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.30978</ENT> <ENT>.28075</ENT> <ENT>.25481</ENT> <ENT>.23161</ENT> <ENT>.21085</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.31589</ENT> <ENT>.28676</ENT> <ENT>.26068</ENT> <ENT>.23732</ENT> <ENT>.21637</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.32204</ENT> <ENT>.29280</ENT> <ENT>.26659</ENT> <ENT>.24306</ENT> <ENT>.22193</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.32825</ENT> <ENT>.29892</ENT> <ENT>.27257</ENT> <ENT>.24889</ENT> <ENT>.22759</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.33457</ENT> <ENT>.30514</ENT> <ENT>.27867</ENT> <ENT>.25484</ENT> <ENT>.23336</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.34099</ENT> <ENT>.31148</ENT> <ENT>.28489</ENT> <ENT>.26092</ENT> <ENT>.23927</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.34751</ENT> <ENT>.31794</ENT> <ENT>.29124</ENT> <ENT>.26712</ENT> <ENT>.24532</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.35416</ENT> <ENT>.32452</ENT> <ENT>.29773</ENT> <ENT>.27348</ENT> <ENT>.25152</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.36096</ENT> <ENT>.33127</ENT> <ENT>.30439</ENT> <ENT>.28002</ENT> <ENT>.25791</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.36793</ENT> <ENT>.33821</ENT> <ENT>.31124</ENT> <ENT>.28676</ENT> <ENT>.26452</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.37509</ENT> <ENT>.34535</ENT> <ENT>.31832</ENT> <ENT>.29374</ENT> <ENT>.27136</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.38244</ENT> <ENT>.35269</ENT> <ENT>.32560</ENT> <ENT>.30093</ENT> <ENT>.27844</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.38998</ENT> <ENT>.36023</ENT> <ENT>.33311</ENT> <ENT>.30836</ENT> <ENT>.28577</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.39767</ENT> <ENT>.36795</ENT> <ENT>.34080</ENT> <ENT>.31599</ENT> <ENT>.29330</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.40553</ENT> <ENT>.37584</ENT> <ENT>.34868</ENT> <ENT>.32382</ENT> <ENT>.30104</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.41352</ENT> <ENT>.38388</ENT> <ENT>.35672</ENT> <ENT>.33182</ENT> <ENT>.30897</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.42165</ENT> <ENT>.39208</ENT> <ENT>.36494</ENT> <ENT>.34001</ENT> <ENT>.31710</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.42993</ENT> <ENT>.40044</ENT> <ENT>.37333</ENT> <ENT>.34839</ENT> <ENT>.32543</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.43834</ENT> <ENT>.40894</ENT> <ENT>.38188</ENT> <ENT>.35694</ENT> <ENT>.33395</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.44689</ENT> <ENT>.41760</ENT> <ENT>.39060</ENT> <ENT>.36567</ENT> <ENT>.34266</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.45556</ENT> <ENT>.42640</ENT> <ENT>.39947</ENT> <ENT>.37458</ENT> <ENT>.35156</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.46435</ENT> <ENT>.43534</ENT> <ENT>.40850</ENT> <ENT>.38365</ENT> <ENT>.36063</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.47325</ENT> <ENT>.44440</ENT> <ENT>.41767</ENT> <ENT>.39288</ENT> <ENT>.36987</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.48226</ENT> <ENT>.45358</ENT> <ENT>.42696</ENT> <ENT>.40225</ENT> <ENT>.37927</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.49136</ENT> <ENT>.46288</ENT> <ENT>.43640</ENT> <ENT>.41177</ENT> <ENT>.38884</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.50056</ENT> <ENT>.47228</ENT> <ENT>.44596</ENT> <ENT>.42143</ENT> <ENT>.39856</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.50988</ENT> <ENT>.48182</ENT> <ENT>.45566</ENT> <ENT>.43125</ENT> <ENT>.40846</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.51927</ENT> <ENT>.49145</ENT> <ENT>.46547</ENT> <ENT>.44120</ENT> <ENT>.41850</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.52874</ENT> <ENT>.50118</ENT> <ENT>.47540</ENT> <ENT>.45128</ENT> <ENT>.42869</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.53828</ENT> <ENT>.51099</ENT> <ENT>.48543</ENT> <ENT>.46146</ENT> <ENT>.43899</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.54788</ENT> <ENT>.52088</ENT> <ENT>.49554</ENT> <ENT>.47176</ENT> <ENT>.44943</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.55754</ENT> <ENT>.53083</ENT> <ENT>.50574</ENT> <ENT>.48216</ENT> <ENT>.45998</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.56726</ENT> <ENT>.54087</ENT> <ENT>.51604</ENT> <ENT>.49267</ENT> <ENT>.47065</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.57703</ENT> <ENT>.55097</ENT> <ENT>.52642</ENT> <ENT>.50327</ENT> <ENT>.48144</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.58685</ENT> <ENT>.56114</ENT> <ENT>.53688</ENT> <ENT>.51398</ENT> <ENT>.49234</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.59670</ENT> <ENT>.57136</ENT> <ENT>.54740</ENT> <ENT>.52476</ENT> <ENT>.50333</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.60658</ENT> <ENT>.58161</ENT> <ENT>.55798</ENT> <ENT>.53560</ENT> <ENT>.51441</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.61647</ENT> <ENT>.59189</ENT> <ENT>.56859</ENT> <ENT>.54651</ENT> <ENT>.52556</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.62635</ENT> <ENT>.60217</ENT> <ENT>.57923</ENT> <ENT>.55744</ENT> <ENT>.53675</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.63622</ENT> <ENT>.61246</ENT> <ENT>.58987</ENT> <ENT>.56840</ENT> <ENT>.54798</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.64606</ENT> <ENT>.62273</ENT> <ENT>.60052</ENT> <ENT>.57937</ENT> <ENT>.55923</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.65589</ENT> <ENT>.63299</ENT> <ENT>.61117</ENT> <ENT>.59037</ENT> <ENT>.57052</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.66569</ENT> <ENT>.64324</ENT> <ENT>.62181</ENT> <ENT>.60136</ENT> <ENT>.58183</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.67546</ENT> <ENT>.65347</ENT> <ENT>.63246</ENT> <ENT>.61237</ENT> <ENT>.59316</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.68521</ENT> <ENT>.66368</ENT> <ENT>.64309</ENT> <ENT>.62338</ENT> <ENT>.60450</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.69492</ENT> <ENT>.67388</ENT> <ENT>.65372</ENT> <ENT>.63440</ENT> <ENT>.61587</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.70461</ENT> <ENT>.68406</ENT> <ENT>.66434</ENT> <ENT>.64542</ENT> <ENT>.62726</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.71425</ENT> <ENT>.69420</ENT> <ENT>.67494</ENT> <ENT>.65643</ENT> <ENT>.63865</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.72384</ENT> <ENT>.70430</ENT> <ENT>.68550</ENT> <ENT>.66742</ENT> <ENT>.65002</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.73336</ENT> <ENT>.71434</ENT> <ENT>.69602</ENT> <ENT>.67837</ENT> <ENT>.66137</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.74281</ENT> <ENT>.72431</ENT> <ENT>.70647</ENT> <ENT>.68926</ENT> <ENT>.67267</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.75216</ENT> <ENT>.73419</ENT> <ENT>.71684</ENT> <ENT>.70009</ENT> <ENT>.68391</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.76143</ENT> <ENT>.74399</ENT> <ENT>.72714</ENT> <ENT>.71085</ENT> <ENT>.69509</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.77060</ENT> <ENT>.75370</ENT> <ENT>.73735</ENT> <ENT>.72153</ENT> <ENT>.70622</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.77969</ENT> <ENT>.76334</ENT> <ENT>.74750</ENT> <ENT>.73215</ENT> <ENT>.71728</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.78870</ENT> <ENT>.77290</ENT> <ENT>.75758</ENT> <ENT>.74272</ENT> <ENT>.72830</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.79764</ENT> <ENT>.78240</ENT> <ENT>.76760</ENT> <ENT>.75323</ENT> <ENT>.73928</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.80646</ENT> <ENT>.79178</ENT> <ENT>.77751</ENT> <ENT>.76364</ENT> <ENT>.75016</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.81511</ENT> <ENT>.80099</ENT> <ENT>.78725</ENT> <ENT>.77387</ENT> <ENT>.76086</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.82353</ENT> <ENT>.80995</ENT> <ENT>.79674</ENT> <ENT>.78386</ENT> <ENT>.77132</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.83169</ENT> <ENT>.81866</ENT> <ENT>.80596</ENT> <ENT>.79357</ENT> <ENT>.78149</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.83960</ENT> <ENT>.82710</ENT> <ENT>.81491</ENT> <ENT>.80301</ENT> <ENT>.79139</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.84727</ENT> <ENT>.83530</ENT> <ENT>.82360</ENT> <ENT>.81218</ENT> <ENT>.80101</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.85473</ENT> <ENT>.84328</ENT> <ENT>.83207</ENT> <ENT>.82112</ENT> <ENT>.81041</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.86201</ENT> <ENT>.85106</ENT> <ENT>.84034</ENT> <ENT>.82986</ENT> <ENT>.81960</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.86905</ENT> <ENT>.85861</ENT> <ENT>.84837</ENT> <ENT>.83835</ENT> <ENT>.82853</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.87585</ENT> <ENT>.86589</ENT> <ENT>.85612</ENT> <ENT>.84655</ENT> <ENT>.83717</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.88239</ENT> <ENT>.87291</ENT> <ENT>.86360</ENT> <ENT>.85447</ENT> <ENT>.84552</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.88873</ENT> <ENT>.87971</ENT> <ENT>.87085</ENT> <ENT>.86216</ENT> <ENT>.85362</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.89487</ENT> <ENT>.88630</ENT> <ENT>.87789</ENT> <ENT>.86963</ENT> <ENT>.86150</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.90070</ENT> <ENT>.89258</ENT> <ENT>.88459</ENT> <ENT>.87674</ENT> <ENT>.86901</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.90609</ENT> <ENT>.89838</ENT> <ENT>.89079</ENT> <ENT>.88332</ENT> <ENT>.87597</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.91106</ENT> <ENT>.90372</ENT> <ENT>.89650</ENT> <ENT>.88939</ENT> <ENT>.88239</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.91570</ENT> <ENT>.90872</ENT> <ENT>.90184</ENT> <ENT>.89507</ENT> <ENT>.88839</ENT> </ROW> <ROW> <PRTPAGE P="66"/> <ENT I="01">90</ENT> <ENT>.92014</ENT> <ENT>.91350</ENT> <ENT>.90696</ENT> <ENT>.90051</ENT> <ENT>.89416</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.92435</ENT> <ENT>.91804</ENT> <ENT>.91182</ENT> <ENT>.90569</ENT> <ENT>.89964</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.92822</ENT> <ENT>.92222</ENT> <ENT>.91630</ENT> <ENT>.91045</ENT> <ENT>.90469</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.93170</ENT> <ENT>.92597</ENT> <ENT>.92032</ENT> <ENT>.91474</ENT> <ENT>.90923</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.93477</ENT> <ENT>.92929</ENT> <ENT>.92387</ENT> <ENT>.91853</ENT> <ENT>.91325</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.93743</ENT> <ENT>.93216</ENT> <ENT>.92695</ENT> <ENT>.92181</ENT> <ENT>.91673</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.93967</ENT> <ENT>.93458</ENT> <ENT>.92955</ENT> <ENT>.92458</ENT> <ENT>.91966</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.94167</ENT> <ENT>.93674</ENT> <ENT>.93186</ENT> <ENT>.92704</ENT> <ENT>.92228</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.94342</ENT> <ENT>.93863</ENT> <ENT>.93389</ENT> <ENT>.92921</ENT> <ENT>.92457</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>94508</ENT> <ENT>94041</ENT> <ENT>.93580</ENT> <ENT>.93124</ENT> <ENT>.92673</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.94672</ENT> <ENT>.94218</ENT> <ENT>.93770</ENT> <ENT>.93326</ENT> <ENT>.92887</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.94819</ENT> <ENT>.94377</ENT> <ENT>.93940</ENT> <ENT>.93508</ENT> <ENT>.93080</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.94979</ENT> <ENT>.94550</ENT> <ENT>.94125</ENT> <ENT>.93704</ENT> <ENT>.93288</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.95180</ENT> <ENT>.94766</ENT> <ENT>.94357</ENT> <ENT>.93952</ENT> <ENT>.93550</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.95377</ENT> <ENT>.94979</ENT> <ENT>.94585</ENT> <ENT>.94194</ENT> <ENT>.93806</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.95663</ENT> <ENT>.95288</ENT> <ENT>.94916</ENT> <ENT>.94547</ENT> <ENT>.94181</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.96101</ENT> <ENT>.95762</ENT> <ENT>.95425</ENT> <ENT>.95091</ENT> <ENT>.94760</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.96688</ENT> <ENT>.96398</ENT> <ENT>.96110</ENT> <ENT>.95824</ENT> <ENT>.95539</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.97569</ENT> <ENT>.97354</ENT> <ENT>.97141</ENT> <ENT>.96928</ENT> <ENT>.96717</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.98924</ENT> <ENT>.98828</ENT> <ENT>.98733</ENT> <ENT>.98638</ENT> <ENT>.98544</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">3.2%</CHED> <CHED H="2">3.4%</CHED> <CHED H="2">3.6%</CHED> <CHED H="2">3.8%</CHED> <CHED H="2">4.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.13908</ENT> <ENT>.12603</ENT> <ENT>.11461</ENT> <ENT>.10461</ENT> <ENT>.09583</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.12570</ENT> <ENT>.11220</ENT> <ENT>.10036</ENT> <ENT>.08998</ENT> <ENT>.08086</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.12862</ENT> <ENT>.11489</ENT> <ENT>.10284</ENT> <ENT>.09225</ENT> <ENT>.08293</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.13198</ENT> <ENT>.11802</ENT> <ENT>.10576</ENT> <ENT>.09496</ENT> <ENT>.08544</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.13559</ENT> <ENT>.12141</ENT> <ENT>.10893</ENT> <ENT>.09793</ENT> <ENT>.08821</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.13943</ENT> <ENT>.12503</ENT> <ENT>.11234</ENT> <ENT>.10112</ENT> <ENT>.09121</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.14345</ENT> <ENT>.12884</ENT> <ENT>.11593</ENT> <ENT>.10451</ENT> <ENT>.09439</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.14763</ENT> <ENT>.13280</ENT> <ENT>.11968</ENT> <ENT>.10805</ENT> <ENT>.09773</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.15198</ENT> <ENT>.13694</ENT> <ENT>.12360</ENT> <ENT>.11176</ENT> <ENT>.10125</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.15652</ENT> <ENT>.14126</ENT> <ENT>.12771</ENT> <ENT>.11567</ENT> <ENT>.10495</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.16123</ENT> <ENT>.14576</ENT> <ENT>.13200</ENT> <ENT>.11975</ENT> <ENT>.10883</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.16613</ENT> <ENT>.15045</ENT> <ENT>.13648</ENT> <ENT>.12402</ENT> <ENT>.11290</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.17119</ENT> <ENT>.15531</ENT> <ENT>.14113</ENT> <ENT>.12847</ENT> <ENT>.11715</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.17638</ENT> <ENT>.16029</ENT> <ENT>.14591</ENT> <ENT>.13304</ENT> <ENT>.12152</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.18164</ENT> <ENT>.16535</ENT> <ENT>.15076</ENT> <ENT>.13769</ENT> <ENT>.12597</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.18693</ENT> <ENT>.17044</ENT> <ENT>.15565</ENT> <ENT>.14238</ENT> <ENT>.13045</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.19224</ENT> <ENT>.17554</ENT> <ENT>.16055</ENT> <ENT>.14707</ENT> <ENT>.13494</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.19756</ENT> <ENT>.18066</ENT> <ENT>.16547</ENT> <ENT>.15178</ENT> <ENT>.13945</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.20294</ENT> <ENT>.18584</ENT> <ENT>.17044</ENT> <ENT>.15655</ENT> <ENT>.14401</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.20840</ENT> <ENT>.19110</ENT> <ENT>.17550</ENT> <ENT>.16140</ENT> <ENT>.14866</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.21399</ENT> <ENT>.19650</ENT> <ENT>.18069</ENT> <ENT>.16639</ENT> <ENT>.15344</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.21972</ENT> <ENT>.20203</ENT> <ENT>.18602</ENT> <ENT>.17152</ENT> <ENT>.15836</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.22559</ENT> <ENT>.20771</ENT> <ENT>.19151</ENT> <ENT>.17680</ENT> <ENT>.16344</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.23162</ENT> <ENT>.21356</ENT> <ENT>.19716</ENT> <ENT>.18225</ENT> <ENT>.16869</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.23784</ENT> <ENT>.21960</ENT> <ENT>.20301</ENT> <ENT>.18791</ENT> <ENT>.17414</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.24429</ENT> <ENT>.22588</ENT> <ENT>.20910</ENT> <ENT>.19380</ENT> <ENT>.17984</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.25098</ENT> <ENT>.23240</ENT> <ENT>.21545</ENT> <ENT>.19996</ENT> <ENT>.18581</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.25792</ENT> <ENT>.23918</ENT> <ENT>.22206</ENT> <ENT>.20639</ENT> <ENT>.19205</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.26512</ENT> <ENT>.24623</ENT> <ENT>.22894</ENT> <ENT>.21310</ENT> <ENT>.19858</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.27253</ENT> <ENT>.25350</ENT> <ENT>.23605</ENT> <ENT>.22004</ENT> <ENT>.20534</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.28016</ENT> <ENT>.26100</ENT> <ENT>.24341</ENT> <ENT>.22724</ENT> <ENT>.21236</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.28799</ENT> <ENT>.26871</ENT> <ENT>.25097</ENT> <ENT>.23464</ENT> <ENT>.21961</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.29603</ENT> <ENT>.27664</ENT> <ENT>.25877</ENT> <ENT>.24230</ENT> <ENT>.22710</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.30428</ENT> <ENT>.28478</ENT> <ENT>.26679</ENT> <ENT>.25018</ENT> <ENT>.23484</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.31273</ENT> <ENT>.29314</ENT> <ENT>.27504</ENT> <ENT>.25830</ENT> <ENT>.24280</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.32139</ENT> <ENT>.30172</ENT> <ENT>.28351</ENT> <ENT>.26665</ENT> <ENT>.25102</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.33024</ENT> <ENT>.31050</ENT> <ENT>.29220</ENT> <ENT>.27523</ENT> <ENT>.25948</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.33929</ENT> <ENT>.31949</ENT> <ENT>.30111</ENT> <ENT>.28404</ENT> <ENT>.26816</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.34851</ENT> <ENT>.32867</ENT> <ENT>.31022</ENT> <ENT>.29305</ENT> <ENT>.27707</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.35791</ENT> <ENT>.33804</ENT> <ENT>.31953</ENT> <ENT>.30228</ENT> <ENT>.28620</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.36749</ENT> <ENT>.34759</ENT> <ENT>.32904</ENT> <ENT>.31172</ENT> <ENT>.29555</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.37724</ENT> <ENT>.35733</ENT> <ENT>.33874</ENT> <ENT>.32137</ENT> <ENT>.30512</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.38717</ENT> <ENT>.36727</ENT> <ENT>.34866</ENT> <ENT>.33124</ENT> <ENT>.31493</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.39727</ENT> <ENT>.37739</ENT> <ENT>.35877</ENT> <ENT>.34132</ENT> <ENT>.32495</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.40752</ENT> <ENT>.38768</ENT> <ENT>.36906</ENT> <ENT>.35159</ENT> <ENT>.33518</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.41791</ENT> <ENT>.39811</ENT> <ENT>.37952</ENT> <ENT>.36204</ENT> <ENT>.34560</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.42844</ENT> <ENT>.40871</ENT> <ENT>.39014</ENT> <ENT>.37267</ENT> <ENT>.35621</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.43910</ENT> <ENT>.41944</ENT> <ENT>.40092</ENT> <ENT>.38347</ENT> <ENT>.36701</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.44990</ENT> <ENT>.43034</ENT> <ENT>.41188</ENT> <ENT>.39446</ENT> <ENT>.37801</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.46083</ENT> <ENT>.44137</ENT> <ENT>.42299</ENT> <ENT>.40562</ENT> <ENT>.38919</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.47189</ENT> <ENT>.45256</ENT> <ENT>.43427</ENT> <ENT>.41695</ENT> <ENT>.40056</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.48306</ENT> <ENT>.46386</ENT> <ENT>.44567</ENT> <ENT>.42844</ENT> <ENT>.41209</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.49432</ENT> <ENT>.47528</ENT> <ENT>.45721</ENT> <ENT>.44006</ENT> <ENT>.42378</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.50567</ENT> <ENT>.48679</ENT> <ENT>.46886</ENT> <ENT>.45182</ENT> <ENT>.43562</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.51708</ENT> <ENT>.49838</ENT> <ENT>.48060</ENT> <ENT>.46367</ENT> <ENT>.44756</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.52854</ENT> <ENT>.51004</ENT> <ENT>.49242</ENT> <ENT>.47563</ENT> <ENT>.45962</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.54004</ENT> <ENT>.52175</ENT> <ENT>.50430</ENT> <ENT>.48766</ENT> <ENT>.47177</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.55159</ENT> <ENT>.53352</ENT> <ENT>.51626</ENT> <ENT>.49978</ENT> <ENT>.48402</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.56316</ENT> <ENT>.54533</ENT> <ENT>.52827</ENT> <ENT>.51196</ENT> <ENT>.49636</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.57478</ENT> <ENT>.55719</ENT> <ENT>.54036</ENT> <ENT>.52424</ENT> <ENT>.50879</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.58643</ENT> <ENT>.56910</ENT> <ENT>.55250</ENT> <ENT>.53658</ENT> <ENT>.52131</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.59811</ENT> <ENT>.58107</ENT> <ENT>.56471</ENT> <ENT>.54901</ENT> <ENT>.53393</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.60982</ENT> <ENT>.59307</ENT> <ENT>.57697</ENT> <ENT>.56150</ENT> <ENT>.54662</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.62155</ENT> <ENT>.60510</ENT> <ENT>.58928</ENT> <ENT>.57405</ENT> <ENT>.55940</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.63327</ENT> <ENT>.61714</ENT> <ENT>.60161</ENT> <ENT>.58664</ENT> <ENT>.57222</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.64498</ENT> <ENT>.62918</ENT> <ENT>.61395</ENT> <ENT>.59926</ENT> <ENT>.58508</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.65666</ENT> <ENT>.64120</ENT> <ENT>.62628</ENT> <ENT>.61188</ENT> <ENT>.59796</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.66829</ENT> <ENT>.65319</ENT> <ENT>.63859</ENT> <ENT>.62448</ENT> <ENT>.61083</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.67986</ENT> <ENT>.66512</ENT> <ENT>.65086</ENT> <ENT>.63706</ENT> <ENT>.62370</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.69139</ENT> <ENT>.67702</ENT> <ENT>.66311</ENT> <ENT>.64963</ENT> <ENT>.63656</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.70286</ENT> <ENT>.68888</ENT> <ENT>.67533</ENT> <ENT>.66218</ENT> <ENT>.64942</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.71431</ENT> <ENT>.70073</ENT> <ENT>.68754</ENT> <ENT>.67474</ENT> <ENT>.66231</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.72572</ENT> <ENT>.71255</ENT> <ENT>.69974</ENT> <ENT>.68730</ENT> <ENT>.67520</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.73704</ENT> <ENT>.72429</ENT> <ENT>.71188</ENT> <ENT>.69980</ENT> <ENT>.68805</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.74819</ENT> <ENT>.73586</ENT> <ENT>.72384</ENT> <ENT>.71214</ENT> <ENT>.70075</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.75909</ENT> <ENT>.74718</ENT> <ENT>.73557</ENT> <ENT>.72424</ENT> <ENT>.71320</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.76971</ENT> <ENT>.75822</ENT> <ENT>.74700</ENT> <ENT>.73606</ENT> <ENT>.72538</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.78004</ENT> <ENT>.76897</ENT> <ENT>.75815</ENT> <ENT>.74758</ENT> <ENT>.73726</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.79010</ENT> <ENT>.77944</ENT> <ENT>.76902</ENT> <ENT>.75883</ENT> <ENT>.74886</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.79993</ENT> <ENT>.78968</ENT> <ENT>.77965</ENT> <ENT>.76984</ENT> <ENT>.76023</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.80955</ENT> <ENT>.79971</ENT> <ENT>.79008</ENT> <ENT>.78064</ENT> <ENT>.77140</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.81891</ENT> <ENT>.80948</ENT> <ENT>.80024</ENT> <ENT>.79118</ENT> <ENT>.78230</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.82796</ENT> <ENT>.81894</ENT> <ENT>.81009</ENT> <ENT>.80140</ENT> <ENT>.79288</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.83672</ENT> <ENT>.82810</ENT> <ENT>.81962</ENT> <ENT>.81131</ENT> <ENT>.80314</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.84525</ENT> <ENT>.83700</ENT> <ENT>82891</ENT> <ENT>.82096</ENT> <ENT>.81314</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.85352</ENT> <ENT>.84567</ENT> <ENT>.83795</ENT> <ENT>.83037</ENT> <ENT>.82291</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.86141</ENT> <ENT>.85394</ENT> <ENT>.84659</ENT> <ENT>.83936</ENT> <ENT>.83224</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.86874</ENT> <ENT>.86162</ENT> <ENT>.85461</ENT> <ENT>.84771</ENT> <ENT>.84092</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.87549</ENT> <ENT>.86870</ENT> <ENT>.86201</ENT> <ENT>.85542</ENT> <ENT>.84893</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.88182</ENT> <ENT>.87534</ENT> <ENT>.86895</ENT> <ENT>.86266</ENT> <ENT>.85645</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.88789</ENT> <ENT>.88171</ENT> <ENT>.87562</ENT> <ENT>86961</ENT> <ENT>.86369</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.89367</ENT> <ENT>.88779</ENT> <ENT>.88198</ENT> <ENT>.87625</ENT> <ENT>.87059</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.89900</ENT> <ENT>.89338</ENT> <ENT>.88784</ENT> <ENT>.88237</ENT> <ENT>.87697</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.90379</ENT> <ENT>.89842</ENT> <ENT>.89312</ENT> <ENT>.88788</ENT> <ENT>.88271</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.90803</ENT> <ENT>.90288</ENT> <ENT>.89780</ENT> <ENT>.89277</ENT> <ENT>.88781</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.91171</ENT> <ENT>.90675</ENT> <ENT>.90185</ENT> <ENT>.89701</ENT> <ENT>.89223</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.91481</ENT> <ENT>.91001</ENT> <ENT>.90527</ENT> <ENT>.90058</ENT> <ENT>.89594</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.91757</ENT> <ENT>.91291</ENT> <ENT>.90831</ENT> <ENT>.90376</ENT> <ENT>.89926</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.91999</ENT> <ENT>.91546</ENT> <ENT>.91098</ENT> <ENT>.90655</ENT> <ENT>.90217</ENT> </ROW> <ROW> <PRTPAGE P="67"/> <ENT I="01">99</ENT> <ENT>.92227</ENT> <ENT>.91786</ENT> <ENT>.91349</ENT> <ENT>.90917</ENT> <ENT>.90490</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.92453</ENT> <ENT>.92023</ENT> <ENT>.91598</ENT> <ENT>.91177</ENT> <ENT>.90761</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.92656</ENT> <ENT>.92236</ENT> <ENT>.91821</ENT> <ENT>.91410</ENT> <ENT>.91003</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.92875</ENT> <ENT>.92467</ENT> <ENT>.92063</ENT> <ENT>.91662</ENT> <ENT>.91266</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.93152</ENT> <ENT>.92758</ENT> <ENT>.92367</ENT> <ENT>.91980</ENT> <ENT>91597</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.93423</ENT> <ENT>.93042</ENT> <ENT>.92665</ENT> <ENT>.92291</ENT> <ENT>.91920</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.93818</ENT> <ENT>.93458</ENT> <ENT>.93101</ENT> <ENT>.92747</ENT> <ENT>.92395</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.94430</ENT> <ENT>.94104</ENT> <ENT>.93779</ENT> <ENT>.93457</ENT> <ENT>.93127</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>95256</ENT> <ENT>.94975</ENT> <ENT>.94696</ENT> <ENT>.94418</ENT> <ENT>.94143</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.96507</ENT> <ENT>96298</ENT> <ENT>.96090</ENT> <ENT>.95883</ENT> <ENT>.95676</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.98450</ENT> <ENT>.98356</ENT> <ENT>.98263</ENT> <ENT>.98170</ENT> <ENT>.98077</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.08811</ENT> <ENT>.08132</ENT> <ENT>.07534</ENT> <ENT>.07006</ENT> <ENT>.06539</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.07283</ENT> <ENT>.06576</ENT> <ENT>.05952</ENT> <ENT>.05400</ENT> <ENT>.04912</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.07471</ENT> <ENT>.06746</ENT> <ENT>.06106</ENT> <ENT>.05539</ENT> <ENT>.05037</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.07704</ENT> <ENT>.06962</ENT> <ENT>.06304</ENT> <ENT>.05722</ENT> <ENT>.05205</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.07962</ENT> <ENT>.07202</ENT> <ENT>.06528</ENT> <ENT>.05930</ENT> <ENT>.05398</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.08243</ENT> <ENT>.07464</ENT> <ENT>.06773</ENT> <ENT>.06159</ENT> <ENT>.05612</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.08542</ENT> <ENT>.07745</ENT> <ENT>.07037</ENT> <ENT>.06406</ENT> <ENT>.05844</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.08857</ENT> <ENT>.08042</ENT> <ENT>.07316</ENT> <ENT>.06669</ENT> <ENT>.06091</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.09189</ENT> <ENT>.08355</ENT> <ENT>.07612</ENT> <ENT>.06948</ENT> <ENT>.06354</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.09540</ENT> <ENT>.08687</ENT> <ENT>.07926</ENT> <ENT>.07245</ENT> <ENT>.06635</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.09908</ENT> <ENT>.09037</ENT> <ENT>.08258</ENT> <ENT>.07560</ENT> <ENT>.06934</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.10296</ENT> <ENT>.09406</ENT> <ENT>.08609</ENT> <ENT>.07894</ENT> <ENT>.07251</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.10701</ENT> <ENT>.09793</ENT> <ENT>.08977</ENT> <ENT>.08245</ENT> <ENT>.07586</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.11119</ENT> <ENT>.10191</ENT> <ENT>.09358</ENT> <ENT>.08608</ENT> <ENT>.07932</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.11544</ENT> <ENT>.10597</ENT> <ENT>.09745</ENT> <ENT>.08978</ENT> <ENT>.08285</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.11972</ENT> <ENT>.11007</ENT> <ENT>.10136</ENT> <ENT>.09350</ENT> <ENT>.08640</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.12402</ENT> <ENT>.11416</ENT> <ENT>.10527</ENT> <ENT>.09723</ENT> <ENT>.08995</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.12832</ENT> <ENT>.11827</ENT> <ENT>.10919</ENT> <ENT>.10096</ENT> <ENT>.09351</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.13268</ENT> <ENT>.12243</ENT> <ENT>.11315</ENT> <ENT>.10474</ENT> <ENT>.09711</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.13712</ENT> <ENT>.12667</ENT> <ENT>.11720</ENT> <ENT>.10860</ENT> <ENT>.10078</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.14170</ENT> <ENT>.13105</ENT> <ENT>.12138</ENT> <ENT>.11259</ENT> <ENT>.10459</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.14642</ENT> <ENT>.13557</ENT> <ENT>.12570</ENT> <ENT>.11671</ENT> <ENT>.10853</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.15129</ENT> <ENT>.14024</ENT> <ENT>.13017</ENT> <ENT>.12099</ENT> <ENT>.11261</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.15634</ENT> <ENT>.14508</ENT> <ENT>.13481</ENT> <ENT>.12544</ENT> <ENT>.11687</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.16159</ENT> <ENT>.15013</ENT> <ENT>.13967</ENT> <ENT>.13009</ENT> <ENT>.12133</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.16709</ENT> <ENT>.15543</ENT> <ENT>.14477</ENT> <ENT>.13500</ENT> <ENT>.12604</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.17286</ENT> <ENT>.16101</ENT> <ENT>.15014</ENT> <ENT>.14018</ENT> <ENT>.13103</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.17891</ENT> <ENT>.16686</ENT> <ENT>.15580</ENT> <ENT>.14564</ENT> <ENT>.13630</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.18525</ENT> <ENT>.17301</ENT> <ENT>.16175</ENT> <ENT>.15140</ENT> <ENT>.14187</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.19183</ENT> <ENT>.17940</ENT> <ENT>.16796</ENT> <ENT>.15742</ENT> <ENT>.14770</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.19867</ENT> <ENT>.18606</ENT> <ENT>.17443</ENT> <ENT>.16370</ENT> <ENT>.15380</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.20574</ENT> <ENT>.19295</ENT> <ENT>.18114</ENT> <ENT>.17023</ENT> <ENT>.16013</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.21307</ENT> <ENT>.20010</ENT> <ENT>.18811</ENT> <ENT>.17702</ENT> <ENT>.16674</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.22064</ENT> <ENT>.20751</ENT> <ENT>.19535</ENT> <ENT>.18407</ENT> <ENT>.17362</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.22846</ENT> <ENT>.21516</ENT> <ENT>.20283</ENT> <ENT>.19138</ENT> <ENT>.18075</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.23653</ENT> <ENT>.22307</ENT> <ENT>.21058</ENT> <ENT>.19896</ENT> <ENT>.18816</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.24484</ENT> <ENT>.23124</ENT> <ENT>.21859</ENT> <ENT>.20681</ENT> <ENT>.19584</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.25340</ENT> <ENT>.23966</ENT> <ENT>.22685</ENT> <ENT>.21492</ENT> <ENT>.20379</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.26219</ENT> <ENT>.24831</ENT> <ENT>.23536</ENT> <ENT>.22328</ENT> <ENT>.21199</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.27120</ENT> <ENT>.25720</ENT> <ENT>.24411</ENT> <ENT>.23188</ENT> <ENT>.22044</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.28045</ENT> <ENT>.26633</ENT> <ENT>.25311</ENT> <ENT>.24075</ENT> <ENT>.22916</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.28992</ENT> <ENT>.27569</ENT> <ENT>.26236</ENT> <ENT>.24986</ENT> <ENT>.23814</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.29965</ENT> <ENT>.28532</ENT> <ENT>.27188</ENT> <ENT>.25926</ENT> <ENT>.24741</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.30960</ENT> <ENT>.29518</ENT> <ENT>.28163</ENT> <ENT>.26890</ENT> <ENT>.25693</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.31977</ENT> <ENT>.30527</ENT> <ENT>.29164</ENT> <ENT>.27880</ENT> <ENT>.26671</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.33013</ENT> <ENT>.31557</ENT> <ENT>.30185</ENT> <ENT>.28892</ENT> <ENT>.27673</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.34071</ENT> <ENT>.32609</ENT> <ENT>.31230</ENT> <ENT>.29929</ENT> <ENT>.28700</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.35148</ENT> <ENT>.33681</ENT> <ENT>.32296</ENT> <ENT>.30988</ENT> <ENT>.29750</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.36246</ENT> <ENT>.34777</ENT> <ENT>.33387</ENT> <ENT>.32072</ENT> <ENT>.30826</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.37364</ENT> <ENT>.35893</ENT> <ENT>.34499</ENT> <ENT>.33179</ENT> <ENT>.31927</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.38503</ENT> <ENT>.37030</ENT> <ENT>.35634</ENT> <ENT>.34310</ENT> <ENT>.33053</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.39659</ENT> <ENT>.38187</ENT> <ENT>.36790</ENT> <ENT>.35462</ENT> <ENT>.34201</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.40832</ENT> <ENT>.39362</ENT> <ENT>.37965</ENT> <ENT>.36636</ENT> <ENT>.35371</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.42021</ENT> <ENT>.40554</ENT> <ENT>.39158</ENT> <ENT>.37829</ENT> <ENT>.36562</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.43222</ENT> <ENT>.41760</ENT> <ENT>.40367</ENT> <ENT>.39039</ENT> <ENT>.37771</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.44436</ENT> <ENT>.42980</ENT> <ENT>.41591</ENT> <ENT>.40264</ENT> <ENT>.38997</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.45660</ENT> <ENT>.44212</ENT> <ENT>.42828</ENT> <ENT>.41504</ENT> <ENT>.40239</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.46897</ENT> <ENT>.45456</ENT> <ENT>.44079</ENT> <ENT>.42760</ENT> <ENT>.41498</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.48142</ENT> <ENT>.46712</ENT> <ENT>.45342</ENT> <ENT>.44030</ENT> <ENT>.42771</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.49399</ENT> <ENT>.47980</ENT> <ENT>.46620</ENT> <ENT>.45314</ENT> <ENT>.44062</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.50666</ENT> <ENT>.49260</ENT> <ENT>.47910</ENT> <ENT>.46613</ENT> <ENT>.45367</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.51944</ENT> <ENT>.50552</ENT> <ENT>.49214</ENT> <ENT>.47927</ENT> <ENT>.46690</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.53232</ENT> <ENT>.51856</ENT> <ENT>.50531</ENT> <ENT>.49256</ENT> <ENT>.48028</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.54529</ENT> <ENT>.53169</ENT> <ENT>.51860</ENT> <ENT>.50598</ENT> <ENT>.49381</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.55832</ENT> <ENT>.54491</ENT> <ENT>.53198</ENT> <ENT>.51950</ENT> <ENT>.50746</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.57140</ENT> <ENT>.55819</ENT> <ENT>.54544</ENT> <ENT>.53312</ENT> <ENT>.52121</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.58451</ENT> <ENT>.57152</ENT> <ENT>.55895</ENT> <ENT>.54681</ENT> <ENT>.53506</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.59763</ENT> <ENT>.58486</ENT> <ENT>.57251</ENT> <ENT>.56054</ENT> <ENT>.54896</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.61076</ENT> <ENT>.59823</ENT> <ENT>.58609</ENT> <ENT>.57432</ENT> <ENT>.56292</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.62390</ENT> <ENT>.61162</ENT> <ENT>.59971</ENT> <ENT>.58816</ENT> <ENT>.57695</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.63705</ENT> <ENT>.62503</ENT> <ENT>.61337</ENT> <ENT>.60204</ENT> <ENT>.59104</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.65023</ENT> <ENT>.63849</ENT> <ENT>.62709</ENT> <ENT>.61600</ENT> <ENT>.60522</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.66344</ENT> <ENT>.65199</ENT> <ENT>.64086</ENT> <ENT>.63003</ENT> <ENT>.61949</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.67661</ENT> <ENT>.66547</ENT> <ENT>.65463</ENT> <ENT>.64407</ENT> <ENT>.63378</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.68964</ENT> <ENT>.67882</ENT> <ENT>.66827</ENT> <ENT>.65798</ENT> <ENT>.64796</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.70243</ENT> <ENT>.69193</ENT> <ENT>.68168</ENT> <ENT>.67168</ENT> <ENT>.66192</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.71495</ENT> <ENT>.70477</ENT> <ENT>.69482</ENT> <ENT>.68511</ENT> <ENT>.67563</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.72717</ENT> <ENT>.71731</ENT> <ENT>.70768</ENT> <ENT>.69826</ENT> <ENT>.68905</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.73912</ENT> <ENT>.72959</ENT> <ENT>.72026</ENT> <ENT>.71114</ENT> <ENT>.70221</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.75083</ENT> <ENT>.74163</ENT> <ENT>.73262</ENT> <ENT>.72379</ENT> <ENT>.71515</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.76235</ENT> <ENT>.75348</ENT> <ENT>.74479</ENT> <ENT>.73627</ENT> <ENT>.72792</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.77360</ENT> <ENT>.76506</ENT> <ENT>.75669</ENT> <ENT>.74848</ENT> <ENT>.74043</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.78452</ENT> <ENT>.77632</ENT> <ENT>.76827</ENT> <ENT>.76036</ENT> <ENT>.75260</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.79513</ENT> <ENT>.78725</ENT> <ENT>.77952</ENT> <ENT>.77192</ENT> <ENT>.76446</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.80547</ENT> <ENT>.79792</ENT> <ENT>.79051</ENT> <ENT>.78322</ENT> <ENT>.77606</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.81557</ENT> <ENT>.80836</ENT> <ENT>.80126</ENT> <ENT>.79429</ENT> <ENT>.78742</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.82524</ENT> <ENT>.81835</ENT> <ENT>.81157</ENT> <ENT>.80489</ENT> <ENT>.79832</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.83423</ENT> <ENT>.82764</ENT> <ENT>.82115</ENT> <ENT>.81477</ENT> <ENT>.80847</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.84253</ENT> <ENT>.83623</ENT> <ENT>.83002</ENT> <ENT>.82390</ENT> <ENT>.81787</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.85033</ENT> <ENT>.84430</ENT> <ENT>.83836</ENT> <ENT>.83250</ENT> <ENT>.82672</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.85784</ENT> <ENT>.85208</ENT> <ENT>.84639</ENT> <ENT>.84079</ENT> <ENT>.83525</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.86502</ENT> <ENT>.85951</ENT> <ENT>.85408</ENT> <ENT>.84871</ENT> <ENT>.84342</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.87164</ENT> <ENT>.86638</ENT> <ENT>.86118</ENT> <ENT>.85605</ENT> <ENT>.85098</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.87761</ENT> <ENT>.87257</ENT> <ENT>.86759</ENT> <ENT>.86267</ENT> <ENT>.85781</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.88290</ENT> <ENT>.87806</ENT> <ENT>.87327</ENT> <ENT>.86854</ENT> <ENT>.86386</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.88750</ENT> <ENT>.88282</ENT> <ENT>.87820</ENT> <ENT>.87364</ENT> <ENT>.86913</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.89136</ENT> <ENT>.88683</ENT> <ENT>.88236</ENT> <ENT>.87793</ENT> <ENT>.87355</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.89481</ENT> <ENT>.89041</ENT> <ENT>.88606</ENT> <ENT>.88176</ENT> <ENT>.87750</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.89783</ENT> <ENT>.89354</ENT> <ENT>.88930</ENT> <ENT>.88511</ENT> <ENT>.88096</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.90067</ENT> <ENT>.89649</ENT> <ENT>.89235</ENT> <ENT>.88826</ENT> <ENT>.88420</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.90349</ENT> <ENT>.89941</ENT> <ENT>.89538</ENT> <ENT>.89138</ENT> <ENT>.88743</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.90600</ENT> <ENT>.90202</ENT> <ENT>.89807</ENT> <ENT>.89416</ENT> <ENT>.89029</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.90873</ENT> <ENT>.90484</ENT> <ENT>.90099</ENT> <ENT>.89717</ENT> <ENT>.89339</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.91217</ENT> <ENT>.90841</ENT> <ENT>.90468</ENT> <ENT>.90099</ENT> <ENT>.99733</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.91553</ENT> <ENT>.91188</ENT> <ENT>.90827</ENT> <ENT>.90469</ENT> <ENT>.90114</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.92047</ENT> <ENT>.91701</ENT> <ENT>.91358</ENT> <ENT>.91018</ENT> <ENT>.90680</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.92819</ENT> <ENT>.92504</ENT> <ENT>.92191</ENT> <ENT>.91880</ENT> <ENT>.91571</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.93868</ENT> <ENT>.93596</ENT> <ENT>.93325</ENT> <ENT>.93056</ENT> <ENT>.92788</ENT> </ROW> <ROW> <PRTPAGE P="68"/> <ENT I="01">108</ENT> <ENT>.95471</ENT> <ENT>.95267</ENT> <ENT>.95064</ENT> <ENT>.94862</ENT> <ENT>.94661</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97985</ENT> <ENT>.97893</ENT> <ENT>.97801</ENT> <ENT>.97710</ENT> <ENT>.97619</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.06126</ENT> <ENT>.05759</ENT> <ENT>.05433</ENT> <ENT>.05143</ENT> <ENT>.04884</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.04480</ENT> <ENT>.04096</ENT> <ENT>.03754</ENT> <ENT>.03450</ENT> <ENT>.03179</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.04591</ENT> <ENT>.04194</ENT> <ENT>.03841</ENT> <ENT>.03527</ENT> <ENT>.03246</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.04745</ENT> <ENT>.04336</ENT> <ENT>.03972</ENT> <ENT>.03646</ENT> <ENT>.03355</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.04924</ENT> <ENT>.04502</ENT> <ENT>.04125</ENT> <ENT>.03789</ENT> <ENT>.03487</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.05124</ENT> <ENT>.04689</ENT> <ENT>.04300</ENT> <ENT>.03952</ENT> <ENT>.03639</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.05342</ENT> <ENT>.04893</ENT> <ENT>.04492</ENT> <ENT>.04131</ENT> <ENT>.03808</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.05574</ENT> <ENT>.05112</ENT> <ENT>.04697</ENT> <ENT>.04324</ENT> <ENT>.03990</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.05822</ENT> <ENT>.05346</ENT> <ENT>.04918</ENT> <ENT>.04533</ENT> <ENT>.04186</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.06089</ENT> <ENT>.05598</ENT> <ENT>.05156</ENT> <ENT>.04759</ENT> <ENT>.04400</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.06372</ENT> <ENT>.05866</ENT> <ENT>.05411</ENT> <ENT>.05000</ENT> <ENT>.04630</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.06673</ENT> <ENT>.06153</ENT> <ENT>.05684</ENT> <ENT>.05260</ENT> <ENT>.04877</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.06992</ENT> <ENT>.06457</ENT> <ENT>.05973</ENT> <ENT>.05536</ENT> <ENT>.05141</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.07322</ENT> <ENT>.06772</ENT> <ENT>.06274</ENT> <ENT>.05824</ENT> <ENT>.05415</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.07659</ENT> <ENT>.07093</ENT> <ENT>.06581</ENT> <ENT>.06117</ENT> <ENT>.05695</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.07998</ENT> <ENT>.07417</ENT> <ENT>.06890</ENT> <ENT>.06411</ENT> <ENT>.05976</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.08337</ENT> <ENT>.07739</ENT> <ENT>.07197</ENT> <ENT>.06704</ENT> <ENT>.06255</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.08675</ENT> <ENT>.08062</ENT> <ENT>.07504</ENT> <ENT>.06996</ENT> <ENT>.06533</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.09018</ENT> <ENT>.08387</ENT> <ENT>.07813</ENT> <ENT>.07290</ENT> <ENT>.06813</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.09367</ENT> <ENT>.08720</ENT> <ENT>.08130</ENT> <ENT>.07591</ENT> <ENT>.07099</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.09730</ENT> <ENT>.09065</ENT> <ENT>.08458</ENT> <ENT>.07904</ENT> <ENT>.07397</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.10106</ENT> <ENT>.09423</ENT> <ENT>.08800</ENT> <ENT>.08229</ENT> <ENT>.07707</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.10496</ENT> <ENT>.09796</ENT> <ENT>.09155</ENT> <ENT>.08568</ENT> <ENT>.08030</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.10903</ENT> <ENT>.10185</ENT> <ENT>.09526</ENT> <ENT>.08923</ENT> <ENT>.08368</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.11330</ENT> <ENT>.10594</ENT> <ENT>.09918</ENT> <ENT>.09297</ENT> <ENT>.08726</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.11782</ENT> <ENT>.11028</ENT> <ENT>.10334</ENT> <ENT>.09696</ENT> <ENT>.09108</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.12262</ENT> <ENT>.11489</ENT> <ENT>.10778</ENT> <ENT>.10122</ENT> <ENT>.09518</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.12771</ENT> <ENT>.11979</ENT> <ENT>.11249</ENT> <ENT>.10576</ENT> <ENT>.09955</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.13309</ENT> <ENT>.12499</ENT> <ENT>.11751</ENT> <ENT>.11060</ENT> <ENT>.10421</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.13873</ENT> <ENT>.13044</ENT> <ENT>.12278</ENT> <ENT>.11570</ENT> <ENT>.10914</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.14464</ENT> <ENT>.13617</ENT> <ENT>.12833</ENT> <ENT>.12107</ENT> <ENT>.11433</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.15079</ENT> <ENT>.14214</ENT> <ENT>.13412</ENT> <ENT>.12668</ENT> <ENT>.11977</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.15722</ENT> <ENT>.14838</ENT> <ENT>.14018</ENT> <ENT>.13256</ENT> <ENT>.12548</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.16391</ENT> <ENT>.15490</ENT> <ENT>.14652</ENT> <ENT>.13873</ENT> <ENT>.13147</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.17087</ENT> <ENT>.16168</ENT> <ENT>.15312</ENT> <ENT>.14515</ENT> <ENT>.13772</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.17811</ENT> <ENT>.16874</ENT> <ENT>.16001</ENT> <ENT>.15186</ENT> <ENT>.14426</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.18562</ENT> <ENT>.17608</ENT> <ENT>.16717</ENT> <ENT>.15886</ENT> <ENT>.15108</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.19340</ENT> <ENT>.18369</ENT> <ENT>.17462</ENT> <ENT>.16613</ENT> <ENT>.15819</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.20144</ENT> <ENT>.19157</ENT> <ENT>.18233</ENT> <ENT>.17368</ENT> <ENT>.16557</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.20974</ENT> <ENT>.19971</ENT> <ENT>.19031</ENT> <ENT>.18149</ENT> <ENT>.17322</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.21830</ENT> <ENT>.20812</ENT> <ENT>.19856</ENT> <ENT>.18959</ENT> <ENT>.18115</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.22714</ENT> <ENT>.21681</ENT> <ENT>.20710</ENT> <ENT>.19797</ENT> <ENT>.18938</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.23627</ENT> <ENT>.22579</ENT> <ENT>.21594</ENT> <ENT>.20665</ENT> <ENT>.19791</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.24566</ENT> <ENT>.23505</ENT> <ENT>.22505</ENT> <ENT>.21562</ENT> <ENT>.20673</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.25532</ENT> <ENT>.24458</ENT> <ENT>.23445</ENT> <ENT>.22488</ENT> <ENT>.21585</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.26522</ENT> <ENT>.25436</ENT> <ENT>.24410</ENT> <ENT>.23440</ENT> <ENT>.22523</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.27538</ENT> <ENT>.26441</ENT> <ENT>.25402</ENT> <ENT>.24420</ENT> <ENT>.23490</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.28579</ENT> <ENT>.27471</ENT> <ENT>.26421</ENT> <ENT>.25427</ENT> <ENT>.24484</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.29647</ENT> <ENT>.28529</ENT> <ENT>.27469</ENT> <ENT>.26463</ENT> <ENT>.25508</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.30739</ENT> <ENT>.29613</ENT> <ENT>.28543</ENT> <ENT>.27527</ENT> <ENT>.26562</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.31859</ENT> <ENT>.30724</ENT> <ENT>.29646</ENT> <ENT>.28620</ENT> <ENT>.27645</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.33001</ENT> <ENT>.31860</ENT> <ENT>.30774</ENT> <ENT>.29740</ENT> <ENT>.28755</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.34167</ENT> <ENT>.33020</ENT> <ENT>.31928</ENT> <ENT>.30886</ENT> <ENT>.29893</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.35355</ENT> <ENT>.34204</ENT> <ENT>.33105</ENT> <ENT>.32057</ENT> <ENT>.31056</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.36562</ENT> <ENT>.35407</ENT> <ENT>.34304</ENT> <ENT>.33250</ENT> <ENT>.32243</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.37787</ENT> <ENT>.36630</ENT> <ENT>.35523</ENT> <ENT>.34465</ENT> <ENT>.33452</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.39029</ENT> <ENT>.37870</ENT> <ENT>.36761</ENT> <ENT>.35699</ENT> <ENT>.34682</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.40289</ENT> <ENT>.39130</ENT> <ENT>.38020</ENT> <ENT>.36956</ENT> <ENT>.35935</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.41565</ENT> <ENT>.40408</ENT> <ENT>.39297</ENT> <ENT>.38231</ENT> <ENT>.37208</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.42859</ENT> <ENT>.41704</ENT> <ENT>.40595</ENT> <ENT>.39529</ENT> <ENT>.38504</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.44170</ENT> <ENT>.43019</ENT> <ENT>.41912</ENT> <ENT>.40847</ENT> <ENT>.39822</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.45499</ENT> <ENT>.44353</ENT> <ENT>.43250</ENT> <ENT>.42187</ENT> <ENT>.41164</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.46845</ENT> <ENT>.45706</ENT> <ENT>.44607</ENT> <ENT>.43548</ENT> <ENT>.42527</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.48208</ENT> <ENT>.47076</ENT> <ENT>.45984</ENT> <ENT>.44930</ENT> <ENT>.43913</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.49583</ENT> <ENT>.48461</ENT> <ENT>.47377</ENT> <ENT>.46329</ENT> <ENT>.45317</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.50971</ENT> <ENT>.49859</ENT> <ENT>.48784</ENT> <ENT>.47744</ENT> <ENT>.46738</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.52369</ENT> <ENT>.51269</ENT> <ENT>.50204</ENT> <ENT>.49173</ENT> <ENT>.48175</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.53774</ENT> <ENT>.52688</ENT> <ENT>.51635</ENT> <ENT>.50614</ENT> <ENT>.49625</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.55187</ENT> <ENT>.54115</ENT> <ENT>.53075</ENT> <ENT>.52066</ENT> <ENT>.51088</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.56607</ENT> <ENT>.55551</ENT> <ENT>.54526</ENT> <ENT>.53530</ENT> <ENT>.52563</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.58035</ENT> <ENT>.56997</ENT> <ENT>.55987</ENT> <ENT>.55006</ENT> <ENT>.54053</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.59474</ENT> <ENT>.58455</ENT> <ENT>.57463</ENT> <ENT>.56498</ENT> <ENT>.55559</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.60923</ENT> <ENT>.59924</ENT> <ENT>.58952</ENT> <ENT>.58004</ENT> <ENT>.57082</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.62375</ENT> <ENT>.61398</ENT> <ENT>.60446</ENT> <ENT>.59518</ENT> <ENT>.58613</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.63818</ENT> <ENT>.62864</ENT> <ENT>.61933</ENT> <ENT>.61026</ENT> <ENT>.60140</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.65240</ENT> <ENT>.64310</ENT> <ENT>.63402</ENT> <ENT>.62515</ENT> <ENT>.61649</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.66636</ENT> <ENT>.65731</ENT> <ENT>.64846</ENT> <ENT>.63981</ENT> <ENT>.63135</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.68005</ENT> <ENT>.67124</ENT> <ENT>.66263</ENT> <ENT>.65420</ENT> <ENT>.64596</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.69347</ENT> <ENT>.68492</ENT> <ENT>.67655</ENT> <ENT>.66836</ENT> <ENT>.66033</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.70669</ENT> <ENT>.69840</ENT> <ENT>.69028</ENT> <ENT>.68232</ENT> <ENT>.67452</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.71973</ENT> <ENT>.71171</ENT> <ENT>.70384</ENT> <ENT>.69613</ENT> <ENT>.68856</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.73252</ENT> <ENT>.72477</ENT> <ENT>.71717</ENT> <ENT>.70970</ENT> <ENT>.70237</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.74499</ENT> <ENT>.73751</ENT> <ENT>.73016</ENT> <ENT>.72295</ENT> <ENT>.71587</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.75713</ENT> <ENT>.74992</ENT> <ENT>.74284</ENT> <ENT>.73589</ENT> <ENT>.72905</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.76901</ENT> <ENT>.76208</ENT> <ENT>.75527</ENT> <ENT>.74857</ENT> <ENT>.74198</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.78067</ENT> <ENT>.77402</ENT> <ENT>.76748</ENT> <ENT>.76104</ENT> <ENT>.75471</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.79185</ENT> <ENT>.78548</ENT> <ENT>.77921</ENT> <ENT>.77304</ENT> <ENT>.76695</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.80228</ENT> <ENT>.79617</ENT> <ENT>.79015</ENT> <ENT>.78423</ENT> <ENT>.77838</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.81193</ENT> <ENT>.80607</ENT> <ENT>.80029</ENT> <ENT>.79460</ENT> <ENT>.78899</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.82102</ENT> <ENT>.81540</ENT> <ENT>.80985</ENT> <ENT>.80438</ENT> <ENT>.79899</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.82979</ENT> <ENT>.82441</ENT> <ENT>.81909</ENT> <ENT>.81384</ENT> <ENT>.80867</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.83820</ENT> <ENT>.83304</ENT> <ENT>.82795</ENT> <ENT>.82292</ENT> <ENT>.81796</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.84598</ENT> <ENT>.84104</ENT> <ENT>.83616</ENT> <ENT>.83134</ENT> <ENT>.82657</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.85300</ENT> <ENT>.84826</ENT> <ENT>.84357</ENT> <ENT>.83894</ENT> <ENT>.83437</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.85924</ENT> <ENT>.85468</ENT> <ENT>.85017</ENT> <ENT>.84570</ENT> <ENT>.84130</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.86466</ENT> <ENT>.86025</ENT> <ENT>.85589</ENT> <ENT>.85158</ENT> <ENT>.84732</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.86922</ENT> <ENT>.86494</ENT> <ENT>.86071</ENT> <ENT>.85652</ENT> <ENT>.85238</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.87329</ENT> <ENT>.86913</ENT> <ENT>.86501</ENT> <ENT>.86093</ENT> <ENT>.85690</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.87685</ENT> <ENT>.87279</ENT> <ENT>.86877</ENT> <ENT>.86479</ENT> <ENT>.86085</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.88019</ENT> <ENT>.87622</ENT> <ENT>.87230</ENT> <ENT>.86841</ENT> <ENT>.86456</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.88351</ENT> <ENT>.87964</ENT> <ENT>.87580</ENT> <ENT>.87200</ENT> <ENT>.86824</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.88646</ENT> <ENT>.88267</ENT> <ENT>.87891</ENT> <ENT>.87519</ENT> <ENT>.87150</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.88965</ENT> <ENT>.88594</ENT> <ENT>.88227</ENT> <ENT>.87863</ENT> <ENT>.87503</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.89370</ENT> <ENT>.89011</ENT> <ENT>.88654</ENT> <ENT>.88301</ENT> <ENT>.87952</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.89763</ENT> <ENT>.89414</ENT> <ENT>.89068</ENT> <ENT>.88725</ENT> <ENT>.88385</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.90345</ENT> <ENT>.90013</ENT> <ENT>.89683</ENT> <ENT>.89356</ENT> <ENT>.89032</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.91265</ENT> <ENT>.90961</ENT> <ENT>.90658</ENT> <ENT>.90358</ENT> <ENT>.90060</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.92522</ENT> <ENT>.92258</ENT> <ENT>.91995</ENT> <ENT>.91734</ENT> <ENT>.91474</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.94461</ENT> <ENT>.94262</ENT> <ENT>.94063</ENT> <ENT>.93866</ENT> <ENT>.93670</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97529</ENT> <ENT>.97438</ENT> <ENT>.97348</ENT> <ENT>.97259</ENT> <ENT>.97170</ENT> </ROW> </GPOTABLE> <PRTPAGE P="69"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.04653</ENT> <ENT>.04447</ENT> <ENT>.04262</ENT> <ENT>.04095</ENT> <ENT>.03946</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.02937</ENT> <ENT>.02720</ENT> <ENT>.02525</ENT> <ENT>.02351</ENT> <ENT>.02194</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02994</ENT> <ENT>.02769</ENT> <ENT>.02567</ENT> <ENT>.02385</ENT> <ENT>.02221</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.03094</ENT> <ENT>.02860</ENT> <ENT>.02650</ENT> <ENT>.02460</ENT> <ENT>.02290</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.03216</ENT> <ENT>.02973</ENT> <ENT>.02755</ENT> <ENT>.02558</ENT> <ENT>.92380</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.03359</ENT> <ENT>.03106</ENT> <ENT>.02879</ENT> <ENT>.02674</ENT> <ENT>.02488</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.03517</ENT> <ENT>.03255</ENT> <ENT>.03019</ENT> <ENT>.02805</ENT> <ENT>.02612</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.03688</ENT> <ENT>.03416</ENT> <ENT>.03171</ENT> <ENT>.02949</ENT> <ENT>.02747</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.03874</ENT> <ENT>.03592</ENT> <ENT>.03337</ENT> <ENT>.03106</ENT> <ENT>.02896</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.04077</ENT> <ENT>.03784</ENT> <ENT>.03519</ENT> <ENT>.03279</ENT> <ENT>.03061</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.04295</ENT> <ENT>.03992</ENT> <ENT>.03717</ENT> <ENT>.03467</ENT> <ENT>.03240</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.04531</ENT> <ENT>.04217</ENT> <ENT>.03931</ENT> <ENT>.03672</ENT> <ENT>.03436</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.04782</ENT> <ENT>.04457</ENT> <ENT>.04161</ENT> <ENT>.03892</ENT> <ENT>.02647</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.05045</ENT> <ENT>.04708</ENT> <ENT>.04402</ENT> <ENT>.04122</ENT> <ENT>.03868</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.05312</ENT> <ENT>.04964</ENT> <ENT>.04646</ENT> <ENT>.04357</ENT> <ENT>.04093</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.05581</ENT> <ENT>.05220</ENT> <ENT>.04891</ENT> <ENT>.04591</ENT> <ENT>.04317</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.05847</ENT> <ENT>.05474</ENT> <ENT>.05134</ENT> <ENT>.04822</ENT> <ENT>.04538</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.06111</ENT> <ENT>.05726</ENT> <ENT>.05374</ENT> <ENT>.05051</ENT> <ENT>.04756</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.06378</ENT> <ENT>.05979</ENT> <ENT>.05615</ENT> <ENT>.05280</ENT> <ENT>.04974</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.06650</ENT> <ENT>.06238</ENT> <ENT>.05861</ENT> <ENT>.05514</ENT> <ENT>.05196</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.06933</ENT> <ENT>.06507</ENT> <ENT>.06117</ENT> <ENT>.05758</ENT> <ENT>.05429</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.07228</ENT> <ENT>.06788</ENT> <ENT>.06384</ENT> <ENT>.06013</ENT> <ENT>.05671</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.07535</ENT> <ENT>.07081</ENT> <ENT>.06664</ENT> <ENT>.06279</ENT> <ENT>.05925</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.07858</ENT> <ENT>.07389</ENT> <ENT>.06958</ENT> <ENT>.06559</ENT> <ENT>.06192</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.08201</ENT> <ENT>.07717</ENT> <ENT>.07270</ENT> <ENT>.06858</ENT> <ENT>.06477</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.08567</ENT> <ENT>.08067</ENT> <ENT>.07606</ENT> <ENT>.07179</ENT> <ENT>.06785</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.08960</ENT> <ENT>.08444</ENT> <ENT>.07968</ENT> <ENT>.07527</ENT> <ENT>.07118</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.09380</ENT> <ENT>.08849</ENT> <ENT>.08357</ENT> <ENT>.07901</ENT> <ENT>.07478</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.09830</ENT> <ENT>.09283</ENT> <ENT>.08775</ENT> <ENT>.08304</ENT> <ENT>.07867</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.10306</ENT> <ENT>.09742</ENT> <ENT>.09218</ENT> <ENT>.08732</ENT> <ENT>.08280</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.10808</ENT> <ENT>.10228</ENT> <ENT>.09688</ENT> <ENT>.09187</ENT> <ENT>.08720</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.11335</ENT> <ENT>.10738</ENT> <ENT>.10182</ENT> <ENT>.09665</ENT> <ENT>.09182</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.11889</ENT> <ENT>.11275</ENT> <ENT>.10704</ENT> <ENT>.10170</ENT> <ENT>.09672</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.12471</ENT> <ENT>.11840</ENT> <ENT>.11252</ENT> <ENT>.10703</ENT> <ENT>.10189</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.13079</ENT> <ENT>.12432</ENT> <ENT>.11827</ENT> <ENT>.11261</ENT> <ENT>.10732</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.13716</ENT> <ENT>.13052</ENT> <ENT>.12431</ENT> <ENT>.11849</ENT> <ENT>.11305</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.14381</ENT> <ENT>.13701</ENT> <ENT>.13063</ENT> <ENT>.12465</ENT> <ENT>.11905</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.15075</ENT> <ENT>.14378</ENT> <ENT>.13724</ENT> <ENT>.13110</ENT> <ENT>.12534</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.15796</ENT> <ENT>.15083</ENT> <ENT>.14412</ENT> <ENT>.13782</ENT> <ENT>.13190</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.16545</ENT> <ENT>.15815</ENT> <ENT>.15129</ENT> <ENT>.14483</ENT> <ENT>.13875</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.17322</ENT> <ENT>.16576</ENT> <ENT>.15874</ENT> <ENT>.15212</ENT> <ENT>.14589</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.18129</ENT> <ENT>.17367</ENT> <ENT>.16649</ENT> <ENT>.15971</ENT> <ENT>.15332</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.18967</ENT> <ENT>.18190</ENT> <ENT>.17456</ENT> <ENT>.16763</ENT> <ENT>.16108</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.19834</ENT> <ENT>.19041</ENT> <ENT>.18293</ENT> <ENT>.17585</ENT> <ENT>.16915</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.20731</ENT> <ENT>.19924</ENT> <ENT>.19160</ENT> <ENT>.18437</ENT> <ENT>.17753</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.21655</ENT> <ENT>.20834</ENT> <ENT>.20055</ENT> <ENT>.19318</ENT> <ENT>.18619</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.22608</ENT> <ENT>.21773</ENT> <ENT>.20981</ENT> <ENT>.20229</ENT> <ENT>.19516</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.23590</ENT> <ENT>.22741</ENT> <ENT>.21935</ENT> <ENT>.21170</ENT> <ENT>.20443</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.24602</ENT> <ENT>.23741</ENT> <ENT>.22922</ENT> <ENT>.22144</ENT> <ENT>.21403</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.25644</ENT> <ENT>.24770</ENT> <ENT>.23939</ENT> <ENT>.23148</ENT> <ENT>.22394</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.26716</ENT> <ENT>.25831</ENT> <ENT>.24989</ENT> <ENT>.24185</ENT> <ENT>.23419</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.27816</ENT> <ENT>.26921</ENT> <ENT>.26068</ENT> <ENT>.25253</ENT> <ENT>.24475</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.28945</ENT> <ENT>.28040</ENT> <ENT>.27176</ENT> <ENT>.26351</ENT> <ENT>.25562</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.30100</ENT> <ENT>.29187</ENT> <ENT>.28313</ENT> <ENT>.27478</ENT> <ENT>.26679</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.31279</ENT> <ENT>.30357</ENT> <ENT>.29475</ENT> <ENT>.28631</ENT> <ENT>.27822</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.32482</ENT> <ENT>.31553</ENT> <ENT>.30663</ENT> <ENT>.29810</ENT> <ENT>.28992</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.33707</ENT> <ENT>.32771</ENT> <ENT>.31875</ENT> <ENT>.31014</ENT> <ENT>.30188</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.34955</ENT> <ENT>.34015</ENT> <ENT>.33112</ENT> <ENT>.32244</ENT> <ENT>.31411</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.36225</ENT> <ENT>.35280</ENT> <ENT>.34372</ENT> <ENT>.33499</ENT> <ENT>.32659</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.37519</ENT> <ENT>.36571</ENT> <ENT>.35659</ENT> <ENT>.34781</ENT> <ENT>.33936</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.38836</ENT> <ENT>.37886</ENT> <ENT>.36971</ENT> <ENT>.36089</ENT> <ENT>.35239</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.40177</ENT> <ENT>.39226</ENT> <ENT>.38309</ENT> <ENT>.37425</ENT> <ENT>.36572</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.41542</ENT> <ENT>.40591</ENT> <ENT>.39674</ENT> <ENT>.38788</ENT> <ENT>.37932</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.42930</ENT> <ENT>.41981</ENT> <ENT>.41064</ENT> <ENT>.40178</ENT> <ENT>.39321</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.44338</ENT> <ENT>.43392</ENT> <ENT>.42477</ENT> <ENT>.41591</ENT> <ENT>.40734</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.45765</ENT> <ENT>.44823</ENT> <ENT>.43910</ENT> <ENT>.43027</ENT> <ENT>.42171</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.47208</ENT> <ENT>.46271</ENT> <ENT>.45364</ENT> <ENT>.44483</ENT> <ENT>.43630</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.48666</ENT> <ENT>.47736</ENT> <ENT>.46834</ENT> <ENT>.45958</ENT> <ENT>.45108</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.50138</ENT> <ENT>.49215</ENT> <ENT>.48320</ENT> <ENT>.47450</ENT> <ENT>.46605</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.51624</ENT> <ENT>.50711</ENT> <ENT>.49824</ENT> <ENT>.48961</ENT> <ENT>.48122</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.53125</ENT> <ENT>.52223</ENT> <ENT>.51345</ENT> <ENT>.50491</ENT> <ENT>.49660</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.54645</ENT> <ENT>.53755</ENT> <ENT>.52889</ENT> <ENT>.52045</ENT> <ENT>.51223</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.56183</ENT> <ENT>.55307</ENT> <ENT>.54453</ENT> <ENT>.53621</ENT> <ENT>.52809</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.57731</ENT> <ENT>.56870</ENT> <ENT>.56030</ENT> <ENT>.55211</ENT> <ENT>.54412</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.59275</ENT> <ENT>.58431</ENT> <ENT>.57606</ENT> <ENT>.56801</ENT> <ENT>.56015</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.60803</ENT> <ENT>.59976</ENT> <ENT>.59168</ENT> <ENT>.58379</ENT> <ENT>.57607</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.62308</ENT> <ENT>.61500</ENT> <ENT>.60709</ENT> <ENT>.59936</ENT> <ENT>.59179</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.63789</ENT> <ENT>.63000</ENT> <ENT>.62227</ENT> <ENT>.61470</ENT> <ENT>.60730</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.65247</ENT> <ENT>.64477</ENT> <ENT>.63723</ENT> <ENT>.62984</ENT> <ENT>.62261</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.66687</ENT> <ENT>.65938</ENT> <ENT>.65203</ENT> <ENT>.64483</ENT> <ENT>.63777</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.68114</ENT> <ENT>.67386</ENT> <ENT>.66672</ENT> <ENT>.65971</ENT> <ENT>.65284</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.69518</ENT> <ENT>.68812</ENT> <ENT>.68119</ENT> <ENT>.67438</ENT> <ENT>.66770</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.70891</ENT> <ENT>.70207</ENT> <ENT>.69535</ENT> <ENT>.68875</ENT> <ENT>.68227</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.72232</ENT> <ENT>.71572</ENT> <ENT>.70922</ENT> <ENT>.70283</ENT> <ENT>.69655</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.73550</ENT> <ENT>.72913</ENT> <ENT>.72285</ENT> <ENT>.71668</ENT> <ENT>.71061</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.74847</ENT> <ENT>.74234</ENT> <ENT>.73630</ENT> <ENT>.73035</ENT> <ENT>.72449</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.76096</ENT> <ENT>.75506</ENT> <ENT>.74925</ENT> <ENT>.74353</ENT> <ENT>.73789</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.77263</ENT> <ENT>.76696</ENT> <ENT>.76137</ENT> <ENT>.75585</ENT> <ENT>.75042</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.78345</ENT> <ENT>.77799</ENT> <ENT>.77261</ENT> <ENT>.76730</ENT> <ENT>.76207</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.79367</ENT> <ENT>.78842</ENT> <ENT>.78323</ENT> <ENT>.77812</ENT> <ENT>.77308</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.80356</ENT> <ENT>.79851</ENT> <ENT>.79353</ENT> <ENT>.78862</ENT> <ENT>.78376</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.81306</ENT> <ENT>.80821</ENT> <ENT>.80344</ENT> <ENT>.79871</ENT> <ENT>.79405</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.82187</ENT> <ENT>.81722</ENT> <ENT>.81263</ENT> <ENT>.80810</ENT> <ENT>.80361</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.82984</ENT> <ENT>.82538</ENT> <ENT>.82096</ENT> <ENT>.81659</ENT> <ENT>.81228</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.83694</ENT> <ENT>.83263</ENT> <ENT>.82837</ENT> <ENT>.82416</ENT> <ENT>.81999</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.84310</ENT> <ENT>.83893</ENT> <ENT>.83481</ENT> <ENT>.83073</ENT> <ENT>.82670</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.84829</ENT> <ENT>.84424</ENT> <ENT>.84023</ENT> <ENT>.83626</ENT> <ENT>.83234</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.85291</ENT> <ENT>.84897</ENT> <ENT>.84506</ENT> <ENT>.84120</ENT> <ENT>.83738</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.85696</ENT> <ENT>.85310</ENT> <ENT>.84929</ENT> <ENT>.84551</ENT> <ENT>.84177</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.86075</ENT> <ENT>.85698</ENT> <ENT>.85325</ENT> <ENT>.84956</ENT> <ENT>.84590</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.86452</ENT> <ENT>.86084</ENT> <ENT>.85719</ENT> <ENT>.85357</ENT> <ENT>.85000</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.86785</ENT> <ENT>.86424</ENT> <ENT>.86066</ENT> <ENT>.85711</ENT> <ENT>.85360</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.87146</ENT> <ENT>.86792</ENT> <ENT>.86442</ENT> <ENT>.86094</ENT> <ENT>.85750</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.87605</ENT> <ENT>.87261</ENT> <ENT>.86921</ENT> <ENT>.86583</ENT> <ENT>.86248</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.88047</ENT> <ENT>.87713</ENT> <ENT>.87382</ENT> <ENT>.87053</ENT> <ENT>.86727</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.88710</ENT> <ENT>.88390</ENT> <ENT>.88073</ENT> <ENT>.87758</ENT> <ENT>.87446</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.89764</ENT> <ENT>.89471</ENT> <ENT>.89179</ENT> <ENT>.88889</ENT> <ENT>.88601</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.91216</ENT> <ENT>.90960</ENT> <ENT>.90705</ENT> <ENT>.90451</ENT> <ENT>.90199</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.93474</ENT> <ENT>.93280</ENT> <ENT>.93086</ENT> <ENT>.92894</ENT> <ENT>.92702</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97081</ENT> <ENT>.96992</ENT> <ENT>.96904</ENT> <ENT>.96816</ENT> <ENT>.96729</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03811</ENT> <ENT>.03689</ENT> <ENT>.03579</ENT> <ENT>.03479</ENT> <ENT>.03388</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.02052</ENT> <ENT>.01924</ENT> <ENT>.01809</ENT> <ENT>.01704</ENT> <ENT>.01609</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02074</ENT> <ENT>.01940</ENT> <ENT>.01819</ENT> <ENT>.01710</ENT> <ENT>.01611</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02136</ENT> <ENT>.01996</ENT> <ENT>.01870</ENT> <ENT>.01756</ENT> <ENT>.01652</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.02219</ENT> <ENT>.02074</ENT> <ENT>.01942</ENT> <ENT>.01822</ENT> <ENT>.01713</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.02321</ENT> <ENT>.02169</ENT> <ENT>.02031</ENT> <ENT>.01905</ENT> <ENT>.01791</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.02437</ENT> <ENT>.02278</ENT> <ENT>.02134</ENT> <ENT>.02003</ENT> <ENT>.01883</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.02565</ENT> <ENT>.02399</ENT> <ENT>.02248</ENT> <ENT>.02111</ENT> <ENT>.01986</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.02706</ENT> <ENT>.02533</ENT> <ENT>.02376</ENT> <ENT>.02232</ENT> <ENT>.02101</ENT> </ROW> <ROW> <PRTPAGE P="70"/> <ENT I="01">9</ENT> <ENT>.02863</ENT> <ENT>.02682</ENT> <ENT>.02518</ENT> <ENT>.02367</ENT> <ENT>.02230</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.03034</ENT> <ENT>.02846</ENT> <ENT>.02674</ENT> <ENT>.02517</ENT> <ENT>.02373</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.03221</ENT> <ENT>.03025</ENT> <ENT>.02846</ENT> <ENT>.02682</ENT> <ENT>.02532</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.03424</ENT> <ENT>.03219</ENT> <ENT>.03032</ENT> <ENT>.02861</ENT> <ENT>.02704</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.03635</ENT> <ENT>.03422</ENT> <ENT>.03228</ENT> <ENT>.03049</ENT> <ENT>.02885</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.03851</ENT> <ENT>.03630</ENT> <ENT>.03427</ENT> <ENT>.03240</ENT> <ENT>.03069</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.04066</ENT> <ENT>.03836</ENT> <ENT>.03624</ENT> <ENT>.03430</ENT> <ENT>.03252</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.04277</ENT> <ENT>.04037</ENT> <ENT>.03817</ENT> <ENT>.03615</ENT> <ENT>.03429</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.04485</ENT> <ENT>.04236</ENT> <ENT>.04007</ENT> <ENT>.03796</ENT> <ENT>.03602</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.04693</ENT> <ENT>.04434</ENT> <ENT>.04196</ENT> <ENT>.03976</ENT> <ENT>.03773</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.04904</ENT> <ENT>.04635</ENT> <ENT>.04387</ENT> <ENT>.04159</ENT> <ENT>.03947</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.05125</ENT> <ENT>.04845</ENT> <ENT>.04588</ENT> <ENT>.04349</ENT> <ENT>.04129</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.05356</ENT> <ENT>.05065</ENT> <ENT>.04797</ENT> <ENT>.04549</ENT> <ENT>.04319</ENT> </ROW> <ROW> <ENT 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I="01">62</ENT> <ENT>.37106</ENT> <ENT>.36307</ENT> <ENT>.35535</ENT> <ENT>.34788</ENT> <ENT>.34066</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.38492</ENT> <ENT>.37691</ENT> <ENT>.36915</ENT> <ENT>.36165</ENT> <ENT>.35438</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.39905</ENT> <ENT>.39102</ENT> <ENT>.38324</ENT> <ENT>.37571</ENT> <ENT>.36841</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.41342</ENT> <ENT>.40539</ENT> <ENT>.39760</ENT> <ENT>.39005</ENT> <ENT>.38272</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.42803</ENT> <ENT>.42000</ENT> <ENT>.41221</ENT> <ENT>.40465</ENT> <ENT>.39731</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.44283</ENT> <ENT>.43483</ENT> <ENT>.42705</ENT> <ENT>.41949</ENT> <ENT>.41215</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.45784</ENT> <ENT>.44987</ENT> <ENT>.44211</ENT> <ENT>.43457</ENT> <ENT>.42724</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.47307</ENT> <ENT>.46513</ENT> <ENT>.45741</ENT> <ENT>.44990</ENT> <ENT>.44254</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.48851</ENT> <ENT>.48063</ENT> <ENT>.47296</ENT> <ENT>.46549</ENT> <ENT>.45821</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.50422</ENT> <ENT>.49641</ENT> <ENT>.48880</ENT> <ENT>.48139</ENT> <ENT>.47416</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.52018</ENT> <ENT>.51246</ENT> <ENT>.50493</ENT> <ENT>.49758</ENT> <ENT>.49042</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.53631</ENT> <ENT>.52870</ENT> <ENT>.52126</ENT> <ENT>.51400</ENT> <ENT>.50691</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.55247</ENT> <ENT>.54497</ENT> <ENT>.53764</ENT> <ENT>.53048</ENT> <ENT>.52347</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.56852</ENT> <ENT>.56115</ENT> <ENT>.55393</ENT> <ENT>.54687</ENT> <ENT>.53997</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.58439</ENT> <ENT>.57714</ENT> <ENT>.57005</ENT> <ENT>.56311</ENT> <ENT>.55632</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.60005</ENT> <ENT>.59294</ENT> <ENT>.58599</ENT> <ENT>.57917</ENT> <ENT>.57249</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.61551</ENT> <ENT>.60856</ENT> <ENT>.60174</ENT> <ENT>.59506</ENT> <ENT>.58851</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.63084</ENT> <ENT>.62405</ENT> <ENT>.61739</ENT> <ENT>.61085</ENT> <ENT>.60443</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.64609</ENT> <ENT>.63946</ENT> <ENT>.63296</ENT> <ENT>.62657</ENT> <ENT>.62030</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.66114</ENT> <ENT>.65469</ENT> <ENT>.64835</ENT> <ENT>.64213</ENT> <ENT>.63602</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.67589</ENT> <ENT>.66963</ENT> <ENT>.66347</ENT> <ENT>.65742</ENT> <ENT>.65146</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.60937</ENT> <ENT>.68429</ENT> <ENT>.67831</ENT> <ENT>.67243</ENT> <ENT>.66664</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.70463</ENT> <ENT>.69875</ENT> <ENT>.69296</ENT> <ENT>.68726</ENT> <ENT>.68165</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.71872</ENT> <ENT>.71304</ENT> <ENT>.70745</ENT> <ENT>.70194</ENT> <ENT>.69651</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.73233</ENT> <ENT>.72685</ENT> <ENT>.72146</ENT> <ENT>.71614</ENT> <ENT>.71089</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.74507</ENT> <ENT>.73978</ENT> <ENT>.73458</ENT> <ENT>.72944</ENT> <ENT>.72438</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.75691</ENT> <ENT>.75181</ENT> <ENT>.74679</ENT> <ENT>.74183</ENT> <ENT>.73694</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.76810</ENT> <ENT>.76319</ENT> <ENT>.75834</ENT> <ENT>.75355</ENT> <ENT>.74883</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.77897</ENT> <ENT>.77424</ENT> <ENT>.76957</ENT> <ENT>.76496</ENT> <ENT>.76040</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.78945</ENT> <ENT>.78490</ENT> <ENT>.78040</ENT> <ENT>.77596</ENT> <ENT>.77158</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.79919</ENT> <ENT>.79481</ENT> <ENT>.79048</ENT> <ENT>.78621</ENT> <ENT>.78198</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.80801</ENT> <ENT>.80380</ENT> <ENT>.79963</ENT> <ENT>.79550</ENT> <ENT>.79143</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.81587</ENT> <ENT>.81180</ENT> <ENT>.80777</ENT> <ENT>.80379</ENT> <ENT>.79985</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.82271</ENT> <ENT>.81877</ENT> <ENT>.81487</ENT> <ENT>.81100</ENT> <ENT>.80719</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.82846</ENT> <ENT>.82462</ENT> <ENT>.82083</ENT> <ENT>.81707</ENT> <ENT>.81335</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.83360</ENT> <ENT>.82985</ENT> <ENT>.82615</ENT> <ENT>.82248</ENT> <ENT>.81885</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.33808</ENT> <ENT>.83441</ENT> <ENT>.83079</ENT> <ENT>.82720</ENT> <ENT>.82365</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.84228</ENT> <ENT>.83869</ENT> <ENT>.83514</ENT> <ENT>.83163</ENT> <ENT>.82815</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.84645</ENT> <ENT>.84294</ENT> <ENT>.83947</ENT> <ENT>.83603</ENT> <ENT>.83262</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.85012</ENT> <ENT>.84668</ENT> <ENT>.84327</ENT> <ENT>.83988</ENT> <ENT>.83653</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.85409</ENT> <ENT>.85072</ENT> <ENT>.84737</ENT> <ENT>.84405</ENT> <ENT>.84077</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.85917</ENT> <ENT>.85588</ENT> <ENT>.85262</ENT> <ENT>.84939</ENT> <ENT>.84619</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.86403</ENT> <ENT>.86083</ENT> <ENT>.85765</ENT> <ENT>.85449</ENT> <ENT>.85136</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.87136</ENT> <ENT>.86829</ENT> <ENT>.86524</ENT> <ENT>.86221</ENT> <ENT>.85921</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.88315</ENT> <ENT>.88032</ENT> <ENT>.87750</ENT> <ENT>.87470</ENT> <ENT>.87192</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.89949</ENT> <ENT>.89700</ENT> <ENT>.89452</ENT> <ENT>.89206</ENT> <ENT>.88961</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.92511</ENT> <ENT>.92321</ENT> <ENT>.92132</ENT> <ENT>.91944</ENT> <ENT>.91757</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96642</ENT> <ENT>.96555</ENT> <ENT>.96468</ENT> <ENT>.96382</ENT> <ENT>.96296</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03305</ENT> <ENT>.03230</ENT> <ENT>.03161</ENT> <ENT>.03098</ENT> <ENT>.03040</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01523</ENT> <ENT>.01444</ENT> <ENT>.01372</ENT> <ENT>.01307</ENT> <ENT>.01247</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01520</ENT> <ENT>.01438</ENT> <ENT>.01362</ENT> <ENT>.01294</ENT> <ENT>.01230</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01557</ENT> <ENT>.01470</ENT> <ENT>.01391</ENT> <ENT>.01319</ENT> <ENT>.01253</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01613</ENT> <ENT>.01522</ENT> <ENT>.01439</ENT> <ENT>.01363</ENT> <ENT>.01294</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01687</ENT> <ENT>.01591</ENT> <ENT>.01504</ENT> <ENT>.01424</ENT> <ENT>.01351</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01774</ENT> <ENT>.01674</ENT> <ENT>.01582</ENT> <ENT>.01498</ENT> <ENT>.01421</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01871</ENT> <ENT>.01766</ENT> <ENT>.01670</ENT> <ENT>.01581</ENT> <ENT>.01500</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01980</ENT> <ENT>.01870</ENT> <ENT>.01769</ENT> <ENT>.01676</ENT> <ENT>.01591</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.02104</ENT> <ENT>.01989</ENT> <ENT>.01883</ENT> <ENT>.01785</ENT> <ENT>.01695</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.02241</ENT> <ENT>.02120</ENT> <ENT>.02009</ENT> <ENT>.01906</ENT> <ENT>.01812</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.02394</ENT> <ENT>.02267</ENT> <ENT>.02150</ENT> <ENT>.02042</ENT> <ENT>.01943</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.02560</ENT> <ENT>.02427</ENT> <ENT>.02305</ENT> <ENT>.02192</ENT> <ENT>.02088</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.02734</ENT> <ENT>.02595</ENT> <ENT>.02467</ENT> <ENT>.02349</ENT> <ENT>.02240</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.02912</ENT> <ENT>.02766</ENT> <ENT>.02632</ENT> <ENT>.02509</ENT> <ENT>.02394</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.03087</ENT> <ENT>.02935</ENT> <ENT>.02795</ENT> <ENT>.02666</ENT> <ENT>.02546</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.03257</ENT> <ENT>.03099</ENT> <ENT>.02952</ENT> <ENT>.02817</ENT> <ENT>.02691</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.03423</ENT> <ENT>.03257</ENT> <ENT>.03104</ENT> <ENT>.02962</ENT> <ENT>.02831</ENT> </ROW> <ROW> <PRTPAGE P="71"/> <ENT I="01">18</ENT> <ENT>.03586</ENT> <ENT>.03414</ENT> <ENT>.03253</ENT> <ENT>.03105</ENT> <ENT>.02967</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.03752</ENT> <ENT>.03572</ENT> <ENT>.03404</ENT> <ENT>.03249</ENT> <ENT>.03105</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.03925</ENT> <ENT>.03737</ENT> <ENT>.03562</ENT> <ENT>.03399</ENT> <ENT>.03248</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.04107</ENT> <ENT>.03910</ENT> <ENT>.03727</ENT> <ENT>.03557</ENT> <ENT>.03398</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.04297</ENT> <ENT>.04091</ENT> <ENT>.03899</ENT> <ENT>.03722</ENT> <ENT>.03556</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.04498</ENT> <ENT>.04283</ENT> <ENT>.04083</ENT> <ENT>.03897</ENT> <ENT>.03723</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.04715</ENT> <ENT>.04491</ENT> <ENT>.04282</ENT> <ENT>.04087</ENT> <ENT>.03905</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.04953</ENT> <ENT>.04718</ENT> <ENT>.04499</ENT> <ENT>.04295</ENT> <ENT>.04105</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.05213</ENT> <ENT>.04968</ENT> <ENT>.04740</ENT> <ENT>.04527</ENT> <ENT>.04327</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.05499</ENT> <ENT>.05243</ENT> <ENT>.05005</ENT> <ENT>.04782</ENT> <ENT>.04573</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.05811</ENT> <ENT>.05545</ENT> <ENT>.05295</ENT> <ENT>.05062</ENT> <ENT>.04844</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.06146</ENT> <ENT>.05868</ENT> <ENT>.05608</ENT> <ENT>.05365</ENT> <ENT>.05136</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.06506</ENT> <ENT>.06217</ENT> <ENT>.05945</ENT> <ENT>.05691</ENT> <ENT>.05452</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.06888</ENT> <ENT>.06586</ENT> <ENT>.06303</ENT> <ENT>.06038</ENT> <ENT>.05789</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.07295</ENT> <ENT>.06981</ENT> <ENT>.06687</ENT> <ENT>.06410</ENT> <ENT>.06149</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.07728</ENT> <ENT>.07401</ENT> <ENT>.07095</ENT> <ENT>.06806</ENT> <ENT>.06535</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.08185</ENT> <ENT>.07846</ENT> <ENT>.07527</ENT> <ENT>.07227</ENT> <ENT>.06944</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.08671</ENT> <ENT>.08319</ENT> 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<ENT>.28186</ENT> <ENT>.27576</ENT> <ENT>.26987</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.30736</ENT> <ENT>.30074</ENT> <ENT>.29434</ENT> <ENT>.28816</ENT> <ENT>.28218</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.32035</ENT> <ENT>.31365</ENT> <ENT>.30718</ENT> <ENT>.30092</ENT> <ENT>.29486</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.33368</ENT> <ENT>.32692</ENT> <ENT>.32038</ENT> <ENT>.31405</ENT> <ENT>.30791</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.34735</ENT> <ENT>.34054</ENT> <ENT>.33394</ENT> <ENT>.32754</ENT> <ENT>.32134</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.36133</ENT> <ENT>.35448</ENT> <ENT>.34783</ENT> <ENT>.34138</ENT> <ENT>.33512</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.37562</ENT> <ENT>.36873</ENT> <ENT>.36204</ENT> <ENT>.35554</ENT> <ENT>.34924</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.39019</ENT> <ENT>.38327</ENT> <ENT>.37655</ENT> <ENT>.37002</ENT> <ENT>.36367</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.40502</ENT> <ENT>.39809</ENT> <ENT>.39134</ENT> <ENT>.38479</ENT> <ENT>.37841</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.42011</ENT> <ENT>.41317</ENT> <ENT>.40642</ENT> <ENT>.39985</ENT> <ENT>.39345</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.43547</ENT> <ENT>.42854</ENT> <ENT>.42179</ENT> <ENT>.41522</ENT> <ENT>.40882</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.45112</ENT> <ENT>.44421</ENT> <ENT>.43748</ENT> <ENT>.43091</ENT> <ENT>.42451</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.46711</ENT> <ENT>.46023</ENT> <ENT>.45352</ENT> <ENT>.44698</ENT> <ENT>.44059</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.48342</ENT> <ENT>.47659</ENT> <ENT>.46992</ENT> <ENT>.46341</ENT> <ENT>.45705</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.49998</ENT> <ENT>.49321</ENT> <ENT>.48660</ENT> <ENT>.48014</ENT> <ENT>.47382</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.51663</ENT> <ENT>.50994</ENT> <ENT>.50339</ENT> <ENT>.49699</ENT> <ENT>.49073</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.53322</ENT> <ENT>.52661</ENT> <ENT>.52014</ENT> <ENT>.51381</ENT> <ENT>.50762</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.54967</ENT> <ENT>.54315</ENT> <ENT>.53678</ENT> <ENT>.53053</ENT> <ENT>.52440</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.56595</ENT> <ENT>.55954</ENT> <ENT>.55326</ENT> <ENT>.54710</ENT> <ENT>.54106</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.58209</ENT> <ENT>.57579</ENT> <ENT>.56961</ENT> <ENT>.56355</ENT> <ENT>.55761</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.59814</ENT> <ENT>.59196</ENT> <ENT>.58590</ENT> <ENT>.57995</ENT> <ENT>.57410</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.61415</ENT> <ENT>.60810</ENT> <ENT>.60217</ENT> <ENT>.59633</ENT> <ENT>.59060</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.63001</ENT> <ENT>.62410</ENT> <ENT>.61830</ENT> <ENT>.61260</ENT> <ENT>.60699</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.64561</ENT> <ENT>.63985</ENT> <ENT>.63419</ENT> <ENT>.62862</ENT> <ENT>.62314</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.66095</ENT> <ENT>.65535</ENT> <ENT>.64983</ENT> <ENT>.64441</ENT> <ENT>.63907</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.67612</ENT> <ENT>.67068</ENT> <ENT>.66533</ENT> <ENT>.66005</ENT> <ENT>.65486</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.69116</ENT> <ENT>.68589</ENT> <ENT>.68070</ENT> <ENT>.67559</ENT> <ENT>.67055</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.70573</ENT> <ENT>.70063</ENT> <ENT>.69561</ENT> <ENT>.69066</ENT> <ENT>.68578</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.71939</ENT> <ENT>.71446</ENT> <ENT>.70961</ENT> <ENT>.70481</ENT> <ENT>.70009</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.73211</ENT> <ENT>.72735</ENT> <ENT>.72265</ENT> <ENT>.71801</ENT> <ENT>.71343</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.74417</ENT> <ENT>.73956</ENT> <ENT>.73501</ENT> <ENT>.73053</ENT> <ENT>.72609</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.75590</ENT> <ENT>.75146</ENT> <ENT>.74707</ENT> <ENT>.74273</ENT> <ENT>.73845</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.76724</ENT> <ENT>.76296</ENT> <ENT>.75873</ENT> <ENT>.75454</ENT> <ENT>.75041</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.77781</ENT> <ENT>.77368</ENT> <ENT>.76960</ENT> <ENT>.76556</ENT> <ENT>.76158</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.78740</ENT> <ENT>.78342</ENT> <ENT>.77948</ENT> <ENT>.77558</ENT> <ENT>.77173</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.79596</ENT> <ENT>.79210</ENT> <ENT>.78829</ENT> <ENT>.78452</ENT> <ENT>.78079</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.80341</ENT> <ENT>.79967</ENT> <ENT>.79597</ENT> <ENT>.79231</ENT> <ENT>.78869</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.80967</ENT> <ENT>.80603</ENT> <ENT>.80242</ENT> <ENT>.79885</ENT> <ENT>.79532</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.81526</ENT> <ENT>.81170</ENT> <ENT>.80818</ENT> <ENT>.80470</ENT> <ENT>.80125</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.82013</ENT> <ENT>.81665</ENT> <ENT>.81320</ENT> <ENT>.80979</ENT> <ENT>.80641</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.82470</ENT> <ENT>.82129</ENT> <ENT>.81791</ENT> <ENT>.81456</ENT> <ENT>.81125</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.82924</ENT> <ENT>.82590</ENT> <ENT>.82258</ENT> <ENT>.81930</ENT> <ENT>.81605</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.83322</ENT> <ENT>.82993</ENT> <ENT>.82667</ENT> <ENT>.82344</ENT> <ENT>.82024</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.83751</ENT> <ENT>.83428</ENT> <ENT>.83108</ENT> <ENT>.82791</ENT> <ENT>.82477</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.84301</ENT> <ENT>.83986</ENT> <ENT>.83674</ENT> <ENT>.83365</ENT> <ENT>.83058</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.84826</ENT> <ENT>.84518</ENT> <ENT>.84213</ENT> <ENT>.83910</ENT> <ENT>.83610</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.85623</ENT> <ENT>.85327</ENT> <ENT>.85033</ENT> <ENT>.84741</ENT> <ENT>.84452</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.86915</ENT> <ENT>.86641</ENT> <ENT>.86369</ENT> <ENT>.86098</ENT> <ENT>.85829</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.88718</ENT> <ENT>.88476</ENT> <ENT>.88236</ENT> <ENT>.87997</ENT> <ENT>.87759</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.91571</ENT> <ENT>.91385</ENT> <ENT>.91201</ENT> <ENT>.91017</ENT> <ENT>.90834</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96211</ENT> <ENT>.96125</ENT> <ENT>.96041</ENT> <ENT>.95956</ENT> <ENT>.95872</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02987</ENT> <ENT>.02938</ENT> <ENT>.02893</ENT> <ENT>.02851</ENT> <ENT>.02812</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01192</ENT> <ENT>.01141</ENT> <ENT>.01094</ENT> <ENT>.01051</ENT> <ENT>.01012</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01173</ENT> <ENT>.01119</ENT> <ENT>.01070</ENT> <ENT>.01025</ENT> <ENT>.00983</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01192</ENT> <ENT>.01136</ENT> <ENT>.01084</ENT> <ENT>.01036</ENT> <ENT>.00992</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01229</ENT> <ENT>.01170</ENT> <ENT>.01116</ENT> <ENT>.01066</ENT> <ENT>.01019</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01283</ENT> <ENT>.01221</ENT> <ENT>.01164</ENT> <ENT>.01111</ENT> <ENT>.01062</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01350</ENT> <ENT>.01284</ENT> <ENT>.01224</ENT> <ENT>.01168</ENT> <ENT>.01116</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01425</ENT> <ENT>.01356</ENT> <ENT>.01292</ENT> <ENT>.01233</ENT> <ENT>.01178</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01512</ENT> <ENT>.01439</ENT> <ENT>.01372</ENT> <ENT>.01309</ENT> <ENT>.01252</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01612</ENT> <ENT>.01535</ENT> <ENT>.01464</ENT> <ENT>.01398</ENT> <ENT>.01337</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01724</ENT> <ENT>.01644</ENT> <ENT>.01569</ENT> <ENT>.01499</ENT> <ENT>.01435</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01851</ENT> <ENT>.01766</ENT> <ENT>.01688</ENT> <ENT>.01615</ENT> <ENT>.01547</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01991</ENT> <ENT>.01902</ENT> <ENT>.01819</ENT> <ENT>.01742</ENT> <ENT>.01671</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.02139</ENT> <ENT>.02045</ENT> <ENT>.01958</ENT> <ENT>.01877</ENT> <ENT>.01802</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.02288</ENT> <ENT>.02190</ENT> <ENT>.02098</ENT> <ENT>.02013</ENT> <ENT>.01934</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02435</ENT> <ENT>.02331</ENT> <ENT>.02235</ENT> <ENT>.02146</ENT> <ENT>.02063</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02575</ENT> <ENT>.02466</ENT> <ENT>.02366</ENT> <ENT>.02272</ENT> <ENT>.02185</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02709</ENT> <ENT>.02595</ENT> <ENT>.02490</ENT> <ENT>.02391</ENT> <ENT>.02300</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.02839</ENT> <ENT>.02721</ENT> <ENT>.02610</ENT> <ENT>.02507</ENT> <ENT>.02410</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.02971</ENT> <ENT>.02846</ENT> <ENT>.02730</ENT> <ENT>.02621</ENT> <ENT>.02520</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.03108</ENT> <ENT>.02977</ENT> <ENT>.02855</ENT> <ENT>.02741</ENT> <ENT>.02635</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.03251</ENT> <ENT>.03114</ENT> <ENT>.02986</ENT> <ENT>.02866</ENT> <ENT>.02755</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.03402</ENT> <ENT>.03258</ENT> <ENT>.03123</ENT> <ENT>.02998</ENT> <ENT>.02880</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.03562</ENT> <ENT>.03410</ENT> <ENT>.03269</ENT> <ENT>.03137</ENT> <ENT>.03014</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.03735</ENT> <ENT>.03577</ENT> <ENT>.03428</ENT> <ENT>.03290</ENT> <ENT>.03159</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.03927</ENT> <ENT>.03761</ENT> <ENT>.03605</ENT> <ENT>.03459</ENT> <ENT>.03322</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.04141</ENT> <ENT>.03966</ENT> <ENT>.03803</ENT> <ENT>.03649</ENT> <ENT>.03505</ENT> </ROW> <ROW> <PRTPAGE P="72"/> <ENT I="01">27</ENT> <ENT>.04377</ENT> <ENT>.04194</ENT> <ENT>.04023</ENT> <ENT>.03861</ENT> <ENT>.03710</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.04639</ENT> <ENT>.04447</ENT> <ENT>.04267</ENT> <ENT>.04098</ENT> <ENT>.03938</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.04922</ENT> <ENT>.04721</ENT> <ENT>.04532</ENT> <ENT>.04354</ENT> <ENT>.04187</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.05228</ENT> <ENT>.05017</ENT> <ENT>.04819</ENT> <ENT>.04633</ENT> <ENT>.04457</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.05554</ENT> <ENT>.05334</ENT> <ENT>.05126</ENT> <ENT>.04930</ENT> <ENT>.04746</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.05904</ENT> <ENT>.05674</ENT> <ENT>.05456</ENT> <ENT>.05251</ENT> <ENT>.05058</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.06279</ENT> <ENT>.06038</ENT> <ENT>.05810</ENT> <ENT>.05595</ENT> <ENT>.05392</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.06677</ENT> <ENT>.06435</ENT> <ENT>.06187</ENT> <ENT>.05962</ENT> <ENT>.05750</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.07102</ENT> <ENT>.06839</ENT> <ENT>.06590</ENT> <ENT>.06355</ENT> <ENT>.06132</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.07553</ENT> <ENT>.07278</ENT> <ENT>.07019</ENT> <ENT>.06773</ENT> <ENT>.06540</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.08030</ENT> <ENT>.07745</ENT> <ENT>.07474</ENT> <ENT>.07217</ENT> <ENT>.06974</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.08534</ENT> <ENT>.08237</ENT> <ENT>.07955</ENT> <ENT>.07687</ENT> <ENT>.07433</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.09065</ENT> <ENT>.08755</ENT> <ENT>.08462</ENT> <ENT>.08182</ENT> <ENT>.07917</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.09624</ENT> <ENT>.09302</ENT> <ENT>.08996</ENT> <ENT>.08706</ENT> <ENT>.08429</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.10212</ENT> <ENT>.09878</ENT> <ENT>.09560</ENT> <ENT>.09258</ENT> <ENT>.08970</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.10833</ENT> <ENT>.10486</ENT> <ENT>.10156</ENT> <ENT>.09842</ENT> <ENT>.09543</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.11484</ENT> <ENT>.11125</ENT> <ENT>.10783</ENT> <ENT>.10456</ENT> <ENT>.10145</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.12167</ENT> <ENT>.11795</ENT> <ENT>.11441</ENT> <ENT>.11102</ENT> <ENT>.10779</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.12880</ENT> <ENT>.12495</ENT> <ENT>.12128</ENT> <ENT>.11777</ENT> <ENT>.11442</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.13625</ENT> <ENT>.13227</ENT> <ENT>.12847</ENT> <ENT>.12484</ENT> <ENT>.12137</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.14402</ENT> <ENT>.13991</ENT> <ENT>.13599</ENT> <ENT>.13223</ENT> <ENT>.12863</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.15214</ENT> <ENT>.14791</ENT> <ENT>.14385</ENT> <ENT>.13997</ENT> <ENT>.13626</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.16060</ENT> <ENT>.15625</ENT> <ENT>.15207</ENT> <ENT>.14806</ENT> <ENT>.14422</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.16944</ENT> <ENT>.16496</ENT> <ENT>.16065</ENT> <ENT>.15653</ENT> <ENT>.15257</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.17862</ENT> <ENT>.17401</ENT> <ENT>.16959</ENT> <ENT>.16534</ENT> <ENT>.16126</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.18816</ENT> <ENT>.18343</ENT> <ENT>.17888</ENT> <ENT>.17451</ENT> <ENT>.17031</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.19805</ENT> <ENT>.19320</ENT> <ENT>.18853</ENT> <ENT>.18404</ENT> <ENT>.17972</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.20825</ENT> <ENT>.20328</ENT> <ENT>.19850</ENT> <ENT>.19390</ENT> <ENT>.18946</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.21878</ENT> <ENT>.21370</ENT> <ENT>.20881</ENT> <ENT>.20409</ENT> <ENT>.19954</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.22963</ENT> <ENT>.22443</ENT> <ENT>.21943</ENT> <ENT>.21460</ENT> <ENT>.20994</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.24081</ENT> <ENT>.23551</ENT> <ENT>.23040</ENT> <ENT>.22546</ENT> <ENT>.22069</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.25231</ENT> <ENT>.24691</ENT> <ENT>.24170</ENT> <ENT>.23665</ENT> <ENT>.23178</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.26418</ENT> <ENT>.25868</ENT> <ENT>.25336</ENT> <ENT>.24822</ENT> <ENT>.24325</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.27640</ENT> <ENT>.27081</ENT> <ENT>.26540</ENT> <ENT>.26016</ENT> <ENT>.25509</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.28899</ENT> <ENT>.28332</ENT> <ENT>.27782</ENT> <ENT>.27249</ENT> <ENT>.26733</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.30197</ENT> <ENT>.29622</ENT> <ENT>.29064</ENT> <ENT>.28523</ENT> <ENT>.27998</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.31533</ENT> <ENT>.30950</ENT> <ENT>.30385</ENT> <ENT>.29836</ENT> <ENT>.29304</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.32905</ENT> <ENT>.32316</ENT> <ENT>.31743</ENT> <ENT>.31188</ENT> <ENT>.30648</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.34311</ENT> <ENT>.33716</ENT> <ENT>.33138</ENT> <ENT>.32576</ENT> <ENT>.32030</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.35751</ENT> <ENT>.35151</ENT> <ENT>.34568</ENT> <ENT>.34001</ENT> <ENT>.33449</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.37221</ENT> <ENT>.36618</ENT> <ENT>.36030</ENT> <ENT>.35459</ENT> <ENT>.34902</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.38723</ENT> <ENT>.38116</ENT> <ENT>.37526</ENT> <ENT>.36950</ENT> <ENT>.36390</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.40257</ENT> <ENT>.39649</ENT> <ENT>.39056</ENT> <ENT>.38478</ENT> <ENT>.37914</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.41826</ENT> <ENT>.41217</ENT> <ENT>.40623</ENT> <ENT>.40043</ENT> <ENT>.39478</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.43435</ENT> <ENT>.42827</ENT> <ENT>.42233</ENT> <ENT>.41652</ENT> <ENT>.41086</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.45084</ENT> <ENT>.44478</ENT> <ENT>.43885</ENT> <ENT>.43305</ENT> <ENT>.42739</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.46765</ENT> <ENT>.46161</ENT> <ENT>.45571</ENT> <ENT>.44994</ENT> <ENT>.44429</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.48460</ENT> <ENT>.47861</ENT> <ENT>.47274</ENT> <ENT>.46700</ENT> <ENT>.46138</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.50155</ENT> <ENT>.49561</ENT> <ENT>.48979</ENT> <ENT>.48409</ENT> <ENT>.47851</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.51841</ENT> <ENT>.51253</ENT> <ENT>.50677</ENT> <ENT>.50112</ENT> <ENT>.49559</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.53514</ENT> <ENT>.52934</ENT> <ENT>.52364</ENT> <ENT>.51806</ENT> <ENT>.51258</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.55177</ENT> <ENT>.54605</ENT> <ENT>.54043</ENT> <ENT>.53492</ENT> <ENT>.52951</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.56837</ENT> <ENT>.56273</ENT> <ENT>.55720</ENT> <ENT>.55177</ENT> <ENT>.54643</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.58497</ENT> <ENT>.57944</ENT> <ENT>.57401</ENT> <ENT>.56866</ENT> <ENT>.56341</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.60148</ENT> <ENT>.59606</ENT> <ENT>.59073</ENT> <ENT>.58548</ENT> <ENT>.58033</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.61775</ENT> <ENT>.61245</ENT> <ENT>.60723</ENT> <ENT>.60210</ENT> <ENT>.59705</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.63381</ENT> <ENT>.62863</ENT> <ENT>.62354</ENT> <ENT>.61852</ENT> <ENT>.61358</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.64974</ENT> <ENT>.64470</ENT> <ENT>.63973</ENT> <ENT>.63484</ENT> <ENT>.63002</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.66558</ENT> <ENT>.66068</ENT> <ENT>.65586</ENT> <ENT>.65110</ENT> <ENT>.64641</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.68096</ENT> <ENT>.67622</ENT> <ENT>.67154</ENT> <ENT>.66692</ENT> <ENT>.66236</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.69542</ENT> <ENT>.69082</ENT> <ENT>.68628</ENT> <ENT>.68180</ENT> <ENT>.67738</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.70891</ENT> <ENT>.70445</ENT> <ENT>.70005</ENT> <ENT>.69570</ENT> <ENT>.69141</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.72172</ENT> <ENT>.71739</ENT> <ENT>.71312</ENT> <ENT>.70891</ENT> <ENT>.70474</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.73422</ENT> <ENT>.73004</ENT> <ENT>.72591</ENT> <ENT>.72182</ENT> <ENT>.71779</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.74632</ENT> <ENT>.74229</ENT> <ENT>.73829</ENT> <ENT>.73435</ENT> <ENT>.73045</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.75763</ENT> <ENT>.75373</ENT> <ENT>.74988</ENT> <ENT>.74606</ENT> <ENT>.74229</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.76791</ENT> <ENT>.76414</ENT> <ENT>.76042</ENT> <ENT>.75673</ENT> <ENT>.75308</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.77710</ENT> <ENT>.77345</ENT> <ENT>.76983</ENT> <ENT>.76626</ENT> <ENT>.76272</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.78510</ENT> <ENT>.78155</ENT> <ENT>.77804</ENT> <ENT>.77457</ENT> <ENT>.77113</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.79183</ENT> <ENT>.78837</ENT> <ENT>.78494</ENT> <ENT>.78155</ENT> <ENT>.77819</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.79783</ENT> <ENT>.79445</ENT> <ENT>.79110</ENT> <ENT>.78779</ENT> <ENT>.78450</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.80306</ENT> <ENT>.79975</ENT> <ENT>.79647</ENT> <ENT>.79322</ENT> <ENT>.79000</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.80797</ENT> <ENT>.80471</ENT> <ENT>.80149</ENT> <ENT>.79830</ENT> <ENT>.79514</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.81283</ENT> <ENT>.80964</ENT> <ENT>.80648</ENT> <ENT>.80335</ENT> <ENT>.80025</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.81708</ENT> <ENT>.81394</ENT> <ENT>.81082</ENT> <ENT>.80774</ENT> <ENT>.80468</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.82165</ENT> <ENT>.81856</ENT> <ENT>.81550</ENT> <ENT>.81247</ENT> <ENT>.80946</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.82754</ENT> <ENT>.82452</ENT> <ENT>.82153</ENT> <ENT>.81857</ENT> <ENT>.81563</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.83312</ENT> <ENT>.83017</ENT> <ENT>.82723</ENT> <ENT>.82433</ENT> <ENT>.82144</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.84165</ENT> <ENT>.83880</ENT> <ENT>.83597</ENT> <ENT>.83316</ENT> <ENT>.83038</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.85562</ENT> <ENT>.85297</ENT> <ENT>.85034</ENT> <ENT>.84772</ENT> <ENT>.84512</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.87523</ENT> <ENT>.87288</ENT> <ENT>.87054</ENT> <ENT>.86822</ENT> <ENT>.86591</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.90652</ENT> <ENT>.90471</ENT> <ENT>.90291</ENT> <ENT>.90111</ENT> <ENT>.89932</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95788</ENT> <ENT>.95704</ENT> <ENT>.95620</ENT> <ENT>.95537</ENT> <ENT>.95455</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02776</ENT> <ENT>.02743</ENT> <ENT>.02712</ENT> <ENT>.02682</ENT> <ENT>.02655</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00975</ENT> <ENT>.00941</ENT> <ENT>.00909</ENT> <ENT>.00880</ENT> <ENT>.00852</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00945</ENT> <ENT>.00909</ENT> <ENT>.00875</ENT> <ENT>.00844</ENT> <ENT>.00816</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00952</ENT> <ENT>.00914</ENT> <ENT>.00879</ENT> <ENT>.00846</ENT> <ENT>.00815</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00976</ENT> <ENT>.00936</ENT> <ENT>.00899</ENT> <ENT>.00865</ENT> <ENT>.00832</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01016</ENT> <ENT>.00974</ENT> <ENT>.00935</ENT> <ENT>.00898</ENT> <ENT>.00864</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01068</ENT> <ENT>.01023</ENT> <ENT>.00981</ENT> <ENT>.00943</ENT> <ENT>.00907</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01128</ENT> <ENT>.01080</ENT> <ENT>.01036</ENT> <ENT>.00995</ENT> <ENT>.00957</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01198</ENT> <ENT>.01148</ENT> <ENT>.01101</ENT> <ENT>.01058</ENT> <ENT>.01017</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01281</ENT> <ENT>.01228</ENT> <ENT>.01179</ENT> <ENT>.01133</ENT> <ENT>.01090</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01375</ENT> <ENT>.01319</ENT> <ENT>.01267</ENT> <ENT>.01219</ENT> <ENT>.01173</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01483</ENT> <ENT>.01425</ENT> <ENT>.01370</ENT> <ENT>.01318</ENT> <ENT>.01270</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01604</ENT> <ENT>.01542</ENT> <ENT>.01484</ENT> <ENT>.01430</ENT> <ENT>.01379</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01732</ENT> <ENT>.01666</ENT> <ENT>.01605</ENT> <ENT>.01548</ENT> <ENT>.01494</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01860</ENT> <ENT>.01792</ENT> <ENT>.01727</ENT> <ENT>.01667</ENT> <ENT>.01610</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01986</ENT> <ENT>.01913</ENT> <ENT>.01845</ENT> <ENT>.01782</ENT> <ENT>.01723</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02103</ENT> <ENT>.02027</ENT> <ENT>.01956</ENT> <ENT>.01889</ENT> <ENT>.01827</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02214</ENT> <ENT>.02134</ENT> <ENT>.02059</ENT> <ENT>.01989</ENT> <ENT>.01923</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.02320</ENT> <ENT>.02236</ENT> <ENT>.02157</ENT> <ENT>.02084</ENT> <ENT>.02014</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.02426</ENT> <ENT>.02337</ENT> <ENT>.02254</ENT> <ENT>.02177</ENT> <ENT>.02104</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.02536</ENT> <ENT>.02442</ENT> <ENT>.02355</ENT> <ENT>.02273</ENT> <ENT>.02197</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.02650</ENT> <ENT>.02552</ENT> <ENT>.02460</ENT> <ENT>.02374</ENT> <ENT>.02293</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.02770</ENT> <ENT>.02667</ENT> <ENT>.02570</ENT> <ENT>.02479</ENT> <ENT>.02394</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.02898</ENT> <ENT>.02789</ENT> <ENT>.02687</ENT> <ENT>.02591</ENT> <ENT>.02501</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.03037</ENT> <ENT>.02923</ENT> <ENT>.02815</ENT> <ENT>.02714</ENT> <ENT>.02619</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.03194</ENT> <ENT>.03073</ENT> <ENT>.02960</ENT> <ENT>.02853</ENT> <ENT>.02752</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.03370</ENT> <ENT>.03243</ENT> <ENT>.03123</ENT> <ENT>.03010</ENT> <ENT>.02904</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.03568</ENT> <ENT>.03434</ENT> <ENT>.03307</ENT> <ENT>.03188</ENT> <ENT>.03076</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.03789</ENT> <ENT>.03647</ENT> <ENT>.03514</ENT> <ENT>.03389</ENT> <ENT>.03271</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.04029</ENT> <ENT>.03880</ENT> <ENT>.03740</ENT> <ENT>.03608</ENT> <ENT>.03483</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.04291</ENT> <ENT>.04135</ENT> <ENT>.03987</ENT> <ENT>.03848</ENT> <ENT>.03716</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.04572</ENT> <ENT>.04407</ENT> <ENT>.04252</ENT> <ENT>.04105</ENT> <ENT>.03966</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.04875</ENT> <ENT>.04702</ENT> <ENT>.04538</ENT> <ENT>.04384</ENT> <ENT>.04237</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.05200</ENT> <ENT>.05019</ENT> <ENT>.04847</ENT> <ENT>.04684</ENT> <ENT>.04530</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.05548</ENT> <ENT>.05358</ENT> <ENT>.05177</ENT> <ENT>.05006</ENT> <ENT>.04843</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.05921</ENT> <ENT>.05722</ENT> <ENT>.05532</ENT> <ENT>.05352</ENT> <ENT>.05181</ENT> </ROW> <ROW> <PRTPAGE P="73"/> <ENT I="01">36</ENT> <ENT>.06319</ENT> <ENT>.06110</ENT> <ENT>.05911</ENT> <ENT>.05722</ENT> <ENT>.05543</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.06743</ENT> <ENT>.06524</ENT> <ENT>.06315</ENT> <ENT>.06117</ENT> <ENT>.05929</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.07191</ENT> <ENT>.06962</ENT> <ENT>.06744</ENT> <ENT>.06536</ENT> <ENT>.06338</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.07665</ENT> <ENT>.074425</ENT> <ENT>.07197</ENT> <ENT>.06980</ENT> <ENT>.06773</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.08166</ENT> <ENT>.07916</ENT> <ENT>.07677</ENT> <ENT>.07450</ENT> <ENT>.07233</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.08696</ENT> <ENT>.08434</ENT> <ENT>.08185</ENT> <ENT>.07947</ENT> <ENT>.07721</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.09257</ENT> <ENT>.08985</ENT> <ENT>.08725</ENT> <ENT>.08477</ENT> <ENT>.08239</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.09848</ENT> <ENT>.09564</ENT> <ENT>.09293</ENT> <ENT>.09034</ENT> <ENT>.08787</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.10470</ENT> <ENT>.10175</ENT> <ENT>.09893</ENT> <ENT>.09623</ENT> <ENT>.09365</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.11121</ENT> <ENT>.10815</ENT> <ENT>.10522</ENT> <ENT>.10241</ENT> <ENT>.09972</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.11805</ENT> <ENT>.11486</ENT> <ENT>.11182</ENT> <ENT>.10890</ENT> <ENT>.10610</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.12519</ENT> <ENT>.12189</ENT> <ENT>.11873</ENT> <ENT>.11569</ENT> <ENT>.11279</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.13269</ENT> <ENT>.12927</ENT> <ENT>.12600</ENT> <ENT>.12285</ENT> <ENT>.11983</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.14054</ENT> <ENT>.13600</ENT> <ENT>.13361</ENT> <ENT>.13035</ENT> <ENT>.12721</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.14876</ENT> <ENT>.14511</ENT> <ENT>.14160</ENT> <ENT>.13822</ENT> <ENT>.13497</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.15734</ENT> <ENT>.15356</ENT> <ENT>.14994</ENT> <ENT>.14645</ENT> <ENT>.14309</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.16627</ENT> <ENT>.16238</ENT> <ENT>.15864</ENT> <ENT>.15504</ENT> <ENT>.15156</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.17557</ENT> <ENT>.17156</ENT> <ENT>.16770</ENT> <ENT>.16399</ENT> <ENT>.16040</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.18519</ENT> <ENT>.18107</ENT> <ENT>.17710</ENT> <ENT>.17327</ENT> <ENT>.16957</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.19515</ENT> <ENT>.19092</ENT> <ENT>.18684</ENT> <ENT>.18290</ENT> <ENT>.17909</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.20544</ENT> <ENT>.20110</ENT> <ENT>.19691</ENT> <ENT>.19286</ENT> <ENT>.18894</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.21609</ENT> <ENT>.21164</ENT> <ENT>.20734</ENT> <ENT>.20318</ENT> <ENT>.19916</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.22707</ENT> <ENT>.22252</ENT> <ENT>.21811</ENT> <ENT>.21385</ENT> <ENT>.20972</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.23844</ENT> <ENT>.23378</ENT> <ENT>.22928</ENT> <ENT>.22491</ENT> <ENT>.22068</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.25018</ENT> <ENT>.24543</ENT> <ENT>.24082</ENT> <ENT>.23636</ENT> <ENT>.23203</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.26233</ENT> <ENT>.25749</ENT> <ENT>.25279</ENT> <ENT>.24823</ENT> <ENT>.24381</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.27490</ENT> <ENT>.26996</ENT> <ENT>.26517</ENT> <ENT>.26052</ENT> <ENT>.25601</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.28787</ENT> <ENT>.28286</ENT> <ENT>.27798</ENT> <ENT>.27325</ENT> <ENT>.26865</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.30124</ENT> <ENT>.29615</ENT> <ENT>.29120</ENT> <ENT>.28639</ENT> <ENT>.28171</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.31500</ENT> <ENT>.30983</ENT> <ENT>.30481</ENT> <ENT>.29993</ENT> <ENT>.29517</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.32912</ENT> <ENT>.32390</ENT> <ENT>.31881</ENT> <ENT>.31386</ENT> <ENT>.30904</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.34360</ENT> <ENT>.33832</ENT> <ENT>.33318</ENT> <ENT>.32817</ENT> <ENT>.32328</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.35843</ENT> <ENT>.35311</ENT> <ENT>.34791</ENT> <ENT>.34285</ENT> <ENT>.33791</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.37365</ENT> <ENT>.36828</ENT> <ENT>.36305</ENT> <ENT>.35794</ENT> <ENT>.35296</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.38925</ENT> <ENT>.38386</ENT> <ENT>.37860</ENT> <ENT>.37346</ENT> <ENT>.36844</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.40532</ENT> <ENT>.39991</ENT> <ENT>.39463</ENT> <ENT>.38946</ENT> <ENT>.38442</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.42185</ENT> <ENT>.41644</ENT> <ENT>.41115</ENT> <ENT>.40597</ENT> <ENT>.40091</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.43876</ENT> <ENT>.43336</ENT> <ENT>.42807</ENT> <ENT>.42289</ENT> <ENT>.41782</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.45588</ENT> <ENT>.45050</ENT> <ENT>.44522</ENT> <ENT>.44005</ENT> <ENT>.43499</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.47304</ENT> <ENT>.46769</ENT> <ENT>.46244</ENT> <ENT>.45729</ENT> <ENT>.45225</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.49016</ENT> <ENT>.48485</ENT> <ENT>.47963</ENT> <ENT>.47451</ENT> <ENT>.46949</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.50721</ENT> <ENT>.50193</ENT> <ENT>.49676</ENT> <ENT>.49168</ENT> <ENT>.48670</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.52419</ENT> <ENT>.51898</ENT> <ENT>.51385</ENT> <ENT>.50882</ENT> <ENT>.50388</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.54119</ENT> <ENT>.53604</ENT> <ENT>.53097</ENT> <ENT>.52600</ENT> <ENT>.52111</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.55825</ENT> <ENT>.55318</ENT> <ENT>.54819</ENT> <ENT>.54328</ENT> <ENT>.53846</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.57526</ENT> <ENT>.57027</ENT> <ENT>.56536</ENT> <ENT>.56053</ENT> <ENT>.55578</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.59208</ENT> <ENT>.58718</ENT> <ENT>.58236</ENT> <ENT>.57762</ENT> <ENT>.57295</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.60871</ENT> <ENT>.60392</ENT> <ENT>.59920</ENT> <ENT>.59455</ENT> <ENT>.58997</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.62527</ENT> <ENT>.62059</ENT> <ENT>.61597</ENT> <ENT>.61143</ENT> <ENT>.60695</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.64179</ENT> <ENT>.63723</ENT> <ENT>.63273</ENT> <ENT>.62830</ENT> <ENT>.62393</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.65787</ENT> <ENT>.65344</ENT> <ENT>.64907</ENT> <ENT>.64475</ENT> <ENT>.64050</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.67302</ENT> <ENT>.66871</ENT> <ENT>.66446</ENT> <ENT>.66026</ENT> <ENT>.65612</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.68717</ENT> <ENT>.68298</ENT> <ENT>.67885</ENT> <ENT>.67477</ENT> <ENT>.67074</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.70063</ENT> <ENT>.69656</ENT> <ENT>.69255</ENT> <ENT>.68858</ENT> <ENT>.68466</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.71380</ENT> <ENT>.70986</ENT> <ENT>.70597</ENT> <ENT>.70212</ENT> <ENT>.69831</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.72659</ENT> <ENT>.72278</ENT> <ENT>.71901</ENT> <ENT>.71528</ENT> <ENT>.71160</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.73856</ENT> <ENT>.73488</ENT> <ENT>.73123</ENT> <ENT>.72762</ENT> <ENT>.72405</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.74947</ENT> <ENT>.74590</ENT> <ENT>.74236</ENT> <ENT>.73887</ENT> <ENT>.73541</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.75922</ENT> <ENT>.75575</ENT> <ENT>.75233</ENT> <ENT>.74893</ENT> <ENT>.74557</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.76773</ENT> <ENT>.76436</ENT> <ENT>.76102</ENT> <ENT>.75772</ENT> <ENT>.75445</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.77487</ENT> <ENT>.77158</ENT> <ENT>.76832</ENT> <ENT>.76510</ENT> <ENT>.76190</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.78125</ENT> <ENT>.77803</ENT> <ENT>.77485</ENT> <ENT>.77169</ENT> <ENT>.76856</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.78681</ENT> <ENT>.78365</ENT> <ENT>.78052</ENT> <ENT>.77742</ENT> <ENT>.77435</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.79201</ENT> <ENT>.78891</ENT> <ENT>.78583</ENT> <ENT>.78279</ENT> <ENT>.77977</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.79717</ENT> <ENT>.79412</ENT> <ENT>.79111</ENT> <ENT>.78811</ENT> <ENT>.78515</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.80165</ENT> <ENT>.79865</ENT> <ENT>.79568</ENT> <ENT>.79273</ENT> <ENT>.78981</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.80648</ENT> <ENT>.80353</ENT> <ENT>.80060</ENT> <ENT>.79769</ENT> <ENT>.79481</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.81271</ENT> <ENT>.80982</ENT> <ENT>.80695</ENT> <ENT>.80411</ENT> <ENT>.80129</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.81858</ENT> <ENT>.81574</ENT> <ENT>.81292</ENT> <ENT>.81013</ENT> <ENT>.80736</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.83761</ENT> <ENT>.82487</ENT> <ENT>.82214</ENT> <ENT>.81943</ENT> <ENT>.81675</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.84254</ENT> <ENT>.83998</ENT> <ENT>.83743</ENT> <ENT>.83490</ENT> <ENT>.83238</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.86362</ENT> <ENT>.86133</ENT> <ENT>.85906</ENT> <ENT>.85681</ENT> <ENT>.85456</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.89755</ENT> <ENT>.89577</ENT> <ENT>.89401</ENT> <ENT>.89226</ENT> <ENT>.89051</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95372</ENT> <ENT>.95290</ENT> <ENT>.95208</ENT> <ENT>.95126</ENT> <ENT>.95045</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02630</ENT> <ENT>.02606</ENT> <ENT>.02583</ENT> <ENT>.02562</ENT> <ENT>.02542</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00827</ENT> <ENT>.00803</ENT> <ENT>.00780</ENT> <ENT>.00759</ENT> <ENT>.00739</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00789</ENT> <ENT>.00763</ENT> <ENT>.00740</ENT> <ENT>.00718</ENT> <ENT>.00697</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00787</ENT> <ENT>.00760</ENT> <ENT>.00736</ENT> <ENT>.00712</ENT> <ENT>.00690</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00802</ENT> <ENT>.00774</ENT> <ENT>.00748</ENT> <ENT>.00723</ENT> <ENT>.00700</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00832</ENT> <ENT>.00802</ENT> <ENT>.00774</ENT> <ENT>.00748</ENT> <ENT>.00724</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00873</ENT> <ENT>.00841</ENT> <ENT>.00812</ENT> <ENT>.00784</ENT> <ENT>.00758</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00921</ENT> <ENT>.00888</ENT> <ENT>.00856</ENT> <ENT>.00827</ENT> <ENT>.00799</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00979</ENT> <ENT>.00944</ENT> <ENT>.00910</ENT> <ENT>.00879</ENT> <ENT>.00850</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01049</ENT> <ENT>.01012</ENT> <ENT>.00976</ENT> <ENT>.00943</ENT> <ENT>.00912</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01131</ENT> <ENT>.01091</ENT> <ENT>.01053</ENT> <ENT>.01018</ENT> <ENT>.00985</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01225</ENT> <ENT>.01183</ENT> <ENT>.01143</ENT> <ENT>.01106</ENT> <ENT>.01070</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01331</ENT> <ENT>.01286</ENT> <ENT>.01244</ENT> <ENT>.01205</ENT> <ENT>.01168</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01444</ENT> <ENT>.01397</ENT> <ENT>.01352</ENT> <ENT>.01311</ENT> <ENT>.01271</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01558</ENT> <ENT>.01508</ENT> <ENT>.01461</ENT> <ENT>.01417</ENT> <ENT>.01375</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01667</ENT> <ENT>.01614</ENT> <ENT>.01565</ENT> <ENT>.01519</ENT> <ENT>.01475</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01768</ENT> <ENT>.01713</ENT> <ENT>.01661</ENT> <ENT>.01612</ENT> <ENT>.01566</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01862</ENT> <ENT>.01803</ENT> <ENT>.01749</ENT> <ENT>.01697</ENT> <ENT>.01649</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01949</ENT> <ENT>.01888</ENT> <ENT>.01831</ENT> <ENT>.01776</ENT> <ENT>.01725</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.02035</ENT> <ENT>.01971</ENT> <ENT>.01910</ENT> <ENT>.01853</ENT> <ENT>.01799</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.02124</ENT> <ENT>.02056</ENT> <ENT>.01992</ENT> <ENT>.01932</ENT> <ENT>.01875</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.02217</ENT> <ENT>.02145</ENT> <ENT>.02078</ENT> <ENT>.02014</ENT> <ENT>.01954</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.02313</ENT> <ENT>.02238</ENT> <ENT>.02166</ENT> <ENT>.02099</ENT> <ENT>.02035</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.02416</ENT> <ENT>.02336</ENT> <ENT>.02261</ENT> <ENT>.02190</ENT> <ENT>.02122</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.02529</ENT> <ENT>.02445</ENT> <ENT>.02365</ENT> <ENT>.02290</ENT> <ENT>.02218</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02657</ENT> <ENT>.02568</ENT> <ENT>.02484</ENT> <ENT>.02404</ENT> <ENT>.02328</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02804</ENT> <ENT>.02710</ENT> <ENT>.02620</ENT> <ENT>.02536</ENT> <ENT>.02456</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02970</ENT> <ENT>.02870</ENT> <ENT>.02776</ENT> <ENT>.02686</ENT> <ENT>.02601</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.03159</ENT> <ENT>.03053</ENT> <ENT>.02953</ENT> <ENT>.02858</ENT> <ENT>.02768</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.03365</ENT> <ENT>.03253</ENT> <ENT>.03147</ENT> <ENT>.03047</ENT> <ENT>.02951</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.03591</ENT> <ENT>.03473</ENT> <ENT>.03361</ENT> <ENT>.03255</ENT> <ENT>.03154</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.03834</ENT> <ENT>.03709</ENT> <ENT>.03591</ENT> <ENT>.03478</ENT> <ENT>.03372</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.04098</ENT> <ENT>.03966</ENT> <ENT>.03841</ENT> <ENT>.03722</ENT> <ENT>.03610</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.04383</ENT> <ENT>.04244</ENT> <ENT>.04112</ENT> <ENT>.03987</ENT> <ENT>.03867</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.04689</ENT> <ENT>.04543</ENT> <ENT>.04403</ENT> <ENT>.04271</ENT> <ENT>.04145</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.05019</ENT> <ENT>.04865</ENT> <ENT>.04718</ENT> <ENT>.04578</ENT> <ENT>.04445</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.05372</ENT> <ENT>.05210</ENT> <ENT>.05055</ENT> <ENT>.04907</ENT> <ENT>.04767</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.05749</ENT> <ENT>.05578</ENT> <ENT>.05416</ENT> <ENT>.05260</ENT> <ENT>.05112</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.06150</ENT> <ENT>.05970</ENT> <ENT>.05799</ENT> <ENT>.05636</ENT> <ENT>.05480</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.06575</ENT> <ENT>.06387</ENT> <ENT>.06207</ENT> <ENT>.06035</ENT> <ENT>.05871</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.07026</ENT> <ENT>.06828</ENT> <ENT>.06639</ENT> <ENT>.06459</ENT> <ENT>.06286</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.07504</ENT> <ENT>.07297</ENT> <ENT>.07099</ENT> <ENT>.06909</ENT> <ENT>.06728</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.08013</ENT> <ENT>.07796</ENT> <ENT>.07589</ENT> <ENT>.07390</ENT> <ENT>.07200</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.08550</ENT> <ENT>.08323</ENT> <ENT>.08106</ENT> <ENT>.07898</ENT> <ENT>.07699</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.09118</ENT> <ENT>.08881</ENT> <ENT>.08654</ENT> <ENT>.08437</ENT> <ENT>.08228</ENT> </ROW> <ROW> <PRTPAGE P="74"/> <ENT I="01">45</ENT> <ENT>.09714</ENT> <ENT>.09467</ENT> <ENT>.09230</ENT> <ENT>.09003</ENT> <ENT>.08784</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.10341</ENT> <ENT>.10084</ENT> <ENT>.09837</ENT> <ENT>.09599</ENT> <ENT>.09371</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.10999</ENT> <ENT>.10731</ENT> <ENT>.10473</ENT> <ENT>.10226</ENT> <ENT>.09988</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.11693</ENT> <ENT>.11414</ENT> <ENT>.11145</ENT> <ENT>.10888</ENT> <ENT>.10639</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.12420</ENT> <ENT>.12130</ENT> <ENT>.11852</ENT> <ENT>.11583</ENT> <ENT>.11325</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.13185</ENT> <ENT>.12884</ENT> <ENT>.12595</ENT> <ENT>.12316</ENT> <ENT>.12047</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.13985</ENT> <ENT>.13674</ENT> <ENT>.13373</ENT> <ENT>.13084</ENT> <ENT>.12805</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.14822</ENT> <ENT>.14499</ENT> <ENT>.14188</ENT> <ENT>.13888</ENT> <ENT>.13598</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.15695</ENT> <ENT>.15361</ENT> <ENT>.15039</ENT> <ENT>.14729</ENT> <ENT>.14428</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.16601</ENT> <ENT>.16256</ENT> <ENT>.15924</ENT> <ENT>.15602</ENT> <ENT>.15292</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.17542</ENT> <ENT>.17186</ENT> <ENT>.16843</ENT> <ENT>.16511</ENT> <ENT>.16190</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.18516</ENT> <ENT>.18150</ENT> <ENT>.17796</ENT> <ENT>.17454</ENT> <ENT>.17122</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.19527</ENT> <ENT>.19150</ENT> <ENT>.18786</ENT> <ENT>.18433</ENT> <ENT>.18091</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.20573</ENT> <ENT>.20186</ENT> <ENT>.19811</ENT> <ENT>.19448</ENT> <ENT>.19096</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.21659</ENT> <ENT>.21262</ENT> <ENT>.20877</ENT> <ENT>.20504</ENT> <ENT>.20142</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.22784</ENT> <ENT>.22377</ENT> <ENT>.21982</ENT> <ENT>.21599</ENT> <ENT>.21227</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.23952</ENT> <ENT>.23535</ENT> <ENT>.23131</ENT> <ENT>.22738</ENT> <ENT>.22357</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.25163</ENT> <ENT>.24737</ENT> <ENT>.24324</ENT> <ENT>.23922</ENT> <ENT>.23531</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.26418</ENT> <ENT>.25984</ENT> <ENT>.25561</ENT> <ENT>.25151</ENT> <ENT>.24751</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.27716</ENT> <ENT>.27273</ENT> <ENT>.26842</ENT> <ENT>.26423</ENT> <ENT>.26015</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.29054</ENT> <ENT>.28604</ENT> <ENT>.28165</ENT> <ENT>.27738</ENT> <ENT>.27322</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.30434</ENT> <ENT>.29976</ENT> <ENT>.29530</ENT> <ENT>.29096</ENT> <ENT>.28672</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.31852</ENT> <ENT>.31388</ENT> <ENT>.30935</ENT> <ENT>.30494</ENT> <ENT>.30063</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.33310</ENT> <ENT>.32840</ENT> <ENT>.32381</ENT> <ENT>.31933</ENT> <ENT>.31496</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.34809</ENT> <ENT>.34334</ENT> <ENT>.33870</ENT> <ENT>.33417</ENT> <ENT>.32975</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.36353</ENT> <ENT>.35874</ENT> <ENT>.35405</ENT> <ENT>.34948</ENT> <ENT>.34500</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.37948</ENT> <ENT>.37466</ENT> <ENT>.36994</ENT> <ENT>.36532</ENT> <ENT>.36081</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.39595</ENT> <ENT>.39111</ENT> <ENT>.38636</ENT> <ENT>.38172</ENT> <ENT>.37718</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.41286</ENT> <ENT>.40801</ENT> <ENT>.40325</ENT> <ENT>.39859</ENT> <ENT>.39403</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.43004</ENT> <ENT>.42518</ENT> <ENT>.42042</ENT> <ENT>.41575</ENT> <ENT>.41118</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.44730</ENT> <ENT>.44245</ENT> <ENT>.43770</ENT> <ENT>.43304</ENT> <ENT>.42846</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.46457</ENT> <ENT>.45974</ENT> <ENT>.45500</ENT> <ENT>.45035</ENT> <ENT>.44579</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.48181</ENT> <ENT>.47700</ENT> <ENT>.47229</ENT> <ENT>.46766</ENT> <ENT>.46311</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.49903</ENT> <ENT>.49426</ENT> <ENT>.48958</ENT> <ENT>.48497</ENT> <ENT>.48045</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.51631</ENT> <ENT>.51159</ENT> <ENT>.50694</ENT> <ENT>.50238</ENT> <ENT>.49789</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.53371</ENT> <ENT>.52905</ENT> <ENT>.52446</ENT> <ENT>.51994</ENT> <ENT>.51550</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.55110</ENT> <ENT>.54650</ENT> <ENT>.54197</ENT> <ENT>.53752</ENT> <ENT>.53313</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.56835</ENT> <ENT>.56382</ENT> <ENT>.55937</ENT> <ENT>.55497</ENT> <ENT>.55065</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.58546</ENT> <ENT>.58101</ENT> <ENT>.57663</ENT> <ENT>.57231</ENT> <ENT>.56806</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.60253</ENT> <ENT>.59817</ENT> <ENT>.59388</ENT> <ENT>.58965</ENT> <ENT>.58547</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.61961</ENT> <ENT>.61536</ENT> <ENT>.61116</ENT> <ENT>.60703</ENT> <ENT>.60294</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.63630</ENT> <ENT>.63215</ENT> <ENT>.62806</ENT> <ENT>.62402</ENT> <ENT>.62004</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.65203</ENT> <ENT>.64800</ENT> <ENT>.64401</ENT> <ENT>.64007</ENT> <ENT>.63619</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.66676</ENT> <ENT>.66282</ENT> <ENT>.65894</ENT> <ENT>.65510</ENT> <ENT>.65131</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.68079</ENT> <ENT>.67696</ENT> <ENT>.67318</ENT> <ENT>.66944</ENT> <ENT>.66574</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.69455</ENT> <ENT>.69084</ENT> <ENT>.68716</ENT> <ENT>.68353</ENT> <ENT>.67993</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.70795</ENT> <ENT>.70435</ENT> <ENT>.70078</ENT> <ENT>.69726</ENT> <ENT>.69377</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.72052</ENT> <ENT>.71703</ENT> <ENT>.71357</ENT> <ENT>.71015</ENT> <ENT>.70677</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.73198</ENT> <ENT>.72860</ENT> <ENT>.72524</ENT> <ENT>.72192</ENT> <ENT>.71864</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.74225</ENT> <ENT>.73896</ENT> <ENT>.73570</ENT> <ENT>.73248</ENT> <ENT>.72928</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.75121</ENT> <ENT>.74801</ENT> <ENT>.74483</ENT> <ENT>.74169</ENT> <ENT>.73858</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.75874</ENT> <ENT>.75561</ENT> <ENT>.75250</ENT> <ENT>.74943</ENT> <ENT>.74639</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.76546</ENT> <ENT>.76240</ENT> <ENT>.75936</ENT> <ENT>.75635</ENT> <ENT>.75336</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.77131</ENT> <ENT>.76830</ENT> <ENT>.76531</ENT> <ENT>.76235</ENT> <ENT>.75942</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.77678</ENT> <ENT>.77382</ENT> <ENT>.77088</ENT> <ENT>.76798</ENT> <ENT>.76509</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.78221</ENT> <ENT>.77930</ENT> <ENT>.77642</ENT> <ENT>.77356</ENT> <ENT>.77072</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.78691</ENT> <ENT>.78404</ENT> <ENT>.78119</ENT> <ENT>.77837</ENT> <ENT>.77557</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.79196</ENT> <ENT>.78912</ENT> <ENT>.78632</ENT> <ENT>.78353</ENT> <ENT>.78077</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.79849</ENT> <ENT>.79572</ENT> <ENT>.79297</ENT> <ENT>.79024</ENT> <ENT>.78753</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.80460</ENT> <ENT>.80188</ENT> <ENT>.79917</ENT> <ENT>.79648</ENT> <ENT>.79381</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.81408</ENT> <ENT>.81143</ENT> <ENT>.80881</ENT> <ENT>.80620</ENT> <ENT>.80361</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.82989</ENT> <ENT>.82740</ENT> <ENT>.82494</ENT> <ENT>.82249</ENT> <ENT>.82006</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.85233</ENT> <ENT>.85012</ENT> <ENT>.84791</ENT> <ENT>.84572</ENT> <ENT>.84353</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.88877</ENT> <ENT>.88704</ENT> <ENT>.88532</ENT> <ENT>.88361</ENT> <ENT>.88190</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94964</ENT> <ENT>.94883</ENT> <ENT>.94803</ENT> <ENT>.94723</ENT> <ENT>.94643</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02523</ENT> <ENT>.02505</ENT> <ENT>.02488</ENT> <ENT>.02472</ENT> <ENT>.02456</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00721</ENT> <ENT>.00703</ENT> <ENT>.00687</ENT> <ENT>.00671</ENT> <ENT>.00657</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00678</ENT> <ENT>.00659</ENT> <ENT>.00642</ENT> <ENT>.00626</ENT> <ENT>.00610</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00670</ENT> <ENT>.00650</ENT> <ENT>.00632</ENT> <ENT>.00615</ENT> <ENT>.00599</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00678</ENT> <ENT>.00658</ENT> <ENT>.00638</ENT> <ENT>.00620</ENT> <ENT>.00603</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00701</ENT> <ENT>.00679</ENT> <ENT>.00658</ENT> <ENT>.00639</ENT> <ENT>.00620</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00733</ENT> <ENT>.00710</ENT> <ENT>.00688</ENT> <ENT>.00668</ENT> <ENT>.00648</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00733</ENT> <ENT>.00748</ENT> <ENT>.00725</ENT> <ENT>.00703</ENT> <ENT>.00682</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00822</ENT> <ENT>.00796</ENT> <ENT>.00771</ENT> <ENT>.00748</ENT> <ENT>.00726</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00882</ENT> <ENT>.00854</ENT> <ENT>.00828</ENT> <ENT>.00803</ENT> <ENT>.00780</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00953</ENT> <ENT>.00924</ENT> <ENT>.00896</ENT> <ENT>.00869</ENT> <ENT>.00844</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01037</ENT> <ENT>.01006</ENT> <ENT>.00976</ENT> <ENT>.00948</ENT> <ENT>.00922</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01132</ENT> <ENT>.01099</ENT> <ENT>.01068</ENT> <ENT>.01038</ENT> <ENT>.01010</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01234</ENT> <ENT>.01199</ENT> <ENT>.01166</ENT> <ENT>.01134</ENT> <ENT>.01104</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01336</ENT> <ENT>.01299</ENT> <ENT>.01264</ENT> <ENT>.01231</ENT> <ENT>.01199</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01434</ENT> <ENT>.01395</ENT> <ENT>.01358</ENT> <ENT>.01323</ENT> <ENT>.01289</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01522</ENT> <ENT>.01481</ENT> <ENT>.01442</ENT> <ENT>.01405</ENT> <ENT>.01371</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01603</ENT> <ENT>.01559</ENT> <ENT>.01518</ENT> <ENT>.01480</ENT> <ENT>.01443</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01677</ENT> <ENT>.01631</ENT> <ENT>.01588</ENT> <ENT>.01547</ENT> <ENT>.01508</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01748</ENT> <ENT>.01700</ENT> <ENT>.01654</ENT> <ENT>.01611</ENT> <ENT>.01570</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01821</ENT> <ENT>.01770</ENT> <ENT>.01722</ENT> <ENT>.01677</ENT> <ENT>.01633</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01897</ENT> <ENT>.01843</ENT> <ENT>.01792</ENT> <ENT>.01744</ENT> <ENT>.01698</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01975</ENT> <ENT>.01918</ENT> <ENT>.01864</ENT> <ENT>.01813</ENT> <ENT>.01765</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.02059</ENT> <ENT>.01998</ENT> <ENT>.01941</ENT> <ENT>.01887</ENT> <ENT>.01836</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.02151</ENT> <ENT>.02087</ENT> <ENT>.02027</ENT> <ENT>.01970</ENT> <ENT>.01915</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02257</ENT> <ENT>.02189</ENT> <ENT>.02125</ENT> <ENT>.02064</ENT> <ENT>.02006</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02380</ENT> <ENT>.02308</ENT> <ENT>.02240</ENT> <ENT>.02175</ENT> <ENT>.02114</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02521</ENT> <ENT>.02445</ENT> <ENT>.02373</ENT> <ENT>.02304</ENT> <ENT>.02239</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02683</ENT> <ENT>.02602</ENT> <ENT>.02525</ENT> <ENT>.02452</ENT> <ENT>.02383</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02861</ENT> <ENT>.02775</ENT> <ENT>.02694</ENT> <ENT>.02616</ENT> <ENT>.02543</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.03058</ENT> <ENT>.02967</ENT> <ENT>.02881</ENT> <ENT>.02798</ENT> <ENT>.02720</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.03270</ENT> <ENT>.03174</ENT> <ENT>.03082</ENT> <ENT>.02995</ENT> <ENT>.02911</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.03502</ENT> <ENT>.03400</ENT> <ENT>.03303</ENT> <ENT>.03210</ENT> <ENT>.03122</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.03754</ENT> <ENT>.03646</ENT> <ENT>.03543</ENT> <ENT>.03444</ENT> <ENT>.03350</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.04025</ENT> <ENT>.03910</ENT> <ENT>.03801</ENT> <ENT>.03697</ENT> <ENT>.03597</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.04318</ENT> <ENT>.04197</ENT> <ENT>.04081</ENT> <ENT>.03971</ENT> <ENT>.03865</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.04633</ENT> <ENT>.04505</ENT> <ENT>.04383</ENT> <ENT>.04266</ENT> <ENT>.04154</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.04971</ENT> <ENT>.04836</ENT> <ENT>.04707</ENT> <ENT>.04583</ENT> <ENT>.04465</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.05331</ENT> <ENT>.05188</ENT> <ENT>.05052</ENT> <ENT>.04922</ENT> <ENT>.04797</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.05714</ENT> <ENT>.05564</ENT> <ENT>.05420</ENT> <ENT>.05282</ENT> <ENT>.05150</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.06121</ENT> <ENT>.05963</ENT> <ENT>.05812</ENT> <ENT>.05667</ENT> <ENT>.05528</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.06554</ENT> <ENT>.06388</ENT> <ENT>.06229</ENT> <ENT>.06076</ENT> <ENT>.05929</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.07018</ENT> <ENT>.06843</ENT> <ENT>.06675</ENT> <ENT>.06514</ENT> <ENT>.06360</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.07508</ENT> <ENT>.07324</ENT> <ENT>.07148</ENT> <ENT>.06979</ENT> <ENT>.06817</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.08028</ENT> <ENT>.07325</ENT> <ENT>.07651</ENT> <ENT>.07473</ENT> <ENT>.07303</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.08575</ENT> <ENT>.08373</ENT> <ENT>.08180</ENT> <ENT>.07993</ENT> <ENT>.07814</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.09152</ENT> <ENT>.08941</ENT> <ENT>.08738</ENT> <ENT>.08543</ENT> <ENT>.08355</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.09759</ENT> <ENT>.09539</ENT> <ENT>.09326</ENT> <ENT>.09122</ENT> <ENT>.08926</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.10401</ENT> <ENT>.10171</ENT> <ENT>.09949</ENT> <ENT>.09735</ENT> <ENT>.09530</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.11076</ENT> <ENT>.10836</ENT> <ENT>.10605</ENT> <ENT>.10382</ENT> <ENT>.10167</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.11788</ENT> <ENT>.11538</ENT> <ENT>.11297</ENT> <ENT>.11065</ENT> <ENT>.10840</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.12535</ENT> <ENT>.12276</ENT> <ENT>.12025</ENT> <ENT>.11782</ENT> <ENT>.11548</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.13319</ENT> <ENT>.13049</ENT> <ENT>.12788</ENT> <ENT>.12536</ENT> <ENT>.12292</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.14139</ENT> <ENT>.13858</ENT> <ENT>.13588</ENT> <ENT>.13326</ENT> <ENT>.13072</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.14992</ENT> <ENT>.14701</ENT> <ENT>.14420</ENT> <ENT>.14149</ENT> <ENT>.13885</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.15880</ENT> <ENT>.15579</ENT> <ENT>.15288</ENT> <ENT>.15006</ENT> <ENT>.14733</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.16801</ENT> <ENT>.16491</ENT> <ENT>.16190</ENT> <ENT>.15898</ENT> <ENT>.15615</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.17760</ENT> <ENT>.17439</ENT> <ENT>.17128</ENT> <ENT>.16827</ENT> <ENT>.16534</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.18755</ENT> <ENT>.18424</ENT> <ENT>.18103</ENT> <ENT>.17792</ENT> <ENT>.17489</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.19790</ENT> <ENT>.19450</ENT> <ENT>.19119</ENT> <ENT>.18798</ENT> <ENT>.18486</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.20866</ENT> <ENT>.20516</ENT> <ENT>.20175</ENT> <ENT>.19844</ENT> <ENT>.19523</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.21986</ENT> <ENT>.21626</ENT> <ENT>.21276</ENT> <ENT>.20936</ENT> <ENT>.20605</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.23151</ENT> <ENT>.22782</ENT> <ENT>.22423</ENT> <ENT>.22073</ENT> <ENT>.21733</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.24362</ENT> <ENT>.23984</ENT> <ENT>.23616</ENT> <ENT>.23257</ENT> <ENT>.22908</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.25617</ENT> <ENT>.25231</ENT> <ENT>.24854</ENT> <ENT>.24487</ENT> <ENT>.24129</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.26917</ENT> <ENT>.26522</ENT> <ENT>.26137</ENT> <ENT>.25761</ENT> <ENT>.25395</ENT> </ROW> <ROW> <PRTPAGE P="75"/> <ENT I="01">66</ENT> <ENT>.28259</ENT> <ENT>.27857</ENT> <ENT>.27464</ENT> <ENT>.27081</ENT> <ENT>.26707</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.29643</ENT> <ENT>.29233</ENT> <ENT>.28833</ENT> <ENT>.28443</ENT> <ENT>.38061</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.31070</ENT> <ENT>.30653</ENT> <ENT>.30246</ENT> <ENT>.29849</ENT> <ENT>.29461</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.32542</ENT> <ENT>.32120</ENT> <ENT>.31707</ENT> <ENT>.31303</ENT> <ENT>.30908</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.34063</ENT> <ENT>.33635</ENT> <ENT>.33217</ENT> <ENT>.32807</ENT> <ENT>.32407</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.35639</ENT> <ENT>.35207</ENT> <ENT>.34784</ENT> <ENT>.34370</ENT> <ENT>.33965</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.37273</ENT> <ENT>.36837</ENT> <ENT>.36410</ENT> <ENT>.35993</ENT> <ENT>.35583</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.38955</ENT> <ENT>.38517</ENT> <ENT>.38088</ENT> <ENT>.37667</ENT> <ENT>.37255</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.40670</ENT> <ENT>.40230</ENT> <ENT>.39799</ENT> <ENT>.39377</ENT> <ENT>.38962</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.42398</ENT> <ENT>.41958</ENT> <ENT>.41526</ENT> <ENT>.41102</ENT> <ENT>.40686</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.44131</ENT> <ENT>.43691</ENT> <ENT>.43259</ENT> <ENT>.42825</ENT> <ENT>.42419</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.45864</ENT> <ENT>.45425</ENT> <ENT>.44994</ENT> <ENT>.44571</ENT> <ENT>.44155</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.47601</ENT> <ENT>.47164</ENT> <ENT>.46734</ENT> <ENT>.46312</ENT> <ENT>.45897</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.49348</ENT> <ENT>.48914</ENT> <ENT>.48487</ENT> <ENT>.48067</ENT> <ENT>.47654</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.51112</ENT> <ENT>.50682</ENT> <ENT>.50259</ENT> <ENT>.49842</ENT> <ENT>.49432</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.52881</ENT> <ENT>.52455</ENT> <ENT>.52036</ENT> <ENT>.51624</ENT> <ENT>.51218</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.54639</ENT> <ENT>.54219</ENT> <ENT>.53805</ENT> <ENT>.53398</ENT> <ENT>.52996</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.56386</ENT> <ENT>.55973</ENT> <ENT>.55566</ENT> <ENT>.55164</ENT> <ENT>.54768</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.58136</ENT> <ENT>.57730</ENT> <ENT>.57329</ENT> <ENT>.56934</ENT> <ENT>.56545</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.59891</ENT> <ENT>.59494</ENT> <ENT>.59102</ENT> <ENT>.58715</ENT> <ENT>.58333</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.61610</ENT> <ENT>.61222</ENT> <ENT>.60839</ENT> <ENT>.60460</ENT> <ENT>.60086</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.62335</ENT> <ENT>.62856</ENT> <ENT>.62481</ENT> <ENT>.62111</ENT> <ENT>.61746</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.64757</ENT> <ENT>.64386</ENT> <ENT>.64021</ENT> <ENT>.63659</ENT> <ENT>.63302</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.66209</ENT> <ENT>.65848</ENT> <ENT>.65491</ENT> <ENT>.65139</ENT> <ENT>.64790</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.67638</ENT> <ENT>.67287</ENT> <ENT>.66939</ENT> <ENT>.66596</ENT> <ENT>.66256</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.69032</ENT> <ENT>.68691</ENT> <ENT>.68353</ENT> <ENT>.68019</ENT> <ENT>.67689</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.70342</ENT> <ENT>.70011</ENT> <ENT>.69683</ENT> <ENT>.69359</ENT> <ENT>.69038</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.71539</ENT> <ENT>.71217</ENT> <ENT>.70899</ENT> <ENT>.70584</ENT> <ENT>.70271</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.72612</ENT> <ENT>.72299</ENT> <ENT>.71989</ENT> <ENT>.71683</ENT> <ENT>.71379</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.73550</ENT> <ENT>.43245</ENT> <ENT>.72943</ENT> <ENT>.72643</ENT> <ENT>.72347</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.74337</ENT> <ENT>.74039</ENT> <ENT>.73743</ENT> <ENT>.73450</ENT> <ENT>.73160</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.75041</ENT> <ENT>.74748</ENT> <ENT>.74458</ENT> <ENT>.74171</ENT> <ENT>.73886</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.74652</ENT> <ENT>.75364</ENT> <ENT>.75079</ENT> <ENT>.74797</ENT> <ENT>.74517</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.76224</ENT> <ENT>.75941</ENT> <ENT>.75660</ENT> <ENT>.75382</ENT> <ENT>.75106</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.76791</ENT> <ENT>.76513</ENT> <ENT>.76237</ENT> <ENT>.75963</ENT> <ENT>.75692</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.77280</ENT> <ENT>.77005</ENT> <ENT>.76732</ENT> <ENT>.67462</ENT> <ENT>.76194</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.77804</ENT> <ENT>.77532</ENT> <ENT>.77263</ENT> <ENT>.76996</ENT> <ENT>.76732</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.78485</ENT> <ENT>.78218</ENT> <ENT>.77954</ENT> <ENT>.77692</ENT> <ENT>.77432</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.79117</ENT> <ENT>.78854</ENT> <ENT>.78594</ENT> <ENT>.78335</ENT> <ENT>.78078</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.80103</ENT> <ENT>.79848</ENT> <ENT>.78595</ENT> <ENT>.79343</ENT> <ENT>.79093</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.81764</ENT> <ENT>.81524</ENT> <ENT>.81285</ENT> <ENT>.81048</ENT> <ENT>.80813</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.84137</ENT> <ENT>.93921</ENT> <ENT>.83706</ENT> <ENT>.83493</ENT> <ENT>.83281</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.88020</ENT> <ENT>.87851</ENT> <ENT>.87682</ENT> <ENT>.87515</ENT> <ENT>.87348</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94563</ENT> <ENT>.94484</ENT> <ENT>.94405</ENT> <ENT>.94326</ENT> <ENT>.94248</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,7,7,7,7,7"> <TTITLE>Table G</TTITLE> <TDESC>Table G—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Pooled Income Fund Having the Yearly Rate of Return Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Yearly rate of return</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02442</ENT> <ENT>.02428</ENT> <ENT>.02414</ENT> <ENT>.02402</ENT> <ENT>.02389</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00643</ENT> <ENT>.00629</ENT> <ENT>.00617</ENT> <ENT>.00605</ENT> <ENT>.00594</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00596</ENT> <ENT>.00582</ENT> <ENT>.00569</ENT> <ENT>.00556</ENT> <ENT>.00544</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00583</ENT> <ENT>.00569</ENT> <ENT>.00555</ENT> <ENT>.00542</ENT> <ENT>.00529</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00586</ENT> <ENT>.00571</ENT> <ENT>.00556</ENT> <ENT>.00542</ENT> <ENT>.00529</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00603</ENT> <ENT>.00587</ENT> <ENT>.00571</ENT> <ENT>.00556</ENT> <ENT>.00542</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00630</ENT> <ENT>.00612</ENT> <ENT>.00595</ENT> <ENT>.00580</ENT> <ENT>.00565</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00663</ENT> <ENT>.00644</ENT> <ENT>.00626</ENT> <ENT>.00610</ENT> <ENT>.00594</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00705</ENT> <ENT>.00685</ENT> <ENT>.00666</ENT> <ENT>.00648</ENT> <ENT>.00631</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00757</ENT> <ENT>.00736</ENT> <ENT>.00716</ENT> <ENT>.00697</ENT> <ENT>.00679</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00821</ENT> <ENT>.00798</ENT> <ENT>.00777</ENT> <ENT>.00756</ENT> <ENT>.00737</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00896</ENT> <ENT>.00872</ENT> <ENT>.00850</ENT> <ENT>.00828</ENT> <ENT>.00807</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00983</ENT> <ENT>.00958</ENT> <ENT>.00934</ENT> <ENT>.00911</ENT> <ENT>.00889</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01076</ENT> <ENT>.01049</ENT> <ENT>.01024</ENT> <ENT>.00999</ENT> <ENT>.00976</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01170</ENT> <ENT>.01141</ENT> <ENT>.01114</ENT> <ENT>.01088</ENT> <ENT>.01064</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01258</ENT> <ENT>.01228</ENT> <ENT>.01200</ENT> <ENT>.01172</ENT> <ENT>.01147</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01337</ENT> <ENT>.01306</ENT> <ENT>.01276</ENT> <ENT>.01247</ENT> <ENT>.01220</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01408</ENT> <ENT>.01375</ENT> <ENT>.01343</ENT> <ENT>.01313</ENT> <ENT>.01284</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01471</ENT> <ENT>.01436</ENT> <ENT>.01403</ENT> <ENT>.01371</ENT> <ENT>.01341</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01531</ENT> <ENT>.01494</ENT> <ENT>.01459</ENT> <ENT>.01426</ENT> <ENT>.01394</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01592</ENT> <ENT>.01553</ENT> <ENT>.01516</ENT> <ENT>.01481</ENT> <ENT>.01447</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01655</ENT> <ENT>.01614</ENT> <ENT>.01574</ENT> <ENT>.01537</ENT> <ENT>.01502</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01719</ENT> <ENT>.01675</ENT> <ENT>.01634</ENT> <ENT>.01594</ENT> <ENT>.01557</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01787</ENT> <ENT>.01741</ENT> <ENT>.01697</ENT> <ENT>.01655</ENT> <ENT>.01615</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01863</ENT> <ENT>.01814</ENT> <ENT>.01768</ENT> <ENT>.01723</ENT> <ENT>.01681</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.01952</ENT> <ENT>.01899</ENT> <ENT>.01850</ENT> <ENT>.01802</ENT> <ENT>.01757</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02056</ENT> <ENT>.02000</ENT> <ENT>.01947</ENT> <ENT>.01897</ENT> <ENT>.01849</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02177</ENT> <ENT>.02118</ENT> <ENT>.02061</ENT> <ENT>.02008</ENT> <ENT>.01956</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02317</ENT> <ENT>.02254</ENT> <ENT>.02194</ENT> <ENT>.02137</ENT> <ENT>.02082</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02472</ENT> <ENT>.02405</ENT> <ENT>.02342</ENT> <ENT>.02281</ENT> <ENT>.02223</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02645</ENT> <ENT>.02574</ENT> <ENT>.02506</ENT> <ENT>.02441</ENT> <ENT>.02379</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02832</ENT> <ENT>.02756</ENT> <ENT>.02684</ENT> <ENT>.02615</ENT> <ENT>.02549</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.03037</ENT> <ENT>.02957</ENT> <ENT>.02880</ENT> <ENT>.02806</ENT> <ENT>.02736</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.03261</ENT> <ENT>.03175</ENT> <ENT>.03093</ENT> <ENT>.03015</ENT> <ENT>.02940</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.03502</ENT> <ENT>.03411</ENT> <ENT>.03324</ENT> <ENT>.03241</ENT> <ENT>.03162</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.03764</ENT> <ENT>.03668</ENT> <ENT>.03576</ENT> <ENT>.03488</ENT> <ENT>.03403</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.04048</ENT> <ENT>.03945</ENT> <ENT>.03847</ENT> <ENT>.03754</ENT> <ENT>.03664</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.04352</ENT> <ENT>.04244</ENT> <ENT>.04140</ENT> <ENT>.04040</ENT> <ENT>.03945</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.04677</ENT> <ENT>.04563</ENT> <ENT>.04453</ENT> <ENT>.04347</ENT> <ENT>.04246</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.05024</ENT> <ENT>.04903</ENT> <ENT>.04787</ENT> <ENT>.04675</ENT> <ENT>.04568</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.05394</ENT> <ENT>.05266</ENT> <ENT>.05143</ENT> <ENT>.05025</ENT> <ENT>.04912</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.05789</ENT> <ENT>.05653</ENT> <ENT>.05524</ENT> <ENT>.05399</ENT> <ENT>.05279</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.06212</ENT> <ENT>.06069</ENT> <ENT>.05932</ENT> <ENT>.05800</ENT> <ENT>.05674</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.06661</ENT> <ENT>.06511</ENT> <ENT>.06366</ENT> <ENT>.06227</ENT> <ENT>.06093</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.07138</ENT> <ENT>.06980</ENT> <ENT>.06828</ENT> <ENT>.06682</ENT> <ENT>.06541</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.07642</ENT> <ENT>.07476</ENT> <ENT>.07316</ENT> <ENT>.07162</ENT> <ENT>.07013</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.08174</ENT> <ENT>.08000</ENT> <ENT>.07832</ENT> <ENT>.07670</ENT> <ENT>.07514</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.08736</ENT> <ENT>.08553</ENT> <ENT>.08377</ENT> <ENT>.08207</ENT> <ENT>.08042</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.09331</ENT> <ENT>.09140</ENT> <ENT>.08955</ENT> <ENT>.08776</ENT> <ENT>.08604</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.09959</ENT> <ENT>.09759</ENT> <ENT>.09565</ENT> <ENT>.09378</ENT> <ENT>.09198</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.10624</ENT> <ENT>.10414</ENT> <ENT>.10212</ENT> <ENT>.10016</ENT> <ENT>.09827</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.11322</ENT> <ENT>.11104</ENT> <ENT>.10892</ENT> <ENT>.10688</ENT> <ENT>.10490</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.12057</ENT> <ENT>.11829</ENT> <ENT>.11608</ENT> <ENT>.11395</ENT> <ENT>.11188</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.12827</ENT> <ENT>.12590</ENT> <ENT>.12360</ENT> <ENT>.12138</ENT> <ENT>.11922</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.13631</ENT> <ENT>.13384</ENT> <ENT>.13145</ENT> <ENT>.12913</ENT> <ENT>.12689</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.14469</ENT> <ENT>.14213</ENT> <ENT>.13964</ENT> <ENT>.13724</ENT> <ENT>.13490</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.15341</ENT> <ENT>.15075</ENT> <ENT>.14817</ENT> <ENT>.14567</ENT> <ENT>.14324</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.16250</ENT> <ENT>.15975</ENT> <ENT>.15708</ENT> <ENT>.15448</ENT> <ENT>.15196</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.17196</ENT> <ENT>.16911</ENT> <ENT>.16634</ENT> <ENT>.16365</ENT> <ENT>.16104</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.18183</ENT> <ENT>.17888</ENT> <ENT>.17602</ENT> <ENT>.17324</ENT> <ENT>.17053</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.19210</ENT> <ENT>.18906</ENT> <ENT>.18611</ENT> <ENT>.18323</ENT> <ENT>.18043</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.20283</ENT> <ENT>.19970</ENT> <ENT>.19665</ENT> <ENT>.19368</ENT> <ENT>.19079</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.21402</ENT> <ENT>.21079</ENT> <ENT>.20766</ENT> <ENT>.20460</ENT> <ENT>.20162</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.22568</ENT> <ENT>.22237</ENT> <ENT>.21914</ENT> <ENT>.21600</ENT> <ENT>.21293</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.23780</ENT> <ENT>.23440</ENT> <ENT>.23109</ENT> <ENT>.22786</ENT> <ENT>.22471</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.25038</ENT> <ENT>.24690</ENT> <ENT>.24350</ENT> <ENT>.24019</ENT> <ENT>.23695</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.26342</ENT> <ENT>.25986</ENT> <ENT>.25638</ENT> <ENT>.25298</ENT> <ENT>.24967</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.27689</ENT> <ENT>.27325</ENT> <ENT>.26970</ENT> <ENT>.26623</ENT> <ENT>.26284</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.29081</ENT> <ENT>.28711</ENT> <ENT>.28248</ENT> <ENT>.27994</ENT> <ENT>.27647</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.30523</ENT> <ENT>.30145</ENT> <ENT>.29776</ENT> <ENT>.29415</ENT> <ENT>.29062</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.32015</ENT> <ENT>.31632</ENT> <ENT>.31257</ENT> <ENT>.30890</ENT> <ENT>.30530</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.33568</ENT> <ENT>.33179</ENT> <ENT>.32799</ENT> <ENT>.32426</ENT> <ENT>.32061</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.35182</ENT> <ENT>.34789</ENT> <ENT>.34404</ENT> <ENT>.34027</ENT> <ENT>.33657</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.36851</ENT> <ENT>.36455</ENT> <ENT>.36066</ENT> <ENT>.35685</ENT> <ENT>.35311</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.38555</ENT> <ENT>.38156</ENT> <ENT>.37765</ENT> <ENT>.37381</ENT> <ENT>.37004</ENT> </ROW> <ROW> <PRTPAGE P="76"/> <ENT I="01">75</ENT> <ENT>.40278</ENT> <ENT>.39877</ENT> <ENT>.39484</ENT> <ENT>.39098</ENT> <ENT>.38710</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.42010</ENT> <ENT>.41608</ENT> <ENT>.41213</ENT> <ENT>.40826</ENT> <ENT>.40445</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.43746</ENT> <ENT>.43344</ENT> <ENT>.42949</ENT> <ENT>.42561</ENT> <ENT>.42179</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.45489</ENT> <ENT>.45088</ENT> <ENT>.44693</ENT> <ENT>.44305</ENT> <ENT>.43923</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.47248</ENT> <ENT>.46848</ENT> <ENT>.46454</ENT> <ENT>.46067</ENT> <ENT>.45686</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.49028</ENT> <ENT>.48631</ENT> <ENT>.48240</ENT> <ENT>.47854</ENT> <ENT>.47475</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.50818</ENT> <ENT>.50423</ENT> <ENT>.50035</ENT> <ENT>.49653</ENT> <ENT>.59276</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.52600</ENT> <ENT>.52210</ENT> <ENT>.51826</ENT> <ENT>.51447</ENT> <ENT>.51074</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.54377</ENT> <ENT>.53992</ENT> <ENT>.53613</ENT> <ENT>.53238</ENT> <ENT>.52869</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.56160</ENT> <ENT>.55781</ENT> <ENT>.55407</ENT> <ENT>.55038</ENT> <ENT>.54674</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.57956</ENT> <ENT>.57584</ENT> <ENT>.57216</ENT> <ENT>.56854</ENT> <ENT>.56496</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.59717</ENT> <ENT>.59353</ENT> <ENT>.58993</ENT> <ENT>.58638</ENT> <ENT>.58287</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.61385</ENT> <ENT>.61028</ENT> <ENT>.60676</ENT> <ENT>.60328</ENT> <ENT>.59984</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.62950</ENT> <ENT>.62601</ENT> <ENT>.62256</ENT> <ENT>.61915</ENT> <ENT>.61578</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.64445</ENT> <ENT>.64104</ENT> <ENT>.63767</ENT> <ENT>.63434</ENT> <ENT>.63105</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.65920</ENT> <ENT>.65588</ENT> <ENT>.65259</ENT> <ENT>.64934</ENT> <ENT>.64612</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.67362</ENT> <ENT>.67039</ENT> <ENT>.66719</ENT> <ENT>.66402</ENT> <ENT>.66089</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.68720</ENT> <ENT>.68405</ENT> <ENT>.68094</ENT> <ENT>.67786</ENT> <ENT>.67481</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.69962</ENT> <ENT>.69657</ENT> <ENT>.69354</ENT> <ENT>.69054</ENT> <ENT>.68757</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.71078</ENT> <ENT>.70780</ENT> <ENT>.70485</ENT> <ENT>.70193</ENT> <ENT>.69903</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.72053</ENT> <ENT>.71763</ENT> <ENT>.71475</ENT> <ENT>.71189</ENT> <ENT>.70906</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.72872</ENT> <ENT>.72587</ENT> <ENT>.72305</ENT> <ENT>.72026</ENT> <ENT>.71748</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.73604</ENT> <ENT>.73325</ENT> <ENT>.73048</ENT> <ENT>.72773</ENT> <ENT>.72501</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.74239</ENT> <ENT>.73964</ENT> <ENT>.73692</ENT> <ENT>.73422</ENT> <ENT>.73154</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.74833</ENT> <ENT>.74562</ENT> <ENT>.74294</ENT> <ENT>.74028</ENT> <ENT>.73764</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.75423</ENT> <ENT>.75156</ENT> <ENT>.74892</ENT> <ENT>.74630</ENT> <ENT>.74370</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.75928</ENT> <ENT>.75664</ENT> <ENT>.75403</ENT> <ENT>.75144</ENT> <ENT>.74887</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.76469</ENT> <ENT>.76209</ENT> <ENT>.75950</ENT> <ENT>.75694</ENT> <ENT>.75440</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.77174</ENT> <ENT>.76918</ENT> <ENT>.76664</ENT> <ENT>.76413</ENT> <ENT>.76163</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.77824</ENT> <ENT>.77571</ENT> <ENT>.77320</ENT> <ENT>.77071</ENT> <ENT>.76824</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.78845</ENT> <ENT>.78599</ENT> <ENT>.78354</ENT> <ENT>.78111</ENT> <ENT>.77870</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.80579</ENT> <ENT>.80346</ENT> <ENT>.80115</ENT> <ENT>.79885</ENT> <ENT>.79657</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.83070</ENT> <ENT>.82860</ENT> <ENT>.82652</ENT> <ENT>.82444</ENT> <ENT>.82238</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.87182</ENT> <ENT>.87016</ENT> <ENT>.86852</ENT> <ENT>.86688</ENT> <ENT>.86525</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94170</ENT> <ENT>.94092</ENT> <ENT>.94014</ENT> <ENT>.93937</ENT> <ENT>.93860</ENT> </ROW> </GPOTABLE> <P> (e) <E T="03">Present value of the remainder interest in the case of transfers to pooled income funds for which the valuation date is after April 30, 1989, and before May 1, 1999</E> —(1) <E T="03">In general.</E> In the case of transfers to pooled income funds for which the valuation date is after April 30, 1989, and before May 1, 1999, the present value of a remainder interest is determined under this section. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). The present value of a remainder interest that is dependent on the termination of the life of one individual is computed by the use of Table S in paragraph (e)(5) of this section. For purposes of the computations under this section, the age of an individual is the age at the individual's nearest birthday. If the valuation date of a transfer to a pooled income fund is after April 30, 1989, and before June 10, 1994, a transferor can rely on Notice 89-24, 1989-1 C.B. 660, or Notice 89-60, 1989-1 C.B. 700, in valuing the transferred interest. (See § 601.601(d)(2)(ii)( <E T="03">b</E> ) of this chapter.) </P> <P> (2) <E T="03">Present value of a remainder interest.</E> The present value of a remainder interest in property transferred to a pooled income fund is computed on the basis of— </P> <P> (i) Life contingencies determined from the values of <E T="03">lx</E> that are set forth in Table 80CNSMT in § 20.2031-7A(e)(4) of this chapter (Estate Tax Regulations); and </P> <P>(ii) Discount at a rate of interest, compounded annually, equal to the highest yearly rate of return of the pooled income fund for the 3 taxable years immediately preceding its taxable year in which the transfer of property to the fund is made. The provisions of § 1.642(c)-6(c) apply for determining the yearly rate of return. However, where the taxable year is less than 12 months, the provisions of § 1.642(c)-6(e)(3)(ii) apply for the determining the yearly rate of return.</P> <P> (3) <E T="03">Pooled income funds in existence less than 3 taxable years.</E> The provisions of § 1.642(c)-6(e)(4) apply for determining the highest yearly rate of return when the pooled income fund has been in existence less than three taxable years. </P> <P> (4) <E T="03">Computation of value of remainder interest.</E> The factor that is used in determining the present value of a remainder interest that is dependent on the termination of the life of one individual is the factor from Table S in paragraph (e)(5) of this section under the appropriate yearly rate of return opposite the number that corresponds to the age of the individual upon whose life the value of the remainder interest is based. Table S in paragraph (e)(5) of this section includes factors for yearly rates of return from 4.2 to 14 percent. Many actuarial factors not contained in Table S in paragraph (e)(5) of this section are contained in Table S in Internal Revenue Service Publication 1457, “Actuarial Values, Alpha Volume,” (8-89). Publication 1457 is no longer available for purchase from the Superintendent of Documents, United States Government Printing Office, Washington, DC 20402. However, pertinent factors in this publication may be <PRTPAGE P="77"/> obtained by a written request to: CC:DOM:CORP:R (IRS Publication 1457), room 5226, Internal Revenue Service, POB 7604, Ben Franklin Station, Washington, DC 20044. For other situations, see § 1.642(c)-6(b). If the yearly rate of return is a percentage that is between the yearly rates of return for which factors are provided, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the fair market value of the property on the valuation date by the appropriate remainder factor. For an example of a computation of the present value of a remainder interest requiring a linear interpolation adjustment, see § 1.642(c)-6(e)(5). </P> <P> (5) <E T="03">Actuarial tables.</E> In the case of transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, the present value of a remainder interest dependent on the termination of one life in the case of a transfer to a pooled income fund is determined by use of the following tables: </P> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table S—Based on Life Table 80CNSMT Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989, and Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.07389</ENT> <ENT>.06749</ENT> <ENT>.06188</ENT> <ENT>.05695</ENT> <ENT>.05261</ENT> <ENT>.04879</ENT> <ENT>.04541</ENT> <ENT>.04243</ENT> <ENT>.03978</ENT> <ENT>.03744</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.06494</ENT> <ENT>.05832</ENT> <ENT>.05250</ENT> <ENT>.04738</ENT> <ENT>.04287</ENT> <ENT>.03889</ENT> <ENT>.03537</ENT> <ENT>.03226</ENT> <ENT>.02950</ENT> <ENT>.02705</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.06678</ENT> <ENT>.05999</ENT> <ENT>.05401</ENT> <ENT>.04874</ENT> <ENT>.04410</ENT> <ENT>.03999</ENT> <ENT>.03636</ENT> <ENT>.03314</ENT> <ENT>.03028</ENT> <ENT>.02773</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.06897</ENT> <ENT>.06200</ENT> <ENT>.05587</ENT> <ENT>.05045</ENT> <ENT>.04567</ENT> <ENT>.04143</ENT> <ENT>.03768</ENT> <ENT>.03435</ENT> <ENT>.03139</ENT> <ENT>.02875</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.07139</ENT> <ENT>.06425</ENT> <ENT>.05796</ENT> <ENT>.05239</ENT> <ENT>.04746</ENT> <ENT>.04310</ENT> <ENT>.03922</ENT> <ENT>.03578</ENT> <ENT>.03271</ENT> <ENT>.02998</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.07401</ENT> <ENT>.06669</ENT> <ENT>.06023</ENT> <ENT>.05451</ENT> <ENT>.04944</ENT> <ENT>.04494</ENT> <ENT>.04094</ENT> <ENT>.03738</ENT> <ENT>.03421</ENT> <ENT>.03137</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.07677</ENT> <ENT>.06928</ENT> <ENT>.06265</ENT> <ENT>.05677</ENT> <ENT>.05156</ENT> <ENT>.04692</ENT> <ENT>.04279</ENT> <ENT>.03911</ENT> <ENT>.03583</ENT> <ENT>.03289</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.07968</ENT> <ENT>.07201</ENT> <ENT>.06521</ENT> <ENT>.05918</ENT> <ENT>.05381</ENT> <ENT>.04903</ENT> <ENT>.04477</ENT> <ENT>.04097</ENT> <ENT>.03757</ENT> <ENT>.03453</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.08274</ENT> <ENT>.07489</ENT> <ENT>.06792</ENT> <ENT>.06172</ENT> <ENT>.05621</ENT> <ENT>.05129</ENT> <ENT>.04689</ENT> <ENT>.04297</ENT> <ENT>.03945</ENT> <ENT>.03630</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.08597</ENT> <ENT>.07794</ENT> <ENT>.07079</ENT> <ENT>.06443</ENT> <ENT>.05876</ENT> <ENT>.05370</ENT> <ENT>.04917</ENT> <ENT>.04511</ENT> <ENT>.04148</ENT> <ENT>.03821</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.08936</ENT> <ENT>.08115</ENT> <ENT>.07383</ENT> <ENT>.06730</ENT> <ENT>.06147</ENT> <ENT>.05626</ENT> <ENT>.05159</ENT> <ENT>.04741</ENT> <ENT>.04365</ENT> <ENT>.04027</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.09293</ENT> <ENT>.08453</ENT> <ENT>.07704</ENT> <ENT>.07035</ENT> <ENT>.06436</ENT> <ENT>.05900</ENT> <ENT>.05419</ENT> <ENT>.04988</ENT> <ENT>.04599</ENT> <ENT>.04250</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.09666</ENT> <ENT>.08807</ENT> <ENT>.08040</ENT> <ENT>.07354</ENT> <ENT>.06739</ENT> <ENT>.06188</ENT> <ENT>.05693</ENT> <ENT>.05248</ENT> <ENT>.04847</ENT> <ENT>.04486</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.10049</ENT> <ENT>.09172</ENT> <ENT>.08387</ENT> <ENT>.07684</ENT> <ENT>.07053</ENT> <ENT>.06487</ENT> <ENT>.05977</ENT> <ENT>.05518</ENT> <ENT>.05104</ENT> <ENT>.04731</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.10437</ENT> <ENT>.09541</ENT> <ENT>.08738</ENT> <ENT>.08017</ENT> <ENT>.07370</ENT> <ENT>.06788</ENT> <ENT>.06263</ENT> <ENT>.05791</ENT> <ENT>.05364</ENT> <ENT>.04978</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.10827</ENT> <ENT>.09912</ENT> <ENT>.09090</ENT> <ENT>.08352</ENT> <ENT>.07688</ENT> <ENT>.07090</ENT> <ENT>.06551</ENT> <ENT>.06064</ENT> <ENT>.05623</ENT> <ENT>.05225</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.11220</ENT> <ENT>.10285</ENT> <ENT>.09445</ENT> <ENT>.08689</ENT> <ENT>.08008</ENT> <ENT>.07394</ENT> <ENT>.06839</ENT> <ENT>.06337</ENT> <ENT>.05883</ENT> <ENT>.05472</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.11615</ENT> <ENT>.10661</ENT> <ENT>.09802</ENT> <ENT>.09028</ENT> <ENT>.08330</ENT> <ENT>.07699</ENT> <ENT>.07129</ENT> <ENT>.06612</ENT> <ENT>.06144</ENT> <ENT>.05719</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.12017</ENT> <ENT>.11043</ENT> <ENT>.10165</ENT> <ENT>.09373</ENT> <ENT>.08656</ENT> <ENT>.08009</ENT> <ENT>.07422</ENT> <ENT>.06890</ENT> <ENT>.06408</ENT> <ENT>.05969</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.12428</ENT> <ENT>.11434</ENT> <ENT>.10537</ENT> <ENT>.09726</ENT> <ENT>.08992</ENT> <ENT>.08327</ENT> <ENT>.07724</ENT> <ENT>.07177</ENT> <ENT>.06679</ENT> <ENT>.06226</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.12850</ENT> <ENT>.11836</ENT> <ENT>.10919</ENT> <ENT>.10089</ENT> <ENT>.09337</ENT> <ENT>.08654</ENT> <ENT>.08035</ENT> <ENT>.07471</ENT> <ENT>.06959</ENT> <ENT>.06492</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.13282</ENT> <ENT>.12248</ENT> <ENT>.11311</ENT> <ENT>.10462</ENT> <ENT>.09692</ENT> <ENT>.08991</ENT> <ENT>.08355</ENT> <ENT>.07775</ENT> <ENT>.07247</ENT> <ENT>.06765</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.13728</ENT> <ENT>.12673</ENT> <ENT>.11717</ENT> <ENT>.10848</ENT> <ENT>.10059</ENT> <ENT>.09341</ENT> <ENT>.08686</ENT> <ENT>.08090</ENT> <ENT>.07546</ENT> <ENT>.07049</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.14188</ENT> <ENT>.13113</ENT> <ENT>.12136</ENT> <ENT>.11248</ENT> <ENT>.10440</ENT> <ENT>.09703</ENT> <ENT>.09032</ENT> <ENT>.08418</ENT> <ENT>.07858</ENT> <ENT>.07345</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.14667</ENT> <ENT>.13572</ENT> <ENT>.12575</ENT> <ENT>.11667</ENT> <ENT>.10839</ENT> <ENT>.10084</ENT> <ENT>.09395</ENT> <ENT>.08764</ENT> <ENT>.08187</ENT> <ENT>.07659</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.15167</ENT> <ENT>.14051</ENT> <ENT>.13034</ENT> <ENT>.12106</ENT> <ENT>.11259</ENT> <ENT>.10486</ENT> <ENT>.09778</ENT> <ENT>.09130</ENT> <ENT>.08536</ENT> <ENT>.07991</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.15690</ENT> <ENT>.14554</ENT> <ENT>.13517</ENT> <ENT>.12569</ENT> <ENT>.11703</ENT> <ENT>.10910</ENT> <ENT>.10184</ENT> <ENT>.09518</ENT> <ENT>.08907</ENT> <ENT>.08346</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.16237</ENT> <ENT>.15081</ENT> <ENT>.14024</ENT> <ENT>.13056</ENT> <ENT>.12171</ENT> <ENT>.11359</ENT> <ENT>.10614</ENT> <ENT>.09930</ENT> <ENT>.09302</ENT> <ENT>.08724</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.16808</ENT> <ENT>.15632</ENT> <ENT>.14555</ENT> <ENT>.13567</ENT> <ENT>.12662</ENT> <ENT>.11831</ENT> <ENT>.11068</ENT> <ENT>.10366</ENT> <ENT>.09720</ENT> <ENT>.09125</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.17404</ENT> <ENT>.16208</ENT> <ENT>.15110</ENT> <ENT>.14104</ENT> <ENT>.13179</ENT> <ENT>.12329</ENT> <ENT>.11547</ENT> <ENT>.10827</ENT> <ENT>.10163</ENT> <ENT>.09551</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.18025</ENT> <ENT>.16808</ENT> <ENT>.15692</ENT> <ENT>.14665</ENT> <ENT>.13721</ENT> <ENT>.12852</ENT> <ENT>.12051</ENT> <ENT>.11313</ENT> <ENT>.10631</ENT> <ENT>.10002</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.18672</ENT> <ENT>.17436</ENT> <ENT>.16300</ENT> <ENT>.15255</ENT> <ENT>.14291</ENT> <ENT>.13403</ENT> <ENT>.12584</ENT> <ENT>.11827</ENT> <ENT>.11127</ENT> <ENT>.10480</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.19344</ENT> <ENT>.18090</ENT> <ENT>.16935</ENT> <ENT>.15870</ENT> <ENT>.14888</ENT> <ENT>.13980</ENT> <ENT>.13142</ENT> <ENT>.12367</ENT> <ENT>.11650</ENT> <ENT>.10985</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.20044</ENT> <ENT>.18772</ENT> <ENT>.17598</ENT> <ENT>.16514</ENT> <ENT>.15513</ENT> <ENT>.14587</ENT> <ENT>.13730</ENT> <ENT>.12936</ENT> <ENT>.12201</ENT> <ENT>.11519</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.20770</ENT> <ENT>.19480</ENT> <ENT>.18287</ENT> <ENT>.17185</ENT> <ENT>.16165</ENT> <ENT>.15221</ENT> <ENT>.14345</ENT> <ENT>.13533</ENT> <ENT>.12780</ENT> <ENT>.12080</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.21522</ENT> <ENT>.20215</ENT> <ENT>.19005</ENT> <ENT>.17884</ENT> <ENT>.16846</ENT> <ENT>.15883</ENT> <ENT>.14989</ENT> <ENT>.14159</ENT> <ENT>.13388</ENT> <ENT>.12670</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.22299</ENT> <ENT>.20974</ENT> <ENT>.19747</ENT> <ENT>.18609</ENT> <ENT>.17552</ENT> <ENT>.16571</ENT> <ENT>.15660</ENT> <ENT>.14812</ENT> <ENT>.14022</ENT> <ENT>.13287</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.23101</ENT> <ENT>.21760</ENT> <ENT>.20516</ENT> <ENT>.19360</ENT> <ENT>.18286</ENT> <ENT>.17288</ENT> <ENT>.16358</ENT> <ENT>.15492</ENT> <ENT>.14685</ENT> <ENT>.13933</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.23928</ENT> <ENT>.22572</ENT> <ENT>.21311</ENT> <ENT>.20139</ENT> <ENT>.19048</ENT> <ENT>.18032</ENT> <ENT>.17085</ENT> <ENT>.16201</ENT> <ENT>.15377</ENT> <ENT>.14607</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.24780</ENT> <ENT>.23409</ENT> <ENT>.22133</ENT> <ENT>.20945</ENT> <ENT>.19837</ENT> <ENT>.18804</ENT> <ENT>.17840</ENT> <ENT>.16939</ENT> <ENT>.16097</ENT> <ENT>.15310</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.25658</ENT> <ENT>.24273</ENT> <ENT>.22982</ENT> <ENT>.21778</ENT> <ENT>.20654</ENT> <ENT>.19605</ENT> <ENT>.18624</ENT> <ENT>.17706</ENT> <ENT>.16847</ENT> <ENT>.16043</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.26560</ENT> <ENT>.25163</ENT> <ENT>.23858</ENT> <ENT>.22639</ENT> <ENT>.21499</ENT> <ENT>.20434</ENT> <ENT>.19436</ENT> <ENT>.18502</ENT> <ENT>.17627</ENT> <ENT>.16806</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.27486</ENT> <ENT>.26076</ENT> <ENT>.24758</ENT> <ENT>.23525</ENT> <ENT>.22370</ENT> <ENT>.21289</ENT> <ENT>.20276</ENT> <ENT>.19326</ENT> <ENT>.18434</ENT> <ENT>.17597</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.28435</ENT> <ENT>.27013</ENT> <ENT>.25683</ENT> <ENT>.24436</ENT> <ENT>.23268</ENT> <ENT>.22172</ENT> <ENT>.21143</ENT> <ENT>.20177</ENT> <ENT>.19270</ENT> <ENT>.18416</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.29407</ENT> <ENT>.27975</ENT> <ENT>.26633</ENT> <ENT>.25373</ENT> <ENT>.24191</ENT> <ENT>.23081</ENT> <ENT>.22038</ENT> <ENT>.21057</ENT> <ENT>.20134</ENT> <ENT>.19265</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.30402</ENT> <ENT>.28961</ENT> <ENT>.27608</ENT> <ENT>.26337</ENT> <ENT>.25142</ENT> <ENT>.24019</ENT> <ENT>.22962</ENT> <ENT>.21966</ENT> <ENT>.21028</ENT> <ENT>.20144</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.31420</ENT> <ENT>.29970</ENT> <ENT>.28608</ENT> <ENT>.27326</ENT> <ENT>.26120</ENT> <ENT>.24983</ENT> <ENT>.23913</ENT> <ENT>.22904</ENT> <ENT>.21951</ENT> <ENT>.21053</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.32460</ENT> <ENT>.31004</ENT> <ENT>.29632</ENT> <ENT>.28341</ENT> <ENT>.27123</ENT> <ENT>.25975</ENT> <ENT>.24892</ENT> <ENT>.23870</ENT> <ENT>.22904</ENT> <ENT>.21991</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.33521</ENT> <ENT>.32058</ENT> <ENT>.30679</ENT> <ENT>.29379</ENT> <ENT>.28151</ENT> <ENT>.26992</ENT> <ENT>.25897</ENT> <ENT>.24862</ENT> <ENT>.23883</ENT> <ENT>.22957</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.34599</ENT> <ENT>.33132</ENT> <ENT>.31746</ENT> <ENT>.30438</ENT> <ENT>.29201</ENT> <ENT>.28032</ENT> <ENT>.26926</ENT> <ENT>.25879</ENT> <ENT>.24888</ENT> <ENT>.23949</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.35695</ENT> <ENT>.34224</ENT> <ENT>.32833</ENT> <ENT>.31518</ENT> <ENT>.30273</ENT> <ENT>.29094</ENT> <ENT>.27978</ENT> <ENT>.26921</ENT> <ENT>.25918</ENT> <ENT>.24966</ENT> </ROW> <ROW> <PRTPAGE P="78"/> <ENT I="01">51</ENT> <ENT>.36809</ENT> 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<ENT>.71507</ENT> <ENT>.70537</ENT> <ENT>.69588</ENT> <ENT>.68660</ENT> <ENT>.67754</ENT> <ENT>.66867</ENT> <ENT>.65999</ENT> <ENT>.65151</ENT> <ENT>.64321</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.73768</ENT> <ENT>.72809</ENT> <ENT>.71872</ENT> <ENT>.70955</ENT> <ENT>.70058</ENT> <ENT>.69180</ENT> <ENT>.68320</ENT> <ENT>.67479</ENT> <ENT>.66655</ENT> <ENT>.65849</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.75001</ENT> <ENT>.74077</ENT> <ENT>.73173</ENT> <ENT>.72288</ENT> <ENT>.71422</ENT> <ENT>.70573</ENT> <ENT>.69741</ENT> <ENT>.68926</ENT> <ENT>.68128</ENT> <ENT>.67345</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.76195</ENT> <ENT>.75306</ENT> <ENT>.74435</ENT> <ENT>.73582</ENT> <ENT>.72746</ENT> <ENT>.71926</ENT> <ENT>.71123</ENT> <ENT>.70335</ENT> <ENT>.69562</ENT> <ENT>.68804</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.77346</ENT> <ENT>.76491</ENT> <ENT>.75654</ENT> <ENT>.74832</ENT> <ENT>.74026</ENT> <ENT>.73236</ENT> <ENT>.72460</ENT> <ENT>.71699</ENT> <ENT>.70952</ENT> <ENT>.70219</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.78456</ENT> <ENT>.77636</ENT> <ENT>.76831</ENT> <ENT>.76041</ENT> <ENT>.75265</ENT> <ENT>.74503</ENT> <ENT>.73756</ENT> <ENT>.73021</ENT> <ENT>.72300</ENT> <ENT>.71592</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.79530</ENT> <ENT>.78743</ENT> <ENT>.77971</ENT> <ENT>.77212</ENT> <ENT>.76466</ENT> <ENT>.75733</ENT> <ENT>.75014</ENT> <ENT>.74306</ENT> <ENT>.73611</ENT> <ENT>.72928</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.80560</ENT> <ENT>.79806</ENT> <ENT>.79065</ENT> <ENT>.78337</ENT> <ENT>.77621</ENT> <ENT>.76917</ENT> <ENT>.76225</ENT> <ENT>.75544</ENT> <ENT>.74875</ENT> <ENT>.74216</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.81535</ENT> <ENT>.80813</ENT> <ENT>.80103</ENT> <ENT>.79404</ENT> <ENT>.78717</ENT> <ENT>.78041</ENT> <ENT>.77375</ENT> <ENT>.76720</ENT> <ENT>.76076</ENT> <ENT>.75442</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.82462</ENT> <ENT>.81771</ENT> <ENT>.81090</ENT> <ENT>.80420</ENT> <ENT>.79760</ENT> <ENT>.79111</ENT> <ENT>.78472</ENT> <ENT>.77842</ENT> <ENT>.77223</ENT> <ENT>.76612</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.83356</ENT> <ENT>.82694</ENT> <ENT>.82043</ENT> <ENT>.81401</ENT> <ENT>.80769</ENT> <ENT>.80147</ENT> <ENT>.79533</ENT> <ENT>.78929</ENT> <ENT>.78334</ENT> <ENT>.77747</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.84225</ENT> <ENT>.83593</ENT> <ENT>.82971</ENT> <ENT>.82357</ENT> <ENT>.81753</ENT> <ENT>.81157</ENT> <ENT>.80570</ENT> <ENT>.79991</ENT> <ENT>.79420</ENT> <ENT>.78857</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.85058</ENT> <ENT>.84455</ENT> <ENT>.83861</ENT> <ENT>.83276</ENT> <ENT>.82698</ENT> <ENT>.82129</ENT> <ENT>.81567</ENT> <ENT>.81013</ENT> <ENT>.80466</ENT> <ENT>.79927</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.85838</ENT> <ENT>.85263</ENT> <ENT>.84696</ENT> <ENT>.84137</ENT> <ENT>.83585</ENT> <ENT>.83040</ENT> <ENT>.82503</ENT> <ENT>.81973</ENT> <ENT>.81449</ENT> <ENT>.80933</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.86557</ENT> <ENT>.86009</ENT> <ENT>.85467</ENT> <ENT>.84932</ENT> <ENT>.84405</ENT> <ENT>.83884</ENT> <ENT>.83370</ENT> <ENT>.82862</ENT> <ENT>.82360</ENT> <ENT>.81865</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.87212</ENT> <ENT>.86687</ENT> <ENT>.86169</ENT> <ENT>.85657</ENT> <ENT>.85152</ENT> <ENT>.84653</ENT> <ENT>.84160</ENT> <ENT>.83673</ENT> <ENT>.83192</ENT> <ENT>.82717</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.87801</ENT> <ENT>.87298</ENT> <ENT>.86801</ENT> <ENT>.86310</ENT> <ENT>.85825</ENT> <ENT>.85345</ENT> <ENT>.84872</ENT> <ENT>.84404</ENT> <ENT>.83941</ENT> <ENT>.83484</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.88322</ENT> <ENT>.87838</ENT> <ENT>.87360</ENT> <ENT>.86888</ENT> <ENT>.86420</ENT> <ENT>.85959</ENT> <ENT>.85502</ENT> <ENT>.85051</ENT> <ENT>.84605</ENT> <ENT>.84165</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.88795</ENT> <ENT>.88328</ENT> <ENT>.87867</ENT> <ENT>.87411</ENT> <ENT>.86961</ENT> <ENT>.86515</ENT> <ENT>.86074</ENT> <ENT>.85639</ENT> <ENT>.85208</ENT> <ENT>.84782</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.89220</ENT> <ENT>.88769</ENT> <ENT>.88323</ENT> <ENT>.87883</ENT> <ENT>.87447</ENT> <ENT>.87016</ENT> <ENT>.86589</ENT> <ENT>.86167</ENT> <ENT>.85750</ENT> <ENT>.85337</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.89612</ENT> <ENT>.89176</ENT> <ENT>.88745</ENT> <ENT>.88318</ENT> <ENT>.87895</ENT> <ENT>.87478</ENT> <ENT>.87064</ENT> <ENT>.86656</ENT> <ENT>.86251</ENT> <ENT>.85850</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.89977</ENT> <ENT>.89555</ENT> <ENT>.89136</ENT> <ENT>.88722</ENT> <ENT>.88313</ENT> <ENT>.87908</ENT> <ENT>.87506</ENT> <ENT>.87109</ENT> <ENT>.86716</ENT> <ENT>.86327</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.90326</ENT> <ENT>.89917</ENT> <ENT>.89511</ENT> <ENT>.89110</ENT> <ENT>.88712</ENT> <ENT>.88318</ENT> <ENT>.87929</ENT> <ENT>.87543</ENT> <ENT>.87161</ENT> <ENT>.86783</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.90690</ENT> <ENT>.90294</ENT> <ENT>.89901</ENT> <ENT>.89513</ENT> <ENT>.89128</ENT> <ENT>.88746</ENT> <ENT>.88369</ENT> <ENT>.87995</ENT> <ENT>.87624</ENT> <ENT>.87257</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.91076</ENT> <ENT>.90694</ENT> <ENT>.90315</ENT> <ENT>.89940</ENT> <ENT>.89569</ENT> <ENT>.89200</ENT> <ENT>.88835</ENT> <ENT>.88474</ENT> <ENT>.88116</ENT> <ENT>.87760</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.91504</ENT> <ENT>.91138</ENT> <ENT>.90775</ENT> <ENT>.90415</ENT> <ENT>.90058</ENT> <ENT>.89704</ENT> <ENT>.89354</ENT> <ENT>.89006</ENT> <ENT>.88661</ENT> <ENT>.88319</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.92027</ENT> <ENT>.91681</ENT> <ENT>.91337</ENT> <ENT>.90996</ENT> <ENT>.90658</ENT> <ENT>.90322</ENT> <ENT>.89989</ENT> <ENT>.89659</ENT> <ENT>.89331</ENT> <ENT>.89006</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.92763</ENT> <ENT>.92445</ENT> <ENT>.92130</ENT> <ENT>.91816</ENT> <ENT>.91506</ENT> <ENT>.91197</ENT> <ENT>.90890</ENT> <ENT>.90586</ENT> <ENT>.90284</ENT> <ENT>.89983</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.93799</ENT> <ENT>.93523</ENT> <ENT>.93249</ENT> <ENT>.92977</ENT> <ENT>.92707</ENT> <ENT>.92438</ENT> <ENT>.92170</ENT> <ENT>.91905</ENT> <ENT>.91641</ENT> <ENT>.91378</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.95429</ENT> <ENT>.95223</ENT> <ENT>.95018</ENT> <ENT>.94814</ENT> <ENT>.94611</ENT> <ENT>.94409</ENT> <ENT>.94208</ENT> <ENT>.94008</ENT> <ENT>.93809</ENT> <ENT>.93611</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97985</ENT> <ENT>.97893</ENT> <ENT>.97801</ENT> <ENT>.97710</ENT> <ENT>.97619</ENT> <ENT>.97529</ENT> <ENT>.97438</ENT> <ENT>.97348</ENT> <ENT>.97259</ENT> <ENT>.97170</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table S—Based on Life Table 80CNSMT Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989, and Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03535</ENT> <ENT>.03349</ENT> <ENT>.03183</ENT> <ENT>.03035</ENT> <ENT>.02902</ENT> <ENT>.02783</ENT> <ENT>.02676</ENT> <ENT>.02579</ENT> <ENT>.02492</ENT> <ENT>.02413</ENT> </ROW> <ROW> <PRTPAGE P="79"/> <ENT I="01">1</ENT> <ENT>.02486</ENT> <ENT>.02292</ENT> <ENT>.02119</ENT> <ENT>.01963</ENT> <ENT>.01824</ENT> <ENT>.01699</ENT> <ENT>.01587</ENT> <ENT>.01486</ENT> <ENT>.01395</ENT> <ENT>.01312</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02547</ENT> <ENT>.02345</ENT> <ENT>.02164</ENT> <ENT>.02002</ENT> <ENT>.01857</ENT> <ENT>.01727</ENT> <ENT>.01609</ENT> <ENT>.01504</ENT> <ENT>.01408</ENT> <ENT>.01321</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02640</ENT> <ENT>.02429</ENT> <ENT>.02241</ENT> <ENT>.02073</ENT> <ENT>.01921</ENT> <ENT>.01785</ENT> <ENT>.01662</ENT> <ENT>.01552</ENT> 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<ENT>.70711</ENT> <ENT>.70159</ENT> <ENT>.69616</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.76011</ENT> <ENT>.75419</ENT> <ENT>.74836</ENT> <ENT>.74261</ENT> <ENT>.73695</ENT> <ENT>.73137</ENT> <ENT>.72588</ENT> <ENT>.72046</ENT> <ENT>.71512</ENT> <ENT>.70986</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.77169</ENT> <ENT>.76599</ENT> <ENT>.76037</ENT> <ENT>.75484</ENT> <ENT>.74938</ENT> <ENT>.74400</ENT> <ENT>.73870</ENT> <ENT>.73347</ENT> <ENT>.72831</ENT> <ENT>.72323</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.78302</ENT> <ENT>.77755</ENT> <ENT>.77215</ENT> <ENT>.76683</ENT> <ENT>.76158</ENT> <ENT>.75640</ENT> <ENT>.75129</ENT> <ENT>.74625</ENT> <ENT>.74128</ENT> <ENT>.73638</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.79395</ENT> <ENT>.78870</ENT> <ENT>.78352</ENT> <ENT>.77842</ENT> <ENT>.77337</ENT> <ENT>.76840</ENT> <ENT>.76349</ENT> <ENT>.75864</ENT> <ENT>.75385</ENT> <ENT>.74913</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.80423</ENT> <ENT>.79920</ENT> <ENT>.79423</ENT> <ENT>.78933</ENT> <ENT>.78449</ENT> <ENT>.77971</ENT> <ENT>.77499</ENT> <ENT>.77033</ENT> <ENT>.76572</ENT> <ENT>.76118</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.81377</ENT> <ENT>.80894</ENT> <ENT>.80417</ENT> <ENT>.79946</ENT> <ENT>.79481</ENT> <ENT>.79022</ENT> <ENT>.78568</ENT> <ENT>.78120</ENT> <ENT>.77677</ENT> <ENT>.77239</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.82247</ENT> <ENT>.81784</ENT> <ENT>.81325</ENT> <ENT>.80873</ENT> <ENT>.80425</ENT> <ENT>.79983</ENT> <ENT>.79547</ENT> <ENT>.79115</ENT> <ENT>.78688</ENT> <ENT>.78266</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.83033</ENT> <ENT>.82586</ENT> <ENT>.82145</ENT> <ENT>.81709</ENT> <ENT>.81278</ENT> <ENT>.80852</ENT> <ENT>.80431</ENT> <ENT>.80014</ENT> <ENT>.79602</ENT> <ENT>.79195</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.83729</ENT> <ENT>.83298</ENT> <ENT>.82872</ENT> <ENT>.82451</ENT> <ENT>.82034</ENT> <ENT>.81622</ENT> <ENT>.81215</ENT> <ENT>.80812</ENT> <ENT>.80414</ENT> <ENT>.80019</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.84361</ENT> <ENT>.83944</ENT> <ENT>.83532</ENT> <ENT>.83124</ENT> <ENT>.82721</ENT> <ENT>.82322</ENT> <ENT>.81927</ENT> <ENT>.81537</ENT> <ENT>.81151</ENT> <ENT>.80769</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.84929</ENT> <ENT>.84525</ENT> <ENT>.84126</ENT> <ENT>.83730</ENT> <ENT>.83339</ENT> <ENT>.82952</ENT> <ENT>.82569</ENT> <ENT>.82190</ENT> <ENT>.81815</ENT> <ENT>.81443</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.85454</ENT> <ENT>.85062</ENT> <ENT>.84674</ENT> <ENT>.84290</ENT> <ENT>.83910</ENT> <ENT>.83534</ENT> <ENT>.83161</ENT> <ENT>.82792</ENT> <ENT>.82427</ENT> <ENT>.82066</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.85942</ENT> <ENT>.85561</ENT> <ENT>.85184</ENT> <ENT>.84810</ENT> <ENT>.84440</ENT> <ENT>.84074</ENT> <ENT>.83711</ENT> <ENT>.83352</ENT> <ENT>.82997</ENT> <ENT>.82644</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.86408</ENT> <ENT>.86037</ENT> <ENT>.85670</ENT> <ENT>.85306</ENT> <ENT>.84946</ENT> <ENT>.84589</ENT> <ENT>.84236</ENT> <ENT>.83886</ENT> <ENT>.83539</ENT> <ENT>.83196</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.86894</ENT> <ENT>.86534</ENT> <ENT>.86177</ENT> <ENT>.85823</ENT> <ENT>.85473</ENT> <ENT>.85126</ENT> <ENT>.84782</ENT> <ENT>.84442</ENT> <ENT>.84104</ENT> <ENT>.83770</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.87408</ENT> <ENT>.87060</ENT> <ENT>.86714</ENT> <ENT>.86371</ENT> <ENT>.86032</ENT> <ENT>.85695</ENT> <ENT>.85362</ENT> <ENT>.85031</ENT> <ENT>.84703</ENT> <ENT>.84378</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.87980</ENT> <ENT>.87644</ENT> <ENT>.87311</ENT> <ENT>.86980</ENT> <ENT>.86653</ENT> <ENT>.86328</ENT> <ENT>.86005</ENT> <ENT>.85686</ENT> <ENT>.85369</ENT> <ENT>.85054</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.88684</ENT> <ENT>.88363</ENT> <ENT>.88046</ENT> <ENT>.87731</ENT> <ENT>.87418</ENT> <ENT>.87108</ENT> <ENT>.86800</ENT> <ENT>.86494</ENT> <ENT>.86191</ENT> <ENT>.85890</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.89685</ENT> <ENT>.89389</ENT> <ENT>.89095</ENT> <ENT>.88804</ENT> <ENT>.88514</ENT> <ENT>.88226</ENT> <ENT>.87940</ENT> <ENT>.87656</ENT> <ENT>.87374</ENT> <ENT>.87094</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.91117</ENT> <ENT>.90858</ENT> <ENT>.90600</ENT> <ENT>.90344</ENT> <ENT>.90089</ENT> <ENT>.89836</ENT> <ENT>.89584</ENT> <ENT>.89334</ENT> <ENT>.89085</ENT> <ENT>.88838</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.93414</ENT> <ENT>.93217</ENT> <ENT>.93022</ENT> <ENT>.92828</ENT> <ENT>.92634</ENT> <ENT>.92442</ENT> <ENT>.92250</ENT> <ENT>.92060</ENT> <ENT>.91870</ENT> <ENT>.91681</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97081</ENT> <ENT>.96992</ENT> <ENT>.96904</ENT> <ENT>.96816</ENT> <ENT>.96729</ENT> <ENT>.96642</ENT> <ENT>.96555</ENT> <ENT>.96468</ENT> <ENT>.96382</ENT> <ENT>.96296</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table S—Based on Life Table 80CNSMT Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989, and Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02341</ENT> <ENT>.02276</ENT> <ENT>.02217</ENT> <ENT>.02163</ENT> <ENT>.02114</ENT> <ENT>.02069</ENT> <ENT>.02027</ENT> <ENT>.01989</ENT> <ENT>.01954</ENT> <ENT>.01922</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01237</ENT> <ENT>.01170</ENT> <ENT>.01108</ENT> <ENT>.01052</ENT> <ENT>.01000</ENT> <ENT>.00953</ENT> <ENT>.00910</ENT> <ENT>.00871</ENT> <ENT>.00834</ENT> <ENT>.00801</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01243</ENT> <ENT>.01172</ENT> <ENT>.01107</ENT> <ENT>.01048</ENT> <ENT>.00994</ENT> <ENT>.00944</ENT> <ENT>.00899</ENT> <ENT>.00857</ENT> <ENT>.00819</ENT> <ENT>.00784</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01278</ENT> <ENT>.01203</ENT> <ENT>.01135</ENT> <ENT>.01073</ENT> <ENT>.01016</ENT> <ENT>.00964</ENT> <ENT>.00916</ENT> <ENT>.00872</ENT> <ENT>.00832</ENT> <ENT>.00795</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01332</ENT> <ENT>.01253</ENT> <ENT>.01182</ENT> <ENT>.01116</ENT> <ENT>.01056</ENT> <ENT>.01001</ENT> <ENT>.00951</ENT> <ENT>.00904</ENT> <ENT>.00862</ENT> <ENT>.00822</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01400</ENT> <ENT>.01317</ENT> <ENT>.01241</ENT> <ENT>.01172</ENT> <ENT>.01109</ENT> <ENT>.01051</ENT> <ENT>.00998</ENT> <ENT>.00949</ENT> <ENT>.00904</ENT> <ENT>.00862</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01477</ENT> <ENT>.01390</ENT> <ENT>.01310</ENT> <ENT>.01238</ENT> <ENT>.01171</ENT> <ENT>.01110</ENT> <ENT>.01054</ENT> <ENT>.01002</ENT> <ENT>.00954</ENT> <ENT>.00910</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01563</ENT> <ENT>.01472</ENT> <ENT>.01389</ENT> <ENT>.01312</ENT> <ENT>.01242</ENT> <ENT>.01178</ENT> <ENT>.01118</ENT> <ENT>.01064</ENT> <ENT>.01013</ENT> <ENT>.00966</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01660</ENT> <ENT>.01564</ENT> <ENT>.01477</ENT> <ENT>.01396</ENT> <ENT>.01322</ENT> <ENT>.01254</ENT> <ENT>.01192</ENT> <ENT>.01134</ENT> <ENT>.01081</ENT> <ENT>.01031</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01770</ENT> <ENT>.01669</ENT> <ENT>.01577</ENT> <ENT>.01492</ENT> <ENT>.01414</ENT> <ENT>.01342</ENT> <ENT>.01276</ENT> <ENT>.01216</ENT> <ENT>.01159</ENT> <ENT>.01107</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01891</ENT> <ENT>.01785</ENT> <ENT>.01688</ENT> <ENT>.01599</ENT> <ENT>.01517</ENT> <ENT>.01442</ENT> <ENT>.01372</ENT> <ENT>.01308</ENT> <ENT>.01249</ENT> <ENT>.01194</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.02026</ENT> <ENT>.01915</ENT> <ENT>.01814</ENT> <ENT>.01720</ENT> <ENT>.01634</ENT> <ENT>.01555</ENT> <ENT>.01481</ENT> <ENT>.01414</ENT> <ENT>.01351</ENT> <ENT>.01293</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.02173</ENT> <ENT>.02056</ENT> <ENT>.01950</ENT> <ENT>.01852</ENT> <ENT>.01761</ENT> <ENT>.01678</ENT> <ENT>.01601</ENT> <ENT>.01529</ENT> <ENT>.01463</ENT> <ENT>.01402</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.02326</ENT> <ENT>.02204</ENT> <ENT>.02092</ENT> <ENT>.01989</ENT> <ENT>.01895</ENT> <ENT>.01807</ENT> <ENT>.01726</ENT> <ENT>.01651</ENT> <ENT>.01582</ENT> <ENT>.01517</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.02478</ENT> <ENT>.02351</ENT> <ENT>.02234</ENT> <ENT>.02126</ENT> <ENT>.02027</ENT> <ENT>.01935</ENT> <ENT>.01850</ENT> <ENT>.01771</ENT> <ENT>.01698</ENT> <ENT>.01630</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02628</ENT> <ENT>.02495</ENT> <ENT>.02372</ENT> <ENT>.02259</ENT> <ENT>.02155</ENT> <ENT>.02058</ENT> <ENT>.01969</ENT> <ENT>.01886</ENT> <ENT>.01810</ENT> <ENT>.01738</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02774</ENT> <ENT>.02635</ENT> <ENT>.02507</ENT> <ENT>.02388</ENT> <ENT>.02279</ENT> <ENT>.02178</ENT> <ENT>.02084</ENT> <ENT>.01997</ENT> <ENT>.01917</ENT> <ENT>.01842</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02917</ENT> <ENT>.02772</ENT> <ENT>.02637</ENT> <ENT>.02513</ENT> <ENT>.02399</ENT> <ENT>.02293</ENT> <ENT>.02194</ENT> <ENT>.02103</ENT> <ENT>.02018</ENT> <ENT>.01940</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.03059</ENT> <ENT>.02907</ENT> <ENT>.02767</ENT> <ENT>.02637</ENT> <ENT>.02517</ENT> <ENT>.02406</ENT> <ENT>.02302</ENT> <ENT>.02207</ENT> <ENT>.02118</ENT> <ENT>.02035</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.03205</ENT> <ENT>.03046</ENT> <ENT>.02899</ENT> <ENT>.02763</ENT> <ENT>.02637</ENT> <ENT>.02521</ENT> <ENT>.02412</ENT> <ENT>.02312</ENT> <ENT>.02218</ENT> <ENT>.02131</ENT> </ROW> <ROW> <PRTPAGE P="81"/> <ENT I="01">20</ENT> <ENT>.03355</ENT> <ENT>.03188</ENT> <ENT>.03035</ENT> <ENT>.02892</ENT> <ENT>.02760</ENT> <ENT>.02638</ENT> <ENT>.02524</ENT> <ENT>.02419</ENT> <ENT>.02320</ENT> <ENT>.02229</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.03509</ENT> <ENT>.03334</ENT> <ENT>.03173</ENT> <ENT>.03024</ENT> <ENT>.02886</ENT> <ENT>.02758</ENT> <ENT>.02638</ENT> <ENT>.02527</ENT> <ENT>.02424</ENT> <ENT>.02328</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.03669</ENT> <ENT>.03487</ENT> <ENT>.03318</ENT> <ENT>.03162</ENT> <ENT>.03017</ENT> <ENT>.02882</ENT> <ENT>.02757</ENT> <ENT>.02640</ENT> <ENT>.02532</ENT> <ENT>.02430</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.03837</ENT> <ENT>.03646</ENT> <ENT>.03470</ENT> <ENT>.03306</ENT> <ENT>.03154</ENT> <ENT>.03013</ENT> <ENT>.02881</ENT> <ENT>.02759</ENT> <ENT>.02644</ENT> <ENT>.02538</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.04018</ENT> <ENT>.03819</ENT> <ENT>.03634</ENT> <ENT>.03463</ENT> <ENT>.03303</ENT> <ENT>.03155</ENT> <ENT>.03016</ENT> <ENT>.02888</ENT> <ENT>.02767</ENT> <ENT>.02655</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.04214</ENT> <ENT>.04006</ENT> <ENT>.03812</ENT> <ENT>.03633</ENT> <ENT>.03465</ENT> <ENT>.03309</ENT> <ENT>.03164</ENT> <ENT>.03029</ENT> <ENT>.02902</ENT> <ENT>.02784</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.04428</ENT> <ENT>.04210</ENT> <ENT>.04008</ENT> <ENT>.03820</ENT> <ENT>.03644</ENT> <ENT>.03481</ENT> <ENT>.03328</ENT> <ENT>.03186</ENT> <ENT>.03052</ENT> <ENT>.02928</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.04662</ENT> <ENT>.04434</ENT> <ENT>.04223</ENT> <ENT>.04025</ENT> <ENT>.03841</ENT> <ENT>.03670</ENT> <ENT>.03509</ENT> <ENT>.03360</ENT> <ENT>.03219</ENT> <ENT>.03088</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.04915</ENT> <ENT>.04677</ENT> <ENT>.04456</ENT> <ENT>.04249</ENT> <ENT>.04056</ENT> <ENT>.03876</ENT> <ENT>.03708</ENT> <ENT>.03550</ENT> <ENT>.03403</ENT> <ENT>.03264</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.05189</ENT> <ENT>.04941</ENT> <ENT>.04709</ENT> <ENT>.04493</ENT> <ENT>.04291</ENT> <ENT>.04102</ENT> <ENT>.03925</ENT> <ENT>.03760</ENT> <ENT>.03604</ENT> <ENT>.03458</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.05485</ENT> <ENT>.05226</ENT> <ENT>.04984</ENT> <ENT>.04757</ENT> <ENT>.04546</ENT> <ENT>.04348</ENT> <ENT>.04162</ENT> <ENT>.03988</ENT> <ENT>.03825</ENT> <ENT>.03671</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.05805</ENT> <ENT>.05535</ENT> <ENT>.05282</ENT> <ENT>.05045</ENT> <ENT>.04824</ENT> <ENT>.04616</ENT> <ENT>.04421</ENT> <ENT>.04238</ENT> <ENT>.04067</ENT> <ENT>.03905</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.06149</ENT> <ENT>.05867</ENT> <ENT>.05603</ENT> <ENT>.05356</ENT> <ENT>.05124</ENT> <ENT>.04906</ENT> <ENT>.04702</ENT> <ENT>.04510</ENT> <ENT>.04329</ENT> <ENT>.04160</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.06520</ENT> <ENT>.06226</ENT> <ENT>.05950</ENT> <ENT>.05692</ENT> <ENT>.05449</ENT> <ENT>.05221</ENT> <ENT>.05007</ENT> <ENT>.04806</ENT> <ENT>.04616</ENT> <ENT>.04438</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.06916</ENT> <ENT>.06609</ENT> <ENT>.06322</ENT> <ENT>.06052</ENT> <ENT>.05799</ENT> <ENT>.05560</ENT> <ENT>.05336</ENT> <ENT>.05125</ENT> <ENT>.04926</ENT> <ENT>.04738</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.07339</ENT> <ENT>.07020</ENT> <ENT>.06720</ENT> <ENT>.06439</ENT> <ENT>.06174</ENT> <ENT>.05925</ENT> <ENT>.05690</ENT> <ENT>.05469</ENT> <ENT>.05260</ENT> <ENT>.05063</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.07787</ENT> <ENT>.07455</ENT> <ENT>.07143</ENT> <ENT>.06850</ENT> <ENT>.06573</ENT> <ENT>.06313</ENT> <ENT>.06068</ENT> <ENT>.05836</ENT> <ENT>.05617</ENT> <ENT>.05411</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.08262</ENT> <ENT>.07917</ENT> <ENT>.07593</ENT> <ENT>.07287</ENT> <ENT>.06999</ENT> <ENT>.06727</ENT> <ENT>.06470</ENT> <ENT>.06228</ENT> <ENT>.05999</ENT> <ENT>.05783</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.08765</ENT> <ENT>.08407</ENT> <ENT>.08069</ENT> <ENT>.07751</ENT> <ENT>.07451</ENT> <ENT>.07167</ENT> <ENT>.06899</ENT> <ENT>.06646</ENT> <ENT>.06407</ENT> <ENT>.06180</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.09296</ENT> <ENT>.08925</ENT> <ENT>.08574</ENT> <ENT>.08243</ENT> <ENT>.07931</ENT> <ENT>.07635</ENT> <ENT>.07356</ENT> <ENT>.07092</ENT> <ENT>.06841</ENT> <ENT>.06604</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.09858</ENT> <ENT>.09472</ENT> <ENT>.09109</ENT> <ENT>.08765</ENT> <ENT>.08440</ENT> <ENT>.08132</ENT> <ENT>.07841</ENT> <ENT>.07565</ENT> <ENT>.07303</ENT> <ENT>.07055</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.10449</ENT> <ENT>.10050</ENT> <ENT>.09673</ENT> <ENT>.09316</ENT> <ENT>.08978</ENT> <ENT>.08658</ENT> <ENT>.08355</ENT> <ENT>.08067</ENT> <ENT>.07794</ENT> <ENT>.07535</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.11069</ENT> <ENT>.10656</ENT> <ENT>.10265</ENT> <ENT>.09895</ENT> <ENT>.09544</ENT> <ENT>.09212</ENT> <ENT>.08896</ENT> <ENT>.08596</ENT> <ENT>.08312</ENT> <ENT>.08041</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.11718</ENT> <ENT>.11291</ENT> <ENT>.10887</ENT> <ENT>.10503</ENT> <ENT>.10140</ENT> <ENT>.09794</ENT> <ENT>.09466</ENT> <ENT>.09154</ENT> <ENT>.08858</ENT> <ENT>.08576</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.12399</ENT> <ENT>.11958</ENT> <ENT>.11540</ENT> <ENT>.11143</ENT> <ENT>.10766</ENT> <ENT>.10407</ENT> <ENT>.10067</ENT> <ENT>.09743</ENT> <ENT>.09434</ENT> <ENT>.09141</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.13111</ENT> <ENT>.12656</ENT> <ENT>.12224</ENT> <ENT>.11814</ENT> <ENT>.11423</ENT> <ENT>.11052</ENT> <ENT>.10699</ENT> <ENT>.10362</ENT> <ENT>.10042</ENT> <ENT>.09736</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.13856</ENT> <ENT>.13387</ENT> <ENT>.12941</ENT> <ENT>.12516</ENT> <ENT>.12113</ENT> <ENT>.11728</ENT> <ENT>.11362</ENT> <ENT>.11013</ENT> <ENT>.10680</ENT> <ENT>.10363</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.14633</ENT> <ENT>.14150</ENT> <ENT>.13690</ENT> <ENT>.13252</ENT> <ENT>.12835</ENT> <ENT>.12438</ENT> <ENT>.12059</ENT> <ENT>.11697</ENT> <ENT>.11352</ENT> <ENT>.11022</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.15442</ENT> <ENT>.14945</ENT> <ENT>.14471</ENT> <ENT>.14020</ENT> <ENT>.13589</ENT> <ENT>.13179</ENT> <ENT>.12787</ENT> <ENT>.12412</ENT> <ENT>.12055</ENT> <ENT>.11713</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.16280</ENT> <ENT>.15769</ENT> <ENT>.15281</ENT> <ENT>.14816</ENT> <ENT>.14373</ENT> <ENT>.13949</ENT> <ENT>.13544</ENT> <ENT>.13157</ENT> <ENT>.12787</ENT> <ENT>.12433</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.17147</ENT> <ENT>.16622</ENT> <ENT>.16121</ENT> <ENT>.15643</ENT> <ENT>.15186</ENT> <ENT>.14749</ENT> <ENT>.14331</ENT> <ENT>.13931</ENT> <ENT>.13548</ENT> <ENT>.13182</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.18045</ENT> <ENT>.17507</ENT> <ENT>.16993</ENT> <ENT>.16501</ENT> <ENT>.16030</ENT> <ENT>.15580</ENT> <ENT>.15150</ENT> <ENT>.14737</ENT> <ENT>.14342</ENT> <ENT>.13963</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.18979</ENT> <ENT>.18427</ENT> <ENT>.17899</ENT> <ENT>.17394</ENT> <ENT>.16911</ENT> <ENT>.16448</ENT> <ENT>.16004</ENT> <ENT>.15579</ENT> <ENT>.15172</ENT> <ENT>.14780</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.19947</ENT> <ENT>.19383</ENT> <ENT>.18842</ENT> <ENT>.18324</ENT> <ENT>.17828</ENT> <ENT>.17352</ENT> <ENT>.16896</ENT> <ENT>.16458</ENT> <ENT>.16038</ENT> <ENT>.15635</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.20950</ENT> <ENT>.20372</ENT> <ENT>.19819</ENT> <ENT>.19288</ENT> <ENT>.18779</ENT> <ENT>.18291</ENT> <ENT>.17822</ENT> <ENT>.17372</ENT> <ENT>.16940</ENT> <ENT>.16524</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.21986</ENT> <ENT>.21397</ENT> <ENT>.20831</ENT> <ENT>.20288</ENT> <ENT>.19767</ENT> <ENT>.19266</ENT> <ENT>.18785</ENT> <ENT>.18322</ENT> <ENT>.17878</ENT> <ENT>.17450</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.23058</ENT> <ENT>.22457</ENT> <ENT>.21879</ENT> <ENT>.21324</ENT> <ENT>.20791</ENT> <ENT>.20278</ENT> <ENT>.19785</ENT> <ENT>.19310</ENT> <ENT>.18854</ENT> <ENT>.18414</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.24167</ENT> <ENT>.23554</ENT> <ENT>.22965</ENT> <ENT>.22399</ENT> <ENT>.21854</ENT> <ENT>.21329</ENT> <ENT>.20824</ENT> <ENT>.20338</ENT> <ENT>.19870</ENT> <ENT>.19419</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.25314</ENT> <ENT>.24690</ENT> <ENT>.24090</ENT> <ENT>.23512</ENT> <ENT>.22956</ENT> <ENT>.22420</ENT> <ENT>.21904</ENT> <ENT>.21407</ENT> <ENT>.20927</ENT> <ENT>.20464</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.26497</ENT> <ENT>.25863</ENT> <ENT>.25252</ENT> <ENT>.24664</ENT> <ENT>.24097</ENT> <ENT>.23550</ENT> <ENT>.23023</ENT> <ENT>.22515</ENT> <ENT>.22024</ENT> <ENT>.21551</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.27712</ENT> <ENT>.27068</ENT> <ENT>.26448</ENT> <ENT>.25849</ENT> <ENT>.25272</ENT> <ENT>.24716</ENT> <ENT>.24178</ENT> <ENT>.23659</ENT> <ENT>.23158</ENT> <ENT>.22674</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.28956</ENT> <ENT>.28304</ENT> <ENT>.27674</ENT> <ENT>.27067</ENT> <ENT>.26480</ENT> <ENT>.25913</ENT> <ENT>.25366</ENT> <ENT>.24837</ENT> <ENT>.24325</ENT> <ENT>.23831</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.30228</ENT> <ENT>.29567</ENT> <ENT>.28929</ENT> <ENT>.28312</ENT> <ENT>.27717</ENT> <ENT>.27141</ENT> <ENT>.26584</ENT> <ENT>.26045</ENT> <ENT>.25524</ENT> <ENT>.25020</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.31525</ENT> <ENT>.30857</ENT> <ENT>.30211</ENT> <ENT>.29586</ENT> <ENT>.28982</ENT> <ENT>.28397</ENT> <ENT>.27832</ENT> <ENT>.27284</ENT> <ENT>.26754</ENT> <ENT>.26240</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.32851</ENT> <ENT>.32176</ENT> <ENT>.31522</ENT> <ENT>.30890</ENT> <ENT>.30278</ENT> <ENT>.29685</ENT> <ENT>.29111</ENT> <ENT>.28555</ENT> <ENT>.28016</ENT> <ENT>.27493</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.34209</ENT> <ENT>.33528</ENT> <ENT>.32868</ENT> <ENT>.32229</ENT> <ENT>.31610</ENT> <ENT>.31010</ENT> <ENT>.30429</ENT> <ENT>.29865</ENT> <ENT>.29317</ENT> <ENT>.28787</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.35604</ENT> <ENT>.34918</ENT> <ENT>.34253</ENT> <ENT>.33609</ENT> <ENT>.32983</ENT> <ENT>.32377</ENT> <ENT>.31788</ENT> <ENT>.31217</ENT> <ENT>.30663</ENT> <ENT>.30124</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.37037</ENT> <ENT>.36347</ENT> <ENT>.35678</ENT> <ENT>.35028</ENT> <ENT>.34398</ENT> <ENT>.33786</ENT> <ENT>.33191</ENT> <ENT>.32614</ENT> <ENT>.32053</ENT> <ENT>.31508</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.38508</ENT> <ENT>.37815</ENT> <ENT>.37142</ENT> <ENT>.36489</ENT> <ENT>.35854</ENT> <ENT>.35237</ENT> <ENT>.34638</ENT> <ENT>.34055</ENT> <ENT>.33488</ENT> <ENT>.32937</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.40008</ENT> <ENT>.39313</ENT> <ENT>.38638</ENT> <ENT>.37982</ENT> <ENT>.37344</ENT> <ENT>.36724</ENT> <ENT>.36120</ENT> <ENT>.35533</ENT> <ENT>.34961</ENT> <ENT>.34405</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.41533</ENT> <ENT>.40838</ENT> <ENT>.40162</ENT> <ENT>.39504</ENT> <ENT>.38864</ENT> <ENT>.38241</ENT> <ENT>.37634</ENT> <ENT>.37043</ENT> <ENT>.36468</ENT> <ENT>.35907</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.43076</ENT> <ENT>.42382</ENT> <ENT>.41705</ENT> <ENT>.41047</ENT> <ENT>.40405</ENT> <ENT>.39780</ENT> <ENT>.39171</ENT> <ENT>.38578</ENT> <ENT>.38000</ENT> <ENT>.37436</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.44638</ENT> <ENT>.43945</ENT> <ENT>.43269</ENT> <ENT>.42611</ENT> <ENT>.41969</ENT> <ENT>.41344</ENT> <ENT>.40733</ENT> <ENT>.40138</ENT> <ENT>.39558</ENT> <ENT>.38991</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.46218</ENT> <ENT>.45527</ENT> <ENT>.44854</ENT> <ENT>.44197</ENT> <ENT>.43556</ENT> <ENT>.42931</ENT> <ENT>.42321</ENT> <ENT>.41725</ENT> <ENT>.41143</ENT> <ENT>.40575</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.47823</ENT> <ENT>.47137</ENT> <ENT>.46466</ENT> <ENT>.45812</ENT> <ENT>.45173</ENT> <ENT>.44549</ENT> <ENT>.43940</ENT> <ENT>.43345</ENT> <ENT>.42763</ENT> <ENT>.42195</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.49459</ENT> <ENT>.48777</ENT> <ENT>.48112</ENT> <ENT>.47462</ENT> <ENT>.46826</ENT> <ENT>.46205</ENT> <ENT>.45598</ENT> <ENT>.45004</ENT> <ENT>.44424</ENT> <ENT>.43856</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.51127</ENT> <ENT>.50452</ENT> <ENT>.49793</ENT> <ENT>.49148</ENT> <ENT>.48517</ENT> <ENT>.47900</ENT> <ENT>.47297</ENT> <ENT>.46706</ENT> <ENT>.46129</ENT> <ENT>.45563</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.52823</ENT> <ENT>.52157</ENT> <ENT>.51505</ENT> <ENT>.50867</ENT> <ENT>.50243</ENT> <ENT>.49632</ENT> <ENT>.49033</ENT> <ENT>.48447</ENT> <ENT>.47873</ENT> <ENT>.47311</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.54541</ENT> <ENT>.53885</ENT> <ENT>.53242</ENT> <ENT>.52613</ENT> <ENT>.51996</ENT> <ENT>.51392</ENT> <ENT>.50800</ENT> <ENT>.50220</ENT> <ENT>.49652</ENT> <ENT>.49094</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.56267</ENT> <ENT>.55621</ENT> <ENT>.54989</ENT> <ENT>.54369</ENT> <ENT>.53762</ENT> <ENT>.53166</ENT> <ENT>.52582</ENT> <ENT>.52009</ENT> <ENT>.51448</ENT> <ENT>.50897</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.57987</ENT> <ENT>.57354</ENT> <ENT>.56733</ENT> <ENT>.56125</ENT> <ENT>.55527</ENT> <ENT>.54941</ENT> <ENT>.54366</ENT> <ENT>.53802</ENT> <ENT>.53248</ENT> <ENT>.52705</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.59685</ENT> <ENT>.59065</ENT> <ENT>.58457</ENT> <ENT>.57860</ENT> <ENT>.57274</ENT> <ENT>.56699</ENT> <ENT>.56134</ENT> <ENT>.55579</ENT> <ENT>.55035</ENT> <ENT>.54499</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.61351</ENT> <ENT>.60746</ENT> <ENT>.60151</ENT> <ENT>.59567</ENT> <ENT>.58993</ENT> <ENT>.58429</ENT> <ENT>.57875</ENT> <ENT>.57331</ENT> <ENT>.56796</ENT> <ENT>.56270</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.62978</ENT> <ENT>.62387</ENT> <ENT>.61806</ENT> <ENT>.61236</ENT> <ENT>.60675</ENT> <ENT>.60123</ENT> <ENT>.59581</ENT> <ENT>.59047</ENT> <ENT>.58523</ENT> <ENT>.58007</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.64567</ENT> <ENT>.63992</ENT> <ENT>.63426</ENT> <ENT>.62869</ENT> <ENT>.62321</ENT> <ENT>.61783</ENT> <ENT>.61253</ENT> <ENT>.60731</ENT> <ENT>.60218</ENT> <ENT>.59713</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.66125</ENT> <ENT>.65565</ENT> <ENT>.65014</ENT> <ENT>.64472</ENT> <ENT>.63938</ENT> <ENT>.63413</ENT> <ENT>.62896</ENT> <ENT>.62387</ENT> <ENT>.61886</ENT> <ENT>.61392</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.67636</ENT> <ENT>.67092</ENT> <ENT>.66557</ENT> <ENT>.66030</ENT> <ENT>.65511</ENT> <ENT>.65000</ENT> <ENT>.64496</ENT> <ENT>.64000</ENT> <ENT>.63511</ENT> <ENT>.63030</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.69081</ENT> <ENT>.68554</ENT> <ENT>.68034</ENT> <ENT>.67522</ENT> <ENT>.67018</ENT> <ENT>.66520</ENT> <ENT>.66031</ENT> <ENT>.65548</ENT> <ENT>.65071</ENT> <ENT>.64602</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.70468</ENT> <ENT>.69957</ENT> <ENT>.69453</ENT> <ENT>.68956</ENT> <ENT>.68466</ENT> <ENT>.67983</ENT> <ENT>.67507</ENT> <ENT>.67037</ENT> <ENT>.66574</ENT> <ENT>.66117</ENT> </ROW> <ROW> <PRTPAGE P="82"/> <ENT I="01">89</ENT> <ENT>.71821</ENT> <ENT>.71326</ENT> <ENT>.70838</ENT> <ENT>.70357</ENT> <ENT>.69882</ENT> <ENT>.69414</ENT> <ENT>.68952</ENT> <ENT>.68495</ENT> <ENT>.68045</ENT> <ENT>.67601</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.73153</ENT> <ENT>.72676</ENT> <ENT>.72204</ENT> <ENT>.71739</ENT> <ENT>.71280</ENT> <ENT>.70827</ENT> <ENT>.70379</ENT> <ENT>.69938</ENT> <ENT>.69502</ENT> <ENT>.69071</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.74447</ENT> <ENT>.73986</ENT> <ENT>.73532</ENT> <ENT>.73083</ENT> <ENT>.72640</ENT> <ENT>.72202</ENT> <ENT>.71770</ENT> <ENT>.71343</ENT> <ENT>.70921</ENT> <ENT>.70504</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.75669</ENT> <ENT>.75225</ENT> <ENT>.74787</ENT> <ENT>.74354</ENT> <ENT>.73927</ENT> <ENT>.73504</ENT> <ENT>.73087</ENT> <ENT>.72674</ENT> <ENT>.72267</ENT> <ENT>.71864</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.76807</ENT> <ENT>.76379</ENT> <ENT>.75957</ENT> <ENT>.75540</ENT> <ENT>.75127</ENT> <ENT>.74719</ENT> <ENT>.74317</ENT> <ENT>.73918</ENT> <ENT>.73524</ENT> <ENT>.73135</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.77849</ENT> <ENT>.77437</ENT> <ENT>.77030</ENT> <ENT>.76627</ENT> <ENT>.76229</ENT> <ENT>.75835</ENT> <ENT>.75446</ENT> <ENT>.75061</ENT> <ENT>.74680</ENT> <ENT>.74303</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.78792</ENT> <ENT>.78394</ENT> <ENT>.78001</ENT> <ENT>.77611</ENT> <ENT>.77226</ENT> <ENT>.76845</ENT> <ENT>.76468</ENT> <ENT>.76096</ENT> <ENT>.75727</ENT> <ENT>.75362</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.79630</ENT> <ENT>.79244</ENT> <ENT>.78863</ENT> <ENT>.78485</ENT> <ENT>.78112</ENT> <ENT>.77742</ENT> <ENT>.77377</ENT> <ENT>.77015</ENT> <ENT>.76657</ENT> <ENT>.76303</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.80391</ENT> <ENT>.80016</ENT> <ENT>.79646</ENT> <ENT>.79280</ENT> <ENT>.78917</ENT> <ENT>.78559</ENT> <ENT>.78203</ENT> <ENT>.77852</ENT> <ENT>.77504</ENT> <ENT>.77160</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.81076</ENT> <ENT>.80712</ENT> <ENT>.80352</ENT> <ENT>.79996</ENT> <ENT>.79643</ENT> <ENT>.79294</ENT> <ENT>.78948</ENT> <ENT>.78606</ENT> <ENT>.78267</ENT> <ENT>.77931</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.81709</ENT> <ENT>.81354</ENT> <ENT>.81004</ENT> <ENT>.80657</ENT> <ENT>.80313</ENT> <ENT>.79972</ENT> <ENT>.79635</ENT> <ENT>.79302</ENT> <ENT>.78971</ENT> <ENT>.78644</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.82296</ENT> <ENT>.81950</ENT> <ENT>.81609</ENT> <ENT>.81270</ENT> <ENT>.80934</ENT> <ENT>.80602</ENT> <ENT>.80273</ENT> <ENT>.79947</ENT> <ENT>.79624</ENT> <ENT>.79304</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.82855</ENT> <ENT>.82518</ENT> <ENT>.82185</ENT> <ENT>.81854</ENT> <ENT>.81526</ENT> <ENT>.81201</ENT> <ENT>.80880</ENT> <ENT>.80561</ENT> <ENT>.80245</ENT> <ENT>.79932</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.83438</ENT> <ENT>.83110</ENT> <ENT>.82785</ENT> <ENT>.82462</ENT> <ENT>.82142</ENT> <ENT>.81826</ENT> <ENT>.81512</ENT> <ENT>.81200</ENT> <ENT>.80892</ENT> <ENT>.80586</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.84056</ENT> <ENT>.83737</ENT> <ENT>.83420</ENT> <ENT>.83106</ENT> <ENT>.82795</ENT> <ENT>.82487</ENT> <ENT>.82181</ENT> <ENT>.81878</ENT> <ENT>.81577</ENT> <ENT>.81279</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.84743</ENT> <ENT>.84433</ENT> <ENT>.84127</ENT> <ENT>.83822</ENT> <ENT>.83521</ENT> <ENT>.83221</ENT> <ENT>.82924</ENT> <ENT>.82630</ENT> <ENT>.82338</ENT> <ENT>.82048</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.85591</ENT> <ENT>.85295</ENT> <ENT>.85001</ENT> <ENT>.84709</ENT> <ENT>.84419</ENT> <ENT>.84132</ENT> <ENT>.83846</ENT> <ENT>.83563</ENT> <ENT>.83282</ENT> <ENT>.83003</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.86816</ENT> <ENT>.86540</ENT> <ENT>.86266</ENT> <ENT>.85993</ENT> <ENT>.85723</ENT> <ENT>.85454</ENT> <ENT>.85187</ENT> <ENT>.84922</ENT> <ENT>.84659</ENT> <ENT>.84397</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.88592</ENT> <ENT>.88348</ENT> <ENT>.88105</ENT> <ENT>.87863</ENT> <ENT>.87623</ENT> <ENT>.87384</ENT> <ENT>.87147</ENT> <ENT>.86911</ENT> <ENT>.86676</ENT> <ENT>.86443</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.91493</ENT> <ENT>.91306</ENT> <ENT>.91119</ENT> <ENT>.90934</ENT> <ENT>.90749</ENT> <ENT>.90566</ENT> <ENT>.90383</ENT> <ENT>.90201</ENT> <ENT>.90020</ENT> <ENT>.89840</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96211</ENT> <ENT>.96125</ENT> <ENT>.96041</ENT> <ENT>.95956</ENT> <ENT>.95872</ENT> <ENT>.95788</ENT> <ENT>.95704</ENT> <ENT>.95620</ENT> <ENT>.95537</ENT> <ENT>.95455</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table S—Based on Life Table 80CNSMT Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989, Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01891</ENT> <ENT>.01864</ENT> <ENT>.01838</ENT> <ENT>.01814</ENT> <ENT>.01791</ENT> <ENT>.01770</ENT> <ENT>.01750</ENT> <ENT>.01732</ENT> <ENT>.01715</ENT> <ENT>.01698</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00770</ENT> <ENT>.00741</ENT> <ENT>.00715</ENT> <ENT>.00690</ENT> <ENT>.00667</ENT> <ENT>.00646</ENT> <ENT>.00626</ENT> <ENT>.00608</ENT> <ENT>.00590</ENT> <ENT>.00574</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00751</ENT> <ENT>.00721</ENT> <ENT>.00693</ENT> <ENT>.00667</ENT> <ENT>.00643</ENT> <ENT>.00620</ENT> <ENT>.00600</ENT> <ENT>.00580</ENT> <ENT>.00562</ENT> <ENT>.00544</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00760</ENT> <ENT>.00728</ENT> <ENT>.00699</ENT> <ENT>.00671</ENT> <ENT>.00646</ENT> <ENT>.00622</ENT> <ENT>.00600</ENT> <ENT>.00579</ENT> <ENT>.00560</ENT> <ENT>.00541</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00786</ENT> <ENT>.00752</ENT> <ENT>.00721</ENT> <ENT>.00692</ENT> <ENT>.00665</ENT> <ENT>.00639</ENT> <ENT>.00616</ENT> <ENT>.00594</ENT> <ENT>.00573</ENT> <ENT>.00554</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00824</ENT> <ENT>.00788</ENT> <ENT>.00755</ENT> <ENT>.00724</ENT> <ENT>.00695</ENT> <ENT>.00668</ENT> <ENT>.00643</ENT> <ENT>.00620</ENT> <ENT>.00598</ENT> <ENT>.00578</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00869</ENT> <ENT>.00832</ENT> <ENT>.00796</ENT> <ENT>.00764</ENT> <ENT>.00733</ENT> <ENT>.00705</ENT> <ENT>.00678</ENT> <ENT>.00654</ENT> <ENT>.00630</ENT> <ENT>.00608</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00923</ENT> <ENT>.00883</ENT> <ENT>.00846</ENT> <ENT>.00811</ENT> <ENT>.00779</ENT> <ENT>.00749</ENT> <ENT>.00720</ENT> <ENT>.00694</ENT> <ENT>.00669</ENT> <ENT>.00646</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00986</ENT> <ENT>.00943</ENT> <ENT>.00904</ENT> <ENT>.00867</ENT> <ENT>.00833</ENT> <ENT>.00801</ENT> <ENT>.00771</ENT> <ENT>.00743</ENT> <ENT>.00716</ENT> <ENT>.00692</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01059</ENT> <ENT>.01014</ENT> <ENT>.00972</ENT> <ENT>.00933</ENT> <ENT>.00897</ENT> <ENT>.00863</ENT> <ENT>.00831</ENT> <ENT>.00801</ENT> <ENT>.00773</ENT> <ENT>.00747</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01142</ENT> <ENT>.01095</ENT> <ENT>.01051</ENT> <ENT>.01009</ENT> <ENT>.00971</ENT> <ENT>.00935</ENT> <ENT>.00901</ENT> <ENT>.00869</ENT> <ENT>.00840</ENT> <ENT>.00812</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01239</ENT> <ENT>.01189</ENT> <ENT>.01142</ENT> <ENT>.01098</ENT> <ENT>.01057</ENT> 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<ENT>.62555</ENT> <ENT>.62088</ENT> <ENT>.61627</ENT> <ENT>.61173</ENT> <ENT>.60725</ENT> <ENT>.60284</ENT> <ENT>.59849</ENT> <ENT>.59420</ENT> <ENT>.58997</ENT> <ENT>.58580</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.64139</ENT> <ENT>.63683</ENT> <ENT>.63233</ENT> <ENT>.62790</ENT> <ENT>.62352</ENT> <ENT>.61921</ENT> <ENT>.61495</ENT> <ENT>.61076</ENT> <ENT>.60661</ENT> <ENT>.60253</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.65666</ENT> <ENT>.65221</ENT> <ENT>.64783</ENT> <ENT>.64350</ENT> <ENT>.63923</ENT> <ENT>.63502</ENT> <ENT>.63086</ENT> <ENT>.62675</ENT> <ENT>.62270</ENT> <ENT>.61871</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.67163</ENT> <ENT>.66730</ENT> <ENT>.66304</ENT> <ENT>.65882</ENT> <ENT>.65466</ENT> <ENT>.65055</ENT> <ENT>.64650</ENT> <ENT>.64249</ENT> <ENT>.63854</ENT> <ENT>.63463</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.68646</ENT> <ENT>.68226</ENT> <ENT>.67812</ENT> <ENT>.67402</ENT> <ENT>.66998</ENT> <ENT>.66599</ENT> <ENT>.66204</ENT> <ENT>.65814</ENT> <ENT>.65430</ENT> <ENT>.65049</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.70093</ENT> <ENT>.69686</ENT> <ENT>.69285</ENT> <ENT>.68888</ENT> <ENT>.68496</ENT> <ENT>.68108</ENT> <ENT>.67725</ENT> <ENT>.67347</ENT> <ENT>.66973</ENT> <ENT>.66604</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.71466</ENT> <ENT>.71073</ENT> <ENT>.70684</ENT> <ENT>.70300</ENT> <ENT>.69920</ENT> <ENT>.69545</ENT> <ENT>.69173</ENT> <ENT>.68806</ENT> <ENT>.68444</ENT> <ENT>.68085</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.72750</ENT> <ENT>.72370</ENT> <ENT>.71994</ENT> <ENT>.71622</ENT> <ENT>.71254</ENT> <ENT>.70890</ENT> <ENT>.70530</ENT> <ENT>.70174</ENT> <ENT>.69822</ENT> <ENT>.69474</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.73931</ENT> <ENT>.73562</ENT> <ENT>.73198</ENT> <ENT>.72838</ENT> <ENT>.72481</ENT> <ENT>.72129</ENT> <ENT>.71780</ENT> <ENT>.71434</ENT> <ENT>.71093</ENT> <ENT>.70755</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.75001</ENT> <ENT>.74644</ENT> <ENT>.74291</ENT> <ENT>.73941</ENT> <ENT>.73595</ENT> <ENT>.73253</ENT> <ENT>.72914</ENT> <ENT>.72579</ENT> <ENT>.72247</ENT> <ENT>.71919</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.75953</ENT> <ENT>.75606</ENT> <ENT>.75262</ENT> <ENT>.74923</ENT> <ENT>.74586</ENT> <ENT>.74253</ENT> <ENT>.73924</ENT> <ENT>.73598</ENT> <ENT>.73275</ENT> <ENT>.72955</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.76819</ENT> <ENT>.76481</ENT> <ENT>.76147</ENT> <ENT>.75816</ENT> <ENT>.75489</ENT> <ENT>.75165</ENT> <ENT>.74844</ENT> <ENT>.74526</ENT> <ENT>.74211</ENT> <ENT>.73899</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.77599</ENT> <ENT>.77270</ENT> <ENT>.76944</ENT> <ENT>.76621</ENT> <ENT>.76302</ENT> <ENT>.75986</ENT> <ENT>.75672</ENT> <ENT>.75362</ENT> <ENT>.75054</ENT> <ENT>.74750</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.78319</ENT> <ENT>.77998</ENT> <ENT>.77680</ENT> <ENT>.77365</ENT> <ENT>.77053</ENT> <ENT>.76744</ENT> <ENT>.76437</ENT> <ENT>.76134</ENT> <ENT>.75833</ENT> <ENT>.75535</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.78987</ENT> <ENT>.78673</ENT> <ENT>.78362</ENT> <ENT>.78054</ENT> <ENT>.77748</ENT> <ENT>.77446</ENT> <ENT>.77146</ENT> <ENT>.76849</ENT> <ENT>.76555</ENT> <ENT>.76263</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.79622</ENT> <ENT>.79315</ENT> <ENT>.79010</ENT> <ENT>.78708</ENT> <ENT>.78409</ENT> <ENT>.78113</ENT> <ENT>.77819</ENT> <ENT>.77528</ENT> <ENT>.77239</ENT> <ENT>.76953</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.80283</ENT> <ENT>.79983</ENT> <ENT>.79685</ENT> <ENT>.79390</ENT> <ENT>.79097</ENT> <ENT>.78807</ENT> <ENT>.78519</ENT> <ENT>.78234</ENT> <ENT>.77951</ENT> <ENT>.77671</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.80983</ENT> <ENT>.80690</ENT> <ENT>.80399</ENT> <ENT>.80111</ENT> <ENT>.79825</ENT> <ENT>.79541</ENT> <ENT>.79260</ENT> <ENT>.78981</ENT> <ENT>.78705</ENT> <ENT>.78430</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.81760</ENT> <ENT>.81475</ENT> <ENT>.81192</ENT> <ENT>.80912</ENT> <ENT>.80633</ENT> <ENT>.80357</ENT> <ENT>.80083</ENT> <ENT>.79810</ENT> <ENT>.79541</ENT> <ENT>.79273</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.82726</ENT> <ENT>.82451</ENT> <ENT>.82178</ENT> <ENT>.81907</ENT> <ENT>.81638</ENT> <ENT>.81371</ENT> <ENT>.81106</ENT> <ENT>.80843</ENT> <ENT>.80582</ENT> <ENT>.80322</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.84137</ENT> <ENT>.83879</ENT> <ENT>.83623</ENT> <ENT>.83368</ENT> <ENT>.83115</ENT> <ENT>.82863</ENT> <ENT>.82614</ENT> <ENT>.82366</ENT> <ENT>.82119</ENT> <ENT>.81874</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.86211</ENT> <ENT>.85981</ENT> <ENT>.85751</ENT> <ENT>.85523</ENT> <ENT>.85297</ENT> <ENT>.85071</ENT> <ENT>.84847</ENT> <ENT>.84624</ENT> <ENT>.84403</ENT> <ENT>.84182</ENT> </ROW> <ROW> <PRTPAGE P="84"/> <ENT I="01">108</ENT> <ENT>.89660</ENT> <ENT>.89481</ENT> <ENT>.89304</ENT> <ENT>.89127</ENT> <ENT>.88950</ENT> <ENT>.88775</ENT> <ENT>.88601</ENT> <ENT>.88427</ENT> <ENT>.88254</ENT> <ENT>.88081</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95372</ENT> <ENT>.95290</ENT> <ENT>.95208</ENT> <ENT>.95126</ENT> <ENT>.95045</ENT> <ENT>.94964</ENT> <ENT>.94883</ENT> <ENT>.94803</ENT> <ENT>.94723</ENT> <ENT>.94643</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table S—Based on Life Table 80CNSMT Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989, and Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01683</ENT> <ENT>.01669</ENT> <ENT>.01655</ENT> <ENT>.01642</ENT> <ENT>.01630</ENT> <ENT>.01618</ENT> <ENT>.01607</ENT> <ENT>.01596</ENT> <ENT>.01586</ENT> <ENT>.01576</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00559</ENT> <ENT>.00544</ENT> <ENT>.00531</ENT> <ENT>.00518</ENT> <ENT>.00506</ENT> <ENT>.00494</ENT> <ENT>.00484</ENT> <ENT>.00473</ENT> <ENT>.00464</ENT> <ENT>.00454</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00528</ENT> <ENT>.00513</ENT> <ENT>.00499</ENT> <ENT>.00485</ENT> <ENT>.00473</ENT> <ENT>.00461</ENT> <ENT>.00449</ENT> <ENT>.00439</ENT> <ENT>.00428</ENT> <ENT>.00419</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00524</ENT> <ENT>.00508</ENT> <ENT>.00493</ENT> <ENT>.00479</ENT> <ENT>.00465</ENT> <ENT>.00453</ENT> <ENT>.00441</ENT> <ENT>.00429</ENT> <ENT>.00419</ENT> <ENT>.00408</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00536</ENT> <ENT>.00519</ENT> <ENT>.00503</ENT> <ENT>.00488</ENT> <ENT>.00473</ENT> <ENT>.00460</ENT> <ENT>.00447</ENT> <ENT>.00435</ENT> <ENT>.00423</ENT> <ENT>.00412</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00558</ENT> <ENT>.00540</ENT> <ENT>.00523</ENT> <ENT>.00507</ENT> <ENT>.00492</ENT> <ENT>.00477</ENT> <ENT>.00464</ENT> <ENT>.00451</ENT> <ENT>.00439</ENT> <ENT>.00427</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00588</ENT> <ENT>.00569</ENT> <ENT>.00550</ENT> <ENT>.00533</ENT> <ENT>.00517</ENT> <ENT>.00502</ENT> <ENT>.00487</ENT> <ENT>.00473</ENT> <ENT>.00460</ENT> <ENT>.00448</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00624</ENT> <ENT>.00604</ENT> <ENT>.00584</ENT> <ENT>.00566</ENT> <ENT>.00549</ENT> <ENT>.00532</ENT> <ENT>.00517</ENT> <ENT>.00502</ENT> <ENT>.00488</ENT> <ENT>.00475</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00668</ENT> <ENT>.00646</ENT> <ENT>.00626</ENT> <ENT>.00606</ENT> <ENT>.00588</ENT> <ENT>.00570</ENT> <ENT>.00554</ENT> <ENT>.00538</ENT> <ENT>.00523</ENT> <ENT>.00509</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00722</ENT> <ENT>.00699</ENT> <ENT>.00677</ENT> <ENT>.00656</ENT> <ENT>.00636</ENT> <ENT>.00617</ENT> <ENT>.00600</ENT> <ENT>.00583</ENT> <ENT>.00567</ENT> <ENT>.00552</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00785</ENT> <ENT>.00761</ENT> <ENT>.00737</ENT> <ENT>.00715</ENT> <ENT>.00694</ENT> <ENT>.00674</ENT> <ENT>.00655</ENT> <ENT>.00637</ENT> <ENT>.00620</ENT> <ENT>.00604</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00861</ENT> <ENT>.00835</ENT> <ENT>.00810</ENT> <ENT>.00786</ENT> <ENT>.00764</ENT> <ENT>.00743</ENT> <ENT>.00723</ENT> <ENT>.00704</ENT> <ENT>.00686</ENT> <ENT>.00668</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00946</ENT> <ENT>.00918</ENT> <ENT>.00891</ENT> <ENT>.00866</ENT> <ENT>.00843</ENT> <ENT>.00820</ENT> <ENT>.00799</ENT> <ENT>.00779</ENT> <ENT>.00760</ENT> <ENT>.00741</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01035</ENT> <ENT>.01006</ENT> <ENT>.00978</ENT> <ENT>.00951</ENT> <ENT>.00927</ENT> <ENT>.00903</ENT> <ENT>.00880</ENT> <ENT>.00859</ENT> <ENT>.00839</ENT> <ENT>.00819</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01122</ENT> <ENT>.01091</ENT> <ENT>.01061</ENT> <ENT>.01034</ENT> <ENT>.01007</ENT> <ENT>.00982</ENT> <ENT>.00958</ENT> <ENT>.00936</ENT> <ENT>.00914</ENT> <ENT>.00894</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01203</ENT> <ENT>.01171</ENT> <ENT>.01140</ENT> <ENT>.01110</ENT> <ENT>.01082</ENT> <ENT>.01056</ENT> <ENT>.01031</ENT> <ENT>.01007</ENT> <ENT>.00985</ENT> <ENT>.00963</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01279</ENT> <ENT>.01244</ENT> <ENT>.01211</ENT> <ENT>.01181</ENT> <ENT>.01151</ENT> <ENT>.01123</ENT> <ENT>.01097</ENT> <ENT>.01072</ENT> <ENT>.01048</ENT> <ENT>.01025</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01347</ENT> <ENT>.01311</ENT> <ENT>.01276</ENT> <ENT>.01244</ENT> <ENT>.01213</ENT> <ENT>.01184</ENT> <ENT>.01156</ENT> <ENT>.01130</ENT> <ENT>.01104</ENT> <ENT>.01081</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01411</ENT> <ENT>.01373</ENT> <ENT>.01336</ENT> <ENT>.01302</ENT> <ENT>.01270</ENT> <ENT>.01239</ENT> <ENT>.01210</ENT> <ENT>.01182</ENT> <ENT>.01155</ENT> <ENT>.01130</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01474</ENT> <ENT>.01434</ENT> <ENT>.01396</ENT> <ENT>.01359</ENT> <ENT>.01325</ENT> <ENT>.01293</ENT> <ENT>.01262</ENT> <ENT>.01233</ENT> <ENT>.01205</ENT> <ENT>.01178</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01537</ENT> <ENT>.01494</ENT> <ENT>.01454</ENT> <ENT>.01415</ENT> <ENT>.01379</ENT> <ENT>.01345</ENT> <ENT>.01313</ENT> <ENT>.01282</ENT> <ENT>.01252</ENT> <ENT>.01224</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01598</ENT> <ENT>.01553</ENT> <ENT>.01510</ENT> <ENT>.01470</ENT> <ENT>.01432</ENT> <ENT>.01396</ENT> <ENT>.01361</ENT> <ENT>.01329</ENT> <ENT>.01298</ENT> <ENT>.01268</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01660</ENT> <ENT>.01613</ENT> <ENT>.01568</ENT> <ENT>.01525</ENT> <ENT>.01485</ENT> <ENT>.01446</ENT> <ENT>.01410</ENT> <ENT>.01375</ENT> <ENT>.01343</ENT> <ENT>.01312</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01725</ENT> <ENT>.01674</ENT> <ENT>.01627</ENT> <ENT>.01581</ENT> <ENT>.01539</ENT> <ENT>.01498</ENT> <ENT>.01460</ENT> <ENT>.01423</ENT> <ENT>.01388</ENT> <ENT>.01355</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01796</ENT> <ENT>.01742</ENT> <ENT>.01692</ENT> <ENT>.01644</ENT> <ENT>.01599</ENT> <ENT>.01556</ENT> <ENT>.01515</ENT> <ENT>.01476</ENT> <ENT>.01439</ENT> <ENT>.01404</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.01876</ENT> <ENT>.01819</ENT> <ENT>.01765</ENT> <ENT>.01714</ENT> <ENT>.01666</ENT> <ENT>.01621</ENT> <ENT>.01577</ENT> <ENT>.01536</ENT> <ENT>.01497</ENT> <ENT>.01460</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.01967</ENT> <ENT>.01907</ENT> <ENT>.01850</ENT> <ENT>.01796</ENT> <ENT>.01745</ENT> <ENT>.01696</ENT> <ENT>.01650</ENT> <ENT>.01606</ENT> <ENT>.01565</ENT> <ENT>.01525</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02072</ENT> <ENT>.02008</ENT> <ENT>.01948</ENT> <ENT>.01890</ENT> <ENT>.01836</ENT> <ENT>.01784</ENT> <ENT>.01735</ENT> <ENT>.01688</ENT> <ENT>.01644</ENT> <ENT>.01601</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02190</ENT> <ENT>.02122</ENT> <ENT>.02057</ENT> <ENT>.01996</ENT> <ENT>.01938</ENT> <ENT>.01883</ENT> <ENT>.01831</ENT> <ENT>.01781</ENT> <ENT>.01734</ENT> <ENT>.01689</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02322</ENT> <ENT>.02249</ENT> <ENT>.02181</ENT> <ENT>.02116</ENT> <ENT>.02054</ENT> <ENT>.01996</ENT> <ENT>.01940</ENT> <ENT>.01887</ENT> <ENT>.01836</ENT> <ENT>.01788</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02469</ENT> <ENT>.02392</ENT> <ENT>.02319</ENT> <ENT>.02250</ENT> <ENT>.02184</ENT> <ENT>.02122</ENT> <ENT>.02062</ENT> <ENT>.02006</ENT> <ENT>.01952</ENT> <ENT>.01900</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02634</ENT> <ENT>.02552</ENT> <ENT>.02475</ENT> <ENT>.02401</ENT> <ENT>.02331</ENT> <ENT>.02264</ENT> <ENT>.02201</ENT> <ENT>.02140</ENT> <ENT>.02083</ENT> <ENT>.02028</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.02816</ENT> <ENT>.02729</ENT> <ENT>.02647</ENT> <ENT>.02568</ENT> <ENT>.02494</ENT> <ENT>.02423</ENT> <ENT>.02355</ENT> <ENT>.02291</ENT> <ENT>.02229</ENT> <ENT>.02170</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.03018</ENT> <ENT>.02926</ENT> <ENT>.02838</ENT> <ENT>.02755</ENT> <ENT>.02675</ENT> <ENT>.02600</ENT> <ENT>.02528</ENT> <ENT>.02459</ENT> <ENT>.02393</ENT> <ENT>.02331</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.03239</ENT> <ENT>.03142</ENT> <ENT>.03048</ENT> <ENT>.02960</ENT> <ENT>.02875</ENT> <ENT>.02795</ENT> <ENT>.02718</ENT> <ENT>.02645</ENT> <ENT>.02575</ENT> <ENT>.02508</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.03482</ENT> <ENT>.03378</ENT> <ENT>.03279</ENT> <ENT>.03185</ENT> <ENT>.03095</ENT> <ENT>.03009</ENT> <ENT>.02928</ENT> <ENT>.02850</ENT> <ENT>.02775</ENT> <ENT>.02704</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.03743</ENT> <ENT>.03633</ENT> <ENT>.03528</ENT> <ENT>.03428</ENT> <ENT>.03333</ENT> <ENT>.03242</ENT> <ENT>.03155</ENT> <ENT>.03072</ENT> <ENT>.02992</ENT> <ENT>.02916</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.04026</ENT> <ENT>.03909</ENT> <ENT>.03798</ENT> <ENT>.03692</ENT> <ENT>.03591</ENT> <ENT>.03494</ENT> <ENT>.03401</ENT> <ENT>.03313</ENT> <ENT>.03228</ENT> <ENT>.03147</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.04330</ENT> <ENT>.04207</ENT> <ENT>.04089</ENT> <ENT>.03977</ENT> <ENT>.03869</ENT> <ENT>.03767</ENT> <ENT>.03668</ENT> <ENT>.03574</ENT> <ENT>.03484</ENT> <ENT>.03398</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.04658</ENT> <ENT>.04528</ENT> <ENT>.04403</ENT> <ENT>.04284</ENT> <ENT>.04170</ENT> <ENT>.04061</ENT> <ENT>.03957</ENT> <ENT>.03857</ENT> <ENT>.03762</ENT> <ENT>.03670</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.05011</ENT> <ENT>.04873</ENT> <ENT>.04741</ENT> <ENT>.04615</ENT> <ENT>.04495</ENT> <ENT>.04379</ENT> <ENT>.04269</ENT> <ENT>.04163</ENT> <ENT>.04061</ENT> <ENT>.03964</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.05389</ENT> <ENT>.05244</ENT> <ENT>.05104</ENT> <ENT>.04971</ENT> <ENT>.04844</ENT> <ENT>.04721</ENT> <ENT>.04604</ENT> <ENT>.04492</ENT> <ENT>.04384</ENT> <ENT>.04281</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.05791</ENT> <ENT>.05638</ENT> <ENT>.05491</ENT> <ENT>.05350</ENT> <ENT>.05216</ENT> <ENT>.05086</ENT> <ENT>.04962</ENT> <ENT>.04844</ENT> <ENT>.04729</ENT> <ENT>.04620</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.06219</ENT> <ENT>.06057</ENT> <ENT>.05902</ENT> <ENT>.05754</ENT> <ENT>.05612</ENT> <ENT>.05475</ENT> <ENT>.05344</ENT> <ENT>.05218</ENT> <ENT>.05098</ENT> <ENT>.04981</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.06673</ENT> <ENT>.06503</ENT> <ENT>.06340</ENT> <ENT>.06184</ENT> <ENT>.06034</ENT> <ENT>.05890</ENT> <ENT>.05752</ENT> <ENT>.05619</ENT> <ENT>.05491</ENT> <ENT>.05368</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.07157</ENT> <ENT>.06978</ENT> <ENT>.06806</ENT> <ENT>.06642</ENT> <ENT>.06484</ENT> <ENT>.06332</ENT> <ENT>.06186</ENT> <ENT>.06046</ENT> <ENT>.05911</ENT> <ENT>.05781</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.07669</ENT> <ENT>.07481</ENT> <ENT>.07301</ENT> <ENT>.07128</ENT> <ENT>.06962</ENT> <ENT>.06802</ENT> <ENT>.06649</ENT> <ENT>.06501</ENT> <ENT>.06358</ENT> <ENT>.06221</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.08212</ENT> <ENT>.08015</ENT> <ENT>.07826</ENT> <ENT>.07645</ENT> <ENT>.07470</ENT> <ENT>.07302</ENT> <ENT>.07140</ENT> <ENT>.06984</ENT> <ENT>.06834</ENT> <ENT>.06690</ENT> 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<ENT>.76058</ENT> <ENT>.75805</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.79007</ENT> <ENT>.78743</ENT> <ENT>.78482</ENT> <ENT>.78222</ENT> <ENT>.77964</ENT> <ENT>.77709</ENT> <ENT>.77455</ENT> <ENT>.77203</ENT> <ENT>.76953</ENT> <ENT>.76705</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.80065</ENT> <ENT>.79809</ENT> <ENT>.79556</ENT> <ENT>.79304</ENT> <ENT>.79054</ENT> <ENT>.78805</ENT> <ENT>.78559</ENT> <ENT>.78314</ENT> <ENT>.78071</ENT> <ENT>.77829</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.81631</ENT> <ENT>.81389</ENT> <ENT>.81149</ENT> <ENT>.80911</ENT> <ENT>.80674</ENT> <ENT>.80438</ENT> <ENT>.80204</ENT> <ENT>.79972</ENT> <ENT>.79741</ENT> <ENT>.79511</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.83963</ENT> <ENT>.83745</ENT> <ENT>.83529</ENT> <ENT>.83313</ENT> <ENT>.83099</ENT> <ENT>.82886</ENT> <ENT>.82674</ENT> <ENT>.82463</ENT> <ENT>.82254</ENT> <ENT>.82045</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.87910</ENT> <ENT>.87739</ENT> <ENT>.87569</ENT> <ENT>.87400</ENT> <ENT>.87232</ENT> <ENT>.87064</ENT> <ENT>.86897</ENT> <ENT>.86731</ENT> <ENT>.86566</ENT> <ENT>.86401</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94563</ENT> <ENT>.94484</ENT> <ENT>.94405</ENT> <ENT>.94326</ENT> <ENT>.94248</ENT> <ENT>.94170</ENT> <ENT>.94092</ENT> <ENT>.94014</ENT> <ENT>.93937</ENT> <ENT>.93860</ENT> </ROW> </GPOTABLE> <P> (f) <E T="03">Present value of the remainder interest in the case of transfers to pooled income funds for which the valuation date is after April 30, 1999, and before May 1, 2009</E> —(1) <E T="03">In general.</E> In the case of transfers to pooled income funds for which the valuation date is after April 30, 1999, and before May 1, 2009, the present value of a remainder interest is determined under this section. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). The present value of a remainder interest that is dependent on the termination of the life of one individual is computed by the use of Table S in paragraph (f)(6) of this section. For purposes of the computations under this section, the age of an <PRTPAGE P="86"/> individual is the age at the individual's nearest birthday. </P> <P> (2) <E T="03">Transitional rules for valuation of transfers to pooled income funds.</E> (i) For purposes of sections 2055, 2106, or 2624, if on May 1, 1999, the decedent was mentally incompetent so that the disposition of the property could not be changed, and the decedent died after April 30, 1999, without having regained competency to dispose of the decedent's property, or the decedent died within 90 days of the date that the decedent first regained competency after April 30, 1999, the present value of a remainder interest is determined as if the valuation date with respect to the decedent's gross estate is either before May 1, 1999, or after April 30, 1999, at the option of the decedent's executor. </P> <P>(ii) For purposes of sections 170, 2055, 2106, 2522, or 2624, in the case of transfers to a pooled income fund for which the valuation date is after April 30, 1999, and before July 1, 1999, the present value of the remainder interest under this section is determined by use of the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial tables under either paragraph (e)(5) or (f)(6) of this section, at the option of the donor or the decedent's executor, as the case may be.</P> <P>(iii) For purposes of paragraphs (f)(2)(i) and (f)(2)(ii) of this section, where the donor or decedent's executor is given the option to use the appropriate actuarial tables under either paragraph (e)(5) or (f)(6) of this section, the donor or decedent's executor must use the same actuarial table with respect to each individual transaction and with respect to all transfers occurring on the valuation date (for example, gift and income tax charitable deductions with respect to the same transfer must be determined based on the same tables, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on the same tables).</P> <P> (3) <E T="03">Present value of a remainder interest.</E> The present value of a remainder interest in property transferred to a pooled income fund is computed on the basis of— </P> <P> (i) Life contingencies determined from the values of <E T="03">lx</E> that are set forth in Table 90CM in § 20.2031-7A(f)(4); and </P> <P>(ii) Discount at a rate of interest, compounded annually, equal to the highest yearly rate of return of the pooled income fund for the 3 taxable years immediately preceding its taxable year in which the transfer of property to the fund is made. The provisions of § 1.642(c)-6(c) apply for determining the yearly rate of return. However, where the taxable year is less than 12 months, the provisions of § 1.642(c)-6(e)(3)(ii) apply for the determining the yearly rate of return.</P> <P> (4) <E T="03">Pooled income funds in existence less than 3 taxable years.</E> The provisions of § 1.642(c)-6(e)(4) apply for determining the highest yearly rate of return when the pooled income fund has been in existence less than 3 taxable years. </P> <P> (5) <E T="03">Computation of value of remainder interest.</E> The factor that is used in determining the present value of a remainder interest that is dependent on the termination of the life of one individual is the factor from Table S in paragraph (f)(6) of this section under the appropriate yearly rate of return opposite the number that corresponds to the age of the individual upon whose life the value of the remainder interest is based. Table S in paragraph (f)(6) of this section includes factors for yearly rates of return from 4.2 to 14 percent. Many actuarial factors not contained in Table S in paragraph (f)(6) of this section are contained in Table S in Internal Revenue Service Publication 1457, “Actuarial Values, Book Aleph,” (7-99). Publication 1457 is no longer available for purchase from the Superintendent of Documents, United States Government Printing Office. However, pertinent factors in this publication may be obtained by a written request to: CC:PA:LPD:PR (IRS Publication 1457), Room 5205, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. For other situations, see § 1.642(c)-6(b). If the yearly rate of return is a percentage that is between the yearly rates of return for which factors are provided, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the fair market value of the property on the <PRTPAGE P="87"/> valuation date by the appropriate remainder factor. For an example of a computation of the present value of a remainder interest requiring a linear interpolation adjustment, see § 1.642(c)-6(e)(5). </P> <P> (6) <E T="03">Actuarial tables.</E> In the case of transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, the present value of a remainder interest dependent on the termination of one life in the case of a transfer to a pooled income fund is determined by use of the following tables: </P> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table S—Based on Life Table 90CM Single Life Remainder Factors </TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.06752</ENT> <ENT>.06130</ENT> <ENT>.05586</ENT> <ENT>.05109</ENT> <ENT>.04691</ENT> <ENT>.04322</ENT> <ENT>.03998</ENT> <ENT>.03711</ENT> <ENT>.03458</ENT> <ENT>.03233</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.06137</ENT> <ENT>.05495</ENT> <ENT>.04932</ENT> <ENT>.04438</ENT> <ENT>.04003</ENT> <ENT>.03620</ENT> <ENT>.03283</ENT> <ENT>.02985</ENT> <ENT>.02721</ENT> <ENT>.02487</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.06325</ENT> <ENT>.05667</ENT> <ENT>.05088</ENT> <ENT>.04580</ENT> <ENT>.04132</ENT> <ENT>.03737</ENT> <ENT>.03388</ENT> <ENT>.03079</ENT> <ENT>.02806</ENT> <ENT>.02563</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.06545</ENT> <ENT>.05869</ENT> <ENT>.05275</ENT> <ENT>.04752</ENT> <ENT>.04291</ENT> <ENT>.03883</ENT> <ENT>.03523</ENT> <ENT>.03203</ENT> <ENT>.02920</ENT> <ENT>.02668</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.06784</ENT> <ENT>.06092</ENT> <ENT>.05482</ENT> <ENT>.04944</ENT> <ENT>.04469</ENT> <ENT>.04048</ENT> <ENT>.03676</ENT> <ENT>.03346</ENT> <ENT>.03052</ENT> <ENT>.02791</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.07040</ENT> <ENT>.06331</ENT> <ENT>.05705</ENT> <ENT>.05152</ENT> <ENT>.04662</ENT> <ENT>.04229</ENT> <ENT>.03845</ENT> <ENT>.03503</ENT> <ENT>.03199</ENT> <ENT>.02928</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.07310</ENT> <ENT>.06583</ENT> <ENT>.05941</ENT> <ENT>.05372</ENT> <ENT>.04869</ENT> <ENT>.04422</ENT> <ENT>.04025</ENT> <ENT>.03672</ENT> <ENT>.03357</ENT> <ENT>.03076</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.07594</ENT> <ENT>.06849</ENT> <ENT>.06191</ENT> <ENT>.05607</ENT> <ENT>.05089</ENT> <ENT>.04628</ENT> <ENT>.04219</ENT> <ENT>.03854</ENT> <ENT>.03528</ENT> <ENT>.03236</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.07891</ENT> <ENT>.07129</ENT> <ENT>.06453</ENT> <ENT>.05853</ENT> <ENT>.05321</ENT> <ENT>.04846</ENT> <ENT>.04424</ENT> <ENT>.04046</ENT> <ENT>.03709</ENT> <ENT>.03407</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.08203</ENT> <ENT>.07423</ENT> <ENT>.06731</ENT> <ENT>.06115</ENT> <ENT>.05567</ENT> <ENT>.05079</ENT> <ENT>.04643</ENT> <ENT>.04253</ENT> <ENT>.03904</ENT> <ENT>.03592</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.08532</ENT> <ENT>.07734</ENT> <ENT>.07024</ENT> <ENT>.06392</ENT> <ENT>.05829</ENT> <ENT>.05326</ENT> <ENT>.04877</ENT> <ENT>.04474</ENT> <ENT>.04114</ENT> <ENT>.03790</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.08875</ENT> <ENT>.08059</ENT> <ENT>.07331</ENT> <ENT>.06683</ENT> <ENT>.06104</ENT> <ENT>.05587</ENT> <ENT>.05124</ENT> <ENT>.04709</ENT> <ENT>.04336</ENT> <ENT>.04002</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.09233</ENT> <ENT>.08398</ENT> <ENT>.07653</ENT> <ENT>.06989</ENT> <ENT>.06394</ENT> <ENT>.05862</ENT> <ENT>.05385</ENT> <ENT>.04957</ENT> <ENT>.04572</ENT> <ENT>.04226</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.09601</ENT> <ENT>.08748</ENT> <ENT>.07985</ENT> <ENT>.07304</ENT> <ENT>.06693</ENT> <ENT>.06146</ENT> <ENT>.05655</ENT> <ENT>.05214</ENT> <ENT>.04816</ENT> <ENT>.04458</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.09974</ENT> <ENT>.09102</ENT> <ENT>.08322</ENT> <ENT>.07624</ENT> <ENT>.06997</ENT> <ENT>.06435</ENT> <ENT>.05929</ENT> <ENT>.05474</ENT> <ENT>.05064</ENT> <ENT>.04694</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.10350</ENT> <ENT>.09460</ENT> <ENT>.08661</ENT> <ENT>.07946</ENT> <ENT>.07303</ENT> <ENT>.06725</ENT> <ENT>.06204</ENT> <ENT>.05735</ENT> <ENT>.05312</ENT> <ENT>.04930</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.10728</ENT> <ENT>.09818</ENT> <ENT>.09001</ENT> <ENT>.08268</ENT> <ENT>.07608</ENT> <ENT>.07014</ENT> <ENT>.06479</ENT> <ENT>.05996</ENT> <ENT>.05559</ENT> <ENT>.05164</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.11108</ENT> <ENT>.10179</ENT> <ENT>.09344</ENT> <ENT>.08592</ENT> <ENT>.07916</ENT> <ENT>.07306</ENT> <ENT>.06755</ENT> <ENT>.06257</ENT> <ENT>.05807</ENT> <ENT>.05399</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.11494</ENT> <ENT>.10545</ENT> <ENT>.09691</ENT> <ENT>.08921</ENT> <ENT>.08227</ENT> <ENT>.07601</ENT> <ENT>.07034</ENT> <ENT>.06521</ENT> <ENT>.06057</ENT> <ENT>.05636</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.11889</ENT> <ENT>.10921</ENT> <ENT>.10047</ENT> <ENT>.09259</ENT> <ENT>.08548</ENT> <ENT>.07904</ENT> <ENT>.07322</ENT> <ENT>.06794</ENT> <ENT>.06315</ENT> <ENT>.05880</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.12298</ENT> <ENT>.11310</ENT> <ENT>.10417</ENT> <ENT>.09610</ENT> <ENT>.08881</ENT> <ENT>.08220</ENT> <ENT>.07622</ENT> <ENT>.07078</ENT> <ENT>.06584</ENT> <ENT>.06135</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.12722</ENT> <ENT>.11713</ENT> <ENT>.10801</ENT> <ENT>.09976</ENT> <ENT>.09228</ENT> <ENT>.08550</ENT> <ENT>.07935</ENT> <ENT>.07375</ENT> <ENT>.06866</ENT> <ENT>.06403</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.13159</ENT> <ENT>.12130</ENT> <ENT>.11199</ENT> <ENT>.10354</ENT> <ENT>.09588</ENT> <ENT>.08893</ENT> <ENT>.08260</ENT> <ENT>.07685</ENT> <ENT>.07160</ENT> <ENT>.06682</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.13613</ENT> <ENT>.12563</ENT> <ENT>.11612</ENT> <ENT>.10748</ENT> <ENT>.09964</ENT> <ENT>.09250</ENT> <ENT>.08601</ENT> <ENT>.08009</ENT> <ENT>.07468</ENT> <ENT>.06975</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.14084</ENT> <ENT>.13014</ENT> <ENT>.12043</ENT> <ENT>.11160</ENT> <ENT>.10357</ENT> <ENT>.09625</ENT> <ENT>.08958</ENT> <ENT>.08349</ENT> <ENT>.07793</ENT> <ENT>.07284</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.14574</ENT> <ENT>.13484</ENT> <ENT>.12493</ENT> <ENT>.11591</ENT> <ENT>.10768</ENT> <ENT>.10018</ENT> <ENT>.09334</ENT> <ENT>.08708</ENT> <ENT>.08135</ENT> <ENT>.07611</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.15084</ENT> <ENT>.13974</ENT> <ENT>.12963</ENT> <ENT>.12041</ENT> <ENT>.11199</ENT> <ENT>.10431</ENT> <ENT>.09728</ENT> <ENT>.09085</ENT> <ENT>.08496</ENT> <ENT>.07956</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.15615</ENT> <ENT>.14485</ENT> <ENT>.13454</ENT> <ENT>.12513</ENT> <ENT>.11652</ENT> <ENT>.10865</ENT> <ENT>.10144</ENT> <ENT>.09484</ENT> <ENT>.08878</ENT> <ENT>.08322</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.16166</ENT> <ENT>.15016</ENT> <ENT>.13965</ENT> <ENT>.13004</ENT> <ENT>.12124</ENT> <ENT>.11319</ENT> <ENT>.10580</ENT> <ENT>.09901</ENT> <ENT>.09279</ENT> <ENT>.08706</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.16737</ENT> <ENT>.15567</ENT> <ENT>.14497</ENT> <ENT>.13516</ENT> <ENT>.12617</ENT> <ENT>.11792</ENT> <ENT>.11035</ENT> <ENT>.10339</ENT> <ENT>.09699</ENT> <ENT>.09109</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.17328</ENT> <ENT>.16138</ENT> <ENT>.15048</ENT> <ENT>.14047</ENT> <ENT>.13129</ENT> <ENT>.12286</ENT> <ENT>.11510</ENT> <ENT>.10796</ENT> <ENT>.10138</ENT> <ENT>.09532</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.17938</ENT> <ENT>.16728</ENT> <ENT>.15618</ENT> <ENT>.14599</ENT> <ENT>.13661</ENT> <ENT>.12799</ENT> <ENT>.12004</ENT> <ENT>.11272</ENT> <ENT>.10597</ENT> <ENT>.09974</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.18568</ENT> <ENT>.17339</ENT> <ENT>.16210</ENT> <ENT>.15171</ENT> <ENT>.14214</ENT> <ENT>.13333</ENT> <ENT>.12520</ENT> <ENT>.11769</ENT> <ENT>.11076</ENT> <ENT>.10435</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.19220</ENT> <ENT>.17972</ENT> <ENT>.16824</ENT> <ENT>.15766</ENT> <ENT>.14790</ENT> <ENT>.13889</ENT> <ENT>.13058</ENT> <ENT>.12289</ENT> <ENT>.11578</ENT> <ENT>.10920</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.19894</ENT> <ENT>.18627</ENT> <ENT>.17460</ENT> <ENT>.16383</ENT> <ENT>.15388</ENT> <ENT>.14468</ENT> <ENT>.13618</ENT> <ENT>.12831</ENT> <ENT>.12102</ENT> <ENT>.11426</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.20592</ENT> <ENT>.19307</ENT> <ENT>.18121</ENT> <ENT>.17025</ENT> <ENT>.16011</ENT> <ENT>.15073</ENT> <ENT>.14204</ENT> <ENT>.13399</ENT> <ENT>.12652</ENT> <ENT>.11958</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.21312</ENT> <ENT>.20010</ENT> <ENT>.18805</ENT> <ENT>.17691</ENT> <ENT>.16658</ENT> <ENT>.15701</ENT> <ENT>.14814</ENT> <ENT>.13990</ENT> <ENT>.13225</ENT> <ENT>.12514</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.22057</ENT> <ENT>.20737</ENT> <ENT>.19514</ENT> <ENT>.18382</ENT> <ENT>.17331</ENT> <ENT>.16356</ENT> <ENT>.15450</ENT> <ENT>.14608</ENT> <ENT>.13825</ENT> <ENT>.13096</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.22827</ENT> <ENT>.21490</ENT> <ENT>.20251</ENT> <ENT>.19100</ENT> <ENT>.18031</ENT> <ENT>.17038</ENT> <ENT>.16113</ENT> <ENT>.15253</ENT> <ENT>.14452</ENT> <ENT>.13705</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.23623</ENT> <ENT>.22270</ENT> <ENT>.21013</ENT> <ENT>.19845</ENT> <ENT>.18759</ENT> <ENT>.17747</ENT> <ENT>.16805</ENT> <ENT>.15927</ENT> <ENT>.15108</ENT> <ENT>.14344</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.24446</ENT> <ENT>.23078</ENT> <ENT>.21805</ENT> <ENT>.20620</ENT> <ENT>.19516</ENT> <ENT>.18487</ENT> <ENT>.17527</ENT> <ENT>.16631</ENT> <ENT>.15795</ENT> <ENT>.15013</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.25298</ENT> <ENT>.23915</ENT> <ENT>.22626</ENT> <ENT>.21425</ENT> <ENT>.20305</ENT> <ENT>.19259</ENT> <ENT>.18282</ENT> <ENT>.17368</ENT> <ENT>.16514</ENT> <ENT>.15715</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.26178</ENT> <ENT>.24782</ENT> <ENT>.23478</ENT> <ENT>.22262</ENT> <ENT>.21125</ENT> <ENT>.20062</ENT> <ENT>.19069</ENT> <ENT>.18138</ENT> <ENT>.17267</ENT> <ENT>.16450</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.27087</ENT> <ENT>.25678</ENT> <ENT>.24360</ENT> <ENT>.23129</ENT> <ENT>.21977</ENT> <ENT>.20898</ENT> <ENT>.19888</ENT> <ENT>.18941</ENT> <ENT>.18053</ENT> <ENT>.17220</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.28025</ENT> <ENT>.26603</ENT> <ENT>.25273</ENT> <ENT>.24027</ENT> <ENT>.22860</ENT> <ENT>.21766</ENT> <ENT>.20740</ENT> <ENT>.19777</ENT> <ENT>.18873</ENT> <ENT>.18023</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.28987</ENT> <ENT>.27555</ENT> <ENT>.26212</ENT> <ENT>.24953</ENT> <ENT>.23772</ENT> <ENT>.22664</ENT> <ENT>.21622</ENT> <ENT>.20644</ENT> <ENT>.19724</ENT> <ENT>.18858</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.29976</ENT> <ENT>.28533</ENT> <ENT>.27179</ENT> <ENT>.25908</ENT> <ENT>.24714</ENT> <ENT>.23591</ENT> <ENT>.22536</ENT> <ENT>.21542</ENT> <ENT>.20606</ENT> <ENT>.19725</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.30987</ENT> <ENT>.29535</ENT> <ENT>.28171</ENT> <ENT>.26889</ENT> <ENT>.25682</ENT> <ENT>.24546</ENT> <ENT>.23476</ENT> <ENT>.22468</ENT> <ENT>.21518</ENT> <ENT>.20621</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.32023</ENT> <ENT>.30563</ENT> <ENT>.29190</ENT> <ENT>.27897</ENT> <ENT>.26678</ENT> <ENT>.25530</ENT> <ENT>.24447</ENT> <ENT>.23425</ENT> <ENT>.22460</ENT> <ENT>.21549</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.33082</ENT> <ENT>.31615</ENT> <ENT>.30234</ENT> <ENT>.28931</ENT> <ENT>.27702</ENT> <ENT>.26543</ENT> <ENT>.25447</ENT> <ENT>.24412</ENT> <ENT>.23434</ENT> <ENT>.22509</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.34166</ENT> <ENT>.32694</ENT> <ENT>.31306</ENT> <ENT>.29995</ENT> <ENT>.28756</ENT> <ENT>.27586</ENT> <ENT>.26479</ENT> <ENT>.25432</ENT> <ENT>.24441</ENT> <ENT>.23502</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.35274</ENT> <ENT>.33798</ENT> <ENT>.32404</ENT> <ENT>.31085</ENT> <ENT>.29838</ENT> <ENT>.28658</ENT> <ENT>.27541</ENT> <ENT>.26482</ENT> <ENT>.25479</ENT> <ENT>.24528</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.36402</ENT> <ENT>.34924</ENT> <ENT>.33525</ENT> <ENT>.32200</ENT> <ENT>.30946</ENT> <ENT>.29757</ENT> <ENT>.28630</ENT> <ENT>.27561</ENT> <ENT>.26547</ENT> <ENT>.25584</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.37550</ENT> <ENT>.36070</ENT> <ENT>.34668</ENT> <ENT>.33339</ENT> <ENT>.32078</ENT> <ENT>.30882</ENT> <ENT>.29746</ENT> <ENT>.28667</ENT> <ENT>.27643</ENT> <ENT>.26669</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.38717</ENT> <ENT>.37237</ENT> <ENT>.35833</ENT> <ENT>.34500</ENT> <ENT>.33234</ENT> <ENT>.32031</ENT> <ENT>.30888</ENT> <ENT>.29801</ENT> <ENT>.28766</ENT> <ENT>.27782</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.39903</ENT> <ENT>.38424</ENT> <ENT>.37019</ENT> <ENT>.35683</ENT> <ENT>.34413</ENT> <ENT>.33205</ENT> <ENT>.32056</ENT> <ENT>.30961</ENT> <ENT>.29918</ENT> <ENT>.28925</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.41108</ENT> <ENT>.39631</ENT> <ENT>.38227</ENT> <ENT>.36890</ENT> <ENT>.35617</ENT> <ENT>.34405</ENT> <ENT>.33250</ENT> <ENT>.32149</ENT> <ENT>.31099</ENT> <ENT>.30097</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.42330</ENT> <ENT>.40857</ENT> <ENT>.39455</ENT> <ENT>.38118</ENT> <ENT>.36844</ENT> <ENT>.35629</ENT> <ENT>.34469</ENT> <ENT>.33363</ENT> <ENT>.32306</ENT> <ENT>.31297</ENT> </ROW> <ROW> <PRTPAGE P="88"/> <ENT I="01">58</ENT> <ENT>.43566</ENT> <ENT>.42098</ENT> <ENT>.40699</ENT> <ENT>.39364</ENT> <ENT>.38089</ENT> <ENT>.36873</ENT> <ENT>.35710</ENT> <ENT>.34600</ENT> <ENT>.33538</ENT> <ENT>.32522</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.44811</ENT> <ENT>.43351</ENT> <ENT>.41956</ENT> <ENT>.40623</ENT> <ENT>.39350</ENT> <ENT>.38133</ENT> <ENT>.36968</ENT> <ENT>.35855</ENT> <ENT>.34789</ENT> <ENT>.33768</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.46066</ENT> <ENT>.44613</ENT> <ENT>.43224</ENT> <ENT>.41896</ENT> <ENT>.40624</ENT> <ENT>.39408</ENT> <ENT>.38243</ENT> <ENT>.37127</ENT> <ENT>.36058</ENT> <ENT>.35033</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.47330</ENT> <ENT>.45887</ENT> <ENT>.44505</ENT> <ENT>.43182</ENT> <ENT>.41914</ENT> <ENT>.40699</ENT> <ENT>.39535</ENT> <ENT>.38418</ENT> <ENT>.37347</ENT> <ENT>.36318</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.48608</ENT> <ENT>.47175</ENT> <ENT>.45802</ENT> <ENT>.44485</ENT> <ENT>.43223</ENT> <ENT>.42011</ENT> <ENT>.40848</ENT> <ENT>.39732</ENT> <ENT>.38660</ENT> <ENT>.37629</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.49898</ENT> <ENT>.48478</ENT> <ENT>.47115</ENT> <ENT>.45807</ENT> <ENT>.44550</ENT> <ENT>.43343</ENT> <ENT>.42184</ENT> <ENT>.41069</ENT> <ENT>.39997</ENT> <ENT>.38966</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.51200</ENT> <ENT>.49793</ENT> <ENT>.48442</ENT> <ENT>.47143</ENT> <ENT>.45895</ENT> <ENT>.44694</ENT> <ENT>.43539</ENT> <ENT>.42427</ENT> <ENT>.41357</ENT> <ENT>.40326</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.52512</ENT> <ENT>.51121</ENT> <ENT>.49782</ENT> <ENT>.48495</ENT> <ENT>.47255</ENT> <ENT>.46062</ENT> <ENT>.44912</ENT> <ENT>.43805</ENT> <ENT>.42738</ENT> <ENT>.41709</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.53835</ENT> <ENT>.52461</ENT> <ENT>.51137</ENT> <ENT>.49862</ENT> <ENT>.48634</ENT> <ENT>.47449</ENT> <ENT>.46307</ENT> <ENT>.45206</ENT> <ENT>.44143</ENT> <ENT>.43118</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.55174</ENT> <ENT>.53818</ENT> <ENT>.52511</ENT> <ENT>.51250</ENT> <ENT>.50034</ENT> <ENT>.48860</ENT> <ENT>.47727</ENT> <ENT>.46633</ENT> <ENT>.45576</ENT> <ENT>.44556</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.56524</ENT> <ENT>.55188</ENT> <ENT>.53899</ENT> <ENT>.52654</ENT> <ENT>.51452</ENT> <ENT>.50291</ENT> <ENT>.49168</ENT> <ENT>.48083</ENT> <ENT>.47034</ENT> <ENT>.46020</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.57882</ENT> <ENT>.56568</ENT> <ENT>.55299</ENT> <ENT>.54071</ENT> <ENT>.52885</ENT> <ENT>.51737</ENT> <ENT>.50627</ENT> <ENT>.49552</ENT> <ENT>.48513</ENT> <ENT>.47506</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.59242</ENT> <ENT>.57951</ENT> <ENT>.56703</ENT> <ENT>.55495</ENT> <ENT>.54325</ENT> <ENT>.53193</ENT> <ENT>.52096</ENT> <ENT>.51034</ENT> <ENT>.50004</ENT> <ENT>.49007</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.60598</ENT> <ENT>.59332</ENT> <ENT>.58106</ENT> <ENT>.56918</ENT> <ENT>.55767</ENT> <ENT>.54651</ENT> <ENT>.53569</ENT> <ENT>.52520</ENT> <ENT>.51503</ENT> <ENT>.50516</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.61948</ENT> <ENT>.60707</ENT> <ENT>.59504</ENT> <ENT>.58338</ENT> <ENT>.57206</ENT> <ENT>.56108</ENT> <ENT>.55043</ENT> <ENT>.54009</ENT> <ENT>.53004</ENT> <ENT>.52029</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.63287</ENT> <ENT>.62073</ENT> <ENT>.60895</ENT> <ENT>.59751</ENT> <ENT>.58640</ENT> <ENT>.57561</ENT> <ENT>.56513</ENT> <ENT>.55495</ENT> <ENT>.54505</ENT> <ENT>.53543</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.64621</ENT> <ENT>.63435</ENT> <ENT>.62282</ENT> <ENT>.61162</ENT> <ENT>.60073</ENT> <ENT>.59015</ENT> <ENT>.57985</ENT> <ENT>.56984</ENT> <ENT>.56009</ENT> <ENT>.55061</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.65953</ENT> <ENT>.64796</ENT> <ENT>.63671</ENT> <ENT>.62575</ENT> <ENT>.61510</ENT> <ENT>.60473</ENT> <ENT>.59463</ENT> <ENT>.58480</ENT> <ENT>.57523</ENT> <ENT>.56591</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.67287</ENT> <ENT>.66160</ENT> <ENT>.65063</ENT> <ENT>.63995</ENT> <ENT>.62954</ENT> <ENT>.61940</ENT> <ENT>.60952</ENT> <ENT>.59989</ENT> <ENT>.59050</ENT> <ENT>.58135</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.68622</ENT> <ENT>.67526</ENT> <ENT>.66459</ENT> <ENT>.65419</ENT> <ENT>.64404</ENT> <ENT>.63415</ENT> <ENT>.62450</ENT> <ENT>.61509</ENT> <ENT>.60590</ENT> <ENT>.59694</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.69954</ENT> <ENT>.68892</ENT> <ENT>.67856</ENT> <ENT>.66845</ENT> <ENT>.65858</ENT> <ENT>.64895</ENT> <ENT>.63955</ENT> <ENT>.63036</ENT> <ENT>.62140</ENT> <ENT>.61264</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.71278</ENT> <ENT>.70250</ENT> <ENT>.69246</ENT> <ENT>.68265</ENT> <ENT>.67308</ENT> <ENT>.66372</ENT> <ENT>.65457</ENT> <ENT>.64563</ENT> <ENT>.63690</ENT> <ENT>.62836</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.72581</ENT> <ENT>.71588</ENT> <ENT>.70618</ENT> <ENT>.69668</ENT> <ENT>.68740</ENT> <ENT>.67833</ENT> <ENT>.66945</ENT> <ENT>.66077</ENT> <ENT>.65227</ENT> <ENT>.64396</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.73857</ENT> <ENT>.72899</ENT> <ENT>.71962</ENT> <ENT>.71045</ENT> <ENT>.70147</ENT> <ENT>.69268</ENT> <ENT>.68408</ENT> <ENT>.67566</ENT> <ENT>.66741</ENT> <ENT>.65933</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.75101</ENT> <ENT>.74178</ENT> <ENT>.73274</ENT> <ENT>.72389</ENT> <ENT>.71522</ENT> <ENT>.70672</ENT> <ENT>.69840</ENT> <ENT>.69024</ENT> <ENT>.68225</ENT> <ENT>.67441</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.76311</ENT> <ENT>.75423</ENT> <ENT>.74553</ENT> <ENT>.73700</ENT> <ENT>.72864</ENT> <ENT>.72044</ENT> <ENT>.71240</ENT> <ENT>.70451</ENT> <ENT>.69678</ENT> <ENT>.68919</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.77497</ENT> <ENT>.76645</ENT> <ENT>.75809</ENT> <ENT>.74988</ENT> <ENT>.74183</ENT> <ENT>.73393</ENT> <ENT>.72618</ENT> <ENT>.71857</ENT> <ENT>.71110</ENT> <ENT>.70377</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.78665</ENT> <ENT>.77848</ENT> <ENT>.77047</ENT> <ENT>.76260</ENT> <ENT>.75487</ENT> <ENT>.74728</ENT> <ENT>.73982</ENT> <ENT>.73250</ENT> <ENT>.72530</ENT> <ENT>.71823</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.79805</ENT> <ENT>.79025</ENT> <ENT>.78258</ENT> <ENT>.77504</ENT> <ENT>.76764</ENT> <ENT>.76036</ENT> <ENT>.75320</ENT> <ENT>.74617</ENT> <ENT>.73925</ENT> <ENT>.73245</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.80904</ENT> <ENT>.80159</ENT> <ENT>.79427</ENT> <ENT>.78706</ENT> <ENT>.77998</ENT> <ENT>.77301</ENT> <ENT>.76615</ENT> <ENT>.75940</ENT> <ENT>.75277</ENT> <ENT>.74624</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.81962</ENT> <ENT>.81251</ENT> <ENT>.80552</ENT> <ENT>.79865</ENT> <ENT>.79188</ENT> <ENT>.78521</ENT> <ENT>.77865</ENT> <ENT>.77220</ENT> <ENT>.76584</ENT> <ENT>.75958</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.82978</ENT> <ENT>.82302</ENT> <ENT>.81636</ENT> <ENT>.80980</ENT> <ENT>.80335</ENT> <ENT>.79699</ENT> <ENT>.79072</ENT> <ENT>.78455</ENT> <ENT>.77847</ENT> <ENT>.77248</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.83952</ENT> <ENT>.83309</ENT> <ENT>.82676</ENT> <ENT>.82052</ENT> <ENT>.81437</ENT> <ENT>.80831</ENT> <ENT>.80234</ENT> <ENT>.79645</ENT> <ENT>.79064</ENT> <ENT>.78492</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.84870</ENT> <ENT>.84260</ENT> <ENT>.83658</ENT> <ENT>.83064</ENT> <ENT>.82479</ENT> <ENT>.81902</ENT> <ENT>.81332</ENT> <ENT>.80771</ENT> <ENT>.80217</ENT> <ENT>.79671</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.85716</ENT> <ENT>.85136</ENT> <ENT>.84563</ENT> <ENT>.83998</ENT> <ENT>.83441</ENT> <ENT>.82891</ENT> <ENT>.82348</ENT> <ENT>.81812</ENT> <ENT>.81283</ENT> <ENT>.80761</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.86494</ENT> <ENT>.85942</ENT> <ENT>.85396</ENT> <ENT>.84858</ENT> <ENT>.84326</ENT> <ENT>.83801</ENT> <ENT>.83283</ENT> <ENT>.82771</ENT> <ENT>.82266</ENT> <ENT>.81767</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.87216</ENT> <ENT>.86690</ENT> <ENT>.86170</ENT> <ENT>.85657</ENT> <ENT>.85149</ENT> <ENT>.84648</ENT> <ENT>.84153</ENT> <ENT>.83664</ENT> <ENT>.83181</ENT> <ENT>.82704</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.87898</ENT> <ENT>.87397</ENT> <ENT>.86902</ENT> <ENT>.86412</ENT> <ENT>.85928</ENT> <ENT>.85450</ENT> <ENT>.84977</ENT> <ENT>.84510</ENT> <ENT>.84049</ENT> <ENT>.83592</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.88537</ENT> <ENT>.88060</ENT> <ENT>.87587</ENT> <ENT>.87121</ENT> <ENT>.86659</ENT> <ENT>.86203</ENT> <ENT>.85751</ENT> <ENT>.85305</ENT> <ENT>.84864</ENT> <ENT>.84427</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.89127</ENT> <ENT>.88672</ENT> <ENT>.88221</ENT> <ENT>.87775</ENT> <ENT>.87335</ENT> <ENT>.86898</ENT> <ENT>.86467</ENT> <ENT>.86040</ENT> <ENT>.85618</ENT> <ENT>.85200</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.89680</ENT> <ENT>.89245</ENT> <ENT>.88815</ENT> <ENT>.88389</ENT> <ENT>.87968</ENT> <ENT>.87551</ENT> <ENT>.87138</ENT> <ENT>.86730</ENT> <ENT>.86326</ENT> <ENT>.85926</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.90217</ENT> <ENT>.89803</ENT> <ENT>.89393</ENT> <ENT>.88987</ENT> <ENT>.88585</ENT> <ENT>.88187</ENT> <ENT>.87793</ENT> <ENT>.87402</ENT> <ENT>.87016</ENT> <ENT>.86633</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.90738</ENT> <ENT>.90344</ENT> <ENT>.89953</ENT> <ENT>.89567</ENT> <ENT>.89183</ENT> <ENT>.88804</ENT> <ENT>.88428</ENT> <ENT>.88056</ENT> <ENT>.87687</ENT> <ENT>.87322</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.91250</ENT> <ENT>.90876</ENT> <ENT>.90504</ENT> <ENT>.90137</ENT> <ENT>.89772</ENT> <ENT>.89412</ENT> <ENT>.89054</ENT> <ENT>.88699</ENT> <ENT>.88348</ENT> <ENT>.88000</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.91751</ENT> <ENT>.91396</ENT> <ENT>.91045</ENT> <ENT>.90696</ENT> <ENT>.90350</ENT> <ENT>.90007</ENT> <ENT>.89668</ENT> <ENT>.89331</ENT> <ENT>.88997</ENT> <ENT>.88666</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.92247</ENT> <ENT>.91912</ENT> <ENT>.91579</ENT> <ENT>.91249</ENT> <ENT>.90922</ENT> <ENT>.90598</ENT> <ENT>.90276</ENT> <ENT>.89957</ENT> <ENT>.89640</ENT> <ENT>.89326</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.92775</ENT> <ENT>.92460</ENT> <ENT>.92148</ENT> <ENT>.91839</ENT> <ENT>.91532</ENT> <ENT>.91227</ENT> <ENT>.90924</ENT> <ENT>.90624</ENT> <ENT>.90326</ENT> <ENT>.90031</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.93290</ENT> <ENT>.92996</ENT> <ENT>.92704</ENT> <ENT>.92415</ENT> <ENT>.92127</ENT> <ENT>.91841</ENT> <ENT>.91558</ENT> <ENT>.91276</ENT> <ENT>.90997</ENT> <ENT>.90719</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.93948</ENT> <ENT>.93680</ENT> <ENT>.93415</ENT> <ENT>.93151</ENT> <ENT>.92889</ENT> <ENT>.92628</ENT> <ENT>.92370</ENT> <ENT>.92113</ENT> <ENT>.91857</ENT> <ENT>.91604</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.94739</ENT> <ENT>.94504</ENT> <ENT>.94271</ENT> <ENT>.94039</ENT> <ENT>.93808</ENT> <ENT>.93579</ENT> <ENT>.93351</ENT> <ENT>.93124</ENT> <ENT>.92899</ENT> <ENT>.92675</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.95950</ENT> <ENT>.95767</ENT> <ENT>.95585</ENT> <ENT>.95404</ENT> <ENT>.95224</ENT> <ENT>.95045</ENT> <ENT>.94867</ENT> <ENT>.94689</ENT> <ENT>.94512</ENT> <ENT>.94336</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.97985</ENT> <ENT>.97893</ENT> <ENT>.97801</ENT> <ENT>.97710</ENT> <ENT>.97619</ENT> <ENT>.97529</ENT> <ENT>.97438</ENT> <ENT>.97348</ENT> <ENT>.97259</ENT> <ENT>.97170</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table S—Based on Life Table 90CM Single Life Remainder Factors </TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03034</ENT> <ENT>.02857</ENT> <ENT>.02700</ENT> <ENT>.02559</ENT> <ENT>.02433</ENT> <ENT>.02321</ENT> <ENT>.02220</ENT> <ENT>.02129</ENT> <ENT>.02047</ENT> <ENT>.01973</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.02279</ENT> <ENT>.02094</ENT> <ENT>.01929</ENT> <ENT>.01782</ENT> <ENT>.01650</ENT> <ENT>.01533</ENT> <ENT>.01427</ENT> <ENT>.01331</ENT> <ENT>.01246</ENT> <ENT>.01168</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02347</ENT> <ENT>.02155</ENT> <ENT>.01983</ENT> <ENT>.01829</ENT> <ENT>.01692</ENT> <ENT>.01569</ENT> <ENT>.01458</ENT> <ENT>.01358</ENT> <ENT>.01268</ENT> <ENT>.01187</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02444</ENT> <ENT>.02243</ENT> <ENT>.02065</ENT> <ENT>.01905</ENT> <ENT>.01761</ENT> <ENT>.01632</ENT> <ENT>.01516</ENT> <ENT>.01412</ENT> <ENT>.01317</ENT> <ENT>.01232</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.02558</ENT> <ENT>.02349</ENT> <ENT>.02163</ENT> <ENT>.01996</ENT> <ENT>.01846</ENT> <ENT>.01712</ENT> <ENT>.01590</ENT> <ENT>.01481</ENT> <ENT>.01382</ENT> <ENT>.01292</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.02686</ENT> <ENT>.02469</ENT> <ENT>.02275</ENT> <ENT>.02101</ENT> <ENT>.01945</ENT> <ENT>.01804</ENT> <ENT>.01677</ENT> <ENT>.01562</ENT> <ENT>.01458</ENT> <ENT>.01364</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.02825</ENT> <ENT>.02600</ENT> <ENT>.02398</ENT> <ENT>.02217</ENT> <ENT>.02053</ENT> <ENT>.01906</ENT> <ENT>.01773</ENT> <ENT>.01653</ENT> <ENT>.01544</ENT> <ENT>.01445</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.02976</ENT> <ENT>.02742</ENT> <ENT>.02532</ENT> <ENT>.02343</ENT> <ENT>.02172</ENT> <ENT>.02019</ENT> <ENT>.01880</ENT> <ENT>.01754</ENT> <ENT>.01640</ENT> <ENT>.01536</ENT> </ROW> <ROW> <PRTPAGE P="89"/> <ENT I="01">8</ENT> <ENT>.03137</ENT> <ENT>.02894</ENT> <ENT>.02675</ENT> <ENT>.02479</ENT> <ENT>.02301</ENT> <ENT>.02140</ENT> <ENT>.01995</ENT> <ENT>.01864</ENT> <ENT>.01744</ENT> <ENT>.01635</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.03311</ENT> <ENT>.03059</ENT> <ENT>.02832</ENT> <ENT>.02627</ENT> <ENT>.02442</ENT> <ENT>.02274</ENT> <ENT>.02122</ENT> <ENT>.01985</ENT> <ENT>.01859</ENT> <ENT>.01745</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.03499</ENT> <ENT>.03237</ENT> <ENT>.03001</ENT> <ENT>.02788</ENT> <ENT>.02595</ENT> <ENT>.02420</ENT> <ENT>.02262</ENT> <ENT>.02118</ENT> <ENT>.01987</ENT> <ENT>.01867</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.03700</ENT> <ENT>.03428</ENT> <ENT>.03183</ENT> <ENT>.02961</ENT> <ENT>.02760</ENT> <ENT>.02578</ENT> <ENT>.02413</ENT> <ENT>.02262</ENT> <ENT>.02125</ENT> <ENT>.02000</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.03913</ENT> <ENT>.03632</ENT> <ENT>.03377</ENT> <ENT>.03146</ENT> <ENT>.02937</ENT> <ENT>.02748</ENT> <ENT>.02575</ENT> <ENT>.02418</ENT> <ENT>.02275</ENT> <ENT>.02144</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.04135</ENT> <ENT>.03843</ENT> <ENT>.03579</ENT> <ENT>.03339</ENT> <ENT>.03122</ENT> <ENT>.02924</ENT> <ENT>.02744</ENT> <ENT>.02580</ENT> <ENT>.02431</ENT> <ENT>.02294</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.04359</ENT> <ENT>.04057</ENT> <ENT>.03783</ENT> <ENT>.03534</ENT> <ENT>.03308</ENT> <ENT>.03102</ENT> <ENT>.02915</ENT> <ENT>.02744</ENT> <ENT>.02587</ENT> <ENT>.02444</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.04584</ENT> <ENT>.04270</ENT> <ENT>.03986</ENT> <ENT>.03728</ENT> <ENT>.03493</ENT> <ENT>.03279</ENT> <ENT>.03083</ENT> <ENT>.02905</ENT> <ENT>.02742</ENT> <ENT>.02593</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.04806</ENT> <ENT>.04482</ENT> <ENT>.04187</ENT> <ENT>.03919</ENT> <ENT>.03674</ENT> <ENT>.03452</ENT> <ENT>.03248</ENT> <ENT>.03063</ENT> <ENT>.02892</ENT> <ENT>.02736</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.05029</ENT> <ENT>.04692</ENT> <ENT>.04387</ENT> <ENT>.04108</ENT> <ENT>.03855</ENT> <ENT>.03623</ENT> <ENT>.03411</ENT> <ENT>.03218</ENT> <ENT>.03040</ENT> <ENT>.02877</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.05253</ENT> <ENT>.04905</ENT> <ENT>.04588</ENT> <ENT>.04299</ENT> <ENT>.04036</ENT> <ENT>.03795</ENT> <ENT>.03574</ENT> <ENT>.03373</ENT> <ENT>.03187</ENT> <ENT>.03017</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.05484</ENT> <ENT>.05124</ENT> <ENT>.04796</ENT> <ENT>.04496</ENT> <ENT>.04222</ENT> <ENT>.03972</ENT> <ENT>.03742</ENT> <ENT>.03532</ENT> <ENT>.03339</ENT> <ENT>.03161</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.05726</ENT> <ENT>.05354</ENT> <ENT>.05013</ENT> <ENT>.04702</ENT> <ENT>.04418</ENT> <ENT>.04158</ENT> <ENT>.03919</ENT> <ENT>.03700</ENT> <ENT>.03498</ENT> <ENT>.03313</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.05980</ENT> <ENT>.05595</ENT> <ENT>.05242</ENT> <ENT>.04920</ENT> <ENT>.04625</ENT> <ENT>.04354</ENT> <ENT>.04105</ENT> <ENT>.03877</ENT> <ENT>.03667</ENT> <ENT>.03473</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.06246</ENT> <ENT>.05847</ENT> <ENT>.05482</ENT> <ENT>.05147</ENT> <ENT>.04841</ENT> <ENT>.04559</ENT> <ENT>.04301</ENT> <ENT>.04063</ENT> <ENT>.03844</ENT> <ENT>.03642</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.06524</ENT> <ENT>.06112</ENT> <ENT>.05734</ENT> <ENT>.05387</ENT> <ENT>.05069</ENT> <ENT>.04777</ENT> <ENT>.04508</ENT> <ENT>.04260</ENT> <ENT>.04032</ENT> <ENT>.03821</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.06819</ENT> <ENT>.06392</ENT> <ENT>.06001</ENT> <ENT>.05642</ENT> <ENT>.05312</ENT> <ENT>.05008</ENT> <ENT>.04728</ENT> <ENT>.04470</ENT> <ENT>.04232</ENT> <ENT>.04012</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.07131</ENT> <ENT>.06690</ENT> <ENT>.06285</ENT> <ENT>.05913</ENT> <ENT>.05570</ENT> <ENT>.05255</ENT> <ENT>.04964</ENT> <ENT>.04695</ENT> <ENT>.04447</ENT> <ENT>.04218</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.07460</ENT> <ENT>.07005</ENT> <ENT>.06586</ENT> <ENT>.06200</ENT> <ENT>.05845</ENT> <ENT>.05518</ENT> <ENT>.05215</ENT> <ENT>.04936</ENT> <ENT>.04677</ENT> <ENT>.04438</ENT> 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<ENT>.80315</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.84787</ENT> <ENT>.84378</ENT> <ENT>.83973</ENT> <ENT>.83573</ENT> <ENT>.83176</ENT> <ENT>.82784</ENT> <ENT>.82396</ENT> <ENT>.82012</ENT> <ENT>.81632</ENT> <ENT>.81255</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.85530</ENT> <ENT>.85138</ENT> <ENT>.84750</ENT> <ENT>.84366</ENT> <ENT>.83985</ENT> <ENT>.83609</ENT> <ENT>.83236</ENT> <ENT>.82867</ENT> <ENT>.82502</ENT> <ENT>.82140</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.86255</ENT> <ENT>.85880</ENT> <ENT>.85508</ENT> <ENT>.85140</ENT> <ENT>.84776</ENT> <ENT>.84415</ENT> <ENT>.84057</ENT> <ENT>.83703</ENT> <ENT>.83353</ENT> <ENT>.83005</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.86960</ENT> <ENT>.86601</ENT> <ENT>.86246</ENT> <ENT>.85894</ENT> <ENT>.85546</ENT> <ENT>.85200</ENT> <ENT>.84858</ENT> <ENT>.84519</ENT> <ENT>.84183</ENT> <ENT>.83849</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.87655</ENT> <ENT>.87313</ENT> <ENT>.86974</ENT> <ENT>.86638</ENT> <ENT>.86305</ENT> 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<ENT>.91351</ENT> <ENT>.91101</ENT> <ENT>.90852</ENT> <ENT>.90605</ENT> <ENT>.90359</ENT> <ENT>.90115</ENT> <ENT>.89873</ENT> <ENT>.89632</ENT> <ENT>.89392</ENT> <ENT>.89154</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.92452</ENT> <ENT>.92230</ENT> <ENT>.92010</ENT> <ENT>.91791</ENT> <ENT>.91573</ENT> <ENT>.91356</ENT> <ENT>.91141</ENT> <ENT>.90927</ENT> <ENT>.90714</ENT> <ENT>.90502</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.94161</ENT> <ENT>.93987</ENT> <ENT>.93814</ENT> <ENT>.93641</ENT> <ENT>.93469</ENT> <ENT>.93298</ENT> <ENT>.93128</ENT> <ENT>.92958</ENT> <ENT>.92790</ENT> <ENT>.92622</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.97081</ENT> <ENT>.96992</ENT> <ENT>.96904</ENT> <ENT>.96816</ENT> <ENT>.96729</ENT> <ENT>.96642</ENT> <ENT>.96555</ENT> <ENT>.96468</ENT> <ENT>.96382</ENT> <ENT>.96296</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table S—Based on Life Table 90CM Single Life Remainder Factors </TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01906</ENT> <ENT>.01845</ENT> <ENT>.01790</ENT> <ENT>.01740</ENT> <ENT>.01694</ENT> <ENT>.01652</ENT> <ENT>.01613</ENT> <ENT>.01578</ENT> <ENT>.01546</ENT> <ENT>.01516</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01098</ENT> <ENT>.01034</ENT> <ENT>.00977</ENT> <ENT>.00924</ENT> <ENT>.00876</ENT> <ENT>.00833</ENT> <ENT>.00793</ENT> <ENT>.00756</ENT> <ENT>.00722</ENT> <ENT>.00691</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01113</ENT> <ENT>.01046</ENT> <ENT>.00986</ENT> <ENT>.00930</ENT> <ENT>.00880</ENT> <ENT>.00834</ENT> <ENT>.00791</ENT> <ENT>.00753</ENT> <ENT>.00717</ENT> <ENT>.00684</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01155</ENT> <ENT>.01084</ENT> <ENT>.01020</ENT> <ENT>.00962</ENT> <ENT>.00909</ENT> <ENT>.00860</ENT> <ENT>.00816</ENT> <ENT>.00775</ENT> <ENT>.00737</ENT> <ENT>.00702</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01211</ENT> <ENT>.01137</ENT> <ENT>.01069</ENT> <ENT>.01008</ENT> <ENT>.00952</ENT> <ENT>.00900</ENT> <ENT>.00853</ENT> <ENT>.00810</ENT> <ENT>.00770</ENT> <ENT>.00733</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01279</ENT> <ENT>.01201</ENT> <ENT>.01130</ENT> <ENT>.01065</ENT> <ENT>.01006</ENT> <ENT>.00952</ENT> <ENT>.00902</ENT> <ENT>.00856</ENT> <ENT>.00814</ENT> <ENT>.00775</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01356</ENT> <ENT>.01274</ENT> <ENT>.01199</ENT> <ENT>.01131</ENT> <ENT>.01068</ENT> <ENT>.01011</ENT> <ENT>.00959</ENT> <ENT>.00910</ENT> <ENT>.00865</ENT> <ENT>.00824</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01442</ENT> <ENT>.01356</ENT> <ENT>.01277</ENT> <ENT>.01205</ENT> <ENT>.01140</ENT> <ENT>.01079</ENT> <ENT>.01023</ENT> <ENT>.00972</ENT> <ENT>.00925</ENT> <ENT>.00881</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01536</ENT> <ENT>.01446</ENT> <ENT>.01363</ENT> <ENT>.01287</ENT> <ENT>.01218</ENT> <ENT>.01154</ENT> <ENT>.01096</ENT> <ENT>.01041</ENT> <ENT>.00991</ENT> <ENT>.00945</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01641</ENT> <ENT>.01546</ENT> <ENT>.01460</ENT> <ENT>.01380</ENT> <ENT>.01307</ENT> <ENT>.01240</ENT> <ENT>.01178</ENT> <ENT>.01120</ENT> <ENT>.01068</ENT> <ENT>.01019</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01758</ENT> <ENT>.01659</ENT> <ENT>.01567</ENT> <ENT>.01484</ENT> <ENT>.01407</ENT> <ENT>.01336</ENT> <ENT>.01270</ENT> <ENT>.01210</ENT> <ENT>.01154</ENT> <ENT>.01103</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01886</ENT> <ENT>.01781</ENT> <ENT>.01686</ENT> <ENT>.01598</ENT> <ENT>.01517</ENT> <ENT>.01442</ENT> <ENT>.01373</ENT> <ENT>.01310</ENT> <ENT>.01251</ENT> <ENT>.01196</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.02024</ENT> <ENT>.01915</ENT> <ENT>.01814</ENT> <ENT>.01721</ENT> <ENT>.01636</ENT> <ENT>.01558</ENT> <ENT>.01485</ENT> <ENT>.01419</ENT> <ENT>.01357</ENT> <ENT>.01299</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.02168</ENT> <ENT>.02054</ENT> <ENT>.01948</ENT> <ENT>.01851</ENT> <ENT>.01762</ENT> <ENT>.01679</ENT> <ENT>.01603</ENT> <ENT>.01533</ENT> <ENT>.01467</ENT> <ENT>.01407</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.02313</ENT> <ENT>.02193</ENT> <ENT>.02083</ENT> <ENT>.01981</ENT> <ENT>.01887</ENT> <ENT>.01801</ENT> <ENT>.01721</ENT> <ENT>.01646</ENT> <ENT>.01578</ENT> <ENT>.01514</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02456</ENT> <ENT>.02330</ENT> <ENT>.02214</ENT> <ENT>.02107</ENT> <ENT>.02009</ENT> <ENT>.01918</ENT> <ENT>.01834</ENT> <ENT>.01756</ENT> <ENT>.01684</ENT> <ENT>.01617</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02593</ENT> <ENT>.02462</ENT> <ENT>.02340</ENT> <ENT>.02229</ENT> <ENT>.02126</ENT> <ENT>.02030</ENT> <ENT>.01942</ENT> <ENT>.01860</ENT> <ENT>.01785</ENT> <ENT>.01714</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02728</ENT> <ENT>.02590</ENT> <ENT>.02463</ENT> <ENT>.02346</ENT> <ENT>.02238</ENT> <ENT>.02138</ENT> <ENT>.02046</ENT> <ENT>.01960</ENT> <ENT>.01880</ENT> <ENT>.01806</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.02861</ENT> <ENT>.02717</ENT> <ENT>.02584</ENT> <ENT>.02462</ENT> <ENT>.02348</ENT> <ENT>.02243</ENT> <ENT>.02146</ENT> <ENT>.02056</ENT> <ENT>.01972</ENT> <ENT>.01894</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.02998</ENT> <ENT>.02847</ENT> <ENT>.02708</ENT> <ENT>.02580</ENT> <ENT>.02461</ENT> <ENT>.02351</ENT> <ENT>.02249</ENT> <ENT>.02154</ENT> <ENT>.02066</ENT> <ENT>.01984</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.03142</ENT> <ENT>.02984</ENT> <ENT>.02839</ENT> <ENT>.02704</ENT> <ENT>.02580</ENT> <ENT>.02465</ENT> <ENT>.02357</ENT> <ENT>.02258</ENT> <ENT>.02165</ENT> <ENT>.02079</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.03295</ENT> <ENT>.03130</ENT> <ENT>.02978</ENT> <ENT>.02837</ENT> <ENT>.02706</ENT> <ENT>.02585</ENT> <ENT>.02473</ENT> <ENT>.02368</ENT> <ENT>.02271</ENT> <ENT>.02180</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.03455</ENT> <ENT>.03283</ENT> <ENT>.03124</ENT> <ENT>.02976</ENT> <ENT>.02839</ENT> <ENT>.02712</ENT> <ENT>.02594</ENT> <ENT>.02484</ENT> <ENT>.02382</ENT> <ENT>.02286</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.03626</ENT> <ENT>.03446</ENT> <ENT>.03279</ENT> <ENT>.03124</ENT> <ENT>.02981</ENT> <ENT>.02847</ENT> <ENT>.02723</ENT> <ENT>.02608</ENT> <ENT>.02500</ENT> <ENT>.02400</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.03809</ENT> <ENT>.03620</ENT> <ENT>.03446</ENT> <ENT>.03283</ENT> <ENT>.03133</ENT> <ENT>.02993</ENT> <ENT>.02863</ENT> <ENT>.02741</ENT> <ENT>.02628</ENT> <ENT>.02522</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.04005</ENT> <ENT>.03808</ENT> <ENT>.03625</ENT> <ENT>.03456</ENT> <ENT>.03298</ENT> <ENT>.03151</ENT> <ENT>.03014</ENT> <ENT>.02887</ENT> <ENT>.02768</ENT> <ENT>.02656</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.04216</ENT> <ENT>.04010</ENT> <ENT>.03819</ENT> <ENT>.03641</ENT> <ENT>.03476</ENT> <ENT>.03322</ENT> <ENT>.03178</ENT> <ENT>.03044</ENT> <ENT>.02919</ENT> <ENT>.02802</ENT> </ROW> <ROW> <PRTPAGE P="91"/> <ENT I="01">27</ENT> <ENT>.04444</ENT> <ENT>.04229</ENT> <ENT>.04029</ENT> <ENT>.03843</ENT> <ENT>.03670</ENT> <ENT>.03508</ENT> <ENT>.03357</ENT> <ENT>.03217</ENT> <ENT>.03085</ENT> <ENT>.02962</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.04687</ENT> <ENT>.04463</ENT> <ENT>.04254</ENT> <ENT>.04059</ENT> <ENT>.03877</ENT> <ENT>.03708</ENT> <ENT>.03550</ENT> <ENT>.03402</ENT> <ENT>.03263</ENT> <ENT>.03133</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.04946</ENT> <ENT>.04712</ENT> <ENT>.04493</ENT> <ENT>.04289</ENT> <ENT>.04099</ENT> <ENT>.03922</ENT> <ENT>.03756</ENT> <ENT>.03600</ENT> <ENT>.03455</ENT> <ENT>.03318</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.05221</ENT> <ENT>.04976</ENT> <ENT>.04748</ENT> <ENT>.04534</ENT> <ENT>.04335</ENT> <ENT>.04149</ENT> <ENT>.03975</ENT> <ENT>.03812</ENT> <ENT>.03659</ENT> <ENT>.03515</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.05511</ENT> <ENT>.05255</ENT> <ENT>.05017</ENT> <ENT>.04794</ENT> <ENT>.04585</ENT> <ENT>.04390</ENT> <ENT>.04208</ENT> <ENT>.04037</ENT> <ENT>.03876</ENT> <ENT>.03725</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.05818</ENT> <ENT>.05551</ENT> <ENT>.05302</ENT> <ENT>.05069</ENT> <ENT>.04851</ENT> <ENT>.04647</ENT> <ENT>.04455</ENT> <ENT>.04276</ENT> <ENT>.04107</ENT> <ENT>.03948</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.06144</ENT> <ENT>.05866</ENT> <ENT>.05606</ENT> <ENT>.05363</ENT> <ENT>.05135</ENT> <ENT>.04921</ENT> <ENT>.04720</ENT> <ENT>.04532</ENT> <ENT>.04355</ENT> <ENT>.04188</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.06489</ENT> <ENT>.06200</ENT> <ENT>.05928</ENT> <ENT>.05674</ENT> <ENT>.05436</ENT> <ENT>.05212</ENT> <ENT>.05002</ENT> <ENT>.04805</ENT> <ENT>.04619</ENT> <ENT>.04444</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.06857</ENT> <ENT>.06555</ENT> <ENT>.06273</ENT> <ENT>.06007</ENT> <ENT>.05758</ENT> <ENT>.05524</ENT> <ENT>.05304</ENT> <ENT>.05097</ENT> <ENT>.04902</ENT> <ENT>.04718</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.07246</ENT> <ENT>.06932</ENT> <ENT>.06638</ENT> <ENT>.06361</ENT> <ENT>.06101</ENT> <ENT>.05856</ENT> <ENT>.05626</ENT> <ENT>.05409</ENT> <ENT>.05205</ENT> <ENT>.05012</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.07659</ENT> <ENT>.07332</ENT> <ENT>.07025</ENT> <ENT>.06737</ENT> <ENT>.06466</ENT> <ENT>.06210</ENT> <ENT>.05969</ENT> <ENT>.05742</ENT> <ENT>.05528</ENT> <ENT>.05325</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.08098</ENT> <ENT>.07758</ENT> <ENT>.07439</ENT> <ENT>.07138</ENT> <ENT>.06855</ENT> <ENT>.06588</ENT> <ENT>.06336</ENT> <ENT>.06099</ENT> <ENT>.05874</ENT> <ENT>.05662</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.08563</ENT> <ENT>.08210</ENT> <ENT>.07878</ENT> <ENT>.07565</ENT> <ENT>.07270</ENT> <ENT>.06992</ENT> <ENT>.06729</ENT> <ENT>.06480</ENT> <ENT>.06245</ENT> <ENT>.06023</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.09059</ENT> <ENT>.08692</ENT> <ENT>.08347</ENT> <ENT>.08021</ENT> <ENT>.07714</ENT> <ENT>.07423</ENT> <ENT>.07149</ENT> <ENT>.06889</ENT> <ENT>.06643</ENT> <ENT>.06411</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.09586</ENT> <ENT>.09206</ENT> <ENT>.08848</ENT> <ENT>.08509</ENT> <ENT>.08189</ENT> <ENT>.07886</ENT> <ENT>.07600</ENT> <ENT>.07329</ENT> <ENT>.07072</ENT> <ENT>.06828</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.10147</ENT> <ENT>.09753</ENT> <ENT>.09381</ENT> <ENT>.09029</ENT> <ENT>.08696</ENT> <ENT>.08381</ENT> <ENT>.08083</ENT> <ENT>.07800</ENT> <ENT>.07531</ENT> <ENT>.07277</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.10742</ENT> <ENT>.10334</ENT> <ENT>.09948</ENT> <ENT>.09583</ENT> <ENT>.09237</ENT> <ENT>.08909</ENT> <ENT>.08598</ENT> <ENT>.08304</ENT> <ENT>.08024</ENT> <ENT>.07758</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.11373</ENT> <ENT>.10950</ENT> <ENT>.10551</ENT> <ENT>.10172</ENT> <ENT>.09813</ENT> <ENT>.09472</ENT> <ENT>.09148</ENT> <ENT>.08841</ENT> <ENT>.08549</ENT> <ENT>.08272</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.12035</ENT> <ENT>.11599</ENT> <ENT>.11185</ENT> <ENT>.10792</ENT> <ENT>.10420</ENT> <ENT>.10066</ENT> <ENT>.09730</ENT> <ENT>.09410</ENT> <ENT>.09106</ENT> <ENT>.08817</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.12732</ENT> <ENT>.12281</ENT> <ENT>.11853</ENT> <ENT>.11447</ENT> <ENT>.11061</ENT> <ENT>.10694</ENT> <ENT>.10345</ENT> <ENT>.10013</ENT> <ENT>.09696</ENT> <ENT>.09395</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.13460</ENT> <ENT>.12995</ENT> <ENT>.12553</ENT> <ENT>.12133</ENT> <ENT>.11733</ENT> <ENT>.11353</ENT> <ENT>.10991</ENT> <ENT>.10646</ENT> <ENT>.10317</ENT> <ENT>.10004</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.14223</ENT> <ENT>.13743</ENT> <ENT>.13287</ENT> <ENT>.12853</ENT> <ENT>.12439</ENT> <ENT>.12046</ENT> <ENT>.11671</ENT> <ENT>.11313</ENT> <ENT>.10972</ENT> <ENT>.10646</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.15020</ENT> <ENT>.14526</ENT> <ENT>.14056</ENT> <ENT>.13608</ENT> <ENT>.13181</ENT> <ENT>.12774</ENT> <ENT>.12385</ENT> <ENT>.12015</ENT> <ENT>.11661</ENT> <ENT>.11322</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.15855</ENT> <ENT>.15347</ENT> <ENT>.14862</ENT> <ENT>.14401</ENT> <ENT>.13960</ENT> <ENT>.13540</ENT> <ENT>.13138</ENT> <ENT>.12754</ENT> <ENT>.12388</ENT> <ENT>.12037</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.16727</ENT> <ENT>.16205</ENT> <ENT>.15707</ENT> <ENT>.15232</ENT> <ENT>.14777</ENT> <ENT>.14344</ENT> <ENT>.13929</ENT> <ENT>.13532</ENT> <ENT>.13153</ENT> <ENT>.12789</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.17634</ENT> <ENT>.17098</ENT> <ENT>.16587</ENT> <ENT>.16097</ENT> <ENT>.15630</ENT> <ENT>.15183</ENT> <ENT>.14755</ENT> <ENT>.14345</ENT> <ENT>.13953</ENT> <ENT>.13577</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.18576</ENT> <ENT>.18027</ENT> <ENT>.17501</ENT> <ENT>.16999</ENT> <ENT>.16518</ENT> <ENT>.16057</ENT> <ENT>.15616</ENT> <ENT>.15194</ENT> <ENT>.14789</ENT> <ENT>.14400</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.19552</ENT> <ENT>.18990</ENT> <ENT>.18451</ENT> <ENT>.17935</ENT> <ENT>.17441</ENT> <ENT>.16968</ENT> <ENT>.16514</ENT> <ENT>.16078</ENT> <ENT>.15661</ENT> <ENT>.15260</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.20564</ENT> <ENT>.19989</ENT> <ENT>.19437</ENT> <ENT>.18908</ENT> <ENT>.18402</ENT> <ENT>.17915</ENT> <ENT>.17449</ENT> <ENT>.17001</ENT> <ENT>.16571</ENT> <ENT>.16157</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.21613</ENT> <ENT>.21025</ENT> <ENT>.20461</ENT> <ENT>.19919</ENT> <ENT>.19400</ENT> <ENT>.18901</ENT> <ENT>.18422</ENT> <ENT>.17962</ENT> <ENT>.17519</ENT> <ENT>.17093</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.22698</ENT> <ENT>.22098</ENT> <ENT>.21522</ENT> <ENT>.20968</ENT> <ENT>.20436</ENT> <ENT>.19925</ENT> <ENT>.19434</ENT> <ENT>.18961</ENT> <ENT>.18507</ENT> <ENT>.18069</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.23816</ENT> <ENT>.23204</ENT> <ENT>.22616</ENT> <ENT>.22051</ENT> <ENT>.21507</ENT> <ENT>.20984</ENT> <ENT>.20481</ENT> <ENT>.19996</ENT> <ENT>.19530</ENT> <ENT>.19080</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.24962</ENT> <ENT>.24339</ENT> <ENT>.23740</ENT> <ENT>.23163</ENT> <ENT>.22608</ENT> <ENT>.22073</ENT> <ENT>.21558</ENT> <ENT>.21062</ENT> <ENT>.20584</ENT> <ENT>.20123</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.26136</ENT> <ENT>.25502</ENT> <ENT>.24892</ENT> <ENT>.24304</ENT> <ENT>.23738</ENT> <ENT>.23192</ENT> <ENT>.22666</ENT> <ENT>.22158</ENT> <ENT>.21669</ENT> <ENT>.21196</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.27339</ENT> <ENT>.26695</ENT> <ENT>.26075</ENT> <ENT>.25477</ENT> <ENT>.24900</ENT> <ENT>.24343</ENT> <ENT>.23806</ENT> <ENT>.23288</ENT> <ENT>.22787</ENT> <ENT>.22304</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.28578</ENT> <ENT>.27925</ENT> <ENT>.27295</ENT> <ENT>.26687</ENT> <ENT>.26100</ENT> <ENT>.25533</ENT> <ENT>.24985</ENT> <ENT>.24456</ENT> <ENT>.23945</ENT> <ENT>.23451</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.29854</ENT> <ENT>.29192</ENT> <ENT>.28553</ENT> <ENT>.27935</ENT> <ENT>.27339</ENT> <ENT>.26762</ENT> <ENT>.26205</ENT> <ENT>.25666</ENT> <ENT>.25145</ENT> <ENT>.24641</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.31164</ENT> <ENT>.30494</ENT> <ENT>.29846</ENT> <ENT>.29221</ENT> <ENT>.28615</ENT> <ENT>.28030</ENT> <ENT>.27463</ENT> <ENT>.26915</ENT> <ENT>.26384</ENT> <ENT>.25870</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.32508</ENT> <ENT>.31831</ENT> <ENT>.31177</ENT> <ENT>.30543</ENT> <ENT>.29930</ENT> <ENT>.29336</ENT> <ENT>.28761</ENT> <ENT>.28203</ENT> <ENT>.27663</ENT> <ENT>.27140</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.33891</ENT> <ENT>.33208</ENT> <ENT>.32547</ENT> <ENT>.31906</ENT> <ENT>.31285</ENT> <ENT>.30684</ENT> <ENT>.30101</ENT> <ENT>.29536</ENT> <ENT>.28987</ENT> <ENT>.28456</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.35318</ENT> <ENT>.34630</ENT> <ENT>.33963</ENT> <ENT>.33316</ENT> <ENT>.32689</ENT> <ENT>.32081</ENT> <ENT>.31491</ENT> <ENT>.30918</ENT> <ENT>.30363</ENT> <ENT>.29823</ENT> </ROW> <ROW> <ENT I="01">68</ENT> 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<ENT>.48506</ENT> <ENT>.47888</ENT> <ENT>.47282</ENT> <ENT>.46690</ENT> <ENT>.46111</ENT> <ENT>.45543</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.52845</ENT> <ENT>.52177</ENT> <ENT>.51523</ENT> <ENT>.50884</ENT> <ENT>.50257</ENT> <ENT>.49645</ENT> <ENT>.49044</ENT> <ENT>.48457</ENT> <ENT>.47881</ENT> <ENT>.47317</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.54584</ENT> <ENT>.53926</ENT> <ENT>.53282</ENT> <ENT>.52650</ENT> <ENT>.52032</ENT> <ENT>.51426</ENT> <ENT>.50833</ENT> <ENT>.50251</ENT> <ENT>.49681</ENT> <ENT>.49122</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.56325</ENT> <ENT>.55678</ENT> <ENT>.55044</ENT> <ENT>.54423</ENT> <ENT>.53813</ENT> <ENT>.53216</ENT> <ENT>.52630</ENT> <ENT>.52056</ENT> <ENT>.51492</ENT> <ENT>.50939</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.58054</ENT> <ENT>.57419</ENT> <ENT>.56797</ENT> <ENT>.56186</ENT> <ENT>.55587</ENT> <ENT>.54999</ENT> <ENT>.54422</ENT> <ENT>.53856</ENT> <ENT>.53300</ENT> <ENT>.52754</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.59762</ENT> <ENT>.59140</ENT> <ENT>.58530</ENT> <ENT>.57931</ENT> <ENT>.57343</ENT> <ENT>.56766</ENT> <ENT>.56198</ENT> <ENT>.55641</ENT> <ENT>.55094</ENT> <ENT>.54557</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.61448</ENT> <ENT>.60840</ENT> <ENT>.60243</ENT> <ENT>.59657</ENT> <ENT>.59081</ENT> <ENT>.58515</ENT> <ENT>.57958</ENT> <ENT>.57411</ENT> <ENT>.56874</ENT> <ENT>.56346</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.63124</ENT> <ENT>.62531</ENT> <ENT>.61949</ENT> <ENT>.61376</ENT> <ENT>.60813</ENT> <ENT>.60259</ENT> <ENT>.59715</ENT> <ENT>.59179</ENT> <ENT>.58652</ENT> <ENT>.58134</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.64800</ENT> <ENT>.64224</ENT> <ENT>.63657</ENT> <ENT>.63099</ENT> <ENT>.62550</ENT> <ENT>.62010</ENT> <ENT>.61478</ENT> <ENT>.60955</ENT> <ENT>.60441</ENT> <ENT>.59934</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.66461</ENT> <ENT>.65902</ENT> <ENT>.65351</ENT> <ENT>.64810</ENT> <ENT>.64276</ENT> <ENT>.63751</ENT> <ENT>.63233</ENT> <ENT>.62724</ENT> <ENT>.62222</ENT> <ENT>.61728</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.68083</ENT> <ENT>.67541</ENT> <ENT>.67008</ENT> <ENT>.66483</ENT> <ENT>.65965</ENT> <ENT>.65455</ENT> <ENT>.64953</ENT> <ENT>.64458</ENT> <ENT>.63970</ENT> <ENT>.63489</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.69663</ENT> <ENT>.69140</ENT> <ENT>.68624</ENT> <ENT>.68116</ENT> <ENT>.67615</ENT> <ENT>.67121</ENT> <ENT>.66634</ENT> <ENT>.66154</ENT> <ENT>.65680</ENT> <ENT>.65213</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.71201</ENT> <ENT>.70696</ENT> <ENT>.70199</ENT> <ENT>.69708</ENT> <ENT>.69224</ENT> <ENT>.68747</ENT> <ENT>.68276</ENT> <ENT>.67811</ENT> <ENT>.67353</ENT> <ENT>.66900</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.72694</ENT> <ENT>.72209</ENT> <ENT>.71730</ENT> <ENT>.71257</ENT> <ENT>.70791</ENT> <ENT>.70330</ENT> <ENT>.69876</ENT> <ENT>.69427</ENT> <ENT>.68984</ENT> <ENT>.68547</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.74117</ENT> <ENT>.73650</ENT> <ENT>.73190</ENT> <ENT>.72735</ENT> <ENT>.72286</ENT> <ENT>.71842</ENT> <ENT>.71404</ENT> <ENT>.70972</ENT> <ENT>.70545</ENT> <ENT>.70123</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.75439</ENT> <ENT>.74991</ENT> <ENT>.74548</ENT> <ENT>.74110</ENT> <ENT>.73678</ENT> <ENT>.73251</ENT> <ENT>.72829</ENT> <ENT>.72412</ENT> <ENT>.72000</ENT> <ENT>.71593</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.76664</ENT> <ENT>.76233</ENT> <ENT>.75806</ENT> <ENT>.75385</ENT> <ENT>.74969</ENT> <ENT>.74557</ENT> <ENT>.74150</ENT> <ENT>.73748</ENT> <ENT>.73350</ENT> <ENT>.72957</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.77809</ENT> <ENT>.77394</ENT> <ENT>.76983</ENT> <ENT>.76578</ENT> <ENT>.76177</ENT> <ENT>.75780</ENT> <ENT>.75388</ENT> <ENT>.75000</ENT> <ENT>.74616</ENT> <ENT>.74237</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.78899</ENT> <ENT>.78500</ENT> <ENT>.78106</ENT> <ENT>.77715</ENT> <ENT>.77329</ENT> <ENT>.76947</ENT> <ENT>.76569</ENT> <ENT>.76195</ENT> <ENT>.75826</ENT> <ENT>.75460</ENT> </ROW> <ROW> <PRTPAGE P="92"/> <ENT I="01">96</ENT> <ENT>.79928</ENT> <ENT>.79544</ENT> <ENT>.79165</ENT> <ENT>.78790</ENT> <ENT>.78418</ENT> <ENT>.78050</ENT> <ENT>.77686</ENT> <ENT>.77326</ENT> <ENT>.76970</ENT> <ENT>.76617</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.80883</ENT> <ENT>.80514</ENT> <ENT>.80149</ENT> <ENT>.79787</ENT> <ENT>.79430</ENT> <ENT>.79075</ENT> <ENT>.78725</ENT> <ENT>.78377</ENT> <ENT>.78033</ENT> <ENT>.77693</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.81781</ENT> <ENT>.81427</ENT> <ENT>.81075</ENT> <ENT>.80727</ENT> <ENT>.80382</ENT> <ENT>.80041</ENT> <ENT>.79703</ENT> <ENT>.79368</ENT> <ENT>.79036</ENT> <ENT>.78708</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.82661</ENT> <ENT>.82320</ENT> <ENT>.81982</ENT> <ENT>.81648</ENT> <ENT>.81316</ENT> <ENT>.80988</ENT> <ENT>.80662</ENT> <ENT>.80340</ENT> <ENT>.80020</ENT> <ENT>.79704</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.83519</ENT> <ENT>.83192</ENT> <ENT>.82868</ENT> <ENT>.82547</ENT> <ENT>.82228</ENT> <ENT>.81913</ENT> <ENT>.81600</ENT> <ENT>.81290</ENT> <ENT>.80982</ENT> <ENT>.80678</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.84368</ENT> <ENT>.84055</ENT> <ENT>.83744</ENT> <ENT>.83437</ENT> <ENT>.83131</ENT> <ENT>.82829</ENT> <ENT>.82529</ENT> <ENT>.82231</ENT> <ENT>.81936</ENT> <ENT>.81643</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.85203</ENT> <ENT>.84904</ENT> <ENT>.84607</ENT> <ENT>.84313</ENT> <ENT>.84021</ENT> <ENT>.83731</ENT> <ENT>.83444</ENT> <ENT>.83159</ENT> <ENT>.82876</ENT> <ENT>.82596</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.86034</ENT> <ENT>.85748</ENT> <ENT>.85465</ENT> <ENT>.85184</ENT> <ENT>.84906</ENT> <ENT>.84629</ENT> <ENT>.84355</ENT> <ENT>.84082</ENT> <ENT>.83812</ENT> <ENT>.83544</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.86923</ENT> <ENT>.86653</ENT> <ENT>.86385</ENT> <ENT>.86119</ENT> <ENT>.85855</ENT> <ENT>.85593</ENT> <ENT>.85333</ENT> <ENT>.85074</ENT> <ENT>.84818</ENT> <ENT>.84563</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.87792</ENT> <ENT>.87537</ENT> <ENT>.87283</ENT> <ENT>.87032</ENT> <ENT>.86782</ENT> <ENT>.86534</ENT> <ENT>.86287</ENT> <ENT>.86042</ENT> <ENT>.85799</ENT> <ENT>.85557</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.88918</ENT> <ENT>.88683</ENT> <ENT>.88450</ENT> <ENT>.88218</ENT> <ENT>.87987</ENT> <ENT>.87758</ENT> <ENT>.87530</ENT> <ENT>.87304</ENT> <ENT>.87079</ENT> <ENT>.86855</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.90291</ENT> <ENT>.90082</ENT> <ENT>.89873</ENT> <ENT>.89666</ENT> <ENT>.89460</ENT> <ENT>.89255</ENT> <ENT>.89051</ENT> <ENT>.88849</ENT> <ENT>.88647</ENT> <ENT>.88447</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.92455</ENT> <ENT>.92288</ENT> <ENT>.92123</ENT> <ENT>.91958</ENT> <ENT>.91794</ENT> <ENT>.91630</ENT> <ENT>.91468</ENT> <ENT>.91306</ENT> <ENT>.91145</ENT> <ENT>.90984</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.96211</ENT> <ENT>.96125</ENT> <ENT>.96041</ENT> <ENT>.95956</ENT> <ENT>.95872</ENT> <ENT>.95788</ENT> <ENT>.95704</ENT> <ENT>.95620</ENT> <ENT>.95537</ENT> <ENT>.95455</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table S—Based on Life Table 90CM Single Life Remainder Factors </TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01488</ENT> <ENT>.01463</ENT> <ENT>.01439</ENT> <ENT>.01417</ENT> <ENT>.01396</ENT> <ENT>.01377</ENT> <ENT>.01359</ENT> <ENT>.01343</ENT> <ENT>.01327</ENT> <ENT>.01312</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00662</ENT> <ENT>.00636</ENT> <ENT>.00612</ENT> <ENT>.00589</ENT> <ENT>.00568</ENT> <ENT>.00548</ENT> <ENT>.00530</ENT> <ENT>.00513</ENT> <ENT>.00497</ENT> <ENT>.00482</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00654</ENT> <ENT>.00626</ENT> <ENT>.00600</ENT> <ENT>.00576</ENT> <ENT>.00554</ENT> <ENT>.00533</ENT> <ENT>.00514</ENT> <ENT>.00496</ENT> <ENT>.00479</ENT> <ENT>.00463</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00670</ENT> <ENT>.00641</ENT> <ENT>.00613</ENT> <ENT>.00588</ENT> <ENT>.00564</ENT> <ENT>.00542</ENT> <ENT>.00522</ENT> <ENT>.00502</ENT> <ENT>.00484</ENT> <ENT>.00468</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00699</ENT> <ENT>.00668</ENT> <ENT>.00639</ENT> <ENT>.00612</ENT> <ENT>.00587</ENT> <ENT>.00563</ENT> <ENT>.00542</ENT> <ENT>.00521</ENT> <ENT>.00502</ENT> <ENT>.00484</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00739</ENT> <ENT>.00706</ENT> <ENT>.00675</ENT> <ENT>.00646</ENT> <ENT>.00620</ENT> <ENT>.00595</ENT> <ENT>.00571</ENT> <ENT>.00550</ENT> <ENT>.00529</ENT> <ENT>.00510</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00786</ENT> <ENT>.00751</ENT> <ENT>.00718</ENT> <ENT>.00687</ENT> <ENT>.00659</ENT> <ENT>.00633</ENT> <ENT>.00608</ENT> <ENT>.00585</ENT> <ENT>.00563</ENT> <ENT>.00543</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00841</ENT> <ENT>.00803</ENT> <ENT>.00769</ENT> <ENT>.00736</ENT> <ENT>.00706</ENT> <ENT>.00678</ENT> <ENT>.00652</ENT> <ENT>.00627</ENT> <ENT>.00604</ENT> <ENT>.00582</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00902</ENT> <ENT>.00863</ENT> <ENT>.00826</ENT> <ENT>.00791</ENT> <ENT>.00759</ENT> <ENT>.00730</ENT> <ENT>.00702</ENT> <ENT>.00675</ENT> <ENT>.00651</ENT> <ENT>.00628</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00973</ENT> <ENT>.00931</ENT> <ENT>.00892</ENT> <ENT>.00856</ENT> <ENT>.00822</ENT> <ENT>.00790</ENT> <ENT>.00760</ENT> <ENT>.00733</ENT> <ENT>.00706</ENT> <ENT>.00682</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01055</ENT> <ENT>.01010</ENT> <ENT>.00969</ENT> <ENT>.00930</ENT> <ENT>.00894</ENT> <ENT>.00861</ENT> <ENT>.00829</ENT> <ENT>.00799</ENT> <ENT>.00772</ENT> <ENT>.00746</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01146</ENT> <ENT>.01099</ENT> <ENT>.01055</ENT> <ENT>.01014</ENT> <ENT>.00976</ENT> <ENT>.00940</ENT> <ENT>.00907</ENT> <ENT>.00875</ENT> <ENT>.00846</ENT> <ENT>.00818</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01246</ENT> <ENT>.01196</ENT> <ENT>.01150</ENT> <ENT>.01106</ENT> <ENT>.01066</ENT> <ENT>.01028</ENT> <ENT>.00993</ENT> <ENT>.00960</ENT> <ENT>.00928</ENT> <ENT>.00899</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01351</ENT> <ENT>.01298</ENT> <ENT>.01249</ENT> <ENT>.01204</ENT> <ENT>.01161</ENT> <ENT>.01121</ENT> <ENT>.01084</ENT> <ENT>.01049</ENT> <ENT>.01016</ENT> <ENT>.00985</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01455</ENT> <ENT>.01400</ENT> <ENT>.01348</ENT> <ENT>.01300</ENT> <ENT>.01255</ENT> <ENT>.01213</ENT> <ENT>.01173</ENT> <ENT>.01136</ENT> <ENT>.01102</ENT> <ENT>.01069</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01555</ENT> <ENT>.01497</ENT> <ENT>.01443</ENT> <ENT>.01392</ENT> <ENT>.01345</ENT> <ENT>.01300</ENT> <ENT>.01259</ENT> <ENT>.01220</ENT> <ENT>.01183</ENT> <ENT>.01148</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01648</ENT> <ENT>.01587</ENT> <ENT>.01530</ENT> <ENT>.01477</ENT> <ENT>.01427</ENT> <ENT>.01380</ENT> <ENT>.01336</ENT> <ENT>.01295</ENT> <ENT>.01257</ENT> <ENT>.01220</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01737</ENT> <ENT>.01673</ENT> <ENT>.01612</ENT> <ENT>.01556</ENT> <ENT>.01504</ENT> <ENT>.01455</ENT> <ENT>.01408</ENT> <ENT>.01365</ENT> <ENT>.01324</ENT> <ENT>.01286</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01822</ENT> <ENT>.01754</ENT> <ENT>.01691</ENT> <ENT>.01632</ENT> <ENT>.01576</ENT> <ENT>.01525</ENT> <ENT>.01476</ENT> <ENT>.01430</ENT> <ENT>.01387</ENT> <ENT>.01347</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01908</ENT> <ENT>.01837</ENT> <ENT>.01770</ENT> <ENT>.01708</ENT> <ENT>.01650</ENT> <ENT>.01595</ENT> <ENT>.01544</ENT> <ENT>.01495</ENT> <ENT>.01450</ENT> <ENT>.01407</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01999</ENT> <ENT>.01924</ENT> <ENT>.01854</ENT> <ENT>.01788</ENT> <ENT>.01726</ENT> <ENT>.01669</ENT> 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<ENT>.83317</ENT> <ENT>.83073</ENT> <ENT>.82831</ENT> <ENT>.82591</ENT> <ENT>.82352</ENT> <ENT>.82115</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.85318</ENT> <ENT>.85079</ENT> <ENT>.84843</ENT> <ENT>.84607</ENT> <ENT>.84374</ENT> <ENT>.84142</ENT> <ENT>.83911</ENT> <ENT>.83682</ENT> <ENT>.83455</ENT> <ENT>.83229</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.86633</ENT> <ENT>.86413</ENT> <ENT>.86193</ENT> <ENT>.85975</ENT> <ENT>.85758</ENT> <ENT>.85543</ENT> <ENT>.85329</ENT> <ENT>.85116</ENT> <ENT>.84904</ENT> <ENT>.84694</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.88247</ENT> <ENT>.88049</ENT> <ENT>.87852</ENT> <ENT>.87656</ENT> <ENT>.87460</ENT> <ENT>.87266</ENT> <ENT>.87073</ENT> <ENT>.86881</ENT> <ENT>.86690</ENT> <ENT>.86500</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.90825</ENT> <ENT>.90666</ENT> <ENT>.90507</ENT> <ENT>.90350</ENT> <ENT>.90193</ENT> <ENT>.90037</ENT> <ENT>.89881</ENT> <ENT>.89727</ENT> <ENT>.89572</ENT> <ENT>.89419</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.95372</ENT> <ENT>.95290</ENT> <ENT>.95208</ENT> <ENT>.95126</ENT> <ENT>.95045</ENT> <ENT>.94964</ENT> <ENT>.94883</ENT> <ENT>.94803</ENT> <ENT>.94723</ENT> <ENT>.94643</ENT> </ROW> </GPOTABLE> <PRTPAGE P="94"/> <GPOTABLE COLS="11" OPTS="L2" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table S—Based on Life Table 90CM Single Life Remainder Factors </TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01298</ENT> <ENT>.01285</ENT> <ENT>.01273</ENT> <ENT>.01261</ENT> <ENT>.01250</ENT> <ENT>.01240</ENT> <ENT>.01230</ENT> <ENT>.01221</ENT> <ENT>.01212</ENT> <ENT>.01203</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00468</ENT> <ENT>.00455</ENT> <ENT>.00443</ENT> <ENT>.00431</ENT> <ENT>.00420</ENT> <ENT>.00410</ENT> <ENT>.00400</ENT> <ENT>.00391</ENT> <ENT>.00382</ENT> <ENT>.00374</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00448</ENT> <ENT>.00435</ENT> <ENT>.00421</ENT> <ENT>.00409</ENT> <ENT>.00398</ENT> <ENT>.00387</ENT> <ENT>.00376</ENT> <ENT>.00366</ENT> <ENT>.00357</ENT> <ENT>.00348</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00452</ENT> <ENT>.00437</ENT> <ENT>.00423</ENT> <ENT>.00410</ENT> <ENT>.00398</ENT> <ENT>.00386</ENT> <ENT>.00375</ENT> <ENT>.00365</ENT> <ENT>.00355</ENT> <ENT>.00345</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00468</ENT> <ENT>.00452</ENT> <ENT>.00437</ENT> <ENT>.00423</ENT> <ENT>.00410</ENT> <ENT>.00397</ENT> <ENT>.00386</ENT> <ENT>.00375</ENT> <ENT>.00364</ENT> <ENT>.00354</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00493</ENT> <ENT>.00476</ENT> <ENT>.00460</ENT> <ENT>.00445</ENT> <ENT>.00431</ENT> <ENT>.00418</ENT> <ENT>.00405</ENT> <ENT>.00393</ENT> <ENT>.00382</ENT> <ENT>.00371</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00524</ENT> <ENT>.00506</ENT> <ENT>.00489</ENT> <ENT>.00473</ENT> <ENT>.00458</ENT> <ENT>.00444</ENT> <ENT>.00430</ENT> <ENT>.00418</ENT> <ENT>.00406</ENT> <ENT>.00394</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00562</ENT> <ENT>.00543</ENT> <ENT>.00525</ENT> <ENT>.00508</ENT> <ENT>.00492</ENT> <ENT>.00477</ENT> <ENT>.00462</ENT> <ENT>.00449</ENT> <ENT>.00436</ENT> <ENT>.00423</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00606</ENT> <ENT>.00586</ENT> <ENT>.00566</ENT> <ENT>.00548</ENT> <ENT>.00531</ENT> <ENT>.00515</ENT> <ENT>.00499</ENT> <ENT>.00485</ENT> <ENT>.00471</ENT> <ENT>.00458</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00659</ENT> <ENT>.00637</ENT> <ENT>.00616</ENT> <ENT>.00597</ENT> <ENT>.00579</ENT> <ENT>.00561</ENT> <ENT>.00545</ENT> <ENT>.00529</ENT> <ENT>.00514</ENT> <ENT>.00500</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00721</ENT> <ENT>.00698</ENT> <ENT>.00676</ENT> <ENT>.00655</ENT> <ENT>.00636</ENT> <ENT>.00617</ENT> <ENT>.00600</ENT> <ENT>.00583</ENT> <ENT>.00567</ENT> <ENT>.00552</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00792</ENT> <ENT>.00767</ENT> <ENT>.00744</ENT> <ENT>.00722</ENT> <ENT>.00701</ENT> <ENT>.00682</ENT> <ENT>.00663</ENT> <ENT>.00645</ENT> <ENT>.00628</ENT> <ENT>.00612</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00871</ENT> <ENT>.00845</ENT> <ENT>.00821</ENT> <ENT>.00797</ENT> <ENT>.00775</ENT> <ENT>.00754</ENT> <ENT>.00735</ENT> <ENT>.00716</ENT> <ENT>.00698</ENT> <ENT>.00681</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.00955</ENT> <ENT>.00928</ENT> <ENT>.00902</ENT> <ENT>.00877</ENT> <ENT>.00854</ENT> <ENT>.00831</ENT> <ENT>.00810</ENT> <ENT>.00790</ENT> <ENT>.00771</ENT> <ENT>.00753</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01038</ENT> <ENT>.01009</ENT> <ENT>.00981</ENT> <ENT>.00955</ENT> <ENT>.00930</ENT> <ENT>.00907</ENT> <ENT>.00885</ENT> <ENT>.00864</ENT> <ENT>.00843</ENT> <ENT>.00824</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01116</ENT> <ENT>.01085</ENT> <ENT>.01056</ENT> <ENT>.01028</ENT> <ENT>.01002</ENT> <ENT>.00977</ENT> <ENT>.00954</ENT> <ENT>.00932</ENT> <ENT>.00910</ENT> <ENT>.00890</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01186</ENT> <ENT>.01153</ENT> <ENT>.01123</ENT> <ENT>.01094</ENT> <ENT>.01066</ENT> <ENT>.01040</ENT> <ENT>.01015</ENT> <ENT>.00992</ENT> <ENT>.00969</ENT> <ENT>.00948</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01250</ENT> <ENT>.01215</ENT> <ENT>.01183</ENT> <ENT>.01152</ENT> <ENT>.01124</ENT> <ENT>.01096</ENT> <ENT>.01070</ENT> <ENT>.01045</ENT> <ENT>.01022</ENT> <ENT>.00999</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01308</ENT> <ENT>.01272</ENT> <ENT>.01238</ENT> <ENT>.01206</ENT> <ENT>.01175</ENT> <ENT>.01147</ENT> <ENT>.01119</ENT> <ENT>.01093</ENT> <ENT>.01068</ENT> <ENT>.01044</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01367</ENT> <ENT>.01329</ENT> <ENT>.01293</ENT> <ENT>.01259</ENT> <ENT>.01227</ENT> <ENT>.01196</ENT> <ENT>.01167</ENT> <ENT>.01140</ENT> <ENT>.01113</ENT> <ENT>.01088</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01428</ENT> <ENT>.01388</ENT> <ENT>.01350</ENT> <ENT>.01314</ENT> <ENT>.01280</ENT> <ENT>.01248</ENT> <ENT>.01217</ENT> <ENT>.01188</ENT> <ENT>.01161</ENT> <ENT>.01134</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01494</ENT> <ENT>.01451</ENT> <ENT>.01411</ENT> <ENT>.01373</ENT> <ENT>.01337</ENT> <ENT>.01303</ENT> <ENT>.01271</ENT> <ENT>.01240</ENT> <ENT>.01211</ENT> <ENT>.01183</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01562</ENT> <ENT>.01517</ENT> <ENT>.01475</ENT> <ENT>.01435</ENT> <ENT>.01397</ENT> <ENT>.01361</ENT> <ENT>.01326</ENT> <ENT>.01294</ENT> <ENT>.01263</ENT> <ENT>.01233</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01635</ENT> <ENT>.01588</ENT> <ENT>.01543</ENT> <ENT>.01501</ENT> <ENT>.01460</ENT> <ENT>.01422</ENT> <ENT>.01386</ENT> <ENT>.01351</ENT> <ENT>.01319</ENT> <ENT>.01287</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01716</ENT> <ENT>.01665</ENT> <ENT>.01618</ENT> <ENT>.01573</ENT> <ENT>.01530</ENT> <ENT>.01489</ENT> <ENT>.01451</ENT> <ENT>.01415</ENT> <ENT>.01380</ENT> <ENT>.01347</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.01804</ENT> <ENT>.01751</ENT> <ENT>.01701</ENT> <ENT>.01653</ENT> <ENT>.01608</ENT> <ENT>.01565</ENT> <ENT>.01524</ENT> <ENT>.01485</ENT> <ENT>.01448</ENT> <ENT>.01413</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.01902</ENT> <ENT>.01845</ENT> <ENT>.01792</ENT> <ENT>.01741</ENT> <ENT>.01693</ENT> <ENT>.01648</ENT> <ENT>.01604</ENT> <ENT>.01563</ENT> <ENT>.01524</ENT> <ENT>.01487</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02011</ENT> <ENT>.01951</ENT> <ENT>.01895</ENT> <ENT>.01841</ENT> <ENT>.01790</ENT> <ENT>.01742</ENT> <ENT>.01696</ENT> <ENT>.01652</ENT> <ENT>.01610</ENT> <ENT>.01571</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02129</ENT> <ENT>.02066</ENT> <ENT>.02006</ENT> <ENT>.01949</ENT> <ENT>.01895</ENT> <ENT>.01844</ENT> <ENT>.01795</ENT> <ENT>.01748</ENT> <ENT>.01704</ENT> <ENT>.01662</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02258</ENT> <ENT>.02191</ENT> <ENT>.02127</ENT> <ENT>.02067</ENT> <ENT>.02009</ENT> <ENT>.01955</ENT> <ENT>.01903</ENT> <ENT>.01853</ENT> <ENT>.01806</ENT> <ENT>.01762</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02396</ENT> <ENT>.02325</ENT> <ENT>.02257</ENT> <ENT>.02193</ENT> <ENT>.02132</ENT> <ENT>.02074</ENT> <ENT>.02019</ENT> <ENT>.01966</ENT> <ENT>.01916</ENT> <ENT>.01869</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02543</ENT> <ENT>.02467</ENT> <ENT>.02396</ENT> <ENT>.02328</ENT> <ENT>.02263</ENT> <ENT>.02201</ENT> <ENT>.02143</ENT> <ENT>.02087</ENT> <ENT>.02034</ENT> <ENT>.01983</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.02701</ENT> <ENT>.02621</ENT> <ENT>.02545</ENT> <ENT>.02472</ENT> <ENT>.02404</ENT> <ENT>.02338</ENT> <ENT>.02276</ENT> <ENT>.02217</ENT> <ENT>.02160</ENT> <ENT>.02106</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.02871</ENT> <ENT>.02786</ENT> <ENT>.02706</ENT> <ENT>.02629</ENT> <ENT>.02556</ENT> <ENT>.02487</ENT> <ENT>.02420</ENT> <ENT>.02357</ENT> <ENT>.02297</ENT> <ENT>.02240</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.03054</ENT> <ENT>.02964</ENT> <ENT>.02879</ENT> <ENT>.02797</ENT> <ENT>.02720</ENT> <ENT>.02646</ENT> <ENT>.02576</ENT> <ENT>.02509</ENT> <ENT>.02445</ENT> <ENT>.02383</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.03253</ENT> <ENT>.03158</ENT> <ENT>.03067</ENT> <ENT>.02981</ENT> <ENT>.02898</ENT> <ENT>.02820</ENT> <ENT>.02745</ENT> <ENT>.02674</ENT> <ENT>.02606</ENT> <ENT>.02541</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.03467</ENT> <ENT>.03366</ENT> <ENT>.03269</ENT> <ENT>.03178</ENT> <ENT>.03090</ENT> <ENT>.03007</ENT> <ENT>.02928</ENT> <ENT>.02852</ENT> <ENT>.02779</ENT> <ENT>.02710</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.03697</ENT> <ENT>.03590</ENT> <ENT>.03488</ENT> <ENT>.03391</ENT> <ENT>.03298</ENT> <ENT>.03209</ENT> <ENT>.03125</ENT> <ENT>.03044</ENT> <ENT>.02967</ENT> <ENT>.02893</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.03947</ENT> <ENT>.03833</ENT> <ENT>.03725</ENT> <ENT>.03622</ENT> <ENT>.03524</ENT> <ENT>.03430</ENT> <ENT>.03340</ENT> <ENT>.03254</ENT> <ENT>.03172</ENT> <ENT>.03094</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.04217</ENT> <ENT>.04096</ENT> <ENT>.03982</ENT> <ENT>.03873</ENT> <ENT>.03768</ENT> <ENT>.03669</ENT> <ENT>.03573</ENT> <ENT>.03482</ENT> <ENT>.03395</ENT> <ENT>.03312</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.04510</ENT> <ENT>.04383</ENT> <ENT>.04262</ENT> <ENT>.04146</ENT> <ENT>.04035</ENT> <ENT>.03930</ENT> <ENT>.03828</ENT> <ENT>.03732</ENT> <ENT>.03639</ENT> <ENT>.03550</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.04830</ENT> <ENT>.04695</ENT> <ENT>.04567</ENT> <ENT>.04445</ENT> <ENT>.04327</ENT> <ENT>.04215</ENT> <ENT>.04108</ENT> <ENT>.04005</ENT> <ENT>.03907</ENT> <ENT>.03812</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.05177</ENT> <ENT>.05035</ENT> <ENT>.04900</ENT> <ENT>.04770</ENT> <ENT>.04646</ENT> <ENT>.04527</ENT> <ENT>.04413</ENT> <ENT>.04304</ENT> <ENT>.04200</ENT> <ENT>.04100</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.05553</ENT> <ENT>.05404</ENT> <ENT>.05261</ENT> <ENT>.05123</ENT> <ENT>.04992</ENT> <ENT>.04866</ENT> <ENT>.04746</ENT> <ENT>.04630</ENT> <ENT>.04520</ENT> <ENT>.04413</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.05960</ENT> <ENT>.05802</ENT> <ENT>.05651</ENT> <ENT>.05506</ENT> <ENT>.05368</ENT> <ENT>.05235</ENT> <ENT>.05107</ENT> <ENT>.04985</ENT> <ENT>.04867</ENT> <ENT>.04754</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.06395</ENT> <ENT>.06229</ENT> <ENT>.06069</ENT> <ENT>.05917</ENT> <ENT>.05770</ENT> <ENT>.05630</ENT> <ENT>.05495</ENT> <ENT>.05365</ENT> <ENT>.05241</ENT> <ENT>.05121</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.06860</ENT> <ENT>.06685</ENT> <ENT>.06517</ENT> <ENT>.06356</ENT> <ENT>.06202</ENT> <ENT>.06053</ENT> <ENT>.05911</ENT> <ENT>.05774</ENT> <ENT>.05643</ENT> <ENT>.05516</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.07353</ENT> <ENT>.07169</ENT> <ENT>.06992</ENT> <ENT>.06823</ENT> <ENT>.06660</ENT> <ENT>.06504</ENT> <ENT>.06353</ENT> <ENT>.06209</ENT> <ENT>.06070</ENT> <ENT>.05936</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.07877</ENT> <ENT>.07684</ENT> <ENT>.07498</ENT> <ENT>.07320</ENT> <ENT>.07149</ENT> <ENT>.06984</ENT> <ENT>.06826</ENT> <ENT>.06673</ENT> <ENT>.06527</ENT> <ENT>.06385</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.08433</ENT> <ENT>.08231</ENT> <ENT>.08036</ENT> <ENT>.07849</ENT> <ENT>.07669</ENT> <ENT>.07495</ENT> <ENT>.07329</ENT> <ENT>.07168</ENT> <ENT>.07013</ENT> <ENT>.06864</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.09026</ENT> <ENT>.08814</ENT> <ENT>.08609</ENT> <ENT>.08413</ENT> <ENT>.08224</ENT> <ENT>.08042</ENT> <ENT>.07867</ENT> <ENT>.07698</ENT> <ENT>.07535</ENT> <ENT>.07378</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.09655</ENT> <ENT>.09433</ENT> <ENT>.09219</ENT> <ENT>.09013</ENT> <ENT>.08815</ENT> <ENT>.08624</ENT> <ENT>.08440</ENT> <ENT>.08262</ENT> <ENT>.08091</ENT> <ENT>.07926</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.10318</ENT> <ENT>.10086</ENT> <ENT>.09863</ENT> <ENT>.09647</ENT> <ENT>.09439</ENT> <ENT>.09239</ENT> <ENT>.09046</ENT> <ENT>.08860</ENT> <ENT>.08680</ENT> <ENT>.08506</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.11017</ENT> <ENT>.10774</ENT> <ENT>.10541</ENT> <ENT>.10315</ENT> <ENT>.10098</ENT> <ENT>.09888</ENT> <ENT>.09686</ENT> <ENT>.09491</ENT> <ENT>.09302</ENT> <ENT>.09120</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.11750</ENT> <ENT>.11498</ENT> <ENT>.11254</ENT> <ENT>.11019</ENT> <ENT>.10792</ENT> <ENT>.10572</ENT> <ENT>.10361</ENT> <ENT>.10156</ENT> <ENT>.09958</ENT> <ENT>.09767</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.12522</ENT> <ENT>.12258</ENT> <ENT>.12005</ENT> <ENT>.11759</ENT> <ENT>.11522</ENT> <ENT>.11294</ENT> <ENT>.11072</ENT> <ENT>.10859</ENT> <ENT>.10652</ENT> <ENT>.10451</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.13332</ENT> <ENT>.13059</ENT> <ENT>.12794</ENT> <ENT>.12539</ENT> <ENT>.12292</ENT> <ENT>.12054</ENT> <ENT>.11823</ENT> <ENT>.11599</ENT> <ENT>.11383</ENT> <ENT>.11174</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.14183</ENT> <ENT>.13899</ENT> <ENT>.13624</ENT> <ENT>.13359</ENT> <ENT>.13102</ENT> <ENT>.12853</ENT> <ENT>.12613</ENT> <ENT>.12380</ENT> <ENT>.12154</ENT> <ENT>.11936</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.15070</ENT> <ENT>.14775</ENT> <ENT>.14490</ENT> <ENT>.14215</ENT> <ENT>.13948</ENT> <ENT>.13689</ENT> <ENT>.13439</ENT> <ENT>.13197</ENT> <ENT>.12962</ENT> <ENT>.12734</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.15990</ENT> <ENT>.15685</ENT> <ENT>.15389</ENT> <ENT>.15103</ENT> <ENT>.14826</ENT> <ENT>.14558</ENT> <ENT>.14298</ENT> <ENT>.14046</ENT> <ENT>.13801</ENT> <ENT>.13564</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.16942</ENT> <ENT>.16626</ENT> <ENT>.16321</ENT> <ENT>.16024</ENT> <ENT>.15737</ENT> <ENT>.15459</ENT> <ENT>.15189</ENT> <ENT>.14927</ENT> <ENT>.14673</ENT> <ENT>.14426</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.17929</ENT> <ENT>.17603</ENT> <ENT>.17287</ENT> <ENT>.16981</ENT> <ENT>.16684</ENT> <ENT>.16395</ENT> <ENT>.16115</ENT> <ENT>.15844</ENT> <ENT>.15580</ENT> <ENT>.15324</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.18960</ENT> <ENT>.18623</ENT> <ENT>.18297</ENT> <ENT>.17980</ENT> <ENT>.17673</ENT> <ENT>.17375</ENT> <ENT>.17085</ENT> <ENT>.16803</ENT> <ENT>.16530</ENT> <ENT>.16264</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.20035</ENT> <ENT>.19688</ENT> <ENT>.19352</ENT> <ENT>.19025</ENT> <ENT>.18708</ENT> <ENT>.18400</ENT> <ENT>.18100</ENT> <ENT>.17809</ENT> <ENT>.17525</ENT> <ENT>.17250</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.21154</ENT> <ENT>.20797</ENT> <ENT>.20451</ENT> <ENT>.20114</ENT> <ENT>.19787</ENT> <ENT>.19469</ENT> <ENT>.19159</ENT> <ENT>.18859</ENT> <ENT>.18566</ENT> <ENT>.18281</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.22318</ENT> <ENT>.21951</ENT> <ENT>.21595</ENT> <ENT>.21249</ENT> <ENT>.20912</ENT> <ENT>.20584</ENT> <ENT>.20265</ENT> <ENT>.19955</ENT> <ENT>.19652</ENT> <ENT>.19358</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.23532</ENT> <ENT>.23156</ENT> <ENT>.22790</ENT> <ENT>.22434</ENT> <ENT>.22088</ENT> <ENT>.21751</ENT> <ENT>.21422</ENT> <ENT>.21102</ENT> <ENT>.20791</ENT> <ENT>.20487</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.24804</ENT> <ENT>.24419</ENT> <ENT>.24044</ENT> <ENT>.23679</ENT> <ENT>.23324</ENT> <ENT>.22977</ENT> <ENT>.22640</ENT> <ENT>.22311</ENT> <ENT>.21990</ENT> <ENT>.21678</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.26133</ENT> <ENT>.25740</ENT> <ENT>.25356</ENT> <ENT>.24983</ENT> <ENT>.24618</ENT> <ENT>.24263</ENT> <ENT>.23917</ENT> <ENT>.23579</ENT> <ENT>.23250</ENT> <ENT>.22929</ENT> </ROW> <ROW> <PRTPAGE P="95"/> <ENT I="01">69</ENT> <ENT>.27516</ENT> <ENT>.27114</ENT> <ENT>.26723</ENT> <ENT>.26341</ENT> <ENT>.25969</ENT> <ENT>.25605</ENT> <ENT>.25251</ENT> <ENT>.24905</ENT> <ENT>.24567</ENT> <ENT>.24237</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.28945</ENT> <ENT>.28536</ENT> <ENT>.28137</ENT> <ENT>.27747</ENT> <ENT>.27367</ENT> <ENT>.26996</ENT> <ENT>.26633</ENT> <ENT>.26279</ENT> <ENT>.25934</ENT> <ENT>.25596</ENT> 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<ENT>.44619</ENT> <ENT>.44192</ENT> <ENT>.43772</ENT> <ENT>.43360</ENT> <ENT>.42954</ENT> <ENT>.42556</ENT> <ENT>.42164</ENT> <ENT>.41779</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.47360</ENT> <ENT>.46920</ENT> <ENT>.46487</ENT> <ENT>.46061</ENT> <ENT>.45643</ENT> <ENT>.45231</ENT> <ENT>.44827</ENT> <ENT>.44429</ENT> <ENT>.44038</ENT> <ENT>.43653</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.49223</ENT> <ENT>.48785</ENT> <ENT>.48355</ENT> <ENT>.47932</ENT> <ENT>.47516</ENT> <ENT>.47106</ENT> <ENT>.46703</ENT> <ENT>.46307</ENT> <ENT>.45916</ENT> <ENT>.45532</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.51081</ENT> <ENT>.50648</ENT> <ENT>.50221</ENT> <ENT>.49802</ENT> <ENT>.49388</ENT> <ENT>.48982</ENT> <ENT>.48581</ENT> <ENT>.48187</ENT> <ENT>.47799</ENT> <ENT>.47416</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.52951</ENT> <ENT>.52523</ENT> <ENT>.52101</ENT> <ENT>.51686</ENT> <ENT>.51277</ENT> <ENT>.50874</ENT> <ENT>.50477</ENT> <ENT>.50086</ENT> <ENT>.49701</ENT> <ENT>.49321</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.54847</ENT> <ENT>.54425</ENT> <ENT>.54009</ENT> <ENT>.53600</ENT> <ENT>.53196</ENT> <ENT>.52798</ENT> <ENT>.52406</ENT> <ENT>.52019</ENT> <ENT>.51638</ENT> <ENT>.51262</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.56749</ENT> <ENT>.56335</ENT> <ENT>.55926</ENT> <ENT>.55523</ENT> <ENT>.55126</ENT> <ENT>.54734</ENT> <ENT>.54348</ENT> <ENT>.53966</ENT> <ENT>.53591</ENT> <ENT>.53220</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.58627</ENT> <ENT>.58221</ENT> <ENT>.57820</ENT> <ENT>.57425</ENT> <ENT>.57035</ENT> <ENT>.56650</ENT> <ENT>.56270</ENT> <ENT>.55895</ENT> <ENT>.55526</ENT> <ENT>.55161</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.60477</ENT> <ENT>.60079</ENT> <ENT>.59688</ENT> <ENT>.59301</ENT> <ENT>.58919</ENT> <ENT>.58542</ENT> <ENT>.58170</ENT> <ENT>.57802</ENT> <ENT>.57439</ENT> <ENT>.57081</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.62297</ENT> <ENT>.61909</ENT> <ENT>.61527</ENT> <ENT>.61149</ENT> <ENT>.60776</ENT> <ENT>.60408</ENT> <ENT>.60044</ENT> <ENT>.59685</ENT> <ENT>.59330</ENT> <ENT>.58979</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.64084</ENT> <ENT>.63707</ENT> <ENT>.63335</ENT> <ENT>.62968</ENT> <ENT>.62604</ENT> <ENT>.62246</ENT> <ENT>.61891</ENT> <ENT>.61540</ENT> <ENT>.61194</ENT> <ENT>.60851</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.65803</ENT> <ENT>.65437</ENT> <ENT>.65076</ENT> <ENT>.64719</ENT> <ENT>.64366</ENT> <ENT>.64017</ENT> <ENT>.63672</ENT> <ENT>.63330</ENT> <ENT>.62993</ENT> <ENT>.62659</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.67412</ENT> <ENT>.67058</ENT> <ENT>.66707</ENT> <ENT>.66360</ENT> <ENT>.66017</ENT> <ENT>.65678</ENT> <ENT>.65342</ENT> <ENT>.65010</ENT> <ENT>.64682</ENT> <ENT>.64357</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.68911</ENT> <ENT>.68567</ENT> <ENT>.68227</ENT> <ENT>.67890</ENT> <ENT>.67557</ENT> <ENT>.67227</ENT> <ENT>.66901</ENT> <ENT>.66578</ENT> <ENT>.66258</ENT> <ENT>.65942</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.70321</ENT> <ENT>.69988</ENT> <ENT>.69657</ENT> <ENT>.69330</ENT> <ENT>.69006</ENT> <ENT>.68686</ENT> <ENT>.68369</ENT> <ENT>.68055</ENT> <ENT>.67744</ENT> <ENT>.67437</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.71674</ENT> <ENT>.71351</ENT> <ENT>.71031</ENT> <ENT>.70713</ENT> <ENT>.70399</ENT> <ENT>.70088</ENT> <ENT>.69781</ENT> <ENT>.69476</ENT> <ENT>.69174</ENT> <ENT>.68875</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.72959</ENT> <ENT>.72646</ENT> <ENT>.72335</ENT> <ENT>.72028</ENT> <ENT>.71724</ENT> <ENT>.71422</ENT> <ENT>.71123</ENT> <ENT>.70828</ENT> <ENT>.70534</ENT> <ENT>.70244</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.74156</ENT> <ENT>.73853</ENT> <ENT>.73552</ENT> <ENT>.73254</ENT> <ENT>.72959</ENT> <ENT>.72666</ENT> <ENT>.72376</ENT> <ENT>.72089</ENT> <ENT>.71804</ENT> <ENT>.71522</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.75287</ENT> <ENT>.74993</ENT> <ENT>.74702</ENT> <ENT>.74413</ENT> <ENT>.74126</ENT> <ENT>.73842</ENT> <ENT>.73561</ENT> <ENT>.73282</ENT> <ENT>.73006</ENT> <ENT>.72732</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.76401</ENT> <ENT>.76117</ENT> <ENT>.75834</ENT> <ENT>.75555</ENT> <ENT>.75277</ENT> <ENT>.75002</ENT> <ENT>.74730</ENT> <ENT>.74459</ENT> <ENT>.74191</ENT> <ENT>.73926</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.77494</ENT> <ENT>.77219</ENT> <ENT>.76946</ENT> <ENT>.76676</ENT> <ENT>.76408</ENT> <ENT>.76142</ENT> <ENT>.75878</ENT> <ENT>.75616</ENT> <ENT>.75357</ENT> <ENT>.75099</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.78580</ENT> <ENT>.78315</ENT> <ENT>.78052</ENT> <ENT>.77791</ENT> <ENT>.77532</ENT> <ENT>.77275</ENT> <ENT>.77021</ENT> <ENT>.76768</ENT> <ENT>.76517</ENT> <ENT>.76268</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.79654</ENT> <ENT>.79399</ENT> <ENT>.79146</ENT> <ENT>.78894</ENT> <ENT>.78645</ENT> <ENT>.78397</ENT> <ENT>.78152</ENT> <ENT>.77908</ENT> <ENT>.77666</ENT> <ENT>.77426</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.80724</ENT> <ENT>.80479</ENT> <ENT>.80236</ENT> <ENT>.79994</ENT> <ENT>.79755</ENT> <ENT>.79517</ENT> <ENT>.79280</ENT> <ENT>.79046</ENT> <ENT>.78813</ENT> <ENT>.78582</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.81879</ENT> <ENT>.81646</ENT> <ENT>.81413</ENT> <ENT>.81183</ENT> <ENT>.80954</ENT> <ENT>.80726</ENT> <ENT>.80501</ENT> <ENT>.80276</ENT> <ENT>.80054</ENT> <ENT>.79832</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.83005</ENT> <ENT>.82782</ENT> <ENT>.82560</ENT> <ENT>.82340</ENT> <ENT>.82121</ENT> <ENT>.81904</ENT> <ENT>.81688</ENT> <ENT>.81474</ENT> <ENT>.81260</ENT> <ENT>.81049</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.84485</ENT> <ENT>.84277</ENT> <ENT>.84071</ENT> <ENT>.83866</ENT> <ENT>.83662</ENT> <ENT>.83459</ENT> <ENT>.83257</ENT> <ENT>.83057</ENT> <ENT>.82857</ENT> <ENT>.82659</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.86311</ENT> <ENT>.86124</ENT> <ENT>.85937</ENT> <ENT>.85751</ENT> <ENT>.85566</ENT> <ENT>.85382</ENT> <ENT>.85199</ENT> <ENT>.85017</ENT> <ENT>.84835</ENT> <ENT>.84655</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.89266</ENT> <ENT>.89114</ENT> <ENT>.88963</ENT> <ENT>.88812</ENT> <ENT>.88662</ENT> <ENT>.88513</ENT> <ENT>.88364</ENT> <ENT>.88216</ENT> <ENT>.88068</ENT> <ENT>.87922</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94563</ENT> <ENT>.94484</ENT> <ENT>.94405</ENT> <ENT>.94326</ENT> <ENT>.94248</ENT> <ENT>.94170</ENT> <ENT>.94092</ENT> <ENT>.94014</ENT> <ENT>.93937</ENT> <ENT>.93860</ENT> </ROW> </GPOTABLE> <P> (7) <E T="03">Effective/applicability dates.</E> Paragraphs (f)(1) through (f)(6) apply after April 30, 1999, and before May 1, 2009. </P> <P> (g) <E T="03">Present value of the remainder interest in the case of transfers to pooled income funds for which the valuation date is on or after May 1, 2009, and before June 1, 2023</E> —(1) <E T="03">In general.</E> In the case of transfers to pooled income funds for which the valuation date is on or after May 1, 2009, and before June 1, 2023, the present value of a remainder interest is determined under this section. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). The present value of a remainder interest that is dependent on the termination of the life of one individual is computed by the use of Table S in paragraph (g)(6) of this section. For purposes of the computations under this section, the age of an individual is the age at the individual's nearest birthday. </P> <P> (2) <E T="03">Transitional rules for valuation of transfers to pooled income funds.</E> (i) For purposes of section 2055, 2106, or 2624, if on May 1, 2009, the decedent was under a mental disability so that the disposition of the property could not be changed, and the decedent died on or after May 1, 2009, but before June 2, 2023, without having regained the ability to dispose of the decedent's property, or if the decedent died within 90 days of the date that the decedent first regained that ability on or after May 1, 2009, but before June 2, 2023, the <PRTPAGE P="96"/> present value of a remainder interest is determined as if the valuation date with respect to the decedent's gross estate is either before May 1, 2009, or after April 30, 2009, at the option of the decedent's executor. </P> <P>(ii) For purposes of section 170, 2055, 2106, 2522, or 2624, in the case of transfers to a pooled income fund for which the valuation date is on or after May 1, 2009, and before July 1, 2009, the present value of the remainder interest under this section is determined by using the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial tables under either paragraph (f)(6) or (g)(6) of this section, at the option of the donor or the decedent's executor, as the case may be.</P> <P>(iii) For purposes of paragraphs (g)(2)(i) and (ii) of this section, where the donor or decedent's executor is given the option to use the appropriate actuarial tables under either paragraph (f)(6) or (g)(6) of this section, the donor or decedent's executor must consistently use the same mortality basis with respect to each interest (income, remainder, partial, etc.) in the same property, and with respect to all transfers occurring on the same valuation date. For example, gift and income tax charitable deductions with respect to the same transfer must be determined based on factors with the same mortality basis, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on factors with the same mortality basis.</P> <P>(iv) In the case of transfers to a pooled income fund for which the valuation date is after April 30, 2019, and before June 1, 2023, the present value of the remainder interest under this section is determined under § 1.642(c)-6(e)(2).</P> <P> (3) <E T="03">Present value of a remainder interest.</E> The present value of a remainder interest in property transferred to a pooled income fund is computed on the basis of— </P> <P> (i) Life contingencies determined from the values of <E T="03">l</E> <E T="52">X</E> that are set forth in Table 2000CM in § 20.2031-7A(g)(4) of this chapter; and </P> <P>(ii) Discount at a rate of interest, compounded annually, equal to the highest yearly rate of return of the pooled income fund for the three taxable years immediately preceding its taxable year in which the transfer of property to the fund is made. The provisions of § 1.642(c)-6(c) apply for determining the yearly rate of return. However, where the taxable year is less than 12 months, the provisions of § 1.642(c)-6(e)(3)(ii) apply for the determining the yearly rate of return.</P> <P> (4) <E T="03">Pooled income funds in existence less than three taxable years.</E> The provisions of § 1.642(c)-6(e)(4) apply for determining the highest yearly rate of return when the pooled income fund has been in existence less than three taxable years. </P> <P> (5) <E T="03">Computation of value of remainder interest.</E> The factor that is used in determining the present value of a remainder interest that is dependent on the termination of the life of one individual is the factor from Table S in paragraph (g)(6) of this section under the appropriate yearly rate of return opposite the number that corresponds to the age of the individual upon whose life the value of the remainder interest is based. Table S in paragraph (g)(6) of this section includes factors for yearly rates of return from 0.2 to 14 percent, inclusive, in increments of two-tenths of one percent. Actuarial factors that do not appear in paragraph (g)(6) of this section may be computed directly by using the formula in § 20.2031-7(d)(2)(ii)(B) of this chapter to derive a remainder factor from the appropriate mortality table to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table S that is referenced and explained by IRS Publication 1457, <E T="03">Actuarial Valuations Version 3A</E> (2009). The table is available at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). For other situations, see § 1.642(c)-6(b). If the yearly rate of return is a percentage that is between the yearly rates of return for which factors are provided by Table S, an exact method of obtaining the applicable factors <PRTPAGE P="97"/> (such as through software using the actual rate of return and actuarial formulas provided in § 20.2031-7(d)(2)(ii)(B) of this chapter) or a linear interpolation must be used, provided whichever method used is applied consistently in valuing all interests in the same property. The present value of the remainder interest is determined by multiplying the fair market value of the property on the valuation date by the appropriate remainder factor. For an example of a computation of the present value of a remainder interest requiring a linear interpolation adjustment, see § 1.642(c)-6(e)(5). </P> <P> (6) <E T="03">Actuarial tables.</E> In the case of transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023, and without regard to the headings in the tables in this paragraph (g)(6) that do not contain this termination date for the applicability of the tables, the present value of a remainder interest dependent on the termination of one life in the case of a transfer to a pooled income fund is determined by using the following tables: </P> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="98"/> <GID>ER10AU11.002</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="99"/> <GID>ER10AU11.003</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="100"/> <GID>ER10AU11.004</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="101"/> <GID>ER10AU11.005</GID> </GPH> <GPH SPAN="2" DEEP="409"> <PRTPAGE P="102"/> <GID>ER10AU11.006</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="103"/> <GID>ER10AU11.007</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="104"/> <GID>ER10AU11.008</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="105"/> <GID>ER10AU11.009</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="106"/> <GID>ER10AU11.010</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="107"/> <GID>ER10AU11.011</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="108"/> <GID>ER10AU11.012</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="109"/> <GID>ER10AU11.013</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="110"/> <GID>ER10AU11.014</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="111"/> <GID>ER10AU11.015</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="112"/> <GID>ER10AU11.016</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="113"/> <GID>ER10AU11.017</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="114"/> <GID>ER10AU11.018</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="115"/> <GID>ER10AU11.019</GID> </GPH> <GPH SPAN="2" DEEP="405"> <PRTPAGE P="116"/> <GID>ER10AU11.020</GID> </GPH> <GPH SPAN="2" DEEP="408"> <PRTPAGE P="117"/> <GID>ER10AU11.021</GID> </GPH> <GPH SPAN="2" DEEP="445"> <PRTPAGE P="118"/> <GID>ER10AU11.022</GID> </GPH> <PRTPAGE P="119"/> <P> (7) <E T="03">Applicability dates.</E> Paragraphs (g)(1) through (6) of this section apply on and after May 1, 2009, and before June 1, 2023. </P> <CITA>[Redesignated at 36 FR 6480, Apr. 6, 1971, as amended by T.D. 8540, 59 FR 30102, 30105, 30116, June 10, 1994; T.D. 8819, 64 FR 23190, 23199, 23228, Apr. 30, 1999; 64 FR 33196, June 22, 1999; T.D. 8886, 65 FR 36943, June 12, 2000; T.D. 9448, 74 FR 21440, 21464, May 7, 2009; T.D. 9540, 76 FR 49612, Aug. 10, 2011; T.D. 9974, 88 FR 37429, June 7, 2023; 88 FR 37432, June 7, 2023]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Election to Treat Trust as Part of an Estate</HD> <SECTION> <SECTNO>§ 1.645-1</SECTNO> <SUBJECT>Election by certain revocable trusts to be treated as part of estate.</SUBJECT> <P> (a) <E T="03">In general.</E> If an election is filed for a qualified revocable trust, as defined in paragraph (b)(1) of this section, in accordance with the rules set forth in paragraph (c) of this section, the qualified revocable trust is treated and taxed for purposes of subtitle A of the Internal Revenue Code as part of its related estate, as defined in paragraph (b)(5) of this section (and not as a separate trust) during the election period, as defined in paragraph (b)(6) of this section. Rules regarding the use of taxpayer identification numbers (TINs) and the filing of a Form 1041, “U.S. Income Tax Return for Estates and Trusts,” for a qualified revocable trust are in paragraph (d) of this section. Rules regarding the tax treatment of an electing trust and related estate and the general filing requirements for the combined entity during the election period are in paragraph (e)(2) of this section. Rules regarding the tax treatment of an electing trust and its filing requirements during the election period if no executor, as defined in paragraph (b)(4) of this section, is appointed for a related estate are in paragraph (e)(3) of this section. Rules for determining the duration of the section 645 election period are in paragraph (f) of this section. Rules regarding the tax effects of the termination of the election are in paragraph (h) of this section. Rules regarding the tax consequences of the appointment of an executor after a trustee has made a section 645 election believing that an executor would not be appointed for a related estate are in paragraph (g) of this section. </P> <P> (b) <E T="03">Definitions.</E> For purposes of this section: </P> <P> (1) <E T="03">Qualified revocable trust.</E> A <E T="03">qualified revocable trust</E> (QRT) is any trust (or portion thereof) that on the date of death of the decedent was treated as owned by the decedent under section 676 by reason of a power held by the decedent (determined without regard to section 672(e)). A trust that was treated as owned by the decedent under section 676 by reason of a power that was exercisable by the decedent only with the approval or consent of a nonadverse party or with the approval or consent of the decedent's spouse is a QRT. A trust that was treated as owned by the decedent under section 676 solely by reason of a power held by a nonadverse party or by reason of a power held by the decedent's spouse is not a QRT. </P> <P> (2) <E T="03">Electing trust.</E> An <E T="03">electing trust</E> is a QRT for which a valid section 645 election has been made. Once a section 645 election has been made for the trust, the trust shall be treated as an electing trust throughout the entire election period. </P> <P> (3) <E T="03">Decedent.</E> The <E T="03">decedent</E> is the individual who was treated as the owner of the <E T="03">QRT</E> under section 676 on the date of that individual's death. </P> <P> (4) <E T="03">Executor.</E> An <E T="03">executor</E> is an executor, personal representative, or administrator that has obtained letters of appointment to administer the decedent's estate through formal or informal appointment procedures. Solely for purposes of this paragraph (b)(4), an executor does not include a person that has actual or constructive possession of property of the decedent unless that person is also appointed or qualified as an executor, administrator, or personal representative of the decedent's estate. If more than one jurisdiction has appointed an executor, the executor appointed in the domiciliary or primary proceeding is the executor of the related estate for purposes of this paragraph (b)(4). </P> <P> (5) <E T="03">Related estate.</E> A <E T="03">related estate</E> is the estate of the decedent who was treated as the owner of the QRT on the date of the decedent's death. </P> <P> (6) <E T="03">Election period.</E> The <E T="03">election period</E> is the period of time during which an <PRTPAGE P="120"/> electing trust is treated and taxed as part of its related estate. The rules for determining the duration of the election period are in paragraph (f) of this section. </P> <P> (c) <E T="03">The election</E> —(1) <E T="03">Filing the election if there is an executor</E> —(i) <E T="03">Time and manner for filing the election.</E> If there is an executor of the related estate, the trustees of each QRT joining in the election and the executor of the related estate make an election under section 645 and this section to treat each QRT joining in the election as part of the related estate for purposes of subtitle A of the Internal Revenue Code by filing a form provided by the IRS for making the election (election form) properly completed and signed under penalties of perjury, or in any other manner prescribed after December 24, 2002 by forms provided by the Internal Revenue Service (IRS), or by other published guidance for making the election. For the election to be valid, the election form must be filed not later than the time prescribed under section 6072 for filing the Form 1041 for the first taxable year of the related estate (regardless of whether there is sufficient income to require the filing of that return). If an extension is granted for the filing of the Form 1041 for the first taxable year of the related estate, the election form will be timely filed if it is filed by the time prescribed for filing the Form 1041 including the extension granted with respect to the Form 1041. </P> <P> (ii) <E T="03">Conditions to election.</E> In addition to providing the information required by the election form, as a condition to a valid section 645 election, the trustee of each QRT joining in the election and the executor of the related estate agree, by signing the election form under penalties of perjury, that: </P> <P>(A) With respect to a trustee—</P> <P> ( <E T="03">1</E> ) The trustee agrees to the election; </P> <P> ( <E T="03">2</E> ) The trustee is responsible for timely providing the executor of the related estate with all the trust information necessary to permit the executor to file a complete, accurate, and timely Form 1041 for the combined electing trust(s) and related estate for each taxable year during the election period; </P> <P> ( <E T="03">3</E> ) The trustee of each QRT joining the election and the executor of the related estate have agreed to allocate the tax burden of the combined electing trust(s) and related estate for each taxable year during the election period in a manner that reasonably reflects the tax obligations of each electing trust and the related estate; and </P> <P> ( <E T="03">4</E> ) The trustee is responsible for insuring that the electing trust's share of the tax obligations of the combined electing trust(s) and related estate is timely paid to the Secretary. </P> <P>(B) With respect to the executor—</P> <P> ( <E T="03">1</E> ) The executor agrees to the election; </P> <P> ( <E T="03">2</E> ) The executor is responsible for filing a complete, accurate, and timely Form 1041 for the combined electing trust(s) and related estate for each taxable year during the election period; </P> <P> ( <E T="03">3</E> ) The executor and the trustee of each QRT joining in the election have agreed to allocate the tax burden of the combined electing trust(s) and related estate for each taxable year during the election period in a manner that reasonably reflects the tax obligations of each electing trust and the related estate; </P> <P> ( <E T="03">4</E> ) The executor is responsible for insuring that the related estate's share of the tax obligations of the combined electing trust(s) and related estate is timely paid to the Secretary. </P> <P> (2) <E T="03">Filing the election if there is no executor</E> —(i) <E T="03">Time and manner for filing the election.</E> If there is no executor for a related estate, an election to treat one or more QRTs of the decedent as an estate for purposes of subtitle A of the Internal Revenue Code is made by the trustees of each QRT joining in the election, by filing a properly completed election form, or in any other manner prescribed after December 24, 2002 by forms provided by the IRS, or by other published guidance for making the election. For the election to be valid, the election form must be filed not later than the time prescribed under section 6072 for filing the Form 1041 for the first taxable year of the trust, taking into account the trustee's election to treat the trust as an estate under section 645 (regardless of whether there is sufficient income to require the filing of that return). If an extension is <PRTPAGE P="121"/> granted for the filing of the Form 1041 for the first taxable year of the electing trust, the election form will be timely filed if it is filed by the time prescribed for filing the Form 1041 including the extension granted with respect to the filing of the Form 1041. </P> <P> (ii) <E T="03">Conditions to election.</E> In addition to providing the information required by the election form, as a condition to a valid section 645 election, the trustee of each QRT joining in the election agrees, by signing the election form under penalties of perjury, that— </P> <P>(A) The trustee agrees to the election;</P> <P>(B) If there is more than one QRT joining in the election, the trustees of each QRT joining in the election have appointed one trustee to be responsible for filing the Form 1041 for the combined electing trusts for each taxable year during the election period (filing trustee) and the filing trustee has agreed to accept that responsibility;</P> <P>(C) If there is more than one QRT, the trustees of each QRT joining in the election have agreed to allocate the tax liability of the combined electing trusts for each taxable year during the election period in a manner that reasonably reflects the tax obligations of each electing trust;</P> <P>(D) The trustee agrees to:</P> <P> ( <E T="03">1</E> ) Timely file a Form 1041 for the electing trust(s) for each taxable year during the election period; or </P> <P> ( <E T="03">2</E> ) If there is more than one QRT and the trustee is not the filing trustee, timely provide the filing trustee with all of the electing trust's information necessary to permit the filing trustee to file a complete, accurate, and timely Form 1041 for the combined electing trusts for each taxable year during the election period; </P> <P> ( <E T="03">3</E> ) Insure that the electing trust's share of the tax burden is timely paid to the Secretary; </P> <P>(E) There is no executor and, to the knowledge and belief of the trustee, one will not be appointed; and</P> <P>(F) If an executor is appointed after the filing of the election form and the executor agrees to the section 645 election, the trustee will complete and file a revised election form with the executor.</P> <P> (3) <E T="03">Election for more than one QRT.</E> If there is more than one QRT, the election may be made for some or all of the QRTs. If there is no executor, one trustee must be appointed by the trustees of the electing trusts to file Forms 1041 for the combined electing trusts filing as an estate during the election period. </P> <P> (d) <E T="03">TIN and filing requirements for a QRT</E> —(1) <E T="03">Obtaining a TIN.</E> Regardless of whether there is an executor for a related estate and regardless of whether a section 645 election will be made for the QRT, a TIN must be obtained for the QRT following the death of the decedent. See § 301.6109-1(a)(3) of this chapter. The trustee must furnish this TIN to the payors of the QRT. See § 301.6109-1(a)(5) of this chapter for the definition of payor. </P> <P> (2) <E T="03">Filing a Form 1041 for a QRT</E> —(i) <E T="03">Option not to file a Form 1041 for a QRT for which a section 645 election will be made.</E> If a section 645 election will be made for a QRT, the executor of the related estate, if any, and the trustee of the QRT may treat the QRT as an electing trust from the decedent's date of death until the due date for the section 645 election. Accordingly, the trustee of the QRT is not required to file a Form 1041 for the QRT for the short taxable year beginning with the decedent's date of death and ending December 31 of that year. However, if a QRT is treated as an electing trust under this paragraph from the decedent's date of death until the due date for the section 645 election but a valid section 645 election is not made for the QRT, the QRT will be subject to penalties and interest for failing to timely file a Form 1041 and pay the tax due thereon. </P> <P> (ii) <E T="03">Requirement to file a Form 1041 for a QRT if paragraph (d)(2)(i) of this section does not apply</E> —(A) <E T="03">Requirement to file Form 1041.</E> If the trustee of the QRT and the executor of the related estate, if any, do not treat the QRT as an electing trust as provided under paragraph (d)(2)(i) of this section, or if the trustee of the electing trust and the executor, if any, are uncertain whether a section 645 election will be made for a QRT, the trustee of the QRT must file a Form 1041 for the short taxable year beginning with the decedent's death <PRTPAGE P="122"/> and ending December 31 of that year (unless the QRT is not required to file a Form 1041 under section 6012 for this period). </P> <P> (B) <E T="03">Requirement to amend Form 1041 if a section 645 election is made</E> —( <E T="03">1</E> ) <E T="03">If there is an executor.</E> If there is an executor and a valid section 645 election is made for a QRT after a Form 1041 has been filed for the QRT as a trust (see paragraph (d)(2)(ii)(A) of this section), the trustee must amend the Form 1041. The QRT's items of income, deduction, and credit must be excluded from the amended Form 1041 filed under this paragraph and must be included on the Form 1041 filed for the first taxable year of the combined electing trust and related estate under paragraph (e)(2)(ii)(A) of this section. </P> <P> ( <E T="03">2</E> ) <E T="03">If there is no executor.</E> If there is no executor and a valid section 645 election is made for a QRT after a Form 1041 has been filed for the QRT as a trust (see paragraph (d)(2)(ii)(A) of this section) for the short taxable year beginning with the decedent's death and ending December 31 of that year, the trustee must file an amended return for the QRT. The amended return must be filed consistent with paragraph (e)(3) of this section and must be filed by the due date of the Form 1041 for the QRT, taking into account the trustee's election under section 645. </P> <P> (e) <E T="03">Tax treatment and general filing requirements of electing trust and related estate during the election period</E> —(1) <E T="03">Effect of election.</E> The section 645 election once made is irrevocable. </P> <P> (2) <E T="03">If there is an executor</E> —(i) <E T="03">Tax treatment of the combined electing trust and related estate.</E> If there is an executor, the electing trust is treated, during the election period, as part of the related estate for all purposes of subtitle A of the Internal Revenue Code. Thus, for example, the electing trust is treated as part of the related estate for purposes of the set-aside deduction under section 642(c)(2), the subchapter S shareholder requirements of section 1361(b)(1), and the special offset for rental real estate activities in section 469(i)(4). </P> <P> (ii) <E T="03">Filing requirements</E> —(A) <E T="03">Filing the Form 1041 for the combined electing trust and related estate during the election period.</E> If there is an executor, the executor files a single income tax return annually (assuming a return is required under section 6012) under the name and TIN of the related estate for the combined electing trust and the related estate. Information regarding the name and TIN of each electing trust must be provided on the Form 1041 as required by the instructions to that form. The period of limitations provided in section 6501 for assessments with respect to an electing trust and the related estate starts with the filing of the return required under this paragraph. Except as required under the separate share rules of section 663(c), for purposes of filing the Form 1041 under this paragraph and computing the tax, the items of income, deduction, and credit of the electing trust and related estate are combined. One personal exemption in the amount of $600 is permitted under section 642(b), and the tax is computed under section 1(e), taking into account section 1(h), for the combined taxable income. </P> <P> (B) <E T="03">Filing a Form 1041 for the electing trust is not required.</E> Except for any final Form 1041 required to be filed under paragraph (h)(2)(i)(B) of this section, if there is an executor, the trustee of the electing trust does not file a Form 1041 for the electing trust during the election period. Although the trustee is not required to file a Form 1041 for the electing trust, the trustee of the electing trust must timely provide the executor of the related estate with all the trust information necessary to permit the executor to file a complete, accurate and timely Form 1041 for the combined electing trust and related estate. The trustee must also insure that the electing trust's share of the tax obligations of the combined electing trust and related estate is timely paid to the Secretary. In certain situations, the trustee of a QRT may be required to file a Form 1041 for the QRT's short taxable year beginning with the date of the decedent's death and ending December 31 of that year. See paragraph (d)(2) of this section. </P> <P> (iii) <E T="03">Application of the separate share rules</E> —(A) <E T="03">Distributions to beneficiaries (other than to a share (or shares) of the combined electing trust and related estate).</E> Under the separate share rules of <PRTPAGE P="123"/> section 663(c), the electing trust and related estate are treated as separate shares for purposes of computing distributable net income (DNI) and applying the distribution provisions of sections 661 and 662. Further, the electing trust share or the related estate share may each contain two or more shares. Thus, if during the taxable year, a distribution is made by the electing trust or the related estate, the DNI of the share making the distribution must be determined and the distribution provisions of sections 661 and 662 must be applied using the separately determined DNI applicable to the distributing share. </P> <P> (B) <E T="03">Adjustments to the DNI of the separate shares for distributions between shares to which sections 661 and 662 would apply.</E> A distribution from one share to another share to which sections 661 and 662 would apply if made to a beneficiary other than another share of the combined electing trust and related estate affects the computation of the DNI of the share making the distribution and the share receiving the distribution. The share making the distribution reduces its DNI by the amount of the distribution deduction that it would be entitled to under section 661 (determined without regard to section 661(c)), had the distribution been made to another beneficiary, and, solely for purposes of calculating DNI, the share receiving the distribution increases its gross income by the same amount. The distribution has the same character in the hands of the recipient share as in the hands of the distributing share. The following example illustrates the provisions of this paragraph (e)(2)(iii)(B): </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(i) A's will provides that, after the payment of debts, expenses, and taxes, the residue of A's estate is to be distributed to Trust, an electing trust. The sole beneficiary of Trust is C. The estate share has $15,000 of gross income, $5,000 of deductions, and $10,000 of taxable income and DNI for the taxable year based on the assets held in A's estate. During the taxable year, A's estate distributes $15,000 to Trust. The distribution reduces the DNI of the estate share by $10,000.</P> <P>(ii) For the same taxable year, the trust share has $25,000 of gross income and $5,000 of deductions. None of the modifications provided for under section 643(a) apply. In calculating the DNI for the trust share, the gross income of the trust share is increased by $10,000, the amount of the reduction in the DNI of the estate share as a result of the distribution to Trust. Thus, solely for purposes of calculating DNI, the trust share has gross income of $35,000, and taxable income of $30,000. Therefore, the trust share has $30,000 of DNI for the taxable year.</P> <P>(iii) During the same taxable year, Trust distributes $35,000 to C. The distribution deduction reported on the Form 1041 filed for A's estate and Trust is $30,000. As a result of the distribution by Trust to C, C must include $30,000 in gross income for the taxable year. The gross income reported on the Form 1041 filed for A's estate and Trust is $40,000.</P> </EXAMPLE> <P> (iv) <E T="03">Application of the governing instrument requirement of section 642(c).</E> A deduction is allowed in computing the taxable income of the combined electing trust and related estate to the extent permitted under section 642(c) for— </P> <P>(A) Any amount of the gross income of the related estate that is paid or set aside during the taxable year pursuant to the terms of the governing instrument of the related estate for a purpose specified in section 170(c); and</P> <P>(B) Any amount of gross income of the electing trust that is paid or set aside during the taxable year pursuant to the terms of the governing instrument of the electing trust for a purpose specified in section 170(c).</P> <P> (3) <E T="03">If there is no executor</E> —(i) <E T="03">Tax treatment of the electing trust.</E> If there is no executor, the trustee treats the electing trust, during the election period, as an estate for all purposes of subtitle A of the Internal Revenue Code. Thus, for example, an electing trust is treated as an estate for purposes of the set-aside deduction under section 642(c)(2), the subchapter S shareholder requirements of section 1361(b)(1), and the special offset for rental real estate activities under section 469(i)(4). The trustee may also adopt a taxable year other than a calendar year. </P> <P> (ii) <E T="03">Filing the Form 1041 for the electing trust.</E> If there is no executor, the trustee of the electing trust must, during the election period, file a Form 1041, under the TIN obtained by the trustee under § 301.6109-1(a)(3) of this chapter upon the death of the decedent, treating the trust as an estate. If there is more than one electing trust, the Form 1041 must be filed by the filing trustee <PRTPAGE P="124"/> (see paragraph (c)(2)(ii)(B) of this section) under the name and TIN of the electing trust of the filing trustee. Information regarding the names and TINs of the other electing trusts must be provided on the Form 1041 as required by the instructions to that form. Any return filed in accordance with this paragraph shall be treated as a return filed for the electing trust (or trusts, if there is more than one electing trust) and not as a return filed for any subsequently discovered related estate. Accordingly, the period of limitations provided in section 6501 for assessments with respect to a subsequently discovered related estate does not start until a return is filed with respect to the related estate. See paragraph (g) of this section. </P> <P> (4) <E T="03">Application of the section 6654(l)(2) to the electing trust.</E> Each electing trust and related estate (if any) is treated as a separate taxpayer for all purposes of subtitle F of the Internal Revenue Code, including, without limitation, the application of section 6654. The provisions of section 6654(l)(2)(A) relating to the two year exception to an estate's obligation to make estimated tax payments, however, will apply to each electing trust for which a section 645 election has been made. </P> <P> (f) <E T="03">Duration of election period</E> —(1) <E T="03">In general.</E> The election period begins on the date of the decedent's death and terminates on the earlier of the day on which both the electing trust and related estate, if any, have distributed all of their assets, or the day before the applicable date. The election does not apply to successor trusts (trusts that are distributees under the trust instrument). </P> <P> (2) <E T="03">Definition of applicable date</E> —(i) <E T="03">Applicable date if no Form 706 “United States Estate (and Generation Skipping Transfer) Tax Return” is required to be filed.</E> If a Form 706 is not required to be filed as a result of the decedent's death, the applicable date is the day which is 2 years after the date of the decedent's death. </P> <P> (ii) <E T="03">Applicable date if a Form 706 is required to be filed.</E> If a Form 706 is required to be filed as a result of the decedent's death, the applicable date is the later of the day that is 2 years after the date of the decedent's death, or the day that is 6 months after the date of final determination of liability for estate tax. Solely for purposes of determining the applicable date under section 645, the date of final determination of liability is the earliest of the following— </P> <P>(A) The date that is six months after the issuance by the Internal Revenue Service of an estate tax closing letter, unless a claim for refund with respect to the estate tax is filed within twelve months after the issuance of the letter;</P> <P>(B) The date of a final disposition of a claim for refund, as defined in paragraph (f)(2)(iii) of this section, that resolves the liability for the estate tax, unless suit is instituted within six months after a final disposition of the claim;</P> <P>(C) The date of execution of a settlement agreement with the Internal Revenue Service that determines the liability for the estate tax;</P> <P>(D) The date of issuance of a decision, judgment, decree, or other order by a court of competent jurisdiction resolving the liability for the estate tax unless a notice of appeal or a petition for certiorari is filed within 90 days after the issuance of a decision, judgment, decree, or other order of a court; or</P> <P>(E) The date of expiration of the period of limitations for assessment of the estate tax provided in section 6501.</P> <P> (iii) <E T="03">Definition of final disposition of claim for refund.</E> For purposes of paragraph (f)(2)(ii)(B) of this section, a claim for refund shall be deemed finally disposed of by the Secretary when all items have been either allowed or disallowed. If a waiver of notification with respect to disallowance is filed with respect to a claim for refund prior to disallowance of the claim, the claim for refund will be treated as disallowed on the date the waiver is filed. </P> <P> (iv) <E T="03">Examples.</E> The application of this paragraph (f)(2) is illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. A</HD> <P> died on October 20, 2002. The executor of <E T="03">A</E> 's estate and the trustee of Trust, an electing trust, made a section 645 election. A Form 706 is not required to be filed as a result of <E T="03">A</E> 's death. The applicable date is October 20, 2004, the day that is two years after <E T="03">A</E> 's date of death. The last day of the election period is October 19, 2004. Beginning October 20, 2004, Trust will no longer be treated and taxed as part of <E T="03">A</E> 's estate. </P> </EXAMPLE> <EXAMPLE> <PRTPAGE P="125"/> <HD SOURCE="HED">Example 2.</HD> <P> Assume the same facts as <E T="03">Example 1,</E> except that a Form 706 is required to be filed as the result of <E T="03">A</E> 's death. The Internal Revenue Service issues an estate tax closing letter accepting the Form 706 as filed on March 15, 2005. The estate does not file a claim for refund by March 15, 2006, the day that is twelve months after the date of issuance of the estate tax closing letter. The date of final determination of liability is September 15, 2005, and the applicable date is March 15, 2006. The last day of the election period is March 14, 2006. Beginning March 15, 2006, Trust will no longer be treated and taxed as part of <E T="03">A</E> 's estate. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> Assume the same facts as <E T="03">Example 1,</E> except that a Form 706 is required to be filed as the result of <E T="03">A</E> 's death. The Form 706 is audited, and a notice of deficiency authorized under section 6212 is mailed to the executor of <E T="03">A</E> 's estate as a result of the audit. The executor files a petition in Tax Court. The Tax Court issues a decision resolving the liability for estate tax on December 14, 2005, and neither party appeals within 90 days after the issuance of the decision. The date of final determination of liability is December 14, 2005. The applicable date is June 14, 2006, the day that is six months after the date of final determination of liability. The last day of the election period is June 13, 2006. Beginning June 14, 2006, Trust will no longer be treated and taxed as part of <E T="03">A</E> 's estate. </P> </EXAMPLE> <P> (g) <E T="03">Executor appointed after the section 645 election is made</E> —(1) <E T="03">Effect on the election.</E> If an executor for the related estate is not appointed until after the trustee has made a valid section 645 election, the executor must agree to the trustee's election, and the IRS must be notified of that agreement by the filing of a revised election form (completed as required by the instructions to that form) within 90 days of the appointment of the executor, for the election period to continue past the date of appointment of the executor. If the executor does not agree to the election or a revised election form is not timely filed as required by this paragraph, the election period terminates the day before the appointment of the executor. If the IRS issues other guidance after December 24, 2002 for notifying the IRS of the executor's agreement to the election, the IRS must be notified in the manner provided in that guidance for the election period to continue. </P> <P> (2) <E T="03">Continuation of election period</E> —(i) <E T="03">Correction of returns filed before executor appointed.</E> If the election period continues under paragraph (g)(1) of this section, the executor of the related estate and the trustee of each electing trust must file amended Forms 1041 to correct the Forms 1041 filed by the trustee before the executor was appointed. The amended Forms 1041 must be filed under the name and TIN of the electing trust and must reflect the items of income, deduction, and credit of the related estate and the electing trust. The name and TIN of the related estate must be provided on the amended Forms 1041 as required in the instructions to that Form. The amended return for the taxable year ending immediately before the executor was appointed must indicate that this Form 1041 is a final return. If the period of limitations for making assessments has expired with respect to the electing trust for any of the Forms 1041 filed by the trustee, the executor must file Forms 1041 for any items of income, deduction, and credit of the related estate that cannot be properly included on amended forms for the electing trust. The personal exemption under section 642(b) is not permitted to be taken on these Forms 1041 filed by the executor. </P> <P> (ii) <E T="03">Returns filed after the appointment of the executor.</E> All returns filed by the combined electing trust and related estate after the appointment of the executor are to be filed under the name and TIN of the related estate in accordance with paragraph (e)(2) of this section. Regardless of the change in the name and TIN under which the Forms 1041 for the combined electing trust and related estate are filed, the combined electing trust and related estate will be treated as the same entity before and after the executor is appointed. </P> <P> (3) <E T="03">Termination of the election period.</E> If the election period terminates under paragraph (g)(1) of this section, the executor must file Forms 1041 under the name and TIN of the estate for all taxable years of the related estate ending after the death of the decedent. The trustee of the electing trust is not required to amend any returns filed for the electing trust during the election period. Following termination of the election period, the trustee of the <PRTPAGE P="126"/> electing trust must obtain a new TIN. See § 301.6109-1(a)(4) of this chapter. </P> <P> (h) <E T="03">Treatment of an electing trust and related estate following termination of the election</E> —(1) <E T="03">The share (or shares) comprising the electing trust is deemed to be distributed upon termination of the election period.</E> On the close of the last day of the election period, the combined electing trust and related estate, if there is an executor, or the electing trust, if there is no executor, is deemed to distribute the share (or shares, as determined under section 663(c)) comprising the electing trust to a new trust in a distribution to which sections 661 and 662 apply. All items of income, including net capital gains, that are attributable to the share (or shares) comprising the electing trust are included in the calculation of the distributable net income of the electing trust and treated as distributed by the combined electing trust and related estate, if there is an executor, or by the electing trust, if there is no executor, to the new trust. The combined electing trust and related estate, if there is an executor, or the electing trust, if there is no executor, is entitled to a distribution deduction to the extent permitted under section 661 in the taxable year in which the election period terminates as a result of the deemed distribution. The new trust shall include the amount of the deemed distribution in gross income to the extent required under section 662. </P> <P> (2) <E T="03">Filing of the Form 1041 upon the termination of the section 645 election</E> —(i) <E T="03">If there is an executor</E> —(A) <E T="03">Filing the Form 1041 for the year of termination.</E> If there is an executor, the Form 1041 filed under the name and TIN of the related estate for the taxable year in which the election terminates includes— </P> <P> ( <E T="03">1</E> ) The items of income, deduction, and credit of the electing trust attributable to the period beginning with the first day of the taxable year of the combined electing trust and related estate and ending with the last day of the election period; </P> <P> ( <E T="03">2</E> ) The items of income, deduction, and credit, if any, of the related estate for the entire taxable year; and </P> <P> ( <E T="03">3</E> ) A deduction for the deemed distribution of the share (or shares) comprising the electing trust to the new trust as provided for under paragraph (h)(1) of this section. </P> <P> (B) <E T="03">Requirement to file a final Form 1041 under the name and TIN of the electing trust.</E> If the electing trust terminates during the election period, the trustee of the electing trust must file a Form 1041 under the name and TIN of the electing trust and indicate that the return is a final return to notify the IRS that the electing trust is no longer in existence. The items of income, deduction, and credit of the trust are not reported on this final Form 1041 but on the appropriate Form 1041 filed for the combined electing trust and related estate. </P> <P> (ii) <E T="03">If there is no executor.</E> If there is no executor, the taxable year of the electing trust closes on the last day of the election period. A Form 1041 is filed in the manner prescribed under paragraph (e)(3)(ii) of this section reporting the items of income, deduction, and credit of the electing trust for the short period ending with the last day of the election period. The Form 1041 filed under this paragraph includes a distribution deduction for the deemed distribution provided for under paragraph (h)(1) of this section. The Form 1041 must indicate that it is a final return. </P> <P> (3) <E T="03">Use of TINs following termination of the election</E> —(i) <E T="03">If there is an executor.</E> Upon termination of the section 645 election, a former electing trust may need to obtain a new TIN. See § 301.6109-1(a)(4) of this chapter. If the related estate continues after the termination of the election period, the related estate must continue to use the TIN assigned to the estate during the election period. </P> <P> (ii) <E T="03">If there is no executor.</E> If there is no executor, the former electing trust must obtain a new TIN if the trust will continue after the termination of the election period. See § 301.6109-1(a)(4) of this chapter. </P> <P> (4) <E T="03">Taxable year of estate and trust upon termination of the election</E> —(i) <E T="03">Estate</E> —Upon termination of the section 645 election period, the taxable year of the estate is the same taxable year used during the election period. </P> <P> (ii) <E T="03">Trust.</E> Upon termination of the section 645 election, the taxable year of the new trust is the calendar year. See section 644. <PRTPAGE P="127"/> </P> <P>(i) [Reserved]</P> <P> (j) <E T="03">Effective date.</E> Paragraphs (a), (b), (c), (d), (f), and (g) of this section apply to trusts and estates of decedents dying on or after December 24, 2002. Paragraphs (e) and (h) of this section apply to taxable years ending on or after December 24, 2002. </P> <CITA>[T.D. 9032, 67 FR 78377, Dec. 24, 2002]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">trusts which distribute current income only</HD> <SECTION> <SECTNO>§ 1.651(a)-1</SECTNO> <SUBJECT>Simple trusts; deduction for distributions; in general.</SUBJECT> <P>Section 651 is applicable only to a trust the governing instruments of which:</P> <P>(a) Requires that the trust distribute all of its income currently for the taxable year, and</P> <P>(b) Does not provide that any amounts may be paid, permanently set aside, or used in the taxable year for the charitable, etc., purposes specified in section 642(c),</P> <FP>and does not make any distribution other than of current income. A trust to which section 651 applies is referred to in this part as a “simple” trust. Trusts subject to section 661 are referred to as “complex” trusts. A trust may be a simple trust for one year and a complex trust for another year. It should be noted that under section 651 a trust qualifies as a simple trust in a taxable year in which it is required to distribute all its income currently and makes no other distributions, whether or not distributions of current income are in fact made. On the other hand a trust is not a complex trust by reason of distributions of amounts other than income unless such distributions are in fact made during the taxable year, whether or not they are required in that year.</FP> </SECTION> <SECTION> <SECTNO>§ 1.651(a)-2</SECTNO> <SUBJECT>Income required to be distributed currently.</SUBJECT> <P>(a) The determination of whether trust income is required to be distributed currently depends upon the terms of the trust instrument and the applicable local law. For this purpose, if the trust instrument provides that the trustee in determining the distributable income shall first retain a reserve for depreciation or otherwise make due allowance for keeping the trust corpus intact by retaining a reasonable amount of the current income for that purpose, the retention of current income for that purpose will not disqualify the trust from being a “simple” trust. The fiduciary must be under a duty to distribute the income currently even if, as a matter of practical necessity, the income is not distributed until after the close of the trust's taxable year. For example: Under the terms of the trust instrument, all of the income is currently distributable to A. The trust reports on the calendar year basis and as a matter of practical necessity makes distribution to A of each quarter's income on the fifteenth day of the month following the close of the quarter. The distribution made by the trust on January 15, 1955, of the income for the fourth quarter of 1954 does not disqualify the trust from treatment in 1955 under section 651, since the income is required to be distributed currently. However, if the terms of a trust require that none of the income be distributed until after the year of its receipt by the trust, the income of the trust is not required to be distributed currently and the trust is not a simple trust. For definition of the term “income” see section 643(b) and § 1.643(b)-1.</P> <P>(b) It is immaterial, for purposes of determining whether all the income is required to be distributed currently, that the amount of income allocated to a particular beneficiary is not specified in the instrument. For example, if the fiduciary is required to distribute all the income currently, but has discretion to “sprinkle” the income among a class of beneficiaries, or among named beneficiaries, in such amount as he may see fit, all the income is required to be distributed currently, even though the amount distributable to a particular beneficiary is unknown until the fiduciary has exercised his discretion.</P> <P> (c) If in one taxable year of a trust its income for that year is required or permitted to be accumulated, and in another taxable year its income for the year is required to be distributed currently (and no other amounts are distributed), the trust is a simple trust for the latter year. For example, a trust <PRTPAGE P="128"/> under which income may be accumulated until a beneficiary is 21 years old, and thereafter must be distributed currently, is a simple trust for taxable years beginning after the beneficiary reaches the age of 21 years in which no other amounts are distributed. </P> <P>(d) If a trust distributes property in kind as part of its requirement to distribute currently all the income as defined under section 643(b) and the applicable regulations, the trust shall be treated as having sold the property for its fair market value on the date of distribution. If no amount in excess of the amount of income as defined under section 643(b) and the applicable regulations is distributed by the trust during the year, the trust will qualify for treatment under section 651 even though property in kind was distributed as part of a distribution of all such income. This paragraph (d) applies for taxable years of trusts ending after January 2, 2004.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 9102, 69 FR 20, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.651(a)-3</SECTNO> <SUBJECT>Distribution of amounts other than income.</SUBJECT> <P>(a) A trust does not qualify for treatment under section 651 for any taxable year in which it actually distributes corpus. For example, a trust which is required to distribute all of its income currently would not qualify as a simple trust under section 651 in the year of its termination since in that year actual distributions of corpus would be made.</P> <P>(b) A trust, otherwise qualifying under section 651, which may make a distribution of corpus in the discretion of the trustee, or which is required under the terms of its governing instrument to make a distribution of corpus upon the happening of a specified event, will be disqualified for treatment under section 651 only for the taxable year in which an actual distribution of corpus is made. For example: Under the terms of a trust, which is required to distribute all of its income currently, half of the corpus is to be distributed to beneficiary A when he becomes 30 years of age. The trust reports on the calendar year basis. On December 28, 1954, A becomes 30 years of age and the trustee distributes half of the corpus of the trust to him on January 3, 1955. The trust will be disqualified for treatment under section 651 only for the taxable year 1955, the year in which an actual distribution of corpus is made.</P> <P>(c) See section 661 and the regulations thereunder for the treatment of trusts which distribute corpus or claim the charitable contributions deduction provided by section 642(c).</P> </SECTION> <SECTION> <SECTNO>§ 1.651(a)-4</SECTNO> <SUBJECT>Charitable purposes.</SUBJECT> <P>A trust is not considered to be a trust which may pay, permanently set aside, or use any amount for charitable, etc., purposes for any taxable year for which it is not allowed a charitable, etc., deduction under section 642(c). Therefore, a trust with a remainder to a charitable organization is not disqualified for treatment as a simple trust if either (a) the remainder is subject to a contingency, so that no deduction would be allowed for capital gains or other amounts added to corpus as amounts permanently set aside for a charitable, etc., purpose under section 642 (c), or (b) the trust receives no capital gains or other income added to corpus for the taxable year for which such a deduction would be allowed.</P> </SECTION> <SECTION> <SECTNO>§ 1.651(a)-5</SECTNO> <SUBJECT>Estates.</SUBJECT> <P>Subpart B has no application to an estate.</P> </SECTION> <SECTION> <SECTNO>§ 1.651(b)-1</SECTNO> <SUBJECT>Deduction for distributions to beneficiaries.</SUBJECT> <P> In computing its taxable income, a simple trust is allowed a deduction for the amount of income which is required under the terms of the trust instrument to be distributed currently to beneficiaries. If the amount of income required to be distributed currently exceeds the distributable net income, the deduction allowable to the trust is limited to the amount of the distributable net income. For this purpose the amount of income required to be distributed currently, or distributable net income, whichever is applicable, does not include items of trust income (adjusted for deductions allocable thereto) which are not included in the gross income of the trust. For determination of the character of the income required to <PRTPAGE P="129"/> be distributed currently, see § 1.652(b)-2. Accordingly, for the purposes of determining the deduction allowable to the trust under section 651, distributable net income is computed without the modifications specified in paragraphs (5), (6), and (7) of section 643(a), relating to tax-exempt interest, foreign income, and excluded dividends. For example: Assume that the distributable net income of a trust as computed under section 643(a) amounts to $99,000 but includes nontaxable income of $9,000. Then distributable net income for the purpose of determining the deduction allowable under section 651 is $90,000 ($99,000 less $9,000 nontaxable income). </P> </SECTION> <SECTION> <SECTNO>§ 1.652(a)-1</SECTNO> <SUBJECT>Simple trusts; inclusion of amounts in income of beneficiaries.</SUBJECT> <P> Subject to the rules in §§ 1.652(a)-2 and 1.652(b)-1, a beneficiary of a simple trust includes in his gross income for the taxable year the amounts of income required to be distributed to him for such year, whether or not distributed. Thus, the income of a simple trust is includible in the beneficiary's gross income for the taxable year in which the income is required to be distributed currently even though, as a matter of practical necessity, the income is not distributed until after the close of the taxable year of the trust. See § 1.642(a)(3)-2 with respect to time of receipt of dividends. See § 1.652(c)-1 for treatment of amounts required to be distributed where a beneficiary and the trust have different taxable years. The term <E T="03">income required to be distributed currently</E> includes income required to be distributed currently which is in fact used to discharge or satisfy any person's legal obligation as that term is used in § 1.662(a)-4. </P> </SECTION> <SECTION> <SECTNO>§ 1.652(a)-2</SECTNO> <SUBJECT>Distributions in excess of distributable net income.</SUBJECT> <P>If the amount of income required to be distributed currently to beneficiaries exceeds the distributable net income of the trust (as defined in section 643(a)), each beneficiary includes in his gross income an amount equivalent to his proportionate share of such distributable net income. Thus, if beneficiary A is to receive two-thirds of the trust income and B is to receive one-third, and the income required to be distributed currently is $99,000, A will receive $66,000 and B, $33,000. However, if the distributable net income, as determined under section 643(a) is only $90,000, A will include two-thirds ($60,000) of that sum in his gross income, and B will include one-third ($30,000) in his gross income. See §§ 1.652(b)-1 and 1.652(b)-2, however, for amounts which are not includible in the gross income of a beneficiary because of their tax-exempt character.</P> </SECTION> <SECTION> <SECTNO>§ 1.652(b)-1</SECTNO> <SUBJECT>Character of amounts.</SUBJECT> <P> In determining the gross income of a beneficiary, the amounts includible under § 1.652(a)-1 have the same character in the hands of the beneficiary as in the hands of the trust. For example, to the extent that the amounts specified in § 1.652(a)-1 consist of income exempt from tax under section 103, such amounts are not included in the beneficiary's gross income. Similarly, dividends distributed to a beneficiary retain their original character in the beneficiary's hands for purposes of determining the availability to the beneficiary of the dividends received credit under section 34 (for dividends received on or before December 31, 1964) and the dividend exclusion under section 116. Also, to the extent that the amounts specified in § 1.652(a)-1 consist of “earned income” in the hands of the trust under the provisions of section 1348 such amount shall be treated under section 1348 as “earned income” in the hands of the beneficiary. Similarly, to the extent such amounts consist of an amount received as a part of a lump sum distribution from a qualified plan and to which the provisions of section 72(n) would apply in the hands of the trust, such amount shall be treated as subject to such section in the hands of the beneficiary except where such amount is deemed under section 666(a) to have been distributed in a preceding taxable year of the trust and the partial tax described in section 668(a)(2) is determined under section 668(b)(1)(B). The tax treatment of amounts determined under § 1.652(a)-1 depends upon the beneficiary's status with respect to them not upon the status of the trust. Thus, if a beneficiary <PRTPAGE P="130"/> is deemed to have received foreign income of a foreign trust, the includibility of such income in his gross income depends upon his taxable status with respect to that income. </P> <CITA>[T.D. 7204, 37 FR 17134, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.652(b)-2</SECTNO> <SUBJECT>Allocation of income items.</SUBJECT> <P>(a) The amounts specified in § 1.652(a)-1 which are required to be included in the gross income of a beneficiary are treated as consisting of the same proportion of each class of items entering into distributable net income of the trust (as defined in section 643(a)) as the total of each class bears to such distributable net income, unless the terms of the trust specifically allocate different classes of income to different beneficiaries, or unless local law requires such an allocation. For example: Assume that under the terms of the governing instrument, beneficiary A is to receive currently one-half of the trust income and beneficiaries B and C are each to receive currently one-quarter, and the distributable net income of the trust (after allocation of expenses) consists of dividends of $10,000, taxable interest of $10,000, and tax-exempt interest of $4,000. A will be deemed to have received $5,000 of dividends, $5,000 of taxable interest, and $2,000 of tax-exempt interest; B and C will each be deemed to have received $2,500 of dividends, $2,500 of taxable interest, and $1,000 of tax-exempt interest. However, if the terms of the trust specifically allocate different classes of income to different beneficiaries, entirely or in part, or if local law requires such an allocation, each beneficiary will be deemed to have received those items of income specifically allocated to him.</P> <P>(b) The terms of the trust are considered specifically to allocate different classes of income to different beneficiaries only to the extent that the allocation is required in the trust instrument, and only to the extent that it has an economic effect independent of the income tax consequences of the allocation. For example:</P> <P>(1) Allocation pursuant to a provision in a trust instrument granting the trustee discretion to allocate different classes of income to different beneficiaries is not a specific allocation by the terms of the trust.</P> <P>(2) Allocation pursuant to a provision directing the trustee to pay all of one income to A, or $10,000 out of the income to A, and the balance of the income to B, but directing the trustee first to allocate a specific class of income to A's share (to the extent there is income of that class and to the extent it does not exceed A's share) is not a specific allocation by the terms of the trust.</P> <P>(3) Allocation pursuant to a provision directing the trustee to pay half the class of income (whatever it may be) to A, and the balance of the income to B, is a specific allocation by the terms of the trust.</P> </SECTION> <SECTION> <SECTNO>§ 1.652(b)-3</SECTNO> <SUBJECT>Allocation of deductions.</SUBJECT> <P>Items of deduction of a trust that enter into the computation of distributable net income are to be allocated among the items of income in accordance with the following principles:</P> <P>(a) All deductible items directly attributable to one class of income (except dividends excluded under section 116) are allocated thereto. For example, repairs to, taxes on, and other expenses directly attributable to the maintenance of rental property or the collection of rental income are allocated to rental income. See § 1.642(e)-1 for treatment of depreciation of rental property. Similarly, all expenditures directly attributable to a business carried on by a trust are allocated to the income from such business. If the deductions directly attributable to a particular class of income exceed that income, the excess is applied against other classes of income in the manner provided in paragraph (d) of this section.</P> <P> (b) The deductions which are not directly attributable to a specific class of income may be allocated to any item of income (including capital gains) included in computing distributable net income, but a portion must be allocated to nontaxable income (except dividends excluded under section 116) pursuant to section 265 and the regulations thereunder. For example, if the income of a trust is $30,000 (after direct expenses), consisting equally of $10,000 of dividends, tax-exempt interest, and rents, and income commissions amount <PRTPAGE P="131"/> to $3,000, one-third ($1,000) of such commissions should be allocated to tax-exempt interest, but the balance of $2,000 may be allocated to the rents or dividends in such proportions as the trustee may elect. The fact that the governing instrument or applicable local law treats certain items of deduction as attributable to corpus or to income not included in distributable net income does not affect allocation under this paragraph. For instance, if in the example set forth in this paragraph the trust also had capital gains which are allocable to corpus under the terms of the trust instrument, no part of the deductions would be allocable thereto since the capital gains are excluded from the computation of distributable net income under section 643(a)(3). </P> <P>(c) Examples of expenses which are considered as not directly attributable to a specific class of income are trustee's commissions, the rental of safe deposit boxes, and State income and personal property taxes.</P> <P>(d) To the extent that any items of deduction which are directly attributable to a class of income exceed that class of income, they may be allocated to any other class of income (including capital gains) included in distributable net income in the manner provided in paragraph (b) of this section, except that any excess deductions attributable to tax-exempt income (other than dividends excluded under section 116) may not be offset against any other class of income. See section 265 and the regulations thereunder. Thus, if the trust has rents, taxable interest, dividends, and tax-exempt interest, and the deductions directly attributable to the rents exceed the rental income, the excess may be allocated to the taxable interest or dividends in such proportions as the fiduciary may elect. However, if the excess deductions are attributable to the tax-exempt interest, they may not be allocated to either the rents, taxable interest, or dividends.</P> </SECTION> <SECTION> <SECTNO>§ 1.652(c)-1</SECTNO> <SUBJECT>Different taxable years.</SUBJECT> <P>If a beneficiary has a different taxable year (as defined in section 441 or 442) from the taxable year of the trust, the amount he is required to include in gross income in accordance with section 652 (a) and (b) is based on the income of the trust for any taxable year or years ending with or within his taxable year. This rule applies to taxable years of normal duration as well as to so-called short taxable years. Income of the trust for its taxable year or years is determined in accordance with its method of accounting and without regard to that of the beneficiary.</P> </SECTION> <SECTION> <SECTNO>§ 1.652(c)-2</SECTNO> <SUBJECT>Death of individual beneficiaries.</SUBJECT> <P>If income is required to be distributed currently to a beneficiary, by a trust for a taxable year which does not end with or within the last taxable year of a beneficiary (because of the beneficiary's death), the extent to which the income is included in the gross income of the beneficiary for his last taxable year or in the gross income of his estate is determined by the computations under section 652 for the taxable year of the trust in which his last taxable year ends. Thus, the distributable net income of the taxable year of the trust determines the extent to which the income required to be distributed currently to the beneficiary is included in his gross income for his last taxable year or in the gross income of his estate. (Section 652(c) does not apply to such amounts.) The gross income for the last taxable year of a beneficiary on the cash basis includes only income actually distributed to the beneficiary before his death. Income required to be distributed, but in fact distributed to his estate, is included in the gross income of the estate as income in respect of a decedent under section 691. See paragraph (e) of § 1.663(c)-3 with respect to separate share treatment for the periods before and after the decedent's death. If the trust does not qualify as a simple trust for the taxable year of the trust in which the last taxable year of the beneficiary ends, see section 662(c) and § 1.662(c)-2.</P> </SECTION> <SECTION> <SECTNO>§ 1.652(c)-3</SECTNO> <SUBJECT>Termination of existence of other beneficiaries.</SUBJECT> <P> If the existence of a beneficiary which is not an individual terminates, the amount to be included under section 652(a) in its gross income for its last taxable year is computed with reference to §§ 1.652(c)-1 and 1.652(c)-2 as if <PRTPAGE P="132"/> the beneficiary were a deceased individual, except that income required to be distributed prior to the termination but actually distributed to the beneficiary's successor in interest is included in the beneficiary's income for its last taxable year. </P> </SECTION> <SECTION> <SECTNO>§ 1.652(c)-4</SECTNO> <SUBJECT>Illustration of the provisions of sections 651 and 652.</SUBJECT> <P>The rules applicable to a trust required to distribute all of its income currently to its beneficiaries may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) Under the terms of a simple trust all of the income is to be distributed equally to beneficiaries A and B and capital gains are to be allocated to corpus. The trust and both beneficiaries file returns on the calendar year basis. No provision is made in the governing instrument with respect to depreciation. During the taxable year 1955, the trust had the following items of income and expense:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="01">Dividends of domestic corporations</ENT> <ENT>50,000</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt interest on municipal bonds</ENT> <ENT>25,000</ENT> </ROW> <ROW> <ENT I="01">Long-term capital gains</ENT> <ENT>15,000</ENT> </ROW> <ROW> <ENT I="01">Taxes and expenses directly attributable to rents</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">Trustee's commissions allocable to income account</ENT> <ENT>2,600</ENT> </ROW> <ROW> <ENT I="01">Trustee's commissions allocable to principal account</ENT> <ENT>1,300</ENT> </ROW> <ROW> <ENT I="01">Depreciation</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> <P>(b) The income of the trust for fiduciary accounting purposes is $92,400, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="01">Dividends</ENT> <ENT>50,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax-exempt interest</ENT> <ENT>25,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>100,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Expenses directly attributable to rental income</ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Trustee's commissions allocable to income account</ENT> <ENT>2,600</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>7,600</ENT> </ROW> <ROW> <ENT I="03">Income computed under section 643(b)</ENT> <ENT>92,400</ENT> </ROW> </GPOTABLE> <FP>One-half ($46,200) of the income of $92,400 is currently distributable to each beneficiary.</FP> <P>(c) The distributable net income of the trust computed under section 643(a) is $91,100, determined as follows (cents are disregarded in the computation):</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="01">Dividends</ENT> <ENT>50,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Tax-exempt interest</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="01">Less: Expenses allocable thereto (25,000/100,000 × $3,900)</ENT> <ENT>975</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>24,025</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT/> <ENT>99,025</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Expenses directly attributable to rental income</ENT> <ENT>$5,000</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions ($3,900 less $975 allocable to tax-exempt interest)</ENT> <ENT>2,925</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>7,925</ENT> </ROW> <ROW> <ENT I="03">Distributable net income</ENT> <ENT/> <ENT>91,100</ENT> </ROW> </GPOTABLE> <FP>In computing the distributable net income of $91,100, the taxable income of the trust was computed with the following modifications: No deductions were allowed for distributions to the beneficiaries and for personal exemption of the trust (section 643(a) (1) and (2)); capital gains were excluded and no deduction under section 1202 (relating to the 50-percent deduction for long-term capital gains) was taken into account (section 643(a)(3)); the tax-exempt interest (as adjusted for expenses) and the dividend exclusion of $50 were included (section 643(a) (5) and (7)). Since all of the income of the trust is required to be currently distributed, no deduction is allowable for depreciation in the absence of specific provisions in the governing instrument providing for the keeping of the trust corpus intact. See section 167(h) and the regulations thereunder.</FP> <P>(d) The deduction allowable to the trust under section 651(a) for distributions to the beneficiaries is $67,025, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income computed under section 643(a) (see paragraph (c))</ENT> <ENT>$91,100</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Tax-exempt interest as adjusted</ENT> <ENT>$24,025</ENT> </ROW> <ROW> <ENT I="02">Dividend exclusion</ENT> <ENT>50</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>24,075</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Distributable net income as determined under section 651(b)</ENT> <ENT>67,025</ENT> </ROW> </GPOTABLE> <FP>Since the amount of the income ($92,400) required to be distributed currently by the trust exceeds the distributable net income ($67,025) as computed under section 651(b), the deduction allowable under section 651(a) is limited to the distributable net income of $67,025.</FP> <P>(e) The taxable income of the trust is $7,200 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="01">Dividends ($50,000 less $50 exclusion)</ENT> <ENT>49,950</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Long-term capital gains</ENT> <ENT>15,000</ENT> </ROW> <ROW> <ENT I="03">Gross income</ENT> <ENT>89,950</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>$5,000</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions</ENT> <ENT>2,925</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>7,500</ENT> </ROW> <ROW> <ENT I="02">Distributions to beneficiaries</ENT> <ENT>67,025</ENT> </ROW> <ROW> <ENT I="02">Personal exemption</ENT> <ENT>300</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>82,750</ENT> </ROW> <ROW> <ENT I="03">Taxable income</ENT> <ENT> </ENT> <ENT>7,200</ENT> </ROW> </GPOTABLE> <FP> The trust is not allowed a deduction for the portion ($975) of the trustee's commissions allocable to tax-exempt interest in computing its taxable income. <PRTPAGE P="133"/> </FP> <P>(f) In determining the character of the amounts includible in the gross income of A and B, it is assumed that the trustee elects to allocate to rents the expenses not directly attributable to a specific item of income other than the portion ($975) of such expenses allocated to tax-exempt interest. The allocation of expenses among the items of income is shown below:</P> <GPOTABLE COLS="5" OPTS="L1" CDEF="s90,8.2,8.2,10.3,8.2"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Rents</CHED> <CHED H="1">Dividends</CHED> <CHED H="1">Tax-exempt interest</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">Income for trust accounting purposes</ENT> <ENT>$25,000</ENT> <ENT>$50,000</ENT> <ENT>$25,000</ENT> <ENT>$100,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>5,000</ENT> <ENT/> <ENT/> <ENT>5,000</ENT> </ROW> <ROW RUL="n,d"> <ENT I="02">Trustee's commissions</ENT> <ENT>2,925</ENT> <ENT/> <ENT>975</ENT> <ENT>3,900</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Total deductions</ENT> <ENT>7,925</ENT> <ENT>0</ENT> <ENT>975</ENT> <ENT>8,900</ENT> </ROW> <ROW> <ENT I="01">Character of amounts in the hands of the beneficiaries</ENT> <ENT>17,075</ENT> <ENT>50,000</ENT> <ENT>24,025</ENT> <ENT> <SU>1</SU>  91,100 </ENT> </ROW> <TNOTE> <SU>1</SU>  Distributable net income. </TNOTE> </GPOTABLE> <FP>Inasmuch as the income of the trust is to be distributed equally to A and B, each is deemed to have received one-half of each item of income; that is, rents of $8,537.50, dividends of $25,000, and tax-exempt interest of $12,012.50. The dividends of $25,000 allocated to each beneficiary are to be aggregated with his other dividends (if any) for purposes of the dividend exclusion provided by section 116 and the dividend received credit allowed under section 34. Also, each beneficiary is allowed a deduction of $2,500 for depreciation of rental property attributable to the portion (one-half) of the income of the trust distributed to him.</FP> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6712, 29 FR 3655, Mar. 24, 1964]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">estates and trusts which may accumulate income or which distribute corpus</HD> <SECTION> <SECTNO>§ 1.661(a)-1</SECTNO> <SUBJECT>Estates and trusts accumulating income or distributing corpus; general.</SUBJECT> <P>Subpart C, part I, subchapter J, chapter 1 of the Code, is applicable to all decedents' estates and their beneficiaries, and to trusts and their beneficiaries other than trusts subject to the provisions of subpart B of such part I (relating to trusts which distribute current income only, or “simple” trusts). A trust which is required to distribute amounts other than income during the taxable year may be subject to subpart B, and not subpart C, in the absence of an actual distribution of amounts other than income during the taxable year. See §§ 1.651(a)-1 and 1.651(a)-3. A trust to which subpart C is applicable is referred to as a “complex” trust in this part. Section 661 has no application to amounts excluded under section 663(a).</P> </SECTION> <SECTION> <SECTNO>§ 1.661(a)-2</SECTNO> <SUBJECT>Deduction for distributions to beneficiaries.</SUBJECT> <P>(a) In computing the taxable income of an estate or trust there is allowed under section 661(a) as a deduction for distributions to beneficiaries the sum of:</P> <P>(1) The amount of income for the taxable year which is required to be distributed currently, and</P> <P>(2) Any other amounts properly paid or credited or required to be distributed for such taxable year.</P> <FP>However, the total amount deductible under section 661(a) cannot exceed the distributable net income as computed under section 643(a) and as modified by section 661(c). See § 1.661(c)-1.</FP> <P> (b) The term <E T="03">income required to be distributed currently</E> includes any amount required to be distributed which may be paid out of income or corpus (such as an annuity), to the extent it is paid out of income for the taxable year. See § 1.651(a)-2 which sets forth additional rules which are applicable in determining whether income of an estate or trust is required to be distributed currently. </P> <P> (c) The term <E T="03">any other amounts properly paid, credited, or required to be distributed</E> includes all amounts properly paid, credited, or required to be distributed by an estate or trust during the taxable year other than income required to be distributed currently. Thus, the term includes the payment of an annuity to the extent it is not paid out of income for the taxable year, and <PRTPAGE P="134"/> a distribution of property in kind (see paragraph (f) of this section). However, see section 663(a) and regulations thereunder for distributions which are not included. Where the income of an estate or trust may be accumulated or distributed in the discretion of the fiduciary, or where the fiduciary has a power to distribute corpus to a beneficiary, any such discretionary distribution would qualify under section 661(a)(2). The term also includes an amount applied or distributed for the support of a dependent of a grantor or of a trustee or cotrustee under the circumstances described in section 677(b) or section 678(c) out of corpus or out of other than income for the taxable year. </P> <P> (d) The terms <E T="03">income required to be distributed currently</E> and <E T="03">any other amounts properly paid or credited or required to be distributed</E> also include any amount used to discharge or satisfy any person's legal obligation as that term is used in § 1.662(a)-4. </P> <P> (e) The terms <E T="03">income required to be distributed currently</E> and <E T="03">any other amounts properly paid or credited or required to be distributed</E> include amounts paid, or required to be paid, during the taxable year pursuant to a court order or decree or under local law, by a decedent's estate as an allowance or award for the support of the decedent's widow or other dependent for a limited period during the administration of the estate. The term <E T="03">any other amounts properly paid or credited or required to be distributed</E> does not include the value of any interest in real estate owned by a decedent, title to which under local law passes directly from the decedent to his heirs or devisees. </P> <P>(f) Gain or loss is realized by the trust or estate (or the other beneficiaries) by reason of a distribution of property in kind if the distribution is in satisfaction of a right to receive a distribution of a specific dollar amount, of specific property other than that distributed, or of income as defined under section 643(b) and the applicable regulations, if income is required to be distributed currently. In addition, gain or loss is realized if the trustee or executor makes the election to recognize gain or loss under section 643(e). This paragraph applies for taxable years of trusts and estates ending after January 2, 2004.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 7287, 38 FR 26912, Sept. 27, 1973; T.D. 9102, 69 FR 20, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.661(b)-1</SECTNO> <SUBJECT>Character of amounts distributed; in general.</SUBJECT> <P>In the absence of specific provisions in the governing instrument for the allocation of different classes of income, or unless local law requires such an allocation, the amount deductible for distributions to beneficiaries under section 661(a) is treated as consisting of the same proportion of each class of items entering into the computation of distributable net income as the total of each class bears to the total distributable net income. For example, if a trust has distributable net income of $20,000, consisting of $10,000 each of taxable interest and royalties and distributes $10,000 to beneficiary A, the deduction of $10,000 allowable under section 661(a) is deemed to consist of $5,000 each of taxable interest and royalties, unless the trust instrument specifically provides for the distribution or accumulation of different classes of income or unless local law requires such an allocation. See also § 1.661(c)-1.</P> </SECTION> <SECTION> <SECTNO>§ 1.661(b)-2</SECTNO> <SUBJECT>Character of amounts distributed when charitable contributions are made.</SUBJECT> <P>In the application of the rule stated in § 1.661(b)-1, the items of deduction which enter into the computation of distributable net income are allocated among the items of income which enter into the computation of distributable net income in accordance with the rules set forth in § 1.652(b)-3, except that, in the absence of specific provisions in the governing instrument, or unless local law requires a different apportionment, amounts paid, permanently set aside, or to be used for the charitable, etc., purposes specified in section 642(c) are first ratably apportioned among each class of items of income entering into the computation of the distributable net income of the estate or trust, in accordance with the rules set out in paragraph (b) of § 1.643(a)-5.</P> </SECTION> <SECTION> <PRTPAGE P="135"/> <SECTNO>§ 1.661(c)-1</SECTNO> <SUBJECT>Limitation on deduction.</SUBJECT> <P>An estate or trust is not allowed a deduction under section 661(a) for any amount which is treated under section 661(b) as consisting of any item of distributable net income which is not included in the gross income of the estate or trust. For example, if in 1962, a trust, which reports on the calendar year basis, has distributable net income of $20,000, which is deemed to consist of $10,000 of dividends and $10,000 of tax-exempt interest, and distributes $10,000 to beneficiary A, the deduction allowable under section 661(a) (computed without regard to section 661(c)) would amount to $10,000 consisting of $5,000 of dividends and $5,000 of tax-exempt interest. The deduction actually allowable under section 661(a) as limited by section 661(c) is $4,975, since no deduction is allowable for the $5,000 of tax-exempt interest and the $25 deemed distributed out of the $50 of dividends excluded under section 116, items of distributable net income which are not included in the gross income of the estate or trust.</P> <CITA>[T.D. 6777, 29 FR 17809, Dec. 16, 1964]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.661(c)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 661.</SUBJECT> <P>The provisions of section 661 may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) Under the terms of a trust, which reports on the calendar year basis, $10,000 a year is required to be paid out of income to a designated charity. The balance of the income may, in the trustee's discretion, be accumulated or distributed to beneficiary A. Expenses are allocable against income and the trust instrument requires a reserve for depreciation. During the taxable year 1955 the trustee contributes $10,000 to charity and in his discretion distributes $15,000 of income to A. The trust has the following items of income and expense for the taxable year 1955:</P> <LDRWK> <FL-2>Dividends</FL-2> <LDRFIG>$10,000</LDRFIG> <FL-2>Partially tax-exempt interest</FL-2> <LDRFIG>10,000</LDRFIG> <FL-2>Fully tax-exempt interest</FL-2> <LDRFIG>10,000</LDRFIG> <FL-2>Rents</FL-2> <LDRFIG>20,000</LDRFIG> <FL-2>Rental expenses</FL-2> <LDRFIG>2,000</LDRFIG> <FL-2>Depreciation of rental property</FL-2> <LDRFIG>3,000</LDRFIG> <FL-2>Trustee's commissions</FL-2> <LDRFIG>5,000</LDRFIG> </LDRWK> <P>(b) The income of the trust for fiduciary accounting purposes is $40,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s50,8,8"> <ROW EXPSTB="01"> <ENT I="01">Dividends</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Fully tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Rents</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>50,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>$2,000</ENT> </ROW> <ROW> <ENT I="02">Depreciation</ENT> <ENT>3,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Trustee's commissions</ENT> <ENT>5,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Income as computed under section 643(b)</ENT> <ENT>40,000</ENT> </ROW> </GPOTABLE> <P>(c) The distributable net income of the trust as computed under section 643(a) is $30,000, determined as follows:</P> <GPOTABLE COLS="4" OPTS="L0" CDEF="s100,10,10,10"> <ROW> <ENT I="01">Rents</ENT> <ENT> </ENT> <ENT> </ENT> <ENT>$20,000</ENT> </ROW> <ROW> <ENT I="01">Dividends</ENT> <ENT> </ENT> <ENT> </ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest</ENT> <ENT> </ENT> <ENT> </ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Fully tax-exempt interest</ENT> <ENT> </ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Expenses allocable thereto (10,000/50,000 × $5,000)</ENT> <ENT>$1,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Charitable contributions allocable thereto (10,000/50,000 × $10,000)</ENT> <ENT>2,000</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT>3,000</ENT> </ROW> <ROW RUL="n,n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT> </ENT> <ENT>7,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT> </ENT> <ENT> </ENT> <ENT>47,000</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT> </ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="02">Depreciation of rental property</ENT> <ENT> </ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions ($5,000 less $1,000 allocated to tax-exempt interest)</ENT> <ENT> </ENT> <ENT>4,000</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="02">Charitable contributions ($10,000 less $2,000 allocated to tax-exempt interest)</ENT> <ENT> </ENT> <ENT>8,000</ENT> </ROW> <ROW RUL="n,n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT> </ENT> <ENT>17,000</ENT> </ROW> <ROW> <ENT I="03">Distributable net income (section 643(a))</ENT> <ENT> </ENT> <ENT> </ENT> <ENT>30,000</ENT> </ROW> </GPOTABLE> <P> (d) The character of the amounts distributed under section 661(a), determined in accordance with the rules prescribed in §§ 1.661(b)-1 and 1.661(b)-2 is shown by the following table (for the purpose of this allocation, it is assumed that the trustee elected to allocate the trustee's commissions to <PRTPAGE P="136"/> rental income except for the amount required to be allocated to tax-exempt interest): </P> <GPOTABLE COLS="7" OPTS="L2" CDEF="s50,8.1,8.1,6.3,9.2,9.2,8.1"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Rental income</CHED> <CHED H="1">Taxable dividends</CHED> <CHED H="1">Excluded dividends</CHED> <CHED H="1">Partially tax-exempt interest</CHED> <CHED H="1">Tax-exempt interest</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">Trust income</ENT> <ENT>$20,000</ENT> <ENT>$9,950</ENT> <ENT>$50</ENT> <ENT>$10,000</ENT> <ENT>$10,000</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Charitable contributions</ENT> <ENT>4,000</ENT> <ENT>2,000</ENT> <ENT/> <ENT>2,000</ENT> <ENT>2,000</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>2,000</ENT> <ENT/> <ENT/> <ENT/> <ENT/> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="02">Depreciation</ENT> <ENT>3,000</ENT> <ENT/> <ENT/> <ENT/> <ENT/> <ENT>3,000</ENT> </ROW> <ROW RUL="n,s,s,s,s,s,s"> <ENT I="02">Trustee's commissions</ENT> <ENT>4,000</ENT> <ENT/> <ENT/> <ENT/> <ENT>1,000</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="03">Total deductions</ENT> <ENT>13,000</ENT> <ENT>2,000</ENT> <ENT>0</ENT> <ENT>2,000</ENT> <ENT>3,000</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>7,000</ENT> <ENT>7,950</ENT> <ENT>50</ENT> <ENT>8,000</ENT> <ENT>7,000</ENT> <ENT>30,000</ENT> </ROW> <ROW> <ENT I="01">Amounts deemed distributed under section 661(a) before applying the limitation of section 661(c)</ENT> <ENT>3,500</ENT> <ENT>3,975</ENT> <ENT>25</ENT> <ENT>4,000</ENT> <ENT>3,500</ENT> <ENT>15,000</ENT> </ROW> </GPOTABLE> <FP>In the absence of specific provisions in the trust instrument for the allocation of different classes of income, the charitable contribution is deemed to consist of a pro rata portion of the gross amount of each items of income of the trust (except dividends excluded under section 116) and the trust is deemed to have distributed to A a pro rata portion (one-half) of each item of income included in distributable net income.</FP> <P>(e) The taxable income of the trust is $11,375 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rental income</ENT> <ENT>$20,000</ENT> </ROW> <ROW> <ENT I="01">Dividends ($10,000 less $50 exclusion)</ENT> <ENT>9,950</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Partially tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Gross income</ENT> <ENT>39,950</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Rental expenses</ENT> <ENT>$2,000</ENT> </ROW> <ROW> <ENT I="02">Depreciation of rental property</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions</ENT> <ENT>4,000</ENT> </ROW> <ROW> <ENT I="02">Charitable contributions</ENT> <ENT>8,000</ENT> </ROW> <ROW> <ENT I="02">Distributions to A</ENT> <ENT>11,475</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT>28,575</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Taxable income</ENT> <ENT>11,375</ENT> </ROW> </GPOTABLE> <FP>In computing the taxable income of the trust no deduction is allowable for the portions of the charitable contributions deduction ($2,000) and trustee's commissions ($1,000) which are treated under section 661(b) as attributable to the tax-exempt interest excludable from gross income. Also, of the dividends of $4,000 deemed to have been distributed to A under section 661(a), $25 (25/50ths of $50) is deemed to have been distributed from the excluded dividends and is not an allowable deduction to the trust. Accordingly, the deduction allowable under section 661 is deemed to be composed of $3,500 rental income, $3,975 of dividends, and $4,000 partially tax-exempt interest. No deduction is allowable for the portion of tax-exempt interest or for the portion of the excluded dividends deemed to have been distributed to the beneficiary.</FP> <P>(f) The trust is entitled to the credit allowed by section 34 with respect to dividends of $5,975 ($9,950 less $3,975 distributed to A) included in gross income. Also, the trust is allowed the credit provided by section 35 with respect to partially tax-exempt interest of $6,000 ($10,000 less $4,000 deemed distributed to A) included in gross income.</P> <P>(g) Dividends of $4,000 allocable to A are to be aggregated with his other dividends (if any) for purposes of the dividend exclusion under section 116 and the dividend received credit under section 84.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.662(a)-1</SECTNO> <SUBJECT>Inclusion of amounts in gross income of beneficiaries of estates and complex trusts; general.</SUBJECT> <P>There is included in the gross income of a beneficiary of an estate or complex trust the sum of:</P> <P>(a) Amounts of income required to be distributed currently to him, and</P> <P>(b) All other amounts properly paid, credited, or required to be distributed to him</P> <FP>by the estate or trust. The preceding sentence is subject to the rules contained in § 1.662(a)-2 (relating to currently distributable income), § 1.662(a)-3 (relating to other amounts distributed), and §§ 1.662(b)-1 and 1.662(b)-2 (relating to character of amounts). Section 662 has no application to amounts excluded under section 663(a).</FP> </SECTION> <SECTION> <SECTNO>§ 1.662(a)-2</SECTNO> <SUBJECT>Currently distributable income.</SUBJECT> <P> (a) There is first included in the gross income of each beneficiary under section 662(a)(1) the amount of income for <PRTPAGE P="137"/> the taxable year of the estate or trust required to be distributed currently to him, subject to the provisions of paragraph (b) of this section. Such amount is included in the beneficiary's gross income whether or not it is actually distributed. </P> <P>(b) If the amount of income required to be distributed currently to all beneficiaries exceeds the distributable net income (as defined in section 643(a) but computed without taking into account the payment, crediting, or setting aside of an amount for which a charitable contributions deduction is allowable under section 642(c)) of the estate or trust, then there is included in the gross income of each beneficiary an amount which bears the same ratio to distributable net income (as so computed) as the amount of income required to be distributed currently to the beneficiary bears to the amount required to be distributed currently to all beneficiaries.</P> <P> (c) The phrase <E T="03">the amount of income for the taxable year required to be distributed currently</E> includes any amount required to be paid out of income or corpus to the extent the amount is satisfied out of income for the taxable year. Thus, an annuity required to be paid in all events (either out of income or corpus) would qualify as income required to be distributed currently to the extent there is income (as defined in section 643(b)) not paid, credited, or required to be distributed to other beneficiaries for the taxable year. If an annuity or a portion of an annuity is deemed under this paragraph to be income required to be distributed currently, it is treated in all respects in the same manner as an amount of income actually required to be distributed currently. The phrase <E T="03">the amount of income for the taxable year required to be distributed currently</E> also includes any amount required to be paid during the taxable year in all events (either out of income or corpus) pursuant to a court order or decree or under local law, by a decedent's estate as an allowance or award for the support of the decedent's widow or other dependent for a limited period during the administration of the estate to the extent there is income (as defined in section 643(b)) of the estate for the taxable year not paid, credited, or required to be distributed to other beneficiaries. </P> <P>(d) If an annuity is paid, credited, or required to be distributed tax free, that is, under a provision whereby the executor or trustee will pay the income tax of the annuitant resulting from the receipt of the annuity, the payment of or for the tax by the executor or trustee will be treated as income paid, credited, or required to be distributed currently to the extent it is made out of income.</P> <P>(e) The application of the rules stated in this section may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(1) Assume that under the terms of the trust instrument $5,000 is to be paid to X charity out of income each year; that $20,000 of income is currently distributable to A; and that an annuity of $12,000 is to be paid to B out of income or corpus. All expenses are charges against income and capital gains are allocable to corpus. During the taxable year the trust had income of $30,000 (after the payment of expenses) derived from taxable interest and made the payments to X charity and distributions to A and B as required by the governing instrument.</P> <P>(2) The amounts treated as distributed currently under section 662(a)(1) total $25,000 ($20,000 to A and $5,000 to B). Since the charitable contribution is out of income the amount of income available for B's annuity is only $5,000. The distributable net income of the trust computed under section 643(a) without taking into consideration the charitable contributions deduction of $5,000 as provided by section 661(a)(1), is $30,000. Since the amounts treated as distributed currently of $25,000 do not exceed the distributable net income (as modified) of $30,000, A is required to include $20,000 in his gross income and B is required to include $5,000 in his gross income under section 662(a)(1).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> Assume the same facts as in paragraph (1) of example 1, except that the trust has, in addition, $10,000 of administration expenses, commissions, etc., chargeable to corpus. The amounts treated as distributed currently under section 662(a)(1) total $25,000 ($20,000 to A and $5,000 to B), since trust income under section 643(b) remains the same as in example 1. Distributable net income of the trust computed under section 643(a) but without taking into account the charitable contributions deduction of $5,000 as provided by section 662(a)(1) is only $20,000. Since the amounts treated as distributed currently of $25,000 exceed the distributable net income (as so computed) of $20,000, A is required to include $16,000 (20,000/25,000 of $20,000) in his gross income and B is required to include $4,000 (5,000/25,000 of $20,000) <PRTPAGE P="138"/> in his gross income under section 662(a)(1). Because A and B are beneficiaries of amounts of income required to be distributed currently, they do not benefit from the reduction of distributable net income by the charitable contributions deduction. </P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 7287, 38 FR 26912, Sept. 27, 1973]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.662(a)-3</SECTNO> <SUBJECT>Other amounts distributed.</SUBJECT> <P>(a) There is included in the gross income of a beneficiary under section 662(a)(2) any amount properly paid, credited, or required to be distributed to the beneficiary for the taxable year, other than (1) income required to be distributed currently, as determined under § 1.662(a)-2, (2) amounts excluded under section 663(a) and the regulations thereunder, and (3) amounts in excess of distributable net income (see paragraph (c) of this section). An amount which is credited or required to be distributed is included in the gross income of a beneficiary whether or not it is actually distributed.</P> <P>(b) Some of the payments to be included under paragraph (a) of this section are: (1) A distribution made to a beneficiary in the discretion of the fiduciary; (2) a distribution required by the terms of the governing instrument upon the happening of a specified event; (3) an annuity which is required to be paid in all events but which is payable only out of corpus; (4) a distribution of property in kind (see paragraph (f) of § 1.661(a)-2); (5) an amount applied or distributed for the support of a dependent of a grantor or a trustee or cotrustee under the circumstances specified in section 677(b) or section 678(c) out of corpus or out of other than income for the taxable year; and (6) an amount required to be paid during the taxable year pursuant to a court order or decree or under local law, by a decedent's estate as an allowance or award for the support of the decedent's widow or other dependent for a limited period during the administration of the estate which is payable only out of corpus of the estate under the order or decree or local law.</P> <P>(c) If the sum of the amounts of income required to be distributed currently (as determined under § 1.662(a)-2) and other amounts properly paid, credited, or required to be distributed (as determined under paragraph (a) of this section) exceeds distributable net income (as defined in section 643(a)), then such other amounts properly paid, credited, or required to be distributed are included in gross income of the beneficiary but only to the extent of the excess of such distributable net income over the amounts of income required to be distributed currently. If the other amounts are paid, credited, or required to be distributed to more than one beneficiary, each beneficiary includes in gross income his proportionate share of the amount includible in gross income pursuant to the preceding sentence. The proportionate share is an amount which bears the same ratio to distributable net income (reduced by amounts of income required to be distributed currently) as the other amounts (as determined under paragraphs (a) and (d) of this section) distributed to the beneficiary bear to the other amounts distributed to all beneficiaries. For treatment of excess distributions by trusts, see sections 665 to 668, inclusive, and the regulations thereunder.</P> <P>(d) The application of the rules stated in this section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>The terms of a trust require the distribution annually of $10,000 of income to A. If any income remains, it may be accumulated or distributed to B, C, and D in amounts in the trustee's discretion. He may also invade corpus for the benefit of A, B, C, or D. In the taxable year, the trust has $20,000 of income after the deduction of all expenses. Distributable net income is $20,000. The trustee distributes $10,000 of income to A. Of the remaining $10,000 of income, he distributes $3,000 each to B, C, and D, and also distributes an additional $5,000 to A. A includes $10,000 in income under section 662(a)(1). The “other amounts distributed” amount of $14,000, includible in the income of the recipients to the extent of $10,000, distributable net income less the income currently distributable to A. A will include an additional $3,571 (5,000/14,000 × $10,000) in income under this section, and B, C, and D will each include $2,143 (3,000/14,000 × $10,000).</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 7287, 38 FR 26913, Sept. 27, 1973]</CITA> </SECTION> <SECTION> <PRTPAGE P="139"/> <SECTNO>§ 1.662(a)-4</SECTNO> <SUBJECT>Amounts used in discharge of a legal obligation.</SUBJECT> <P> Any amount which, pursuant to the terms of a will or trust instrument, is used in full or partial discharge or satisfaction of a legal obligation of any person is included in the gross income of such person under section 662(a) (1) or (2), whichever is applicable, as though directly distributed to him as a beneficiary, except in cases to which section 71 (relating to alimony payments) or section 682 (relating to income of a trust in case of divorce, etc.) applies. The term <E T="03">legal obligation</E> includes a legal obligation to support another person if, and only if, the obligation is not affected by the adequacy of the dependent's own resources. For example, a parent has a “legal obligation” within the meaning of the preceding sentence to support his minor child if under local law property or income from property owned by the child cannot be used for his support so long as his parent is able to support him. On the other hand, if under local law a mother may use the resources of a child for the child's support in lieu of supporting him herself, no obligation of support exists within the meaning of this paragraph, whether or not income is actually used for support. Similarly, since under local law a child ordinarily is obligated to support his parent only if the parent's earnings and resources are insufficient for the purpose, no obligation exists whether or not the parent's earnings and resources are sufficient. In any event the amount of trust income which is included in the gross income of a person obligated to support a dependent is limited by the extent of his legal obligation under local law. In the case of a parent's obligation to support his child, to the extent that the parent's legal obligation of support, including education, is determined under local law by the family's station in life and by the means of the parent, it is to be determined without consideration of the trust income in question. </P> </SECTION> <SECTION> <SECTNO>§ 1.662(b)-1</SECTNO> <SUBJECT>Character of amounts; when no charitable contributions are made.</SUBJECT> <P>In determining the amount includible in the gross income of a beneficiary, the amounts which are determined under section 662(a) and §§ 1.662(a)-1 through 1.662(a)-4 shall have the same character in the hands of the beneficiary as in the hands of the estate or trust. The amounts are treated as consisting of the same proportion of each class of items entering into the computation of distributable net income as the total of each class bears to the total distributable net income of the estate or trust unless the terms of the governing instrument specifically allocate different classes of income to different beneficiaries, or unless local law requires such an allocation. For this purpose, the principles contained in § 1.652(b)-1 shall apply.</P> </SECTION> <SECTION> <SECTNO>§ 1.662(b)-2</SECTNO> <SUBJECT>Character of amounts; when charitable contributions are made.</SUBJECT> <P>When a charitable contribution is made, the principles contained in §§ 1.652(b)-1 and 1.662(b)-1 generally apply. However, before the allocation of other deductions among the items of distributable net income, the charitable contributions deduction allowed under section 642(c) is (in the absence of specific allocation under the terms of the governing instrument or the requirement under local law of a different allocation) allocated among the classes of income entering into the computation of estate or trust income in accordance with the rules set forth in paragraph (b) of § 1.643(a)-5. In the application of the preceding sentence, for the purpose of allocating items of income and deductions to beneficiaries to whom income is required to be distributed currently, the amount of the charitable contributions deduction is disregarded to the extent that it exceeds the income of the trust for the taxable year reduced by amounts for the taxable year required to be distributed currently. The application of this section may be illustrated by the following examples (of which example (1) is illustrative of the preceding sentence):</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> (a) A trust instrument provides that $30,000 of its income must be distributed currently to A, and the balance may either be distributed to B, distributed to a designated charity, or accumulated. Accumulated income may be distributed to B and to the charity. The trust for its taxable year has $40,000 of taxable interest and $10,000 of <PRTPAGE P="140"/> tax-exempt income, with no expenses. The trustee distributed $30,000 to A, $50,000 to charity X, and $10,000 to B. </P> <P>(b) Distributable net income for the purpose of determining the character of the distribution to A is $30,000 (the charitable contributions deduction, for this purpose, being taken into account only to the extent of $20,000, the difference between the income of the trust for the taxable year, $50,000, and the amount required to be distributed currently, $30,000).</P> <P>(c) The charitable contributions deduction taken into account, $20,000, is allocated proportionately to the items of income of the trust, $16,000 to taxable interest and $4,000 to tax-exempt income.</P> <P>(d) Under section 662(a)(1), the amount of income required to be distributed currently to A is $30,000, which consists of the balance of these items, $24,000 of taxable interest and $6,000 of tax-exempt income.</P> <P>(e) In determining the amount to be included in the gross income of B under section 662 for the taxable year, however, the entire charitable contributions deduction is taken into account, with the result that there is no distributable net income and therefore no amount to be included in gross income.</P> <P>(f) See subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code for application of the throwback provisions to the distribution made to B.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The net income of a trust is payable to A for life, with the remainder to a charitable organization. Under the terms of the trust instrument and local law capital gains are added to corpus. During the taxable year the trust receives dividends of $10,000 and realized a long-term capital gain of $10,000, for which a long-term capital gain deduction of $5,000 is allowed under section 1202. Since under the trust instrument and local law the capital gains are allocated to the charitable organization, and since the capital gain deduction is directly attributable to the capital gain, the charitable contributions deduction and the capital gain deduction are both allocable to the capital gain, and dividends in the amount of $10,000 are allocable to A.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.662(c)-1</SECTNO> <SUBJECT>Different taxable years.</SUBJECT> <P>If a beneficiary has a different taxable year (as defined in section 441 or 442) from the taxable year of an estate or trust, the amount he is required to include in gross income in accordance with section 662 (a) and (b) is based upon the distributable net income of the estate or trust and the amounts properly paid, credited, or required to be distributed to the beneficiary for any taxable year or years of the estate or trust ending with or within his taxable year. This rule applies as to so-called short taxable years as well as taxable years of normal duration. Income of an estate or trust for its taxable year or years is determined in accordance with its method of accounting and without regard to that of the beneficiary.</P> </SECTION> <SECTION> <SECTNO>§ 1.662(c)-2</SECTNO> <SUBJECT>Death of individual beneficiary.</SUBJECT> <P>If an amount specified in section 662(a) (1) or (2) is paid, credited, or required to be distributed by an estate or trust for a taxable year which does not end with or within the last taxable year of a beneficiary (because of the beneficiary's death), the extent to which the amount is included in the gross income of the beneficiary for his last taxable year or in the gross income of his estate is determined by the computations under section 662 for the taxable year of the estate or trust in which his last taxable year ends. Thus, the distributable net income and the amounts paid, credited, or required to be distributed for the taxable year of the estate or trust, determine the extent to which the amounts paid, credited, or required to be distributed to the beneficiary are included in his gross income for his last taxable year or in the gross income of his estate. (Section 662(c) does not apply to such amounts.) The gross income for the last taxable year of a beneficiary on the cash basis includes only income actually distributed to the beneficiary before his death. Income required to be distributed, but in fact distributed to his estate, is included in the gross income of the estate as income in respect of a decedent under section 691. See paragraph (e) of § 1.663(c)-3 with respect to separate share treatment for the periods before and after the death of a trust's beneficiary.</P> </SECTION> <SECTION> <SECTNO>§ 1.662(c)-3</SECTNO> <SUBJECT>Termination of existence of other beneficiaries.</SUBJECT> <P> If the existence of a beneficiary which is not an individual terminates, the amount to be included under section 662(a) in its gross income for the last taxable year is computed with reference to §§ 1.662(c)-1 and 1.662(c)-2 as if the beneficiary were a deceased individual, except that income required to <PRTPAGE P="141"/> be distributed prior to the termination but actually distributed to the beneficiary's successor in interest is included in the beneficiary's income for its last taxable year. </P> </SECTION> <SECTION> <SECTNO>§ 1.662(c)-4</SECTNO> <SUBJECT>Illustration of the provisions of sections 661 and 662.</SUBJECT> <P>The provisions of sections 661 and 662 may be illustrated in general by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) Under the terms of a testamentary trust one-half of the trust income is to be distributed currently to W, the decedent's wife, for her life. The remaining trust income may, in the trustee's discretion, either be paid to D, the grantor's daughter, paid to designated charities, or accumulated. The trust is to terminate at the death of W and the principal will then be payable to D. No provision is made in the trust instrument with respect to depreciation of rental property. Capital gains are allocable to the principal account under the applicable local law. The trust and both beneficiaries file returns on the calendar year basis. The records of the fiduciary show the following items of income and deduction for the taxable year 1955:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="01">Dividends of domestic corporations</ENT> <ENT>50,000</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt interest</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Capital gains (long term)</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="01">Depreciation of rental property</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Expenses attributable to rental income</ENT> <ENT>15,400</ENT> </ROW> <ROW> <ENT I="01">Trustee's commissions allocable to income account</ENT> <ENT>2,800</ENT> </ROW> <ROW> <ENT I="01">Trustee's commissions allocable to principal account</ENT> <ENT>1,100</ENT> </ROW> </GPOTABLE> <P>(b) The income for trust accounting purposes is $111,800, and the trustee distributes one-half ($55,900) to W and in his discretion makes a contribution of one-quarter ($27,950) to charity X and distributes the remaining one-quarter ($27,950) to D. The total of the distributions to beneficiaries is $83,850, consisting of (1) income required to be distributed currently to W of $55,900 and (2) other amounts properly paid or credited to D of $27,950. The income for trust accounting purposes of $111,800 is determined as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="01">Dividends</ENT> <ENT>50,000</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt interest</ENT> <ENT>20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Partially tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>130,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Rental expenses</ENT> <ENT>$15,400</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions allocable to income account</ENT> <ENT>2,800</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>18,200</ENT> </ROW> <ROW> <ENT I="03">Income as computed under section 643(b)</ENT> <ENT>111,800</ENT> </ROW> </GPOTABLE> <P>(c) The distributable net income of the trust as computed under section 643(a) is $82,750, determined as follows:</P> <GPOTABLE COLS="4" OPTS="L1,p1,6/7" CDEF="s100,10,10,10"> <ROW> <ENT I="01">Rents</ENT> <ENT/> <ENT/> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="01">Dividends</ENT> <ENT/> <ENT/> <ENT>50,000</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest</ENT> <ENT/> <ENT/> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt interest</ENT> <ENT/> <ENT>$20,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions allocable thereto (20,000/130,000 of $3,900)</ENT> <ENT>$600</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Charitable contributions allocable thereto (20,000/130,000 of $27,950)</ENT> <ENT>4,300</ENT> </ROW> <ROW> <ENT I="11"> </ENT> <ENT>—————</ENT> <ENT>4,900</ENT> </ROW> <ROW RUL="n,n,n,s"> <ENT I="11"> </ENT> <ENT O="xl"/> <ENT>—————</ENT> <ENT>15,100</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT/> <ENT/> <ENT>125,100</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT/> <ENT>15,400</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions ($3,900 less $600 allocated to tax-exempt interest)</ENT> <ENT/> <ENT>3,300</ENT> </ROW> <ROW> <ENT I="02">Charitable deduction ($27,950 less $4,300 attributable to tax-exempt interest)</ENT> <ENT/> <ENT>23,650</ENT> </ROW> <ROW RUL="n,n,n,s"> <ENT I="11"> </ENT> <ENT O="xl"/> <ENT>—————</ENT> <ENT>42,350</ENT> </ROW> <ROW> <ENT I="03">Distributable net income</ENT> <ENT/> <ENT/> <ENT>82,750</ENT> </ROW> </GPOTABLE> <FP>In computing the distributable net income of $82,750, the taxable income of the trust was computed with the following modifications: No deductions were allowed for distributions to beneficiaries and for personal exemption of the trust (section 643(a) (1) and (2)); capital gains were excluded and no deduction under section 1202 (relating to the 50 percent deduction for long-term capital gains) was taken into account (section 643(a)(3)); and the tax-exempt interest (as adjusted for expenses and charitable contributions) and the dividend exclusion of $50 were included (section 643(a) (5) and (7)).</FP> <P>(d) Inasmuch as the distributable net income of $82,750 as determined under section 643(a) is less than the sum of the amounts distributed to W and D of $83,850, the deduction allowable to the trust under section 661(a) is such distributable net income as modified under section 661(c) to exclude therefrom the items of income not included in the gross income of the trust, as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income</ENT> <ENT>$82,750</ENT> </ROW> <ROW> <PRTPAGE P="142"/> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Tax-exempt interest (as adjusted for expenses and the charitable contributions)</ENT> <ENT>$15,100</ENT> </ROW> <ROW> <ENT I="02">Dividend exclusion allowable under section 116</ENT> <ENT>50</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>15,150</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Deduction allowable under section 661(a)</ENT> <ENT>67,600</ENT> </ROW> </GPOTABLE> <P>(e) For the purpose of determining the character of the amounts deductible under section 642(c) and section 661(a), the trustee elected to offset the trustee's commissions (other than the portion required to be allocated to tax-exempt interest) against the rental income. The following table shows the determination of the character of the amounts deemed distributed to beneficiaries and contributed to charity.</P> <GPOTABLE COLS="7" OPTS="L2" CDEF="s40,9,9,9,9,9,9"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Rents</CHED> <CHED H="1">Taxable dividends</CHED> <CHED H="1">Excluded dividends</CHED> <CHED H="1">Tax exempt interest</CHED> <CHED H="1">Partially tax exempt interest</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">Trust income</ENT> <ENT>$50,000</ENT> <ENT>$49,950</ENT> <ENT>$50</ENT> <ENT>$20,000</ENT> <ENT>$10,000</ENT> <ENT>$130,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Charitable contribution</ENT> <ENT>10,750</ENT> <ENT>10,750</ENT> <ENT/> <ENT>4,300</ENT> <ENT>2,150</ENT> <ENT>27,950</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>15,400</ENT> <ENT/> <ENT/> <ENT/> <ENT/> <ENT>15,400</ENT> </ROW> <ROW RUL="n,s,s,s,s,s,s"> <ENT I="02">Trustee's commissions</ENT> <ENT>3,300</ENT> <ENT/> <ENT/> <ENT>600</ENT> <ENT/> <ENT>3,900</ENT> </ROW> <ROW RUL="n,s,s,s,s,s,s"> <ENT I="03">Total deductions</ENT> <ENT>29,450</ENT> <ENT>10,750</ENT> <ENT>0</ENT> <ENT>4,900</ENT> <ENT>2,150</ENT> <ENT>47,250</ENT> </ROW> <ROW> <ENT I="01">Amounts distributable to beneficiaries</ENT> <ENT>20,550</ENT> <ENT>39,200</ENT> <ENT>50</ENT> <ENT>15,100</ENT> <ENT>7,850</ENT> <ENT>82,750</ENT> </ROW> </GPOTABLE> <FP>The character of the charitable contribution is determined by multiplying the total charitable contribution ($27,950) by a fraction consisting of each item of trust income, respectively, over the total trust income, except that no part of the dividends excluded from gross income are deemed included in the charitable contribution. For example, the charitable contribution is deemed to consist of rents of $10,750 (50,000/130,000 × $27,950).</FP> <P>(f) The taxable income of the trust is $9,900 determined as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rental income</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="01">Dividends ($50,000 less $50 exclusion)</ENT> <ENT>49,950</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest</ENT> <ENT>10,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Capital gains</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="03">Gross income</ENT> <ENT>129,950</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Rental expenses</ENT> <ENT>15,400</ENT> </ROW> <ROW> <ENT I="02">Trustee's commissions</ENT> <ENT>3,300</ENT> </ROW> <ROW> <ENT I="02">Charitable contributions</ENT> <ENT>23,650</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="02">Distributions to beneficiaries</ENT> <ENT>67,600</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="22"> </ENT> <ENT> </ENT> <ENT>120,050</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Taxable income</ENT> <ENT>9,900</ENT> </ROW> </GPOTABLE> <P>(g) In computing the amount includible in W's gross income under section 662(a)(1), the $55,900 distribution to her is deemed to be composed of the following proportions of the items of income deemed to have been distributed to the beneficiaries by the trust (see paragraph (e) of this example):</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents (20,550/82,750 × $55,900)</ENT> <ENT>$13,882</ENT> </ROW> <ROW> <ENT I="01">Dividends (39,250/82,750 × $55,900)</ENT> <ENT>26,515</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest (7,850/ 82,750 × $55,900)</ENT> <ENT>5,303</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax-exempt interest (15,100/82,750 × $55,900)</ENT> <ENT>10,200</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>55,900</ENT> </ROW> </GPOTABLE> <FP>Accordingly, W will exclude $10,200 of tax-exempt interest from gross income and will receive the credits and exclusion for dividends received and for partially tax-exempt interest provided in sections 34, 116, and 35, respectively, with respect to the dividends and partially tax-exempt interest deemed to have been distributed to her, her share of the dividends being aggregated with other dividends received by her for purposes of the dividend credit and exclusion. In addition, she may deduct a share of the depreciation deduction proportionate to the trust income allocable to her; that is, one-half of the total depreciation deduction, or $5,000.</FP> <P>(h) Inasmuch as the sum of the amount of income required to be distributed currently to W ($55,900) and the other amounts properly paid, credited, or required to be distributed to D ($27,950) exceeds the distributable net income ($82,750) of the trust as determined under section 643(a), D is deemed to have received $26,850 ($82,750 less $55,900) for income tax purposes. The character of the amounts deemed distributed to her is determined as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Rents (20,550/82,750 × $26,850)</ENT> <ENT>$6,668</ENT> </ROW> <ROW> <ENT I="01">Dividends (39,250/82,750 × $26,850)</ENT> <ENT>12,735</ENT> </ROW> <ROW> <ENT I="01">Partially tax-exempt interest (7,850/ 82,750 × $26,850)</ENT> <ENT>2,547</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax-exempt interest (15,100/82,750 × $26,850)</ENT> <ENT>4,900</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>26,850</ENT> </ROW> </GPOTABLE> <FP> Accordingly, D will exclude $4,900 of tax-exempt interest from gross income and will receive the credits and exclusion for dividends received and for partially tax-exempt interest provided in sections 34, 116, and 35, respectively, with respect to the dividends and partially tax-exempt interest deemed to have been distributed to her, her share of the <PRTPAGE P="143"/> dividends being aggregated with other dividends received by her for purposes of the dividend credit and exclusion. In addition, she may deduct a share of the depreciation deduction proportionate to the trust income allocable to her; that is, one-fourth of the total depreciation deduction, or $2,500. </FP> <P>(i) [Reserved]</P> <P>(j) The remaining $2,500 of the depreciation deduction is allocated to the amount distributed to charity X and is hence non-deductible by the trust, W, or D. (See § 1.642(e)-1.)</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.663(a)-1</SECTNO> <SUBJECT>Special rules applicable to sections 661 and 662; exclusions; gifts, bequests, etc.</SUBJECT> <P> (a) <E T="03">In general.</E> A gift or bequest of a specific sum of money or of specific property, which is required by the specific terms of the will or trust instrument and is properly paid or credited to a beneficiary, is not allowed as a deduction to an estate or trust under section 661 and is not included in the gross income of a beneficiary under section 662, unless under the terms of the will or trust instrument the gift or bequest is to be paid or credited to the recipient in more than three installments. Thus, in order for a gift or bequest to be excludable from the gross income of the recipient, (1) it must qualify as a gift or bequest of a specific sum of money or of specific property (see paragraph (b) of this section), and (2) the terms of the governing instrument must not provide for its payment in more than three installments (see paragraph (c) of this section). The date when the estate came into existence or the date when the trust was created is immaterial. </P> <P> (b) <E T="03">Definition of a gift or bequest of a specific sum of money or of specific property.</E> (1) In order to qualify as a gift or bequest of a specific sum of money or of specific property under section 663(a), the amount of money or the identity of the specific property must be ascertainable under the terms of a testator's will as of the date of his death, or under the terms of an inter vivos trust instrument as of the date of the inception of the trust. For example, bequests to a decedent's son of the decedent's interest in a partnership and to his daughter of a sum of money equal to the value of the partnership interest are bequests of specific property and of a specific sum of money, respectively. On the other hand, a bequest to the decedent's spouse of money or property, to be selected by the decedent's executor, equal in value to a fraction of the decedent's “adjusted gross estate” is neither a bequest of a specific sum of money or of specific property. The identity of the property and the amount of money specified in the preceding sentence are dependent both on the exercise of the executor's discretion and on the payment of administration expenses and other charges, neither of which are facts existing on the date of the decedent's death. It is immaterial that the value of the bequest is determinable after the decedent's death before the bequest is satisfied (so that gain or loss may be realized by the estate in the transfer of property in satisfaction of it). </P> <P>(2) The following amounts are not considered as gifts or bequests of a sum of money or of specific property within the meaning of this paragraph:</P> <P>(i) An amount which can be paid or credited only from the income of an estate or trust, whether from the income for the year of payment or crediting, or from the income accumulated from a prior year;</P> <P>(ii) An annuity, or periodic gifts of specific property in lieu of or having the effect of an annuity;</P> <P>(iii) A residuary estate or the corpus of a trust; or</P> <P>(iv) A gift or bequest paid in a lump sum or in not more than three installments, if the gift or bequest is required to be paid in more than three installments under the terms of the governing instrument.</P> <P>(3) The provisions of subparagraphs (1) and (2) of this paragraph may be illustrated by the following examples, in which it is assumed that the gift or bequest is not required to be made in more than three installments (see paragraph (c)):</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> Under the terms of a will, a legacy of $5,000 was left to A, 1,000 shares of X company stock was left to W, and the balance of the estate was to be divided equally between W and B. No provision was made in the will for the disposition of income of the estate during the period of administration. The estate had income of $25,000 during the taxable year 1954, which was accumulated and added to corpus for estate accounting <PRTPAGE P="144"/> purposes. During the taxable year, the executor paid the legacy of $5,000 in a lump sum to A, transferred the X company stock to W, and made no other distributions to beneficiaries. The distributions to A and W qualify for the exclusion under section 663(a)(1). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Under the terms of a will, the testator's estate was to be distributed to A. No provision was made in the will for the distribution of the estate's income during the period of administration. The estate had income of $50,000 for the taxable year. The estate distributed to A stock with a basis of $40,000 and with a fair market value of $40,000 on the date of distribution. No other distributions were made during the year. The distribution does not qualify for the exclusion under section 663(a)(1), because it is not a specific gift to A required by the terms of the will. Accordingly, the fair market value of the property ($40,000) represents a distribution within the meaning of sections 661(a) and 662(a) (see § 1.661(a)-2(c)).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>Under the terms of a trust instrument, trust income is to be accumulated for a period of 10 years. During the eleventh year, the trustee is to distribute $10,000 to B, payable from income or corpus, and $10,000 to C, payable out of accumulated income. The trustee is to distribute the balance of the accumulated income to A. Thereafter, A is to receive all the current income until the trust terminates. Only the distribution to B would qualify for the exclusion under section 663(a)(1).</P> </EXAMPLE> <P>(4) A gift or bequest of a specific sum of money or of specific property is not disqualified under this paragraph solely because its payment is subject to a condition. For example, provision for a payment by a trust to beneficiary A of $10,000 when he reaches age 25, and $10,000 when he reaches age 30, with payment over to B of any amount not paid to A because of his death, is a gift to A of a specific sum of money payable in two installments, within the meaning of this paragraph, even though the exact amount payable to A cannot be ascertained with certainty under the terms of the trust instrument.</P> <P> (c) <E T="03">Installment payments.</E> (1) In determining whether a gift or bequest of a specific sum of money or of specific property, as defined in paragraph (b) of this section, is required to be paid or credited to a particular beneficiary in more than three installments: </P> <P>(i) Gifts or bequests of articles for personal use (such as personal and household effects, automobiles, and the like) are disregarded.</P> <P>(ii) Specifically devised real property, the title to which passes directly from the decedent to the devisee under local law, is not taken into account, since it would not constitute an amount paid, credited, or required to be distributed under section 661 (see paragraph (e) of § 1.661(a)-2).</P> <P>(iii) All gifts and bequests under a decedent's will (which are not disregarded pursuant to subdivisions (i) and (ii) of this subparagraph) for which no time of payment or crediting is specified, and which are to be paid or credited in the ordinary course of administration of the decedent's estate, are considered as required to be paid or credited in a single installment.</P> <P>(iv) All gifts and bequests (which are not disregarded pursuant to subdivisions (i) and (ii) of this subparagraph) payable at any one specified time under the terms of the governing instrument are taken into account as a single installment.</P> <FP>For purposes of determining the number of installments paid or credited to a particular beneficiary, a decedent's estate and a testamentary trust shall each be treated as a separate entity.</FP> <P>(2) The application of the rules stated in subparagraph (1) of this paragraph may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example (1).</HD> <P>(i) Under the terms of a decedent's will, $10,000 in cash, household furniture, a watch, an automobile, 100 shares of X company stock, 1,000 bushels of grain, 500 head of cattle, and a farm (title to which passed directly to A under local law) are bequeathed or devised outright to A. The will also provides for the creation of a trust for the benefit of A, under the terms of which there are required to be distributed to A, $10,000 in cash and 100 shares of Y company stock when he reaches 25 years of age, $25,000 in cash and 200 shares of Y company stock when he reaches 30 years of age, and $50,000 in cash and 300 shares of Y company stock when he reaches 35 years of age.</P> <P>(ii) The furniture, watch, automobile, and the farm are excluded in determining whether any gift or bequest is required to be paid or credited to A in more than three installments. These items qualify for the exclusion under section 663(a)(1) regardless of the treatment of the other items of property bequeathed to A.</P> <P> (iii) The $10,000 in cash, the shares of X company stock, the grain, the cattle and the assets required to create the trust, to be paid or credited by the estate to A and the trust <PRTPAGE P="145"/> are considered as required to be paid or credited in a single installment to each, regardless of the manner of payment or distribution by the executor, since no time of payment or crediting is specified in the will. The $10,000 in cash and shares of Y company stock required to be distributed by the trust to A when he is 25 years old are considered as required to be paid or distributed as one installment under the trust. Likewise, the distributions to be made by the trust to A when he is 30 and 35 years old are each considered as one installment under the trust. Since the total number of installments to be made by the estate does not exceed three, all of the items of money and property distributed by the estate qualify for the exclusion under section 663(a)(1). Similarly, the three distributions by the trust qualify. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example (2).</HD> <P>Assume the same facts as in example (1), except that another distribution of a specified sum of money is required to be made by the trust to A when he becomes 40 years old. This distribution would also qualify as an installment, thus making four installments in all under the trust. None of the gifts to A under the trust would qualify for the exclusion under section 663(a)(1). The situation as to the estate, however, would not be changed.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example (3).</HD> <P>A trust instrument provides that A and B are each to receive $75,000 in installments of $25,000, to be paid in alternate years. The trustee distributes $25,000 to A in 1954, 1956, and 1958, and to B in 1955, 1957, and 1959. The gifts to A and B qualify for exclusion under section 663(a)(1), although a total of six payments is made. The gifts of $75,000 to each beneficiary are to be separately treated.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 8849, 64 FR 72543, Dec. 28, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(a)-2</SECTNO> <SUBJECT>Charitable, etc., distributions.</SUBJECT> <P>Any amount paid, permanently set aside, or to be used for the charitable, etc., purposes specified in section 642(c) and which is allowable as a deduction under that section is not allowed as a deduction to an estate or trust under section 661 or treated as an amount distributed for purposes of determining the amounts includible in gross income of beneficiaries under section 662. Amounts paid, permanently set aside, or to be used for charitable, etc., purposes are deductible by estates or trusts only as provided in section 642(c). For purposes of this section, the deduction provided in section 642(c) is computed without regard to the provisions of section 508(d), section 681, or section 4948(c)(4) (concerning unrelated business income and private foundations).</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7428, 41 FR 34627, Aug. 16, 1976]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(a)-3</SECTNO> <SUBJECT>Denial of double deduction.</SUBJECT> <P>No amount deemed to have been distributed to a beneficiary in a preceding year under section 651 or 661 is included in amounts falling within section 661(a) or 662(a). For example, assume that all of the income of a trust is required to be distributed currently to beneficiary A and both the trust and A report on the calendar year basis. For administrative convenience, the trustee distributes in January and February 1956 a portion of the income of the trust required to be distributed in 1955. The portion of the income for 1955 which was distributed by the trust in 1956 may not be claimed as a deduction by the trust for 1956 since it is deductible by the trust and includible in A's gross income for the taxable year 1955.</P> </SECTION> <SECTION> <SECTNO>§ 1.663(b)-1</SECTNO> <SUBJECT>Distributions in first 65 days of taxable year; scope.</SUBJECT> <P> (a) <E T="03">Taxable years beginning after December 31, 1968</E> —(1) <E T="03">General rule.</E> With respect to taxable years beginning after December 31, 1968, the fiduciary of a trust may elect under section (b) to 663 treat any amount or portion thereof that is properly paid or credited to a beneficiary within the first 65 days following the close of the taxable year as an amount that was properly paid or credited on the last day of such taxable year. </P> <P> (2) <E T="03">Effect of election.</E> (i) An election is effective only with respect to the taxable year for which the election is made. In the case of distributions made after May 8, 1972, the amount to which the election applies shall not exceed: </P> <P> ( <E T="03">a</E> ) The amount of income of the trust (as defined in § 1.643(b)-1) for the taxable year for which the election is made, or </P> <P> ( <E T="03">b</E> ) The amount of distributable net income of the trust (as defined in §§ 1.643(a)-1 through 1.643(a)-7) for such taxable year, if greater, </P> <FP> reduced by any amounts paid, credited, or required to be distributed in such <PRTPAGE P="146"/> taxable year other than those amounts considered paid or credited in a preceding taxable year by reason of section 663(b) and this section. An election shall be made for each taxable year for which the treatment is desired. The application of this paragraph may be illustrated by the following example: </FP> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>X Trust, a calendar year trust, has $1,000 of income (as defined in § 1.643(b)-1) and $800 of distributable net income (as defined in §§ 1.643(a)-1 through 1.643(a)-7) in 1972. The trust properly pays $550 to A, a beneficiary, on January 15, 1972, which the trustee elects to treat under section 663(b) as paid on December 31, 1971. The trust also properly pays to A $600 on July 19, 1972, and $450 on January 17, 1973. For 1972, the maximum amount that may be elected under this subdivision to be treated as properly paid or credited on the last day of 1972 is $400 ($1,000−$600). The $550 paid on January 15, 1972, does not reduce the maximum amount to which the election may apply, because that amount is treated as properly paid on December 31, 1971.</P> </EXAMPLE> <P>(ii) If an election is made with respect to a taxable year of a trust, this section shall apply only to those amounts which are properly paid or credited within the first 65 days following such year and which are so designated by the fiduciary in his election. Any amount considered under section 663(b) as having been distributed in the preceding taxable year shall be so treated for all purposes. For example, in determining the beneficiary's tax liability, such amount shall be considered as having been received by the beneficiary in his taxable year in which or with which the last day of the preceding taxable year of the trust ends.</P> <P> (b) <E T="03">Taxable years beginning before January 1, 1969.</E> With respect to taxable years of a trust beginning before January 1, 1969, the fiduciary of the trust may elect under section 663(b) to treat distributions within the first 65 days following such taxable year as amounts which were paid or credited on the last day of such taxable year, if: </P> <P>(1) The trust was in existence prior to January 1, 1954;</P> <P>(2) An amount in excess of the income of the immediately preceding taxable year may not (under the terms of the governing instrument) be distributed in any taxable year; and</P> <P>(3) The fiduciary elects (as provided in § 1.663(b)-2) to have section 663(b) apply.</P> <CITA>[T.D. 7204, 37 FR 17135, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(b)-2</SECTNO> <SUBJECT>Election.</SUBJECT> <P> (a) <E T="03">Manner and time of election; irrevocability</E> —(1) <E T="03">When return is required to be filed.</E> If a trust return is required to be filed for the taxable year of the trust for which the election is made, the election shall be made in the appropriate place on such return. The election under this subparagraph shall be made not later than the time prescribed by law for filing such return (including extensions thereof). Such election shall become irrevocable after the last day prescribed for making it. </P> <P> (2) <E T="03">When no return is required to be filed.</E> If no return is required to be filed for the taxable year of the trust for which the election is made, the election shall be made in a statement filed with the internal revenue office with which a return by such trust would be filed if such trust were required to file a return for such taxable year. See section 6091 and the regulations thereunder for place for filing returns. The election under this subparagraph shall be made not later than the time prescribed by law for filing a return if such trust were required to file a return for such taxable year. Such election shall become irrevocable after the last day prescribed for making it. </P> <P> (b) <E T="03">Elections under prior law.</E> Elections made pursuant to section 663(b) prior to its amendment by section 331(b) of the Tax Reform Act of 1969 (83 Stat. 598), which, under prior law, were irrevocable for the taxable year for which the election was made and all subsequent years, are not effective for taxable years beginning after December 31, 1968. In the case of a trust for which an election was made under prior law, the fiduciary shall make the election for each taxable year beginning after December 31, 1968, for which the treatment provided by section 663(b) is desired. </P> <CITA>[T.D. 7204, 37 FR 17135, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <PRTPAGE P="147"/> <SECTNO>§ 1.663(c)-1</SECTNO> <SUBJECT>Separate shares treated as separate trusts or as separate estates; in general.</SUBJECT> <P>(a) If a single trust (or estate) has more than one beneficiary, and if different beneficiaries have substantially separate and independent shares, their shares are treated as separate trusts (or estates) for the sole purpose of determining the amount of distributable net income allocable to the respective beneficiaries under sections 661 and 662. Application of this rule will be significant in, for example, situations in which income is accumulated for beneficiary A but a distribution is made to beneficiary B of both income and corpus in an amount exceeding the share of income that would be distributable to B had there been separate trusts (or estates). In the absence of a separate share rule B would be taxed on income which is accumulated for A. The division of distributable net income into separate shares will limit the tax liability of B. Section 663(c) does not affect the principles of applicable law in situations in which a single trust (or estate) instrument creates not one but several separate trusts (or estates), as opposed to separate shares in the same trust (or estate) within the meaning of this section.</P> <P>(b) The separate share rule does not permit the treatment of separate shares as separate trusts (or estates) for any purpose other than the application of distributable net income. It does not, for instance, permit the treatment of separate shares as separate trusts (or estates) for purposes of:</P> <P>(1) The filing of returns and payment of tax,</P> <P>(2) The deduction of personal exemption under section 642(b), and</P> <P>(3) The allowance to beneficiaries succeeding to the trust (or estate) property of excess deductions and unused net operating loss and capital loss carryovers on termination of the trust (or estate) under section 642(h).</P> <P>(c) The separate share rule may be applicable even though separate and independent accounts are not maintained and are not required to be maintained for each share on the books of account of the trust (or estate), and even though no physical segregation of assets is made or required.</P> <P>(d) Separate share treatment is not elective. Thus, if a trust (or estate) is properly treated as having separate and independent shares, such treatment must prevail in all taxable years of the trust (or estate) unless an event occurs as a result of which the terms of the trust (or estate) instrument and the requirements of proper administration require different treatment.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, as amended by T.D. 8849, 64 FR 72543, Dec. 28, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(c)-2</SECTNO> <SUBJECT>Rules of administration.</SUBJECT> <P> (a) <E T="03">When separate shares come into existence.</E> A separate share comes into existence upon the earliest moment that a fiduciary may reasonably determine, based upon the known facts, that a separate economic interest exists. </P> <P> (b) <E T="03">Computation of distributable net income for each separate share</E> —(1) <E T="03">General rule.</E> The amount of distributable net income for any share under section 663(c) is computed as if each share constituted a separate trust or estate. Accordingly, each separate share shall calculate its distributable net income based upon its portion of gross income that is includible in distributable net income and its portion of any applicable deductions or losses. </P> <P> (2) <E T="03">Section 643(b) income.</E> This paragraph (b)(2) governs the allocation of the portion of gross income includible in distributable net income that is income within the meaning of section 643(b). Such gross income is allocated among the separate shares in accordance with the amount of income that each share is entitled to under the terms of the governing instrument or applicable local law. </P> <P> (3) <E T="03">Income in respect of a decedent.</E> This paragraph (b)(3) governs the allocation of the portion of gross income includible in distributable net income that is income in respect of a decedent within the meaning of section 691(a) and is not income within the meaning of section 643(b). Such gross income is allocated among the separate shares that could potentially be funded with these amounts irrespective of whether the share is entitled to receive any income under the terms of the governing instrument or applicable local law. The amount of such gross income allocated <PRTPAGE P="148"/> to each share is based on the relative value of each share that could potentially be funded with such amounts. </P> <P> (4) <E T="03">Gross income not attributable to cash.</E> This paragraph (b)(4) governs the allocation of the portion of gross income includible in distributable net income that is not attributable to cash received by the estate or trust (for example, original issue discount, a distributive share of partnership tax items, and the pro rata share of an S corporation's tax items). Such gross income is allocated among the separate shares in the same proportion as section 643(b) income from the same source would be allocated under the terms of the governing instrument or applicable local law. </P> <P> (5) <E T="03">Deductions and losses.</E> Any deduction or any loss which is applicable solely to one separate share of the trust or estate is not available to any other share of the same trust or estate. </P> <P> (c) <E T="03">Computations and valuations.</E> For purposes of calculating distributable net income for each separate share, the fiduciary must use a reasonable and equitable method to make the allocations, calculations, and valuations required by paragraph (b) of this section. </P> <CITA>[T.D. 8849, 64 FR 72543, Dec. 28, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(c)-3</SECTNO> <SUBJECT>Applicability of separate share rule to certain trusts.</SUBJECT> <P>(a) The applicability of the separate share rule provided by section 663(c) to trusts other than qualified revocable trusts within the meaning of section 645(b)(1) will generally depend upon whether distributions of the trust are to be made in substantially the same manner as if separate trusts had been created. Thus, if an instrument directs a trustee to divide the testator's residuary estate into separate shares (which under applicable law do not constitute separate trusts) for each of the testator's children and the trustee is given discretion, with respect to each share, to distribute or accumulate income or to distribute principal or accumulated income, or to do both, separate shares will exist under section 663(c). In determining whether separate shares exist, it is immaterial whether the principal and any accumulated income of each share is ultimately distributable to the beneficiary of such share, to his descendants, to his appointees under a general or special power of appointment, or to any other beneficiaries (including a charitable organization) designated to receive his share of the trust and accumulated income upon termination of the beneficiary's interest in the share. Thus, a separate share may exist if the instrument provides that upon the death of the beneficiary of the share, the share will be added to the shares of the other beneficiaries of the trust.</P> <P>(b) Separate share treatment will not be applied to a trust or portion of a trust subject to a power to: (1) Distribute, apportion, or accumulate income, or (2) distribute corpus to or for one or more beneficiaries within a group or class of beneficiaries, unless payment of income, accumulated income, or corpus of a share of one beneficiary cannot affect the proportionate share of income, accumulated income, or corpus of any shares of the other beneficiaries, or unless substantially proper adjustment must thereafter be made (under the governing instrument) so that substantially separate and independent shares exist.</P> <P>(c) A share may be considered as separate even though more than one beneficiary has an interest in it. For example, two beneficiaries may have equal, disproportionate, or indeterminate interests in one share which is separate and independent from another share in which one or more beneficiaries have an interest. Likewise, the same person may be a beneficiary of more than one separate share.</P> <P> (d) Separate share treatment may be given to a trust or portion of a trust otherwise qualifying under this section if the trust or portion of a trust is subject to a power to pay out to a beneficiary of a share (of such trust or portion) an amount of corpus in excess of his proportionate share of the corpus of the trust if the possibility of exercise of the power is remote. For example, if the trust is subject to a power to invade the entire corpus for the health, education, support, or maintenance of A, separate share treatment is applied if exercise of the power requires consideration of A's other income which is so substantial as to make the possibility <PRTPAGE P="149"/> of exercise of the power remote. If instead it appears that A and B have separate shares in a trust, subject to a power to invade the entire corpus for the comfort, pleasure, desire, or happiness of A, separate share treatment shall not be applied. </P> <P>(e) For taxable years ending before December 31, 1978, the separate share rule may also be applicable to successive interests in point of time, as for instance in the case of a trust providing for a life estate to A and a second life estate or outright remainder to B. In such a case, in the taxable year of a trust in which a beneficiary dies items of income and deduction properly allocable under trust accounting principles to the period before a beneficiary's death are attributed to one share, and those allocable to the period after the beneficiary's death are attributed to the other share. Separate share treatment is not available to a succeeding interest, however, with respect to distributions which would otherwise be deemed distributed in a taxable year of the earlier interest under the throwback provisions of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code. The application of this paragraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust instrument directs that the income of a trust is to be paid to A for her life. After her death income may be distributed to B or accumulated. A dies on June 1, 1956. The trust keeps its books on the basis of the calendar year. The trust instrument permits invasions of corpus for the benefit of A and B, and an invasion of corpus was in fact made for A's benefit in 1956. In determining the distributable net income of the trust for the purpose of determining the amounts includible in A's income, income and deductions properly allocable to the period before A's death are treated as income and deductions of a separate share; and for that purpose no account is taken of income and deductions allocable to the period after A's death.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 7633, 44 FR 57926, Oct. 9, 1979; T.D. 8849, 64 FR 72543, Dec. 28, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(c)-4</SECTNO> <SUBJECT>Applicability of separate share rule to estates and qualified revocable trusts.</SUBJECT> <P> (a) <E T="03">General rule.</E> The applicability of the separate share rule provided by section 663(c) to estates and qualified revocable trusts within the meaning of section 645(b)(1) will generally depend upon whether the governing instrument and applicable local law create separate economic interests in one beneficiary or class of beneficiaries of such estate or trust. Ordinarily, a separate share exists if the economic interests of the beneficiary or class of beneficiaries neither affect nor are affected by the economic interests accruing to another beneficiary or class of beneficiaries. Separate shares include, for example, the income on bequeathed property if the recipient of the specific bequest is entitled to such income and a surviving spouse's elective share that under local law is entitled to income and appreciation or depreciation. Furthermore, a qualified revocable trust for which an election is made under section 645 is always a separate share of the estate and may itself contain two or more separate shares. Conversely, a gift or bequest of a specific sum of money or of property as defined in section 663(a)(1) is not a separate share. </P> <P> (b) <E T="03">Special rule for certain types of beneficial interests.</E> Notwithstanding the provisions of paragraph (a) of this section, a surviving spouse's elective share that under local law is determined as of the date of the decedent's death and is not entitled to income or any appreciation or depreciation is a separate share. Similarly, notwithstanding the provisions of paragraph (a) of this section, a pecuniary formula bequest that, under the terms of the governing instrument or applicable local law, is not entitled to income or to share in appreciation or depreciation constitutes a separate share if the governing instrument does not provide that it is to be paid or credited in more than three installments. </P> <P> (c) <E T="03">Shares with multiple beneficiaries and beneficiaries of multiple shares.</E> A share may be considered as separate even though more than one beneficiary has an interest in it. For example, two beneficiaries may have equal, disproportionate, or indeterminate interests in one share which is economically separate and independent from another share in which one or more beneficiaries have an interest. Moreover, <PRTPAGE P="150"/> the same person may be a beneficiary of more than one separate share. </P> <CITA>[T.D. 8849, 64 FR 72544, Dec. 28, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(c)-5</SECTNO> <SUBJECT>Examples.</SUBJECT> <P>Section 663(c) may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(i) A single trust was created in 1940 for the benefit of A, B, and C, who were aged 6, 4, and 2, respectively. Under the terms of the instrument, the trust income is required to be divided into three equal shares. Each beneficiary's share of the income is to be accumulated until he becomes 21 years of age. When a beneficiary reaches the age of 21, his share of the income may thereafter be either accumulated or distributed to him in the discretion of the trustee. The trustee also has discretion to invade corpus for the benefit of any beneficiary to the extent of his share of the trust estate, and the trust instrument requires that the beneficiary's right to future income and corpus will be proportionately reduced. When each beneficiary reaches 35 years of age, his share of the trust estate shall be paid over to him. The interest in the trust estate of any beneficiary dying without issue and before he has attained the age of 35 is to be equally divided between the other beneficiaries of the trust. All expenses of the trust are allocable to income under the terms of the trust instrument.</P> <P>(ii) No distributions of income or corpus were made by the trustee prior to 1955, although A became 21 years of age on June 30, 1954. During the taxable year of 1955, the trust has income from royalties of $20,000 and expenses of $5,000. The trustee in his discretion distributes $12,000 to A. Both A and the trust report on the calendar year basis.</P> <P>(iii) The trust qualifies for the separate share treatment under section 663(c) and the distributable net income must be divided into three parts for the purpose of determining the amount deductible by the trust under section 661 and the amount includible in A's gross income under section 662.</P> <P>(iv) The distributable net income of each share of the trust is $5,000 ($6,667 less $1,667). Since the amount ($12,000) distributed to A during 1955 exceeds the distributable net income of $5,000 allocated to his share, the trust is deemed to have distributed to him $5,000 of 1955 income and $7,000 of amounts other than 1955 income. Accordingly, the trust is allowed a deduction of $5,000 under section 661. The taxable income of the trust for 1955 is $9,900, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s40,8,8"> <ROW> <ENT I="01">Royalties</ENT> <ENT>$20,000</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Expenses</ENT> <ENT>$5,000</ENT> </ROW> <ROW> <ENT I="02">Distribution to A</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="11"> </ENT> <ENT/> <ENT>10,100</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Taxable income</ENT> <ENT>9,900</ENT> </ROW> </GPOTABLE> <P>(v) In accordance with section 662, A must include in his gross income for 1955 an amount equal to the portion ($5,000) of the distributable net income of the trust allocated to his share. Also, the excess distribution of $7,000 made by the trust is subject to the throwback provisions of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, and the regulations thereunder.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> (i) <E T="03">Facts.</E> Testator, who dies in 2000, is survived by a spouse and two children. Testator's will contains a fractional formula bequest dividing the residuary estate between the surviving spouse and a trust for the benefit of the children. Under the fractional formula, the marital bequest constitutes 60% of the estate and the children's trust constitutes 40% of the estate. During the year, the executor makes a partial proportionate distribution of $1,000,0000, ($600,000 to the surviving spouse and $400,000 to the children's trust) and makes no other distributions. The estate receives dividend income of $20,000, and pays expenses of $8,000 that are deductible on the estate's federal income tax return. </P> <P> (ii) <E T="03">Conclusion.</E> The fractional formula bequests to the surviving spouse and to the children's trust are separate shares. Because Testator's will provides for fractional formula residuary bequests, the income and any appreciation in the value of the estate assets are proportionately allocated between the marital share and the trust's share. Therefore, in determining the distributable net income of each share, the income and expenses must be allocated 60% to the marital share and 40% to the trust's share. The distributable net income is $7,200 (60% of income less 60% of expenses) for the marital share and $4,800 (40% of income less 40% of expenses) for the trust's share. Because the amount distributed in partial satisfaction of each bequest exceeds the distributable net income of each share, the estate's distribution deduction under section 661 is limited to the sum of the distributable net income for both shares. The estate is allowed a distribution deduction of $12,000 ($7,200 for the marital share and $4,800 for the trust's share). As a result, the estate has zero taxable income ($20,000 income less $8,000 expenses and $12,000 distribution deduction). Under section 662, the surviving spouse and the trust must include in gross income $7,200 and $4,800, respectively. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> The facts are the same as in <E T="03">Example 2,</E> except that in 2000 the executor makes the payment to partially fund the children's trust but makes no payment to the surviving spouse. The fiduciary must use a reasonable and equitable method to allocate income and expenses to the trust's <PRTPAGE P="151"/> share. Therefore, depending on when the distribution is made to the trust, it may no longer be reasonable or equitable to determine the distributable net income for the trust's share by allocating to it 40% of the estate's income and expenses for the year. The computation of the distributable net income for the trust's share should take into consideration that after the partial distribution the relative size of the trust's separate share is reduced and the relative size of the spouse's separate share is increased. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P> (i) <E T="03">Facts.</E> Testator, who dies in 2000, is survived by a spouse and one child. Testator's will provides for a pecuniary formula bequest to be paid in not more than three installments to a trust for the benefit of the child of the largest amount that can pass free of Federal estate tax and a bequest of the residuary to the surviving spouse. The will provides that the bequest to the child's trust is not entitled to any of the estate's income and does not participate in appreciation or depreciation in estate assets. During the 2000 taxable year, the estate receives dividend income of $200,000 and pays expenses of $15,000 that are deductible on the estate's federal income tax return. The executor partially funds the child's trust by distributing to it securities that have an adjusted basis to the estate of $350,000 and a fair market value of $380,000 on the date of distribution. As a result of this distribution, the estate realizes long-term capital gain of $30,000. </P> <P> (ii) <E T="03">Conclusion.</E> The estate has two separate shares consisting of a formula pecuniary bequest to the child's trust and a residuary bequest to the surviving spouse. Because, under the terms of the will, no estate income is allocated to the bequest to the child's trust, the distributable net income for that trust's share is zero. Therefore, with respect to the $380,000 distribution to the child's trust, the estate is allowed no deduction under section 661, and no amount is included in the trust's gross income under section 662. Because no distributions were made to the spouse, there is no need to compute the distributable net income allocable to the marital share. The taxable income of the estate for the 2000 taxable year is $214,400 ($200,000 (dividend income) plus $30,000 (capital gain) minus $15,000 (expenses) and minus $600 (personal exemption)). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P> The facts are the same as in <E T="03">Example 4,</E> except that during 2000 the estate reports on its federal income tax return a pro rata share of an S corporation's tax items and a distributive share of a partnership's tax items allocated on Form K-1s to the estate by the S corporation and by the partnership, respectively. Because, under the terms of the will, no estate income from the S corporation or the partnership would be allocated to the pecuniary bequest to child's trust, none of the tax items attributable to the S corporation stock or the partnership interest is allocated to the trust's separate share. Therefore, with respect to the $380,000 distribution to the trust, the estate is allowed no deduction under section 661, and no amount is included in the trust's gross income under section 662. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6.</HD> <P> The facts are the same as in <E T="03">Example 4,</E> except that during 2000 the estate receives a distribution of $900,000 from the decedent's individual retirement account that is included in the estate's gross income as income in respect of a decedent under section 691(a). The entire $900,000 is allocated to corpus under applicable local law. Both the separate share for the child's trust and the separate share for the surviving spouse may potentially be funded with the proceeds from the individual retirement account. Therefore, a portion of the $900,000 gross income must be allocated to the trust's separate share. The amount allocated to the trust's share must be based upon the relative values of the two separate shares using a reasonable and equitable method. The estate is entitled to a deduction under section 661 for the portion of the $900,000 properly allocated to the trust's separate share, and the trust must include this amount in income under section 662. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7.</HD> <P> (i) <E T="03">Facts.</E> Testator, who dies in 2000, is survived by a spouse and three adult children. Testator's will divides the residue of the estate equally among the three children. The surviving spouse files an election under the applicable state's elective share statute. Under this statute, a surviving spouse is entitled to one-third of the decedent's estate after the payment of debts and expenses. The statute also provides that the surviving spouse is not entitled to any of the estate's income and does not participate in appreciation or depreciation of the estate's assets. However, under the statute, the surviving spouse is entitled to interest on the elective share from the date of the court order directing the payment until the executor actually makes payment. During the estate's 2001 taxable year, the estate distributes to the surviving spouse $5,000,000 in partial satisfaction of the elective share and pays $200,000 of interest on the delayed payment of the elective share. During that year, the estate receives dividend income of $3,000,000 and pays expenses of $60,000 that are deductible on the estate's federal income tax return. </P> <P> (ii) <E T="03">Conclusion.</E> The estate has four separate shares consisting of the surviving spouse's elective share and each of the three children's residuary bequests. Because the surviving spouse is not entitled to any estate income under state law, none of the estate's gross income is allocated to the spouse's separate share for purposes of determining that share's distributable net income. Therefore, with respect to the $5,000,000 distribution, <PRTPAGE P="152"/> the estate is allowed no deduction under section 661, and no amount is included in the spouse's gross income under section 662. The $200,000 of interest paid to the spouse must be included in the spouse's gross income under section 61. Because no distributions were made to any other beneficiaries during the year, there is no need to compute the distributable net income of the other three separate shares. Thus, the taxable income of the estate for the 2000 taxable year is $2,939,400 ($3,000,000 (dividend income) minus $60,000 (expenses) and $600 (personal exemption)). The estate's $200,000 interest payment is a nondeductible personal interest expense described in section 163(h). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8.</HD> <P>The will of Testator, who dies in 2000, directs the executor to distribute the X stock and all dividends therefrom to child A and the residue of the estate to child B. The estate has two separate shares consisting of the income on the X stock bequeathed to A and the residue of the estate bequeathed to B. The bequest of the X stock meets the definition of section 663(a)(1) and therefore is not a separate share. If any distributions, other than shares of the X stock, are made during the year to either A or B, then for purposes of determining the distributable net income for the separate shares, gross income attributable to dividends on the X stock must be allocated to A's separate share and any other income must be allocated to B's separate share.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9.</HD> <P>The will of Testator, who dies in 2000, directs the executor to divide the residue of the estate equally between Testator's two children, A and B. The will directs the executor to fund A's share first with the proceeds of Testator's individual retirement account. The date of death value of the estate after the payment of debts, expenses, and estate taxes is $9,000,000. During 2000, the $900,000 balance in Testator's individual retirement account is distributed to the estate. The entire $900,000 is allocated to corpus under applicable local law. This amount is income in respect of a decedent within the meaning of section 691(a). The estate has two separate shares, one for the benefit of A and one for the benefit of B. If any distributions are made to either A or B during the year, then, for purposes of determining the distributable net income for each separate share, the $900,000 of income in respect of a decedent must be allocated to A's share.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10.</HD> <P> The facts are the same as in <E T="03">Example 9,</E> except that the will directs the executor to fund A's share first with X stock valued at $3,000,000, rather than with the proceeds of the individual retirement account. The estate has two separate shares, one for the benefit of A and one for the benefit of B. If any distributions are made to either A or B during the year, then, for purposes of determining the distributable net income for each separate share, the $900,000 of gross income attributable to the proceeds from the individual retirement account must be allocated between the two shares to the extent that they could potentially be funded with those proceeds. The maximum amount of A's share that could potentially be funded with the income in respect of decedent is $1,500,000 ($4,500,000 value of share less $3,000,000 to be funded with stock) and the maximum amount of B's share that could potentially be funded with income in respect of decedent is $4,500,000. Based upon the relative values of these amounts, the gross income attributable to the proceeds of the individual retirement account is allocated $225,000 (or one-fourth) to A's share and $675,000 (or three-fourths) to B's share. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 11.</HD> <P>The will of Testator, who dies in 2000, provides that after the payment of specific bequests of money, the residue of the estate is to be divided equally among the Testator's three children, A, B, and C. The will also provides that during the period of administration one-half of the income from the residue is to be paid to a designated charitable organization. After the specific bequests of money are paid, the estate initially has three equal separate shares. One share is for the benefit of the charitable organization and A, another share is for the benefit of the charitable organization and B, and the last share is for the benefit of the charitable organization and C. During the period of administration, payments of income to the charitable organization are deductible by the estate to the extent provided in section 642(c) and are not subject to the distribution provisions of sections 661 and 662.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960. Redesignated and amended by T.D. 8849, 64 FR 72543, 72544, Dec. 28, 1999; 65 FR 16317, Mar. 28, 2000]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.663(c)-6</SECTNO> <SUBJECT>Effective dates.</SUBJECT> <P> Sections 1.663(c)-1 through 1.663(c)-5 are applicable for estates and qualified revocable trusts within the meaning of section 645(b)(1) with respect to decedents who die on or after December 28, 1999. However, for estates and qualified revocable trusts with respect to decedents who died after the date that section 1307 of the Tax Reform Act of 1997 became effective but before December 28, 1999, the IRS will accept any reasonable interpretation of the separate share provisions, including those provisions provided in 1999-11 I.R.B. 41 (see § 601.601(d)(2)(ii)(b) of this chapter). For trusts other than qualified revocable <PRTPAGE P="153"/> trusts, § 1.663(c)-2 is applicable for taxable years of such trusts beginning after December 28, 1999. </P> <CITA>[T.D. 8849, 64 FR 72545, Dec. 28, 1999; 65 FR 16317, Mar. 28, 2000]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.664-1</SECTNO> <SUBJECT>Charitable remainder trusts.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Introduction</E> —(i) <E T="03">General description of a charitable remainder trust.</E> Generally, a charitable remainder trust is a trust which provides for a specified distribution, at least annually, to one or more beneficiaries, at least one of which is not a charity, for life or for a term of years, with an irrevocable remainder interest to be held for the benefit of, or paid over to, charity. The specified distribution to be paid at least annually must be a sum certain which is not less than 5 percent of the initial net fair market value of all property placed in trust (in the case of a charitable remainder annuity trust) or a fixed percentage which is not less than 5 percent of the net fair market value of the trust assets, valued annually (in the case of a charitable remainder unitrust). A trust created after July 31, 1969, which is a charitable remainder trust, is exempt from all of the taxes imposed by subtitle A of the Code for any taxable year of the trust, except for a taxable year beginning before January 1, 2007, in which it has unrelated business taxable income. For taxable years beginning after December 31, 2006, an excise tax, treated as imposed by chapter 42, is imposed on charitable remainder trusts that have unrelated business taxable income. See paragraph (c) of this section. </P> <P> (ii) <E T="03">Scope.</E> This section provides definitions, general rules governing the creation and administration of a charitable remainder trust, and rules governing the taxation of the trust and its beneficiaries. For the application of certain foundation rules to charitable remainder trusts, see paragraph (b) of this section. If the trust has unrelated business taxable income, see paragraph (c) of this section. For the treatment of distributions to recipients, see paragraph (d) of this section. For the treatment of distributions to charity, see paragraph (e) of this section. For the time limitations for amendment of governing instruments, see paragraph (f) of this section. For transitional rules under which particular requirements are inapplicable to certain trusts, see paragraph (g) of this section. Section 1.664-2 provides rules relating solely to a charitable remainder annuity trust. Section 1.664-3 provides rules relating solely to a charitable remainder unitrust. Section 1.664-4 provides rules governing the calculation of the fair market value of the remainder interest in a charitable remainder unitrust. For rules relating to the filing of returns for a charitable remainder trust, see paragraph (a)(6) of § 1.6012-3 and section 6034 and the regulations thereunder. </P> <P> (iii) <E T="03">Definitions.</E> As used in this section and §§ 1.664-2, 1.664-3, and 1.664-4: </P> <P> ( <E T="03">a) Charitable remainder trust.</E> The term <E T="03">charitable remainder trust</E> means a trust with respect to which a deduction is allowable under section 170, 2055, 2106, or 2522 and which meets the description of a charitable remainder annuity trust (as described in § 1.664-2) or a charitable remainder unitrust (as described in § 1.664-3). </P> <P> ( <E T="03">b) Annuity amount.</E> The term <E T="03">annuity amount</E> means the amount described in paragraph (a)(1) of § 1.664-2 which is payable, at least annually, to the beneficiary of a charitable remainder annuity trust. </P> <P> ( <E T="03">c) Unitrust amount.</E> The term <E T="03">unitrust amount</E> means the amount described in paragraph (a)(1) of § 1.664-3 which is payable, at least annually, to the beneficiary of a charitable remainder unitrust. </P> <P> ( <E T="03">d) Recipient.</E> The term <E T="03">recipient</E> means the beneficiary who receives the possession or beneficial enjoyment of the annuity amount or unitrust amount. </P> <P> ( <E T="03">e) Governing instrument.</E> The term <E T="03">governing instrument</E> has the same meaning as in section 508(e) and the regulations thereunder. </P> <P> (2) <E T="03">Requirement that the trust must be either a charitable remainder annuity trust or a charitable remainder unitrust.</E> A trust is a charitable remainder trust only if it is either a charitable remainder annuity trust in every respect or a charitable remainder unitrust in every respect. For example, a trust which provides for the payment each year to a noncharitable beneficiary of the <PRTPAGE P="154"/> greater of a sum certain or a fixed percentage of the annual value of the trust assets is not a charitable remainder trust inasmuch as the trust is neither a charitable remainder annuity trust (for the reason that the payment for the year may be a fixed percentage of the annual value of the trust assets which is not a “sum certain”) nor a charitable remainder unitrust (for the reason that the payment for the year may be a sum certain which is not a “fixed percentage” of the annual value of the trust assets). </P> <P> (3) <E T="03">Restrictions on investments.</E> A trust is not a charitable remainder trust if the provisions of the trust include a provision which restricts the trustee from investing the trust assets in a manner which could result in the annual realization of a reasonable amount of income or gain from the sale or disposition of trust assets. In the case of transactions with, or for the benefit of, a disqualified person, see section 4941(d) and the regulations thereunder for rules relating to the definition of self-dealing. </P> <P> (4) <E T="03">Requirement that trust must meet definition of and function exclusively as a charitable remainder trust from its creation.</E> In order for a trust to be a charitable remainder trust, it must meet the definition of and function exclusively as a charitable remainder trust from the creation of the trust. Solely for the purposes of section 664 and the regulations thereunder, the trust will be deemed to be created at the earliest time that neither the grantor nor any other person is treated as the owner of the entire trust under subpart E, part 1, subchapter J, chapter 1, subtitle A of the Code (relating to grantors and others treated as substantial owners), but in no event prior to the time property is first transferred to the trust. For purposes of the preceding sentence, neither the grantor nor his spouse shall be treated as the owner of the trust under such subpart E merely because the grantor or his spouse is named as a recipient. See examples 1 through 3 of subparagraph (6) of this paragraph for illustrations of the foregoing rule. </P> <P> (5) <E T="03">Rules applicable to testamentary transfers</E> —(i) <E T="03">Deferral of annuity or unitrust amount.</E> Notwithstanding subparagraph (4) of this paragraph and §§ 1.664-2 and 1.664-3, for purposes of sections 2055 and 2106 a charitable remainder trust shall be deemed created at the date of death of the decedent (even though the trust is not funded until the end of a reasonable period of administration or settlement) if the obligation to pay the annuity or unitrust amount with respect to the property passing in trust at the death of the decedent begins as of the date of death of the decedent, even though the requirement to pay such amount is deferred in accordance with the rules provided in this subparagraph. If permitted by applicable local law or authorized by the provisions of the governing instrument, the requirement to pay such amount may be deferred until the end of the taxable year of the trust in which occurs the complete funding of the trust. Within a reasonable period after such time, the trust must pay (in the case of an underpayment) or must receive from the recipient (in the case of an overpayment) the difference between: </P> <P> ( <E T="03">a</E> ) Any annuity or unitrust amounts actually paid, plus interest on such amounts computed at the rate of interest specified in paragraph (a)(5)(iv) of this section, compounded annually, and </P> <P> ( <E T="03">b</E> ) The annuity or unitrust amounts payable, plus interest on such amounts computed at the rate of interest specified in paragraph (a)(5)(iv) of this section, compounded annually. </P> <FP>The amounts payable shall be retroactively determined by using the taxable year, valuation method, and valuation dates which are ultimately adopted by the charitable remainder trust. See subdivision (ii) of this subparagraph for rules relating to retroactive determination of the amount payable under a charitable remainder unitrust. See paragraph (d)(4) of this section for rules relating to the year of inclusion in the case of an underpayment to a recipient and the allowance of a deduction in the case of an overpayment to a recipient.</FP> <P> (ii) For purposes of retroactively determining the amount under subdivision (i)( <E T="03">b</E> ) of this subparagraph, the governing instrument of a charitable remainder unitrust may provide that the amount described in subdivision (i)( <E T="03">b</E> ) of this subparagraph with respect <PRTPAGE P="155"/> to property passing in trust at the death of the decedent for the period which begins on the date of death of the decedent and ends on the earlier of the date of death of the last recipient or the end of the taxable year of the trust in which occurs the complete funding of the trust shall be computed by multiplying: </P> <P> ( <E T="03">a</E> ) The sum of ( <E T="03">1</E> ) the value, on the earlier of the date of death of the last recipient or the last day in such taxable year, of the property held in trust which is attributable to property passing to the trust at the death of the decedent, ( <E T="03">2</E> ) any distributions in respect of unitrust amounts made by the trust or estate before such date, and ( <E T="03">3</E> ) interest on such distributions computed at the rate of interest specified in paragraph (a)(5)(iv) of this section, compounded annually, from the date of distribution to such date by: </P> <P> ( <E T="03">b</E> )( <E T="03">1</E> ) In the case of transfers made after November 30, 1983, for which the valuation date is before May 1, 1989, a factor equal to 1.000000 less the factor under the appropriate adjusted payout rate in Table D in § 1.664-4(e)(6) opposite the number of years in column 1 between the date of death of the decedent and the date of the earlier of the death of the last recipient or the last day of such taxable year. </P> <P> ( <E T="03">2</E> ) In the case of transfers for which the valuation date is after April 30, 1989, a factor equal to 1.000000 less the factor under the appropriate adjusted payout rate in Table D in § 1.664-4(e)(6) opposite the number of years in column 1 between the date of death of the decedent and the date of the earlier of the death of the last recipient or the last day of such taxable year. The appropriate adjusted payout rate is determined by using the appropriate Table F contained in § 1.664-4(e)(6) for the section 7520 rate for the month of the valuation date. </P> <P> ( <E T="03">3</E> ) If the number of years between the date of death and the date of the earlier of the death of the last recipient or the last day of such taxable year is between periods for which factors are provided, a linear interpolation must be made. </P> <P> (iii) <E T="03">Treatment of distributions.</E> The treatment of a distribution to a charitable remainder trust, or to a recipient in respect of an annuity or unitrust amount, paid, credited, or required to be distributed by an estate, or by a trust which is not a charitable remainder trust, shall be governed by the rules of subchapter J, chapter 1, subtitle A of the Code other than section 664. In the case of a charitable remainder trust which is partially or fully funded during the period of administration of an estate or settlement of a trust (which is not a charitable remainder trust), the treatment of any amount paid, credited, or required to be distributed by the charitable remainder trust shall be governed by the rules of section 664. </P> <P> (iv) <E T="03">Rate of interest.</E> The following rates of interest shall apply for purposes of paragraphs (a)(5) (i) through (ii) of this section: </P> <P> ( <E T="03">a</E> ) The section 7520 rate for the month in which the valuation date with respect to the transfer is (or one of the prior two months if elected under § 1.7520-2(b)) after April 30, 1989; </P> <P> ( <E T="03">b</E> ) 10 percent for instruments executed or amended (other than in the case of a reformation under section 2055(e)(3)) on or after August 9, 1984, and before May 1, 1989, and not subsequently amended; </P> <P> ( <E T="03">c</E> ) 6 percent or 10 percent for instruments executed or amended (other than in the case of a reformation under section 2055(e)(3)) after October 24, 1983, and before August 9, 1984; and </P> <P> ( <E T="03">d</E> ) 6 percent for instruments executed before October 25, 1983, and not subsequently amended (other than in the case of a reformation under section 2055(e)(3)). </P> <P> (6) <E T="03">Examples.</E> The application of the rules in paragraphs (a)(4) and (a)(5) of this section require the use of actuarial factors contained in §§ 1.664-4(e) and 1.664-4A and may be illustrated by use of the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> On September 19, 1971, H transfers property to a trust over which he retains an inter vivos power of revocation. The trust is to pay W 5 percent of the value of the trust assets, valued annually, for her life, remainder to charity. The trust would satisfy all of the requirements of section 664 if it were irrevocable. For purposes of section 664, the trust is not deemed created in 1971 because H is treated as the owner of the entire trust under subpart E. On May 26, 1975, H <PRTPAGE P="156"/> predeceases W at which time the trust becomes irrevocable. For purposes of section 664, the trust is deemed created on May 26, 1975, because that is the earliest date on which H is not treated as the owner of the entire trust under subpart E. The trust becomes a charitable remainder trust on May 26, 1975, because it meets the definition of a charitable remainder trust from its creation. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> The facts are the same as in <E T="03">example 1,</E> except that H retains the inter vivos power to revoke only one-half of the trust. For purposes of section 664, the trust is deemed created on September 19, 1971, because on that date the grantor is not treated as the owner of the entire trust under subpart E. Consequently, a charitable deduction is not allowable either at the creation of the trust or at H's death because the trust does not meet the definition of a charitable remainder trust from the date of its creation. The trust does not meet the definition of a charitable remainder trust from the date of its creation because the trust is subject to a partial power to revoke on such date. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> The facts are the same as in <E T="03">example 1,</E> except that the residue of H's estate is to be paid to the trust and the trust is required to pay H's debts. The trust is not a charitable remainder trust at H's death because it does not function exclusively as a charitable remainder trust from the date of its creation which, in this case, is the date it becomes irrevocable. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>(i) In 1971, H transfers property to Trust A over which he retains an inter vivos power of revocation. Trust A, which is not a charitable remainder trust, is to provide income or corpus to W until the death of H. Upon H's death the trust is required by its governing instrument to pay the debts and administration expenses of H's estate, and then to terminate and distribute all of the remaining assets to a separate Trust B which meets the definition of a charitable remainder annuity trust.</P> <P>(ii) Trust B will be charitable remainder trust from the date of its funding because it will function exclusively as a charitable remainder trust from its creation. For purposes of section 2055, Trust B will be deemed created at H's death if the obligation to pay the annuity amount begins on the date of H's death. For purposes of section 664, Trust B becomes a charitable remainder trust as soon as it is partially or completely funded. Consequently, unless Trust B has unrelated business taxable income, the income of the trust is exempt from all taxes imposed by subtitle A of the Code, and any distributions by the trust, even before it is completely funded, are governed by the rules of section 664. Any distributions made by Trust A, including distributions to a recipient in respect of annuity amounts, are governed by the rules of subchapter J, chapter 1, subtitle A of the Code other than section 664.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P>In 1973, H dies testate leaving the net residue of his estate (after payment by the estate of all debts and administration expenses) to a trust which meets the definition of a charitable remainder unitrust. For purposes of section 2055, the trust is deemed created at H's death if the requirement to pay the unitrust amount begins on H's death and is a charitable remainder trust even though the estate is obligated to pay debts and administration expenses.</P> <P>For purposes of section 664, the trust becomes a charitable remainder trust as soon as it is partially or completely funded. Consequently, unless the trust has unrelated business taxable income, the income of the trust is exempt from all taxes imposed by subtitle A of the Code, and any distributions by the trust, even before it is completely funded, are governed by the rules of section 664. Any distributions made by H's estate, including distributions to a recipient in respect of unitrust amounts, are governed by the rules of subchapter J, chapter 1, subtitle A of the Code other than section 664.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6.</HD> <P>(i) On January 1, 1974, H dies testate leaving the residue of his estate to a charitable remainder unitrust. The governing instrument provides that, beginning at H's death, the trustee is to make annual payments to W, on December 31 of each year of 5 percent of the net fair market value of the trust assets, valued as of December 31 of each year, for W's life and to pay the remainder to charity at the death of W. The governing instrument also provides that the actual payment of the unitrust amount need not be made until the end of the taxable year of the trust in which occurs the complete funding of the trust. The governing instrument also provides that the amount payable with respect to the period between the date of death and the end of such taxable year shall be computed under the special method provided in subparagraph (5)(ii) of this paragraph. The governing instrument provides that, within a reasonable period after the end of the taxable year of the trust in which occurs the complete funding of the trust, the trustee shall pay (in the case of an underpayment) or shall receive from the recipient (in the case of an overpayment) the difference between the unitrust amounts paid (plus interest at 6 percentage compounded annually) and the amount computed under the special method. The trust is completely funded on September 20, 1976. No amounts were paid before June 30, 1977. The trust adopts a fiscal year of July 1 to June 30. The net fair market value of the trust assets on June 30, 1977, is $100,000.</P> <P> (ii) Because no amounts were paid prior to the end of the taxable year in which the trust was completely funded, the amount payable at the end of such taxable year is equal to the net fair market value of the trust assets on the last day of such taxable <PRTPAGE P="157"/> year (June 30, 1977) multiplied by a factor equal to 1.0 minus the factor in Table D corresponding to the number of years in the period between the date of death and the end of such taxable year. The adjusted payout rate (determined under § 1.664-4A(c)) is 5 percent. Because the last day of the taxable year in which the trust is completely funded in June 30, 1977, there are 3 181/365 years in such period. Because there is no factor given in Table D for such a period, a linear interpolation must be made: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">1.0 minus 0.814506 (factor at 5 percent for 4 years)</ENT> <ENT>0.185494</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">1.0 minus 0.857375 (factor at 5 percent for 3 years)</ENT> <ENT>.142625</ENT> </ROW> <ROW> <ENT I="03">Difference</ENT> <ENT>.042869</ENT> </ROW> <ROW> <ENT I="28"> 181 ÷ 365= <E T="03">X</E> ÷ 0.042869 </ENT> </ROW> <ROW> <ENT I="11"> </ENT> </ROW> <ROW> <ENT I="28"> <E T="03">X</E> = 0.021258 </ENT> </ROW> <ROW> <ENT I="11"> </ENT> </ROW> <ROW> <ENT I="01">1.0 minus 0.857375 (factor at 5 percent for 3 years</ENT> <ENT>0.142625</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Plus: X</ENT> <ENT>.021258</ENT> </ROW> <ROW> <ENT I="03">Interpolated factor</ENT> <ENT>.163883</ENT> </ROW> </GPOTABLE> <FP>Thus, the amount payable for the period from January 1, 1974, to June 30, 1977, is $16,388.30 ($100,000 × 0.163883). Thereafter, the trust assets must be valued on December 31 of each year and 5 percent of such value paid annually to W for her life.</FP> </EXAMPLE> <P> (7) <E T="03">Valuation of unmarketable assets</E> —(i) <E T="03">In general.</E> If unmarketable assets are transferred to or held by a trust, the trust will not be a trust with respect to which a deduction is available under section 170, 2055, 2106, or 2522, or will be treated as failing to function exclusively as a charitable remainder trust unless, whenever the trust is required to value such assets, the valuation is— </P> <P> ( <E T="03">a</E> ) Performed exclusively by an independent trustee; or </P> <P> ( <E T="03">b</E> ) Determined by a current qualified appraisal from a qualified appraiser, as those terms are defined in— </P> <P> ( <E T="03">1</E> ) Section 1.170A-13(c)(3) and 1.170A-13(c)(5), respectively, for appraisals prepared for returns or submissions filed on or before August 17, 2006; </P> <P> ( <E T="03">2</E> ) Section 3 of Notice 2006-96, 2006-2 CB 902, for appraisals prepared for returns or submissions filed after August 17, 2006, if the donations are made before January 1, 2019; or </P> <P> ( <E T="03">3</E> ) Section 1.170A-17(a) and 1.170A-17(b), respectively, for appraisals prepared for returns or submissions for donations made on or after January 1, 2019. </P> <P> (ii) <E T="03">Unmarketable assets.</E> Unmarketable assets are assets that are not cash, cash equivalents, or other assets that can be readily sold or exchanged for cash or cash equivalents. For example, unmarketable assets include real property, closely-held stock, and an unregistered security for which there is no available exemption permitting public sale. </P> <P> (iii) <E T="03">Independent trustee.</E> An independent trustee is a person who is not the grantor of the trust, a noncharitable beneficiary, or a related or subordinate party to the grantor, the grantor's spouse, or a noncharitable beneficiary (within the meaning of section 672(c) and the applicable regulations). </P> <P> (b) <E T="03">Application of certain foundation rules to charitable remainder trusts.</E> See section 4947(a)(2) and section 4947(b)(3)(B) and the regulations thereunder for the application to charitable remainder trusts of certain provisions relating to private foundations. See section 508(e) for rules relating to required provisions in governing instruments prohibiting certain activities specified in section 4947(a)(2). </P> <P> (c) <E T="03">Excise tax on charitable remainder trusts</E> —(1) <E T="03">In general.</E> For each taxable year beginning after December 31, 2006, in which a charitable remainder annuity trust or a charitable remainder unitrust has any unrelated business taxable income, an excise tax is imposed on that trust in an amount equal to the amount of such unrelated business taxable income. For this purpose, unrelated business taxable income is as defined in section 512, determined as if part III, subchapter F, chapter 1, subtitle A of the Internal Revenue Code applied to such trust. Such excise tax is treated as imposed by chapter 42 (other than subchapter E) and is reported and payable in accordance with the appropriate forms and instructions. Such excise tax shall be allocated to corpus and, therefore, is not deductible in determining taxable income distributed to a beneficiary. (See paragraph (d)(2) of this section.) The charitable remainder trust income that is unrelated business taxable income constitutes income of the trust for purposes of determining the character of <PRTPAGE P="158"/> the distribution made to the beneficiary. Income of the charitable remainder trust is allocated among the charitable remainder trust income categories in paragraph (d)(1) of this section without regard to whether any part of that income constitutes unrelated business taxable income under section 512. </P> <P> (2) <E T="03">Examples.</E> The application of the rules in this paragraph (c) may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>For 2007, a charitable remainder annuity trust with a taxable year beginning on January 1, 2007, has $60,000 of ordinary income, including $10,000 of gross income from a partnership that constitutes unrelated business taxable income to the trust. The trust has no deductions that are directly connected with that income. For that same year, the trust has administration expenses (deductible in computing taxable income) of $16,000, resulting in net ordinary income of $44,000. The amount of unrelated business taxable income is computed by taking gross income from an unrelated trade or business and deducting expenses directly connected with carrying on the trade or business, both computed with modifications under section 512(b). Section 512(b)(12) provides a specific deduction of $1,000 in computing the amount of unrelated business taxable income. Under the facts presented in this example, there are no other modifications under section 512(b). The trust, therefore, has unrelated business taxable income of $9,000 ($10,000 minus the $1,000 deduction under section 512(b)(12)). Undistributed ordinary income from prior years is $12,000 and undistributed capital gains from prior years are $50,000. Under the terms of the trust agreement, the trust is required to pay an annuity of $100,000 for year 2007 to the noncharitable beneficiary. Because the trust has unrelated business taxable income of $9,000, the excise tax imposed under section 664(c) is equal to the amount of such unrelated business taxable income, $9,000. The character of the $100,000 distribution to the noncharitable beneficiary is as follows: $56,000 of ordinary income ($44,000 from current year plus $12,000 from prior years), and $44,000 of capital gains. The $9,000 excise tax is allocated to corpus, and does not reduce the amount in any of the categories of income under paragraph (d)(1) of this section. At the beginning of year 2008, the amount of undistributed capital gains is $6,000, and there is no undistributed ordinary income.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>During 2007, a charitable remainder annuity trust with a taxable year beginning on January 1, 2007, sells real estate generating gain of $40,000. Because the trust had obtained a loan to finance part of the purchase price of the asset, some of the income from the sale is treated as debt-financed income under section 514 and thus constitutes unrelated business taxable income under section 512. The unrelated debt-financed income computed under section 514 is $30,000. Assuming the trust receives no other income in 2007, the trust will have unrelated business taxable income under section 512 of $29,000 ($30,000 minus the $1,000 deduction under section 512(b)(12)). Except for section 512(b)(12), no other exceptions or modifications under sections 512-514 apply when calculating unrelated business taxable income based on the facts presented in this example. Because the trust has unrelated business taxable income of $29,000, the excise tax imposed under section 664(c) is equal to the amount of such unrelated business taxable income, $29,000. The $29,000 excise tax is allocated to corpus, and does not reduce the amount in any of the categories of income under paragraph (d)(1) of this section. Regardless of how the trust's income might be treated under sections 511-514, the entire $40,000 is capital gain for purposes of section 664 and is allocated accordingly to and within the second of the categories of income under paragraph (d)(1) of this section.</P> </EXAMPLE> <P> (3) <E T="03">Effective/applicability date.</E> This paragraph (c) is applicable for taxable years beginning after December 31, 2006. The rules that apply with respect to taxable years beginning before January 1, 2007, are contained in § 1.664-1(c) as in effect prior to June 24, 2008. (See 26 CFR part 1, § 1.664-1(c)(1) revised as of April 1, 2007.) </P> <P> (d) <E T="03">Treatment of annual distributions to recipients</E> —(1) <E T="03">Character of distributions</E> —(i) <E T="03">Assignment of income to categories and classes at the trust level.</E> ( <E T="03">a</E> ) A trust's income, including income includible in gross income and other income, is assigned to one of three categories in the year in which it is required to be taken into account by the trust. These categories are— </P> <P> ( <E T="03">1</E> ) Gross income, other than gains and amounts treated as gains from the sale or other disposition of capital assets (referred to as the ordinary income category); </P> <P> ( <E T="03">2</E> ) Gains and amounts treated as gains from the sale or other disposition of capital assets (referred to as the capital gains category); and </P> <P> ( <E T="03">3</E> ) Other income (including income excluded under part III, subchapter B, chapter 1, subtitle A of the Internal Revenue Code). </P> <P> ( <E T="03">b</E> ) Items within the ordinary income and capital gains categories are assigned to different classes based on the <PRTPAGE P="159"/> Federal income tax rate applicable to each type of income in that category in the year the items are required to be taken into account by the trust. For example, for a trust with a taxable year ending December 31, 2004, the ordinary income category may include a class of qualified dividend income as defined in section 1(h)(11) and a class of all other ordinary income, and the capital gains category may include separate classes for short-term and long-term capital gains and losses, such as a short-term capital gain class, a 28-percent long-term capital gain class (gains and losses from collectibles and section 1202 gains), an unrecaptured section 1250 long-term capital gain class (long-term gains not treated as ordinary income that would be treated as ordinary income if section 1250(b)(1) included all depreciation), a qualified 5-year long-term capital gain class as defined in section 1(h)(9) prior to amendment by the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA), Public Law 108-27 (117 Stat. 752), and an all other long-term capital gain class. After items are assigned to a class, the tax rates may change so that items in two or more classes would be taxed at the same rate if distributed to the recipient during a particular year. If the changes to the tax rates are permanent, the undistributed items in those classes are combined into one class. If, however, the changes to the tax rates are only temporary (for example, the new rate for one class will sunset in a future year), the classes are kept separate. </P> <P> (ii) <E T="03">Order of distributions.</E> ( <E T="03">a</E> ) The categories and classes of income (determined under paragraph (d)(1)(i) of this section) are used to determine the character of an annuity or unitrust distribution from the trust in the hands of the recipient irrespective of whether the trust is exempt from taxation under section 664(c) for the year of the distribution. The determination of the character of amounts distributed or deemed distributed at any time during the taxable year of the trust shall be made as of the end of that taxable year. The tax rate or rates to be used in computing the recipient's tax on the distribution shall be the tax rates that are applicable, in the year in which the distribution is required to be made, to the classes of income deemed to make up that distribution, and not the tax rates that are applicable to those classes of income in the year the income is received by the trust. The character of the distribution in the hands of the annuity or unitrust recipient is determined by treating the distribution as being made from each category in the following order: </P> <P> ( <E T="03">1</E> ) First, from ordinary income to the extent of the sum of the trust's ordinary income for the taxable year and its undistributed ordinary income for prior years. </P> <P> ( <E T="03">2</E> ) Second, from capital gain to the extent of the trust's capital gains determined under paragraph (d)(1)(iv) of this section. </P> <P> ( <E T="03">3</E> ) Third, from other income to the extent of the sum of the trust's other income for the taxable year and its undistributed other income for prior years. </P> <P> ( <E T="03">4</E> ) Finally, from trust corpus (with corpus defined for this purpose as the net fair market value of the trust assets less the total undistributed income (but not loss) in paragraphs (d)(1)(i)( <E T="03">a</E> ) ( <E T="03">1</E> ) through ( <E T="03">3</E> ) of this section). </P> <P> ( <E T="03">b</E> ) If the trust has different classes of income in the ordinary income category, the distribution from that category is treated as being made from each class, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest Federal income tax rate. If the trust has different classes of net gain in the capital gains category, the distribution from that category is treated as being made first from the short-term capital gain class and then from each class of long-term capital gain, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. If two or more classes within the same category are subject to the same current tax rate, but at least one of those classes will be subject to a different tax rate in a future year (for example, if the current rate sunsets), the order of that class in relation to other classes in the category <PRTPAGE P="160"/> with the same current tax rate is determined based on the future rate or rates applicable to those classes. Within each category, if there is more than one type of income in a class, amounts treated as distributed from that class are to be treated as consisting of the same proportion of each type of income as the total of the current and undistributed income of that type bears to the total of the current and undistributed income of all types of income included in that class. For example, if rental income and interest income are subject to the same current and future Federal income tax rate and, therefore, are in the same class, a distribution from that class will be treated as consisting of a proportional amount of rental income and interest income. </P> <P> (iii) <E T="03">Treatment of losses at the trust level</E> —( <E T="03">a</E> ) <E T="03">Ordinary income category.</E> A net ordinary loss for the current year is first used to reduce undistributed ordinary income for prior years that is assigned to the same class as the loss. Any excess loss is then used to reduce the current and undistributed ordinary income from other classes, in turn, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest Federal income tax rate. If any of the loss exists after all the current and undistributed ordinary income from all classes has been offset, the excess is carried forward indefinitely to reduce ordinary income for future years and retains its class assignment. For purposes of this section, the amount of current income and prior years' undistributed income shall be computed without regard to the deduction for net operating losses provided by section 172 or 642(d). </P> <P> ( <E T="03">b</E> ) <E T="03">Other income category.</E> A net loss in the other income category for the current year is used to reduce undistributed income in this category for prior years and any excess is carried forward indefinitely to reduce other income for future years. </P> <P> (iv) <E T="03">Netting of capital gains and losses at the trust level.</E> Capital gains of the trust are determined on a cumulative net basis under the rules of this paragraph (d)(1) without regard to the provisions of section 1212. For each taxable year, current and undistributed gains and losses within each class are netted to determine the net gain or loss for that class, and the classes of capital gains and losses are then netted against each other in the following order. First, a net loss from a class of long-term capital gain and loss (beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate) is used to offset net gain from each other class of long-term capital gain and loss, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. Second, either— </P> <P> ( <E T="03">a</E> ) A net loss from all the classes of long-term capital gain and loss (beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate) is used to offset any net gain from the class of short-term capital gain and loss; or </P> <P> ( <E T="03">b</E> ) A net loss from the class of short-term capital gain and loss is used to offset any net gain from each class of long-term capital gain and loss, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest Federal income tax rate. </P> <P> (v) <E T="03">Carry forward of net capital gain or loss by the trust.</E> If, at the end of a taxable year, a trust has, after the application of paragraph (d)(1)(iv) of this section, any net loss or any net gain that is not treated as distributed under paragraph (d)(1)(ii)( <E T="03">a</E> )( <E T="03">2</E> ) of this section, the net gain or loss is carried over to succeeding taxable years and retains its character in succeeding taxable years as gain or loss from its particular class. </P> <P> (vi) <E T="03">Special transitional rules.</E> To be eligible to be included in the class of qualified dividend income, dividends must meet the definition of section 1(h)(11) and must be received by the trust after December 31, 2002. Long-term capital gain or loss properly taken into account by the trust before January 1, 1997, is included in the class of all other long-term capital gains and losses. Long-term capital gain or loss properly taken into account by the <PRTPAGE P="161"/> trust on or after January 1, 1997, and before May 7, 1997, if not treated as distributed in 1997, is included in the class of all other long-term capital gains and losses. Long-term capital gain or loss (other than 28-percent gain (gains and losses from collectibles and section 1202 gains), unrecaptured section 1250 gain (long-term gains not treated as ordinary income that would be treated as ordinary income if section 1250(b)(1) included all depreciation), and qualified 5-year gain as defined in section 1(h)(9) prior to amendment by JGTRRA), properly taken into account by the trust before January 1, 2003, and distributed during 2003 is treated as if it were properly taken into account by the trust after May 5, 2003. Long-term capital gain or loss (other than 28-percent gain, unrecaptured section 1250 gain, and qualified 5-year gain), properly taken into account by the trust on or after January 1, 2003, and before May 6, 2003, if not treated as distributed during 2003, is included in the class of all other long-term capital gain. Qualified 5-year gain properly taken into account by the trust after December 31, 2000, and before May 6, 2003, if not treated as distributed by the trust in 2003 or a prior year, must be maintained in a separate class within the capital gains category until distributed. Qualified 5-year gain properly taken into account by the trust before January 1, 2003, and deemed distributed during 2003 is subject to the same current tax rate as deemed distributions from the class of all other long-term capital gain realized by the trust after May 5, 2003. Qualified 5-year gain properly taken into account by the trust on or after January 1, 2003, and before May 6, 2003, if treated as distributed by the trust in 2003, is subject to the tax rate in effect prior to the amendment of section 1(h)(9) by JGTRRA. </P> <P> (vii) <E T="03">Application of section 643(a)(7).</E> For application of the anti-abuse rule of section 643(a)(7) to distributions from charitable remainder trusts, see § 1.643(a)-8. </P> <P> (viii) <E T="03">Examples.</E> The following examples illustrate the rules in this paragraph (d)(1): </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(i) X, a charitable remainder annuity trust described in section 664(d)(1), is created on January 1, 2003. The annual annuity amount is $100. X's income for the 2003 tax year is as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$80</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>50</ENT> </ROW> <ROW> <ENT I="01">Capital gains and losses</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">Tax-exempt income</ENT> <ENT>0</ENT> </ROW> </GPOTABLE> <P>(ii) In 2003, the year this income is received by the trust, qualified dividend income is subject to a different rate of Federal income tax than interest income and is, therefore, a separate class of income in the ordinary income category. The annuity amount is deemed to be distributed from the classes within the ordinary income category, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. Because during 2003 qualified dividend income is taxed at a lower rate than interest income, the interest income is deemed distributed prior to the qualified dividend income. Therefore, in the hands of the recipient, the 2003 annuity amount has the following characteristics:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$80</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>20</ENT> </ROW> </GPOTABLE> <P>(iii) The remaining $30 of qualified dividend income that is not treated as distributed to the recipient in 2003 is carried forward to 2004 as undistributed qualified dividend income.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(i) The facts are the same as in Example 1, and at the end of 2004, X has the following classes of income:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income class</ENT> <ENT>$5</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income class ($10 from 2004 and $30 carried forward from 2003)</ENT> <ENT>40</ENT> </ROW> <ROW> <ENT I="01">Net short-term capital gain class</ENT> <ENT>15</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital loss in 28-percent class</ENT> <ENT>(325)</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in unrecaptured section 1250 gain class</ENT> <ENT>175</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in all other long-term capital gain class</ENT> <ENT>350</ENT> </ROW> </GPOTABLE> <P> (ii) In 2004, gain in the unrecaptured section 1250 gain class is subject to a 25-percent Federal income tax rate, and gain in the all other long-term capital gain class is subject to a lower rate. The net long-term capital loss in the 28-percent gain class is used to offset the net capital gains in the other classes of long-term capital gain and loss, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. The $325 net loss in the 28-percent gain class reduces the $175 net gain in the unrecaptured section 1250 gain class to $0. The remaining $150 loss from the 28-percent gain class reduces the $350 gain in the all other long-term capital gain class to $200. As in Example 1, qualified dividend income is taxed at a lower rate than interest income during 2004. The annuity amount is deemed to be distributed from all the classes in the ordinary income category and then from the classes in the capital gains category, beginning with the class subject to the highest Federal income tax rate <PRTPAGE P="162"/> and ending with the class subject to the lowest rate. In the hands of the recipient, the 2004 annuity amount has the following characteristics: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$ 5</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>40</ENT> </ROW> <ROW> <ENT I="01">Net short-term capital gain</ENT> <ENT>15</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in all other long-term capital gain class</ENT> <ENT>40</ENT> </ROW> </GPOTABLE> <P>(iii) The remaining $160 gain in the all other long-term capital gain class that is not treated as distributed to the recipient in 2004 is carried forward to 2005 as gain in that same class.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>(i) The facts are the same as in Examples 1 and 2, and at the end of 2005, X has the following classes of income:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income class</ENT> <ENT>$ 5</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>20</ENT> </ROW> <ROW> <ENT I="01">Net loss in short-term capital gain class</ENT> <ENT>(50)</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in 28-percent gain class</ENT> <ENT>10</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in unrecaptured section 1250 gain class</ENT> <ENT>135</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in all other long-term capital gain class (carried forward from 2004)</ENT> <ENT>160</ENT> </ROW> </GPOTABLE> <P>(ii) There are no long-term capital losses to net against the long-term capital gains. Thus, the net short-term capital loss is used to offset the net capital gains in the classes of long-term capital gain and loss, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. The $50 net short-term loss reduces the $10 net gain in the 28-percent gain class to $0. The remaining $40 net loss reduces the $135 net gain in the unrecaptured section 1250 gain class to $95. As in Examples 1 and 2, during 2005, qualified dividend income is taxed at a lower rate than interest income; gain in the unrecaptured section 1250 gain class is taxed at 25 percent; and gain in the all other long-term capital gain class is taxed at a rate lower than 25 percent. The annuity amount is deemed to be distributed from all the classes in the ordinary income category and then from the classes in the capital gains category, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. Therefore, in the hands of the recipient, the 2005 annuity amount has the following characteristics:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$ 5</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>20</ENT> </ROW> <ROW> <ENT I="01">Unrecaptured section 1250 gain</ENT> <ENT>75</ENT> </ROW> </GPOTABLE> <P>(iii) The remaining $20 gain in the unrecaptured section 1250 gain class and the $160 gain in the all other long-term capital gain class that are not treated as distributed to the recipient in 2005 are carried forward to 2006 as gains in their respective classes.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>(i) The facts are the same as in Examples 1, 2 and 3, and at the end of 2006, X has the following classes of income:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income class</ENT> <ENT>$ 95</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income class</ENT> <ENT>10</ENT> </ROW> <ROW> <ENT I="01">Net loss in short-term capital gain class</ENT> <ENT>(20)</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital loss in 28-percent gain class</ENT> <ENT>(350)</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in unrecaptured section 1250 gain class (carried forward from 2005)</ENT> <ENT>20</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in all other long-term capital gain class (carried forward from 2005)</ENT> <ENT>160</ENT> </ROW> </GPOTABLE> <P>(ii) A net long-term capital loss in one class is used to offset the net capital gains in the other classes of long-term capital gain and loss, in turn, until exhaustion of the class, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. The $350 net loss in the 28-percent gain class reduces the $20 net gain in the unrecaptured section 1250 gain class to $0. The remaining $330 net loss reduces the $160 net gain in the all other long-term capital gain class to $0. As in Examples 1, 2 and 3, during 2006, qualified dividend income is taxed at a lower rate than interest income. The annuity amount is deemed to be distributed from all the classes in the ordinary income category and then from the classes in the capital gains category, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. In the hands of the recipient, the 2006 annuity amount has the following characteristics:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$ 95</ENT> </ROW> <ROW> <ENT I="01">Qualified dividend income</ENT> <ENT>5</ENT> </ROW> </GPOTABLE> <P>(iii) The remaining $5 of qualified dividend income that is not treated as distributed to the recipient in 2006 is carried forward to 2007 as qualified dividend income. The $20 net loss in the short-term capital gain class and the $170 net loss in the 28-percent gain class are carried forward to 2007 as net losses in their respective classes.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P>(i) X, a charitable remainder annuity trust described in section 664(d)(1), is created on January 1, 2002. The annual annuity amount is $100. Except for qualified 5-year gain of $200 realized before May 6, 2003, but not distributed, X has no other gains or losses carried over from former years. X's income for the 2007 tax year is as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income class</ENT> <ENT>$ 10</ENT> </ROW> <ROW> <ENT I="01">Net gain in short-term capital gain class</ENT> <ENT>5</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in 28-percent gain class</ENT> <ENT>5</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in unrecaptured section 1250 gain class</ENT> <ENT>10</ENT> </ROW> <ROW> <ENT I="01">Net long-term capital gain in all other long-term capital gain class</ENT> <ENT>10</ENT> </ROW> </GPOTABLE> <P> (ii) The annuity amount is deemed to be distributed from all the classes in the ordinary income category and then from the classes in the capital gains category, beginning with the class subject to the highest Federal income tax rate and ending with the class subject to the lowest rate. In 2007, gains distributed to a recipient from both the qualified 5-year gain class and the all other long-term capital gains class are taxed at a 15/5 percent tax rate. Since after December 31, 2008, gains distributed from the qualified 5-year gain class will be taxed at a lower rate <PRTPAGE P="163"/> than gains distributed from the other classes of long-term capital gain and loss, distributions from the qualified 5-year gain class are made after distributions from the other classes of long-term capital gain and loss. In the hands of the recipient, the 2007 annuity amount has the following characteristics: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,5"> <ROW> <ENT I="01">Interest income</ENT> <ENT>$10</ENT> </ROW> <ROW> <ENT I="01">Short-term capital gain</ENT> <ENT>5</ENT> </ROW> <ROW> <ENT I="01">28-percent gain</ENT> <ENT>5</ENT> </ROW> <ROW> <ENT I="01">Unrecaptured section 1250 gain</ENT> <ENT>10</ENT> </ROW> <ROW> <ENT I="01">All other long-term capital gain</ENT> <ENT>10</ENT> </ROW> <ROW> <ENT I="01">Qualified 5-year gain (taxed as all other long-term capital gain)</ENT> <ENT>60</ENT> </ROW> </GPOTABLE> <P>(iii) The remaining $140 of qualified 5-year gain that is not treated as distributed to the recipient in 2007 is carried forward to 2008 as qualified 5-year gain.</P> </EXAMPLE> <P> (ix) <E T="03">Effective dates.</E> The rules in this paragraph (d)(1) that require long-term capital gains to be distributed in the following order: first, 28-percent gain (gains and losses from collectibles and section 1202 gains); second, unrecaptured section 1250 gain (long-term gains not treated as ordinary income that would be treated as ordinary income if section 1250(b)(1) included all depreciation); and then, all other long-term capital gains are applicable for taxable years ending on or after December 31, 1998. The rules in this paragraph (d)(1) that provide for the netting of capital gains and losses are applicable for taxable years ending on or after December 31, 1998. The rule in the second sentence of paragraph (d)(1)(vi) of this section is applicable for taxable years ending on or after December 31, 1998. The rule in the third sentence of paragraph (d)(1)(vi) of this section is applicable for distributions made in taxable years ending on or after December 31, 1998. All other provisions of this paragraph (d)(1) are applicable for taxable years ending after November 20, 2003. </P> <P> (2) <E T="03">Allocation of deductions.</E> Items of deduction of the trust for a taxable year of the trust which are deductible in determining taxable income (other than the deductions permitted by sections 642(b), 642(c), 661, and 1202) which are directly attributable to one or more classes of items within a category of income (determined under paragraph (d)(1)(i)( <E T="03">a</E> ) of this section) or to corpus shall be allocated to such classes of items or to corpus. All other allowable deductions for such taxable year which are not directly attributable to one or more classes of items within a category of income or to corpus (other than the deductions permitted by sections 642(b), 642(c), 661, and 1202) shall be allocated among the classes of items within the category (excluding classes of items with net losses) on the basis of the gross income of such classes for such taxable year reduced by the deductions allocated thereto under the first sentence of this subparagraph, but in no event shall the amount of expenses allocated to any class of items exceed such income of such class for the taxable year. Items of deduction which are not allocable under the above two sentences (other than the deductions permitted by sections 642(b), 642(c), 661, and 1202) may be allocated in any manner. All taxes imposed by chapter 42 of the Code (including without limitation taxes treated under section 664(c)(2) as imposed by chapter 42) and, for taxable years beginning prior to January 1, 2007, all taxes imposed by subtitle A of the Code for which the trust is liable because it has unrelated business taxable income, shall be allocated to corpus. Any expense which is not deductible in determining taxable income and which is not allocable to any class of items described in paragraph (d)(1)(i)( <E T="03">a</E> )( <E T="03">3</E> ) of this section shall be allocated to corpus. The deductions allowable to a trust under sections 642(b), 642(c), 661, and 1202 are not allowed in determining the amount or character of any class of items within a category of income described in paragraph (d)(1)(i)( <E T="03">a</E> ) of this section or to corpus. </P> <P> (3) <E T="03">Allocation of income among recipients.</E> If there are two or more recipients, each will be treated as receiving his pro rata portion of the categories of income and corpus. The application of this rule may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> X transfers $40,000 to a charitable remainder annuity trust which is to pay $3,000 per year to X and $2,000 per year to Y for a term of 5 years. During the first taxable year the trust has $3,000 of ordinary income, $500 of capital gain, and $500 of tax-exempt income after allocation of all expenses. X is treated as receiving ordinary income of $1,800 ($3,000 / $5,000 × $3,000), capital gain of $300 ($3,000 / $5,000 × $500), tax exempt income of $300 ($3,000 / $5,000 × $500), and corpus of $600 ($3,000 / $5,000 × [$5,000 − $4,000]). Y is <PRTPAGE P="164"/> treated as receiving ordinary income of $1,200 ($2,000 / $5,000 × $3,000), capital gain of $200 ($2,000 / $5,000 × $500), tax exempt income of $200 ($2,000 / $5,000 × $500), and corpus of $400 ($2,000 / $5,000 × [$5,000 − $4,000]). </P> </EXAMPLE> <P> (4) <E T="03">Year of inclusion</E> —(i) <E T="03">General rule.</E> To the extent required by this paragraph, the annuity or unitrust amount is includible in the recipient's gross income for the taxable year in which the annuity or unitrust amount is required to be distributed even though the annuity or unitrust amount is not distributed until after the close of the taxable year of the trust. If a recipient has a different taxable year (as defined in section 441 or 442) from the taxable year of the trust, the amount he is required to include in gross income to the extent required by this paragraph shall be included in his taxable year in which or with which ends the taxable year of the trust in which such amount is required to be distributed. </P> <P> (ii) <E T="03">Payments resulting from incorrect valuations.</E> Notwithstanding subdivision (i) of this subparagraph, any payments which are made or required to be distributed by a charitable remainder trust pursuant to paragraph (a)(5) of this section, under paragraph (f)(3) of this section because of an amendment to the governing instrument, or under paragraphs (a)(1) of §§ 1.664-2 and 1.664-3 because of an incorrect valuation, shall, to the extent required by this paragraph, be included in the gross income of the recipient in his taxable year in which or with which ends the taxable year of the trust in which the amount is paid, credited, or required to be distributed. For rules relating to required adjustments of underpayments and overpayments of the annuity or unitrust amounts in respect of payments made prior to the amendment of a governing instrument, see paragraph (f)(3) of this section. There is allowable to a recipient a deduction from gross income for any amounts repaid to the trust because of an overpayment during the reasonable period of administration or settlement or until the trust is fully funded, because of an amendment, or because of an incorrect valuation, to the extent such amounts were included in his gross income. See section 1341 and the regulations thereunder for rules relating to the computation of tax where a taxpayer restores substantial amounts held under a claim of right. </P> <P> (iii) <E T="03">Rules applicable to year of recipient's death.</E> If the taxable year of the trust does not end with or within the last taxable year of the recipient because of the recipient's death, the extent to which the annuity or unitrust amount required to be distributed to him is included in the gross income of the recipient for his last taxable year, or in the gross income of his estate, is determined by making the computations required under this paragraph for the taxable year of the trust in which his last taxable year ends. (The last sentence of subdivision (i) of this subparagraph does not apply to such amounts.) The gross income for the last taxable year of a recipient on the cash basis includes (to the extent required by this paragraph) amounts actually distributed to the recipient before his death. Amounts required to be distributed which are distributed to his estate, are included (to the extent required by this paragraph) in the gross income of the estate as income in respect of a decedent under section 691. </P> <P> (5) <E T="03">Distributions in kind.</E> The annuity or unitrust amount may be paid in cash or in other property. In the case of a distribution made in other property, the amount paid, credited, or required to be distributed shall be considered as an amount realized by the trust from the sale or other disposition of property. The basis of the property in the hands of the recipient is its fair market value at the time it was paid, credited, or required to be distributed. The application of these rules may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>On January 1, 1971, X creates a charitable remainder annuity trust, whose taxable year is the calendar year, under which X is to receive $5,000 per year. During 1971, the trust receives $500 of ordinary income. On December 31, 1971, the trust distributed cash of $500 and a capital asset of the trust having a fair market value of $4,500 and a basis of $2,200. The trust is deemed to have realized a capital gain of $2,300. X treats the distribution of $5,000 as being ordinary income of $500, capital gain of $2,300 and trust corpus of $2,200. The basis of the distributed property is $4,500 in the hands of X.</P> </EXAMPLE> <P> (e) <E T="03">Other distributions</E> —(1) <E T="03">Character of distributions.</E> An amount distributed by <PRTPAGE P="165"/> the trust to an organization described in section 170(c) other than the annuity or unitrust amount shall be considered as a distribution of corpus and of those categories of income specified in paragraph (d)(1)(i)( <E T="03">a</E> ) of this section in an order inverse to that prescribed in such paragraph. The character of such amount shall be determined as of the end of the taxable year of the trust in which the distribution is made after the character of the annuity or unitrust amount has been determined. </P> <P> (2) <E T="03">Distributions in kind.</E> In the case of a distribution of an amount to which subparagraph (1) of this paragraph applies, no gain or loss is realized by the trust by reason of a distribution in kind unless such distribution is in satisfaction of a right to receive a distribution of a specific dollar amount or in specific property other than that distributed. </P> <P> (f) <E T="03">Effective date</E> —(1) <E T="03">General rule.</E> The provisions of this section are effective with respect to transfers in trust made after July 31, 1969. Any trust created (within the meaning of applicable local law) prior to August 1, 1969, is not a charitable remainder trust even if it otherwise satisfies the definition of a charitable remainder trust. The provisions of paragraph § 1.664-1(a)(7)(i)(b) apply as provided in that paragraph. </P> <P> (2) <E T="03">Transfers to pre-1970 trusts.</E> Property transferred to a trust created (within the meaning of applicable local law) before August 1, 1969, whose governing instrument provides that an organization described in section 170(c) receives an irrevocable remainder interest in such trust, shall, for purposes of subparagraphs (1) and (3) of this paragraph, be deemed transferred to a trust created on the date of such transfer provided that the transfer occurs after July 31, 1969, and prior to October 18, 1971, and the transferred property and any undistributed income therefrom is severed and placed in a separate trust before December 31, 1972, or if later, on or before the 30th day after the date on which any judicial proceedings begun before December 31, 1972, which are required to sever such property, become final. </P> <P> (3) <E T="03">Amendment of post-1969 trusts.</E> A trust created (within the meaning of applicable local law) subsequent to July 31, 1969, and prior to December 31, 1972, which is not a charitable remainder trust at the date of its creation, may be treated as a charitable remainder trust from the date it would be deemed created under § 1.664-1(a) (4) and (5)(i) for all purposes: <E T="03">Provided,</E> That all the following requirements are met: </P> <P>(i) At the time of the creation of the trust, the governing instrument provides that an organization described in section 170(c) receives an irrevocable remainder interest in such trust.</P> <P> (ii) The governing instrument of the trust is amended so that the trust will meet the definition of a charitable remainder trust and, if applicable, will meet the requirement of paragraph (a)(5)(i) of this section that obligation to make payment of the annuity or unitrust amount with respect to property passing at death begin as of the date of death, before December 31, 1972, or if later, on or before the 30th day after the date on which any judicial proceedings which are begun before December 31, 1972, and which are required to amend its governing instrument, become final. In the case of a trust created (within the meaning of applicable local law) subsequent to July 31, 1969, and prior to December 31, 1972, the provisions of section 508(d)(2)(A) shall not apply if the governing instrument of the trust is amended so as to comply with the requirements of section 508(e) before December 31, 1972, or if later, on or before the 30th day after the date on which any judicial proceedings which are begun before December 31, 1972, and which are required to amend its governing instrument, become final. Notwithstanding the provisions of paragraphs (a)(3) and (a)(4) of §§ 1.664-2 and 1.664-3, the governing instrument may grant to the trustee a power to amend the governing instrument for the sole purpose of complying with the requirements of this section and § 1.664-2 or § 1.664-3: <E T="03">Provided,</E> That at the creation of the trust, the governing instrument ( <E T="03">a</E> ) provides for the payment of a unitrust amount described in § 1.664-3(a)(1)(i) or an annuity which meets the requirements of paragraph (a)(2) of § 1.664-2 or § 1.664-3, ( <E T="03">b</E> ) designates the recipients of the trust and the period for which the amount described in ( <E T="03">a</E> ) <PRTPAGE P="166"/> of this subdivision (ii) is to be paid, and ( <E T="03">c</E> ) provides that an organization described in section 170(c) receives an irrevocable remainder interest in such trust. The mere granting of such a power is not sufficient to meet the requirements of this subparagraph that the governing instrument be amended in the manner and within the time limitations of this subparagraph. </P> <P> (iii)( <E T="03">a</E> ) Where the amount of the distributions which would have been made by the trust to a recipient if the amended provisions of such trust had been in effect from the time of creation of such trust exceeds the amount of the distributions made by the trust prior to its amendment, the trust pays an amount equal to such excess to the recipient. </P> <P> ( <E T="03">b</E> ) Where the amount of distributions made to the recipient prior to the amendment of the trust exceeds the amount of the distributions which would have been made by such trust if the amended provisions of such trust had been in effect from the time of creation of such trust, such excess is repaid to the trust by the recipient. </P> <FP>See paragraph (d)(4) of this section for rules relating to the year of inclusion in the case of an underpayment to a recipient and the allowance of a deduction in the case of an overpayment to a recipient. A deduction for a transfer to a charitable remainder trust shall not be allowed until the requirements of this paragraph are met and then only if the deduction is claimed on a timely filed return (including extensions) or on a claim for refund filed within the period of limitations prescribed by section 6511(a).</FP> <P> (4) <E T="03">Valuation of unmarketable assets.</E> The rules contained in paragraph (a)(7) of this section are applicable for trusts created on or after December 10, 1998. A trust in existence as of December 10, 1998, whose governing instrument requires that an independent trustee value the trust's unmarketable assets may be amended or reformed to permit a valuation method that satisfies the requirements of paragraph (a)(7) of this section for taxable years beginning on or after December 10, 1998. </P> <P> (g) <E T="03">Transitional effective date.</E> Notwithstanding any other provision of this section, § 1.664-2 or § 1.664-3, the requirement of paragraph (a)(5)(i) of this section that interest accrue on overpayments and underpayments, the requirement of paragraph (a)(5)(ii) of this section that the unitrust amount accruing under the formula provided therein cease with the death of the last recipient, and the requirement that the governing instrument of the trust contain the provisions specified in paragraph (a)(1)(iv) of § 1.664-2 (relating to computation of the annuity amount in certain circumstances), paragraph (a)(1)(v) of § 1.664-3 (relating to computation of the unitrust amount in certain circumstances), paragraphs (b) of §§ 1.664-2 and 1.664-3 (relating to additional contributions), and paragraph (a)(1)(iii) of § 1.664-3 (relating to incorrect valuations), paragraphs (a)(6)(iv) of §§ 1.664-2 and 1.664-3 (relating to alternative remaindermen) shall not apply to: </P> <P>(1) A will executed on or before December 31, 1972, if:</P> <P>(i) The testator dies before December 31, 1975, without having republished the will after December 31, 1972, by codicil or otherwise.</P> <P>(ii) The testator at no time after December 31, 1972, had the right to change the provisions of the will which pertain to the trust, or</P> <P>(iii) The will is not republished by codicil or otherwise before December 31, 1975, and the testator is on such date and at all times thereafter under a mental disability to republish the will by codicil or otherwise, or</P> <P>(2) A trust executed on or before December 31, 1972, if:</P> <P>(i) The grantor dies before December 31, 1975, without having amended the trust after December 31, 1972,</P> <P>(ii) The trust is irrevocable on December 31, 1972, or</P> <P>(iii) The trust is not amended before December 31, 1975, and the grantor is on such date and at all times thereafter under a mental disability to change the terms of the trust.</P> <CITA>[T.D. 7202, 37 FR 16913, Aug. 23, 1972]</CITA> <EDNOTE> <HD SOURCE="HED">Editorial Note:</HD> <P> For <E T="04">Federal Register</E> citations affecting § 1.664-1, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at <E T="03">www.govinfo.gov.</E> </P> </EDNOTE> </SECTION> <SECTION> <PRTPAGE P="167"/> <SECTNO>§ 1.664-2</SECTNO> <SUBJECT>Charitable remainder annuity trust.</SUBJECT> <P> (a) <E T="03">Description.</E> A charitable remainder annuity trust is a trust which complies with the applicable provisions of § 1.664-1 and meets all of the following requirements: </P> <P> (1) <E T="03">Required payment of annuity amount</E> —(i) <E T="03">Payment of sum certain at least annually.</E> The governing instrument provides that the trust will pay a sum certain not less often than annually to a person or persons described in paragraph (a)(3) of this section for each taxable year of the period specified in paragraph (a)(5) of this section. </P> <P> ( <E T="03">a</E> ) <E T="03">General rule applicable to all trusts.</E> A trust will not be deemed to have engaged in an act of self-dealing (within the meaning of section 4941), to have unrelated debt-financed income (within the meaning of section 514), to have received an additional contribution (within the meaning of paragraph (b) of this section), or to have failed to function exclusively as a charitable remainder trust (within the meaning of § 1.664-1(a)(4)) merely because the annuity amount is paid after the close of the taxable year if such payment is made within a reasonable time after the close of such taxable year and the entire annuity amount in the hands of the recipient is characterized only as income from the categories described in section 664(b)(1), (2), or (3), except to the extent it is characterized as corpus described in section 664(b)(4) because— </P> <P> ( <E T="03">1</E> ) The trust pays the annuity amount by distributing property (other than cash) that it owned at the close of the taxable year to pay the annuity amount, and the trustee elects to treat any income generated by the distribution as occurring on the last day of the taxable year in which the annuity amount is due; </P> <P> ( <E T="03">2</E> ) The trust pays the annuity amount by distributing cash that was contributed to the trust (with respect to which a deduction was allowable under section 170, 2055, 2106, or 2522); or </P> <P> ( <E T="03">3</E> ) The trust pays the annuity amount by distributing cash received as a return of basis in any asset that was contributed to the trust (with respect to which a deduction was allowable under section 170, 2055, 2106, or 2522), and that is sold by the trust during the year for which the annuity amount is due. </P> <P> ( <E T="03">b</E> ) <E T="03">Special rule for trusts created before</E> December 10, 1998. In addition to the circumstances described in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section, a trust created before December 10, 1998, will not be deemed to have engaged in an act of self-dealing (within the meaning of section 4941), to have unrelated debt-financed income (within the meaning of section 514), to have received an additional contribution (within the meaning of paragraph (b) of this section), or to have failed to function exclusively as a charitable remainder trust (within the meaning of § 1.664-1(a)(4)) merely because the annuity amount is paid after the close of the taxable year if such payment is made within a reasonable time after the close of such taxable year and the sum certain to be paid each year as the annuity amount is 15 percent or less of the initial net fair market value of the property irrevocably passing in trust as determined for federal tax purposes. </P> <P> ( <E T="03">c</E> ) <E T="03">Reasonable time.</E> For this paragraph (a)(1)(i), a reasonable time will not ordinarily extend beyond the date by which the trustee is required to file Form 5227, “Split-Interest Trust Information Return,” (including extensions) for the taxable year. </P> <P> ( <E T="03">d</E> ) <E T="03">Example.</E> The following example illustrates the rules in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example. X</HD> <P> is a charitable remainder annuity trust described in section 664(d)(1) that was created after December 10, 1998. The prorated annuity amount payable from <E T="03">X</E> for Year 1 is $100. The trustee does not pay the annuity amount to the recipient by the close of Year 1. At the end of Year 1, <E T="03">X</E> has only $95 in the ordinary income category under section 664(b)(1) and no income in the capital gain or tax-exempt income categories under section 664(b)(2) or (3), respectively. By April 15 of Year 2, in addition to $95 in cash, the trustee distributes to the recipient of the annuity a capital asset with a $5 fair market value and a $2 adjusted basis to pay the $100 annuity amount due for Year 1. The trust owned the asset at the end of Year 1. Under § 1.664-1(d)(5), the distribution is treated as a sale by <E T="03">X,</E> resulting in <E T="03">X</E> recognizing a $3 capital gain. The trustee elects to treat the capital gain as occurring on the last day of Year 1. Under § 1.664-1(d)(1), the character of the annuity amount for Year 1 in the recipient's hands is $95 of ordinary income, $3 of <PRTPAGE P="168"/> capital gain income, and $2 of trust corpus. For Year 1, <E T="03">X</E> satisfied paragraph (a)(1)(i)( <E T="03">a</E> ) of this section. </P> </EXAMPLE> <P> ( <E T="03">e</E> ) <E T="03">Effective date.</E> This paragraph (a)(1)(i) is applicable for taxable years ending after April 18, 1997. However, paragraphs (a)(1)(i)( <E T="03">a</E> )( <E T="03">2</E> ) and ( <E T="03">3</E> ) of this section apply only to distributions made on or after January 5, 2001. </P> <P> (ii) <E T="03">Definition of sum certain.</E> A sum certain is a stated dollar amount which is the same either as to each recipient or as to the total amount payable for each year of such period. For example, a provision for an amount which is the same every year to A until his death and concurrently an amount which is the same every year to B until his death, with the amount to each recipient to terminate at his death, would satisfy the above rule. Similarly, provisions for an amount to A and B for their joint lives and then to the survivor would satisfy the above rule. In the case of a distribution to an organization described in section 170(c) at the death of a recipient or the expiration of a term of years, the governing instrument may provide for a reduction of the stated amount payable after such a distribution: <E T="03">Provided,</E> That: </P> <P> ( <E T="03">a</E> ) The reduced amount payable is the same either as to each recipient or as to the total amount payable for each year of the balance of such period, and </P> <P> ( <E T="03">b</E> ) The requirements of subparagraph (2)(ii) of this paragraph are met. </P> <P> (iii) <E T="03">Sum certain stated as a fraction or percentage.</E> The stated dollar amount may be expressed as a fraction or a percentage of the initial net fair market value of the property irrevocably passing in trust as finally determined for Federal tax purposes. If the stated dollar amount is so expressed and such market value is incorrectly determined by the fiduciary, the requirement of this subparagraph will be satisfied if the governing instrument provides that in such event the trust shall pay to the recipient (in the case of an undervaluation) or be repaid by the recipient (in the case of an overvaluation) an amount equal to the difference between the amount which the trust should have paid the recipient if the correct value were used and the amount which the trust actually paid the recipient. Such payments or repayments must be made within a reasonable period after the final determination of such value. Any payment due to a recipient by reason of such incorrect valuation shall be considered to be a payment required to be distributed at the time of such final determination for purposes of paragraph (d)(4)(ii) of § 1.664-1. See paragraph (d)(4) of § 1.664-1 for rules relating to the year of inclusion of such payments and the allowance of a deduction for such repayments. See paragraph (b) of this section for rules relating to future contributions. For rules relating to required adjustments for underpayments or overpayments of the amount described in this paragraph in respect of payments made during a reasonable period of administration, see paragraph (a)(5) of § 1.664-1. The application of the rule permitting the stated dollar amount to be expressed as a fraction or a percentage of the initial net fair market value of the property irrevocably passing in trust as finally determined for Federal tax purposes may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> The will of X provides for the transfer of one-half of his residuary estate to a charitable remainder annuity trust which is required to pay to W for life an annuity equal to 5 percent of the initial net fair market value of the interest passing in trust as finally determined for Federal tax purposes. The annuity is to be paid on December 31 of each year computed from the date of X's death. The will also provides that if such initial net fair market value is incorrectly determined, the trust shall pay to W, in the case of an undervaluation, or be repaid by W, in the case of an overvaluation, an amount equal to the difference between the amount which the trust should have paid if the correct value were used and the amount which the trust actually paid. X dies on March 1, 1971. The executor files an estate tax return showing the value of the residuary estate as $250,000 before reduction for taxes and expenses of $50,000. The executor paid to W $4,192 ([$250,000 − $50,000] × 1/2 × 5 percent × 306/365) on December 31, 1971. On January 1, 1972, the executor transfers one-half of the residue of the estate to the trust. The trust adopts the calendar year as its taxable year. The value of the residuary estate is finally determined for Federal tax purposes to be $240,000 ($290,000 − $50,000). Accordingly, the amount which the executor should have paid to W is $5,030 ([$290,000 − $50,000] × 1/2 × 5 percent × 306 / 365). Consequently, an additional amount of $838 ($5,030 − $4,192) must be paid to W within a reasonable period after the <PRTPAGE P="169"/> final determination of value for Federal tax purposes. </P> </EXAMPLE> <P> (iv) <E T="03">Computation of annuity amount in certain circumstances</E> —( <E T="03">a</E> ) <E T="03">Short taxable years.</E> The governing instrument provides that, in the case of a taxable year which is for a period of less than 12 months other than the taxable year in which occurs the end of the period specified in subparagraph (5) of this paragraph, the annuity amount determined under subdivision (i) of this subparagraph shall be the amount otherwise determined under that subdivision multiplied by a fraction the numerator of which is the number of days in the taxable year of the trust and the denominator of which is 365 (366 if February 29 is a day included in the numerator). </P> <P> ( <E T="03">b</E> ) <E T="03">Last taxable year of period.</E> The governing instrument provides that, in the case of the taxable year in which occurs the end of the period specified in subparagraph (5) of this paragraph, the annuity amount which must be distributed under subdivision (i) of this subparagraph shall be the amount otherwise determined under that subdivision multiplied by a fraction the numerator of which is the number of days in the period beginning on the first day of such taxable year and ending on the last day of the period specified in subparagraph (5) of this paragraph and the denominator of which is 365 (366 if February 29 is a day included in the numerator). See subparagraph (5) of this paragraph for a special rule allowing termination of payment of the annuity amount with the regular payment next preceding the termination of the period specified therein. </P> <P> (2) <E T="03">Minimum annuity amount</E> —(i) <E T="03">General rule.</E> The total amount payable under subparagraph (1) of this paragraph is not less than 5 percent of the initial net fair market value of the property placed in trust as finally determined for Federal tax purposes. </P> <P> (ii) <E T="03">Reduction of annuity amount in certain cases.</E> A trust will not fail to meet the requirements of this subparagraph by reason of the fact that it provides for a reduction of the stated amount payable upon the death of a recipient or the expiration of a term of years provided that: </P> <P> ( <E T="03">a</E> ) A distribution is made to an organization described in section 170(c) at the death of such recipient or the expiration of such term of years, and </P> <P> ( <E T="03">b</E> ) The total amounts payable each year under subparagraph (1) of this paragraph after such distribution are not less than a stated dollar amount which bears the same ratio to 5 percent of the initial net fair market value of the trust assets as the net fair market value of the trust assets immediately after such distribution bears to the net fair market value of the trust assets immediately before such distribution. </P> <P> (iii) <E T="03">Rule applicable to inter vivos trust which does not provide for payment of minimum annuity amount.</E> In the case where the grantor of an inter vivos trust underestimates in good faith the initial net fair market value of the property placed in trust as finally determined for Federal tax purposes and specifies a fixed dollar amount for the annuity which is less than 5 percent of the initial net fair market value of the property placed in trust as finally determined for Federal tax purposes, the trust will be deemed to have met the 5 percent requirement if the grantor or his representative consents, by appropriate agreement with the District Director, to accept an amount equal to 20 times the annuity as the fair market value of the property placed in trust for purposes of determining the appropriate charitable contributions deduction. </P> <P> (3) <E T="03">Permissible recipients</E> —(i) <E T="03">General rule.</E> The amount described in subparagraph (1) of this paragraph is payable to or for the use of a named person or persons, at least one of which is not an organization described in section 170(c). If the amount described in subparagraph (1) of this paragraph is to be paid to an individual or individuals, all such individuals must be living at the time of the creation of the trust. A named person or persons may include members of a named class provided that, in the case of a class which includes any individual, all such individuals must be alive and ascertainable at the time of the creation of the trust unless the period for which the annuity amount is to be paid to such class consists solely of a term of years. For example, in the case of a testamentary <PRTPAGE P="170"/> trust, the testator's will may provide that an amount shall be paid to his children living at his death. </P> <P> (ii) <E T="03">Power to alter amount paid to recipients.</E> A trust is not a charitable remainder annuity trust if any person has the power to alter the amount to be paid to any named person other than an organization described in section 170(c) if such power would cause any person to be treated as the owner of the trust, or any portion thereof, if subpart E, part 1, subchapter J, chapter 1, subtitle A of the Code were applicable to such trust. See paragraph (a)(4) of this section for a rule permitting the retention by a grantor of a testamentary power to revoke or terminate the interest of any recipient other than an organization described in section 170(c). For example, the governing instrument may not grant the trustee the power to allocate the annuity among members of a class unless such power falls within one of the exceptions to section 674(a). </P> <P> (4) <E T="03">Other payments.</E> No amount other than the amount described in subparagraph (1) of this paragraph may be paid to or for the use of any person other than an organization described in section 170(c). An amount is not paid to or for the use of any person other than an organization described in section 170(c) if the amount is transferred for full and adequate consideration. The trust may not be subject to a power to invade, alter, amend, or revoke for the beneficial use of a person other than an organization described in section 170(c). Notwithstanding the preceding sentence, the grantor may retain the power exercisable only by will to revoke or terminate the interest of any recipient other than an organization described in section 170(c). The governing instrument may provide that any amount other than the amount described in subparagraph (1) of this paragraph shall be paid (or may be paid in the discretion of the trustee) to an organization described in section 170(c) provided that in the case of distributions in kind, the adjusted basis of the property distributed is fairly representative of the adjusted basis of the property available for payment on the date of payment. For example, the governing instrument may provide that a portion of the trust assets may be distributed currently, or upon the death of one or more recipients, to an organization described in section 170(c). </P> <P> (5) <E T="03">Period of payment of annuity amount</E> —(i) <E T="03">General rules.</E> The period for which an amount described in subparagraph (1) of this paragraph is payable begins with the first year of the charitable remainder trust and continues either for the life or lives of a named individual or individuals or for a term of years not to exceed 20 years. Only an individual or an organization described in section 170(c) may receive an amount for the life of an individual. If an individual receives an amount for life, it must be solely for his life. Payment of the amount described in subparagraph (1) of this paragraph may terminate with the regular payment next preceding the termination of the period described in this subparagraph. The fact that the recipient may not receive such last payment shall not be taken into account for purposes of determining the present value of the remainder interest. In the case of an amount payable for a term of years, the length of the term of years shall be ascertainable with certainty at the time of the creation of the trust, except that the term may be terminated by the death of the recipient or by the grantor's exercise by will of a retained power to revoke or terminate the interest of any recipient other than an organization described in section 170(c). In any event, the period may not extend beyond either the life or lives of a named individual or individuals or a term of years not to exceed 20 years. For example, the governing instrument may not provide for the payment of an annuity amount to A for his life and then to B for a term of years because it is possible for the period to last longer than either the lives of recipients in being at the creation of the trust or a term of years not to exceed 20 years. On the other hand, the governing instrument may provide for the payment of an annuity amount to A for his life and then to B for his life or a term of years (not to exceed 20 years), whichever is shorter (but not longer), if both A and B are in being at the creation of the trust because it is not possible for the period to last longer than the lives <PRTPAGE P="171"/> of recipients in being at the creation of the trust. </P> <P> (ii) <E T="03">Relationship to 5 percent requirement.</E> The 5 percent requirement provided in subparagraph (2) of this paragraph must be met until the termination of all of the payments described in subparagraph (1) of this paragraph. For example, the following provisions would satisfy the above rules: </P> <P> ( <E T="03">a</E> ) An amount equal to at least 5 percent of the initial net fair market value of the property placed in trust to A and B for their joint lives and then to the survivor for his life; </P> <P> ( <E T="03">b</E> ) An amount equal to at least 5 percent of the initial net fair market value of the property placed in trust to A for life or for a term of years not longer than 20 years, whichever is longer (or shorter); </P> <P> ( <E T="03">c</E> ) An amount equal to at least 5 percent of the initial net fair market value of the property placed in trust to A for a term of years not longer than 20 years and then to B for life (provided B was living at the date of creation of the trust); </P> <P> ( <E T="03">d</E> ) An amount to A for his life and concurrently an amount to B for his life (the amount to each recipient to terminate at his death) if the amount given to each individual is not less than 5 percent of the initial net fair market value of the property placed in trust; or </P> <P> ( <E T="03">e</E> ) An amount to A for his life and concurrently an equal amount to B for his life, and at the death of the first to die, the trust to distribute one-half of the then value of its assets to an organization described in section 170(c), if the total of the amounts given to A and B is not less than 5 percent of the initial net fair market value of the property placed in trust. </P> <P> (6) <E T="03">Permissible remaindermen</E> —(i) <E T="03">General rule.</E> At the end of the period specified in subparagraph (5) of this paragraph the entire corpus of the trust is required to be irrevocably transferred, in whole or in part, to or for the use of one or more organizations described in section 170(c) or retained, in whole or in part, for such use. </P> <P> (ii) <E T="03">Treatment of trust.</E> If all of the trust corpus is to be retained for such use, the taxable year of the trust shall terminate at the end of the period specified in subparagraph (5) of this paragraph and the trust shall cease to be treated as a charitable remainder trust for all purposes. If all or any portion of the trust corpus is to be transferred to or for the use of such organization or organizations, the trustee shall have a reasonable time after the period specified in subparagraph (5) of this paragraph to complete the settlement of the trust. During such time, the trust shall continue to be treated as a charitable remainder trust for all purposes, such as sections 664, 4947(a)(2), and 4947(b)(3)(B). Upon the expiration of such period, the taxable year of the trust shall terminate and the trust shall cease to be treated as a charitable remainder trust for all purposes. If the trust continues in existence, it will be subject to the provisions of section 4947(a)(1) unless the trust is exempt from taxation under section 501(a). For purposes of determining whether the trust is exempt under section 501(a) as an organization described in section 501(c)(3), the trust shall be deemed to have been created at the time it ceases to be treated as a charitable remainder trust. </P> <P> (iii) <E T="03">Concurrent or successive remaindermen.</E> Where interests in the corpus of the trust are given to more than one organization described in section 170(c) such interests may be enjoyed by them either concurrently or successively. </P> <P> (iv) <E T="03">Alternative remaindermen.</E> The governing instrument shall provide that if an organization to or for the use of which the trust corpus is to be transferred or for the use of which the trust corpus is to be retained is not an organization described in section 170(c) at the time any amount is to be irrevocably transferred to or for the use of such organization, such amount shall be transferred to or for the use of one or more alternative organizations which are described in section 170(c) at such time or retained for such use. Such alternative organization or organizations may be selected in any manner provided by the terms of the governing instrument. </P> <P> (b) <E T="03">Additional contributions.</E> A trust is not a charitable remainder annuity trust unless its governing instrument <PRTPAGE P="172"/> provides that no additional contributions may be made to the charitable remainder annuity trust after the initial contribution. For purposes of this section, all property passing to a charitable remainder annuity trust by reason of death of the grantor shall be considered one contribution. </P> <P> (c) <E T="03">Calculation of the fair market value of the remainder interest of a charitable remainder annuity trust.</E> For purposes of sections 170, 2055, 2106, and 2522, the fair market value of the remainder interest of a charitable remainder annuity trust (as described in this section) is the net fair market value (as of the appropriate valuation date) of the property placed in trust less the present value of the annuity. For purposes of this section, <E T="03">valuation date</E> means, in general, the date on which the property is transferred to the trust by the donor regardless of when the trust is created. In the case of transfers to a charitable remainder annuity trust for which the valuation date is after April 30, 1999, if an election is made under section 7520 and § 1.7520-2(b) to compute the present value of the charitable interest by using the interest rate component for either of the 2 months preceding the month in which the transfer is made, the month so elected is the valuation date for purposes of determining the interest rate and mortality tables. For purposes of section 2055 or 2106, the valuation date is the date of death unless the alternate valuation date is elected in accordance with section 2032 in which event, and within the limitations set forth in section 2032 and the regulations in this part under section 2032, the valuation date is the alternate valuation date. If the decedent's estate elects the alternate valuation date under section 2032 and also elects, under section 7520 and § 1.7520-2(b), to use the interest rate component for one of the 2 months preceding the alternate valuation date, the month so elected is the valuation date for purposes of determining the interest rate and mortality tables. The present value of an annuity is computed under § 20.2031-7(d) of this chapter for transfers for which the valuation date is on or after June 1, 2023, or under § 20.2031-7A(a) through (g) of this chapter, whichever is applicable, for transfers for which the valuation date is before June 1, 2023. See, however, §§ 20.2031-7(d)(3) and 25.2512-5(d)(3) (transition rules) and 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). </P> <P> (d) <E T="03">Deduction for transfers to a charitable remainder annuity trust.</E> For rules relating to a deduction for transfers to a charitable remainder annuity trust, see section 170, 2055, 2106, or 2522 and the regulations thereunder. Any claim for deduction on any return for the value of a remainder interest in a charitable remainder annuity trust must be supported by a full statement attached to the return showing the computation of the present value of such interest. The deduction allowed by section 170 is limited to the fair market value of the remainder interest of a charitable remainder annuity trust regardless of whether an organization described in section 170(c) also receives a portion of the annuity. For a special rule relating to the reduction of the amount of a charitable contribution deduction with respect to a contribution of certain ordinary income property or capital gain property, see section 170(e)(1)(A) or 170(e)(1)(B)(i) and the regulations thereunder. For rules for postponing the time for deduction of a charitable contribution of a future interest in tangible personal property, see section 170(a)(3) and the regulations thereunder. </P> <P> (e) <E T="03">Applicability date.</E> Paragraph (c) of this section applies on and after June 1, 2023. </P> <CITA>[T.D. 7202, 37 FR 16918, Aug. 23, 1972, as amended by T.D. 7955, 49 FR 19983, May 11, 1984; T.D. 8540, 59 FR 30116, June 10, 1994; T.D. 8791, 63 FR 68191, Dec. 10, 1998; T.D. 8819, 64 FR 23229, Apr. 30, 1999; T.D. 8819, Mar. 9, 2000, 65 FR 12471; T.D. 8926, 66 FR 1037, Jan. 5, 2001; T.D. 9448, 74 FR 21464, May 7, 2009; T.D. 9540, 76 FR 49595, Aug. 10, 2011; T.D. 9974, 88 FR 37433, June 7, 2023]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.664-3</SECTNO> <SUBJECT>Charitable remainder unitrust.</SUBJECT> <P> (a) <E T="03">Description.</E> A charitable remainder unitrust is a trust which complies with the applicable provisions of § 1.664-1 and meets all of the following requirements: </P> <P> (1) <E T="03">Required payment of unitrust amount</E> —(i) <E T="03">Payment of fixed percentage at least annually</E> —( <E T="03">a</E> ) <E T="03">General rule.</E> The <PRTPAGE P="173"/> governing instrument provides that the trust will pay not less often than annually a fixed percentage of the net fair market value of the trust assets determined annually to a person or persons described in paragraph (a)(3) of this section for each taxable year of the period specified in paragraph (a)(5) of this section. This paragraph (a)(1)(i)( <E T="03">a</E> ) is applicable for taxable years ending after April 18, 1997. </P> <P> ( <E T="03">b</E> ) <E T="03">Income exception.</E> Instead of the amount described in ( <E T="03">a</E> ) of this subdivision (i), the governing instrument may provide that the trust shall pay for any year either the amount described in ( <E T="03">1</E> ) or the total of the amounts described in ( <E T="03">1</E> ) and ( <E T="03">2</E> ) of this subdivision ( <E T="03">b</E> ). </P> <P> ( <E T="03">1</E> ) The amount of trust income for a taxable year to the extent that such amount is not more than the amount required to be distributed under paragraph (a)(1)(i)( <E T="03">a</E> ) of this section. </P> <P> ( <E T="03">2</E> ) An amount of trust income for a taxable year that is in excess of the amount required to be distributed under paragraph (a)(1)(i)( <E T="03">a</E> ) of this section for such year to the extent that (by reason of paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">1</E> ) of this section) the aggregate of the amounts paid in prior years was less than the aggregate of such required amounts. </P> <P> ( <E T="03">3</E> ) For purposes of this paragraph (a)(1)(i)( <E T="03">b</E> ), trust income generally means income as defined under section 643(b) and the applicable regulations. However, trust income may not be determined by reference to a fixed percentage of the annual fair market value of the trust property, notwithstanding any contrary provision in applicable state law. Proceeds from the sale or exchange of any assets contributed to the trust by the donor must be allocated to principal and not to trust income at least to the extent of the fair market value of those assets on the date of their contribution to the trust. Proceeds from the sale or exchange of any assets purchased by the trust must be allocated to principal and not to trust income at least to the extent of the trust's purchase price of those assets. Except as provided in the two preceding sentences, proceeds from the sale or exchange of any assets contributed to the trust by the donor or purchased by the trust may be allocated to income, pursuant to the terms of the governing instrument, if not prohibited by applicable local law. A discretionary power to make this allocation may be granted to the trustee under the terms of the governing instrument but only to the extent that the state statute permits the trustee to make adjustments between income and principal to treat beneficiaries impartially. </P> <P> ( <E T="03">4</E> ) The rules in paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">1</E> ) and ( <E T="03">2</E> ) of this section are applicable for taxable years ending after April 18, 1997. The rule in the first sentence of paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">3</E> ) is applicable for taxable years ending after April 18, 1997. The rules in the second, fourth, and fifth sentences of paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">3</E> ) are applicable for taxable years ending after January 2, 2004. The rule in the third sentence of paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">3</E> ) is applicable for sales or exchanges that occur after April 18, 1997. The rule in the sixth sentence of paragraph (a)(1)(i)( <E T="03">b</E> )( <E T="03">3</E> ) is applicable for trusts created after January 2, 2004. </P> <P> ( <E T="03">c</E> ) <E T="03">Combination of methods.</E> Instead of the amount described in paragraph (a)(1)(i)( <E T="03">a</E> ) or ( <E T="03">b</E> ) of this section, the governing instrument may provide that the trust will pay not less often than annually the amount described in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section for an initial period and then pay the amount described in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section (calculated using the same fixed percentage) for the remaining years of the trust only if the governing instrument provides that— </P> <P> ( <E T="03">1</E> ) The change from the method prescribed in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section to the method prescribed in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section is triggered on a specific date or by a single event whose occurrence is not discretionary with, or within the control of, the trustees or any other persons; </P> <P> ( <E T="03">2</E> ) The change from the method prescribed in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section to the method prescribed in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section occurs at the beginning of the taxable year that immediately follows the taxable year during which the date or event specified under paragraph (a)(1)(i)( <E T="03">c</E> )( <E T="03">1</E> ) of this section occurs; and <PRTPAGE P="174"/> </P> <P> ( <E T="03">3</E> ) Following the trust's conversion to the method described in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section, the trust will pay at least annually to the permissible recipients the amount described only in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section and not any amount described in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section. </P> <P> ( <E T="03">d</E> ) <E T="03">Triggering event.</E> For purposes of paragraph (a)(1)(i)( <E T="03">c</E> )( <E T="03">1</E> ) of this section, a triggering event based on the sale of unmarketable assets as defined in § 1.664-1(a)(7)(ii), or the marriage, divorce, death, or birth of a child with respect to any individual will not be considered discretionary with, or within the control of, the trustees or any other persons. </P> <P> ( <E T="03">e</E> ) <E T="03">Examples.</E> The following examples illustrate the rules in paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. For each example, assume that the governing instrument of charitable remainder unitrust <E T="03">Y</E> provides that <E T="03">Y</E> will initially pay not less often than annually the amount described in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section and then pay the amount described in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section (calculated using the same fixed percentage) for the remaining years of the trust and that the requirements of paragraphs (a)(1)(i)( <E T="03">c</E> )( <E T="03">2</E> ) and ( <E T="03">3</E> ) of this section are satisfied. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Y</HD> <P> is funded with the donor's former personal residence. The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the trust sells the residence. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Y</HD> <P> is funded with cash and an unregistered security for which there is no available exemption permitting public sale under the Securities and Exchange Commission rules. The governing instrument of <E T="03">Y</E> provides that the change in method for computing the annual unitrust amount is triggered on the earlier of the date when the stock is sold or at the time the restrictions on its public sale lapse or are otherwise lifted. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Y</HD> <P> is funded with cash and with a security that may be publicly traded under the Securities and Exchange Commission rules. The governing instrument of <E T="03">Y</E> provides that the change in method for computing the annual unitrust amount is triggered when the stock is sold. <E T="03">Y</E> does not provide for a combination of methods that satisfies the requirements of paragraph (a)(1)(i)( <E T="03">c</E> ) of this section because the sale of the publicly-traded stock is within the discretion of the trustee. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. S</HD> <P> establishes <E T="03">Y</E> for her granddaughter, <E T="03">G,</E> when <E T="03">G</E> is 10 years old. The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which <E T="03">G</E> turns 18 years old. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P> The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the donor is married. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6.</HD> <P> The governing instrument of <E T="03">Y</E> provides that if the donor divorces, the change in method for computing the annual unitrust amount will occur as of the first day of the year following the year of the divorce. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7.</HD> <P> The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the noncharitable beneficiary's first child is born. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8.</HD> <P> The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the noncharitable beneficiary's father dies. <E T="03">Y</E> provides for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9.</HD> <P> The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the noncharitable beneficiary's financial advisor determines that the beneficiary should begin receiving payments under the second prescribed payment method. Because the change in methods for paying the unitrust amount is triggered by an event that is within a person's control, <E T="03">Y</E> does not provide for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10.</HD> <P> The governing instrument of <E T="03">Y</E> provides for the change in method for computing the annual unitrust amount as of the first day of the year following the year in which the noncharitable beneficiary submits <PRTPAGE P="175"/> a request to the trustee that the trust convert to the second prescribed payment method. Because the change in methods for paying the unitrust amount is triggered by an event that is within a person's control, <E T="03">Y</E> does not provide for a combination of methods that satisfies paragraph (a)(1)(i)( <E T="03">c</E> ) of this section. </P> </EXAMPLE> <P> ( <E T="03">f</E> ) <E T="03">Effective date</E> —( <E T="03">1</E> ) <E T="03">General rule.</E> Paragraphs (a)(1)(i)( <E T="03">c</E> ), ( <E T="03">d</E> ), and ( <E T="03">e</E> ) of this section are applicable for charitable remainder trusts created on or after December 10, 1998. </P> <P> ( <E T="03">2</E> ) <E T="03">General rule regarding reformations of combination of method unitrusts.</E> If a trust is created on or after December 10, 1998, and contains a provision allowing a change in calculating the unitrust amount that does not comply with the provisions of paragraph (a)(1)(i)( <E T="03">c</E> ) of this section, the trust will qualify as a charitable remainder unitrust only if it is amended or reformed to use the initial method for computing the unitrust amount throughout the term of the trust, or is reformed in accordance with paragraph (a)(1)(i)( <E T="03">f</E> )( <E T="03">3</E> ) of this section. If a trust was created before December 10, 1998, and contains a provision allowing a change in calculating the unitrust amount that does not comply with the provisions of paragraph (a)(1)(i)( <E T="03">c</E> ) of this section, the trust may be reformed to use the initial method for computing the unitrust amount throughout the term of the trust without causing the trust to fail to function exclusively as a charitable remainder unitrust under § 1.664-1(a)(4), or may be reformed in accordance with paragraph (a)(1)(i)( <E T="03">f</E> )( <E T="03">3</E> ) of this section. Except as provided in paragraph (a)(1)(i)( <E T="03">f</E> )( <E T="03">3</E> ) of this section, a qualified charitable remainder unitrust will not continue to qualify as a charitable remainder unitrust if it is amended or reformed to add a provision allowing a change in the method for calculating the unitrust amount. </P> <P> ( <E T="03">3</E> ) <E T="03">Special rule for reformations of trusts that begin by June 8, 1999.</E> Notwithstanding paragraph (a)(1)(i)( <E T="03">f</E> )( <E T="03">2</E> ) of this section, if a trust either provides for payment of the unitrust amount under a combination of methods that is not permitted under paragraph (a)(1)(i)( <E T="03">c</E> ) of this section, or provides for payment of the unitrust amount under only the method prescribed in paragraph (a)(1)(i)( <E T="03">b</E> ) of this section, then the trust may be reformed to allow for a combination of methods permitted under paragraph (a)(1)(i)( <E T="03">c</E> ) of this section without causing the trust to fail to function exclusively as a charitable remainder unitrust under § 1.664-1(a)(4) or to engage in an act of self-dealing under section 4941 if the trustee begins legal proceedings to reform by June 8, 1999. The triggering event under the reformed governing instrument may not occur in a year prior to the year in which the court issues the order reforming the trust, except for situations in which the governing instrument prior to reformation already provided for payment of the unitrust amount under a combination of methods that is not permitted under paragraph (a)(1)(i)( <E T="03">c</E> ) of this section and the triggering event occurred prior to the reformation. </P> <P> ( <E T="03">g</E> ) <E T="03">Payment under general rule for fixed percentage trusts.</E> When the unitrust amount is computed under paragraph (a)(1)(i)( <E T="03">a</E> ) of this section, a trust will not be deemed to have engaged in an act of self-dealing (within the meaning of section 4941), to have unrelated debt-financed income (within the meaning of section 514), to have received an additional contribution (within the meaning of paragraph (b) of this section), or to have failed to function exclusively as a charitable remainder trust (within the meaning of § 1.664-1(a)(4)) merely because the unitrust amount is paid after the close of the taxable year if such payment is made within a reasonable time after the close of such taxable year and the entire unitrust amount in the hands of the recipient is characterized only as income from the categories described in section 664(b)(1), (2), or (3), except to the extent it is characterized as corpus described in section 664(b)(4) because— </P> <P> ( <E T="03">1</E> ) The trust pays the unitrust amount by distributing property (other than cash) that it owned at the close of the taxable year, and the trustee elects to treat any income generated by the distribution as occurring on the last day of the taxable year in which the unitrust amount is due; </P> <P> ( <E T="03">2</E> ) The trust pays the unitrust amount by distributing cash that was contributed to the trust (with respect <PRTPAGE P="176"/> to which a deduction was allowable under section 170, 2055, 2106, or 2522); or </P> <P> ( <E T="03">3</E> ) The trust pays the unitrust amount by distributing cash received as a return of basis in any asset that was contributed to the trust (with respect to which a deduction was allowable under section 170, 2055, 2106, or 2522), and that is sold by the trust during the year for which the unitrust amount is due. </P> <P> ( <E T="03">h</E> ) <E T="03">Special rule for fixed percentage trusts created before December 10, 1998.</E> When the unitrust amount is computed under paragraph (a)(1)(i)( <E T="03">a</E> ) of this section, a trust created before December 10, 1998, will not be deemed to have engaged in an act of self-dealing (within the meaning of section 4941), to have unrelated debt-financed income (within the meaning of section 514), to have received an additional contribution (within the meaning of paragraph (b) of this section), or to have failed to function exclusively as a charitable remainder trust (within the meaning of § 1.664-1(a)(4)) merely because the unitrust amount is paid after the close of the taxable year if such payment is made within a reasonable time after the close of such taxable year and the fixed percentage to be paid each year as the unitrust amount is 15 percent or less of the net fair market value of the trust assets as determined under paragraph (a)(1)(iv) of this section. </P> <P> ( <E T="03">i</E> ) <E T="03">Example.</E> The following example illustrates the rules in paragraph (a)(1)(i)( <E T="03">g</E> ) of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example. X</HD> <P> is a charitable remainder unitrust that calculates the unitrust amount under paragraph (a)(1)(i)( <E T="03">a</E> ) of this section. <E T="03">X</E> was created after December 10, 1998. The prorated unitrust amount payable from <E T="03">X</E> for Year 1 is $100. The trustee does not pay the unitrust amount to the recipient by the end of the Year 1. At the end of Year 1, <E T="03">X</E> has only $95 in the ordinary income category under section 664(b)(1) and no income in the capital gain or tax-exempt income categories under section 664(b) (2) or (3), respectively. By April 15 of Year 2, in addition to $95 in cash, the trustee distributes to the unitrust recipient a capital asset with a $5 fair market value and a $2 adjusted basis to pay the $100 unitrust amount due for Year 1. The trust owned the asset at the end of Year 1. Under § 1.664-1(d)(5), the distribution is treated as a sale by <E T="03">X,</E> resulting in <E T="03">X</E> recognizing a $3 capital gain. The trustee elects to treat the capital gain as occurring on the last day of Year 1. Under § 1.664-1(d)(1), the character of the unitrust amount for Year 1 in the recipient's hands is $95 of ordinary income, $3 of capital gain income, and $2 of trust corpus. For Year 1, <E T="03">X</E> satisfied paragraph (a)(1)(i)( <E T="03">g</E> ) of this section. </P> </EXAMPLE> <P> ( <E T="03">j</E> ) <E T="03">Payment under income exception.</E> When the unitrust amount is computed under paragraph (a)(1)(i)( <E T="03">b</E> ) of this section, a trust will not be deemed to have engaged in an act of self-dealing (within the meaning of section 4941), to have unrelated debt-financed income (within the meaning of section 514), to have received an additional contribution (within the meaning of paragraph (b) of this section), or to have failed to function exclusively as a charitable remainder trust (within the meaning of § 1.664-1(a)(4)) merely because payment of the unitrust amount is made after the close of the taxable year if such payment is made within a reasonable time after the close of such taxable year. </P> <P> ( <E T="03">k</E> ) <E T="03">Reasonable time.</E> For paragraphs (a)(1)(i) ( <E T="03">g</E> ), ( <E T="03">h</E> ), and ( <E T="03">j</E> ) of this section, a reasonable time will not ordinarily extend beyond the date by which the trustee is required to file Form 5227, “Split-Interest Trust Information Return,” (including extensions) for the taxable year. </P> <P> ( <E T="03">l</E> ) <E T="03">Effective date.</E> Paragraphs (a)(1)(i) ( <E T="03">g</E> ), ( <E T="03">h</E> ), ( <E T="03">i</E> ), ( <E T="03">j</E> ), and ( <E T="03">k</E> ) of this section are applicable for taxable years ending after April 18, 1997. Paragraphs (a)(1)(i)( <E T="03">g</E> )( <E T="03">2</E> ) and ( <E T="03">3</E> ) apply only to distributions made on or after January 5, 2001. </P> <P> (ii) <E T="03">Definition of fixed percentage.</E> The fixed percentage may be expressed either as a fraction or as a percentage and must be payable each year in the period specified in subparagraph (5) of this paragraph. A percentage is fixed if the percentage is the same either as to each recipient or as to the total percentage payable each year of such period. For example, provision for a fixed percentage which is the same every year to A until his death and concurrently a fixed percentage which is the same every year to B until his death, the fixed percentage to each recipient to terminate at his death, would satisfy the rule. Similarly, provision for a fixed percentage to A and B for their joint lives and then to the survivor <PRTPAGE P="177"/> would satisfy the rule. In the case of a distribution to an organization described in section 170(c) at the death of a recipient or the expiration of a term of years, the governing instrument may provide for a reduction of the fixed percentage payable after such distribution <E T="03">Provided</E> That: </P> <P> ( <E T="03">a</E> ) The reduced fixed percentage is the same either as to each recipient or as to the total amount payable for each year of the balance of such period, and </P> <P> ( <E T="03">b</E> ) The requirements of subparagraph (2)(ii) of this paragraph are met. </P> <P> (iii) <E T="03">Rules applicable to incorrect valuations.</E> The governing instrument provides that in the case where the net fair market value of the trust assets is incorrectly determined by the fiduciary, the trust shall pay to the recipient (in the case of an undervaluation) or be repaid by the recipient (in the case of an overvaluation) an amount equal to the difference between the amount which the trust should have paid the recipient if the correct value were used and the amount which the trust actually paid the recipient. Such payments or repayments must be made within a reasonable period after the final determination of such value. Any payment due to a recipient by reason of such incorrect valuation shall be considered to be a payment required to be distributed at the time of such final determination for purposes of paragraph (d)(4)(ii) of § 1.664-1. See paragraph (d)(4) of § 1.664-1 for rules relating to the year of inclusion of such payments and the allowance of a deduction for such repayments. See paragraph (b) of this section for rules relating to additional contributions. </P> <P> (iv) <E T="03">Rules applicable to valuation.</E> In computing the net fair market value of the trust assets there shall be taken into account all assets and liabilities without regard to whether particular items are taken into account in determining the income of the trust. The net fair market value of the trust assets may be determined on any one date during the taxable year of the trust, or by taking the average of valuations made on more than one date during the taxable year of the trust, so long as the same valuation date or dates and valuation methods are used each year. If the governing instrument does not specify the valuation date or dates, the trustee must select such date or dates and indicate the selection on the first return on Form 5227, “Split-Interest Trust Information Return,” that the trust must file. The amount described in subdivision (i)( <E T="03">a</E> ) of this subparagraph which must be paid each year must be based upon the valuation for such year. </P> <P> (v) <E T="03">Computation of unitrust amount in certain circumstances—(a) Short taxable years.</E> The governing instrument provides that, in the case of a taxable year which is for a period of less than 12 months other than the taxable year in which occurs the end of the period specified in subparagraph (5) of this paragraph: </P> <P> ( <E T="03">1</E> ) The amount determined under subdivision (i)( <E T="03">a</E> ) of this subparagraph shall be the amount otherwise determined under that subdivision multiplied by a fraction the numerator of which is the number of days in the taxable year of the trust and the denominator of which is 365 (366 if February 29 is a day included in the numerator), </P> <P> ( <E T="03">2</E> ) The amount determined under subdivision (i)( <E T="03">b</E> ) of this subparagraph shall be computed by using the amount determined under subdivision ( <E T="03">a</E> )( <E T="03">1</E> ) of this subdivision (v), and </P> <P> ( <E T="03">3</E> ) If no valuation date occurs before the end of the taxable year of the trust, the trust assets shall be valued as of the last day of the taxable year of the trust. </P> <P> ( <E T="03">b</E> ) <E T="03">Last taxable year of period.</E> ( <E T="03">1</E> ) The governing instrument provides that, in the case of the taxable year in which occurs the end of the period specified in subparagraph (5) of this paragraph: </P> <P> ( <E T="03">i</E> ) The unitrust amount which must be distributed under subdivision (i)( <E T="03">a</E> ) of this subparagraph shall be the amount otherwise determined under that subdivision multiplied by a fraction the numerator of which is the number of days in the period beginning on the first day of such taxable year and ending on the last day of the period specified in subparagraph (5) of this paragraph and the denominator of which is 365 (366 if February 29 is a day included in the numerator), </P> <P> ( <E T="03">ii</E> ) The amount determined under subdivision (i)( <E T="03">b</E> ) of this subparagraph shall be computed by using the amount <PRTPAGE P="178"/> determined under ( <E T="03">b</E> )( <E T="03">1</E> )( <E T="03">i</E> ) of this subdivision (v), and </P> <P> ( <E T="03">iii</E> ) If no valuation date occurs before the end of such period, the trust assets shall be valued as of the last day of such period. </P> <P> ( <E T="03">2</E> ) See subparagraph (5) of this paragraph for a special rule allowing termination of payment of the unitrust amount with the regular payment next preceding the termination of the period specified therein. </P> <P> (2) <E T="03">Minimum unitrust amount</E> —(i) <E T="03">General rule.</E> The fixed percentage described in subparagraph (1)(i) of this paragraph with respect to all beneficiaries taken together is not less than 5 percent. </P> <P> (ii) <E T="03">Reduction of unitrust amount in certain cases.</E> A trust will not fail to meet the requirements of this subparagraph by reason of the fact that it provides for a reduction of the fixed percentage payable upon the death of a recipient or the expiration of a term of years <E T="03">Provided</E> That: </P> <P> ( <E T="03">a</E> ) A distribution is made to an organization described in section 170(c) at the death of such recipient or the expiration of such term of years, and </P> <P> ( <E T="03">b</E> ) The total of the percentage payable under subparagraph (1) of this paragraph after such distribution is not less than 5 percent. </P> <P> (3) <E T="03">Permissible recipients</E> —(i) <E T="03">General rule.</E> The amount described in subparagraph (1) of this paragraph is payable to or for the use of a named person or persons, at least one of which is not an organization described in section 170(c). If the amount described in subparagraph (1) of this paragraph is to be paid to an individual or individuals, all such individuals must be living at the time of creation of the trust. A named person or persons may include members of a named class except in the case of a class which includes any individual, all such individuals must be alive and ascertainable at the time of the creation of the trust unless the period for which the unitrust amount is to be paid to such class consists solely of a term of years. For example, in the case of a testamentary trust, the testator's will may provide that the required amount shall be paid to his children living at his death. </P> <P> (ii) <E T="03">Power to alter amount paid to recipients.</E> A trust is not a charitable remainder unitrust if any person has the power to alter the amount to be paid to any named person other than an organization described in section 170(c) if such power would cause any person to be treated as the owner of the trust, or any portion thereof, if subpart E, part 1, subchapter J, chapter 1, subtitle A of the Code were applicable to such trust. See paragraph (a)(4) of this section for a rule permitting the retention by a grantor of a testamentary power to revoke or terminate the interest of any recipient other than an organization described in section 170(c). For example, the governing instrument may not grant the trustee the power to allocate the fixed percentage among members of a class unless such power falls within one of the exceptions to section 674(a). </P> <P> (4) <E T="03">Other payments.</E> No amount other than the amount described in subparagraph (1) of this paragraph may be paid to or for the use of any person other than an organization described in section 170(c). An amount is not paid to or for the use of any person other than an organization described in section 170(c) if the amount is transferred for full and adequate consideration. The trust may not be subject to a power to invade, alter, amend, or revoke for the beneficial use of a person other than an organization described in section 170(c). Notwithstanding the preceding sentence, the grantor may retain the power exercisable only by will to revoke or terminate the interest of any recipient other than an organization described in section 170(c). The governing instrument may provide that any amount other than the amount described in subparagraph (1) of this paragraph shall be paid (or may be paid in the discretion of the trustee) to an organization described in section 170(c) provided that, in the case of distributions in kind, the adjusted basis of the property distributed is fairly representative of the adjusted basis of the property available for payment on the date of payment. For example, the governing instrument may provide that a portion of the trust assets may be distributed currently, or upon the death <PRTPAGE P="179"/> of one or more recipients, to an organization described in section 170(c). </P> <P> (5) <E T="03">Period of payment of unitrust amount</E> —(i) <E T="03">General rules.</E> The period for which an amount described in subparagraph (1) of this paragraph is payable begins with the first year of the charitable remainder trust and continues either for the life or lives of a named individual or individuals or for a term of years not to exceed 20 years. Only an individual or an organization described in section 170(c) may receive an amount for the life of an individual. If an individual receives an amount for life, it must be solely for his life. Payment of the amount described in subparagraph (1) of this paragraph may terminate with the regular payment next preceding the termination of the period described in this subparagraph. The fact that the recipient may not receive such last payment shall not be taken into account for purposes of determining the present value of the remainder interest. In the case of an amount payable for a term of years, the length of the term of years shall be ascertainable with certainty at the time of the creation of the trust, except that the term may be terminated by the death of the recipient or by the grantor's exercise by will of a retained power to revoke or terminate the interest of any recipient other than an organization described in section 170(c). In any event, the period may not extend beyond either the life or lives of a named individual or individuals or a term of years not to exceed 20 years. For example, the governing instrument may not provide for the payment of a unitrust amount to A for his life and then to B for a term of years because it is possible for the period to last longer than either the lives of recipients in being at the creation of the trust or a term of years not to exceed 20 years. On the other hand, the governing instrument may provide for the payment of a unitrust amount to A for his life and then to B for his life or a term of years (not to exceed 20 years), whichever is shorter (but not longer), if both A and B are in being at the creation of the trust because it is not possible for the period to last longer than the lives of recipients in being at the creation of the trust. </P> <P> (ii) <E T="03">Relationship to 5 percent requirement.</E> The 5 percent requirement provided in subparagraph (2) of this paragraph must be met until the termination of all of the payments described in subparagraph (1) of this paragraph. For example, the following provisions would satisfy the above rules: </P> <P> ( <E T="03">a</E> ) A fixed percentage of at least 5 percent to A and B for their joint lives and then to the survivor for his life; </P> <P> ( <E T="03">b</E> ) A fixed percentage of at least 5 percent to A for life or for a term of years not longer than 20 years, whichever is longer (or shorter); </P> <P> ( <E T="03">c</E> ) A fixed percentage of at least 5 percent to A for life or for a term of years not longer than 20 years and then to B for life (provided B was living at the creation of the trust); </P> <P> ( <E T="03">d</E> ) A fixed percentage to A for his life and concurrently a fixed percentage to B for his life (the percentage to each recipient to terminate at his death) if the percentage given to each individual is not less than 5 percent; </P> <P> ( <E T="03">e</E> ) A fixed percentage to A for his life and concurrently an equal percentage to B for his life, and at the death of the first to die, the trust to distribute one-half of the then value of its assets to an organization described in section 170(c) if the total of the percentages is not less than 5 percent for the entire period described in this subparagraph. </P> <P> (6) <E T="03">Permissible remaindermen</E> —(i) <E T="03">General rule.</E> At the end of the period specified in subparagraph (5) of this paragraph, the entire corpus of the trust is required to be irrevocably transferred, in whole or in part, to or for the use of one or more organizations described in section 170(c) or retained, in whole or in part, for such use. </P> <P> (ii) <E T="03">Treatment of trust.</E> If all of the trust corpus is to be retained for such use, the taxable year of the trust shall terminate at the end of the period specified in subparagraph (5) of this paragraph and the trust shall cease to be treated as a charitable remainder trust for all purposes. If all or any portion of the trust corpus is to be transferred to or for the use of such organization or organizations, the trustee shall have a reasonable time after the period specified in subparagraph (5) of this paragraph to complete the settlement of the trust. During such time, the trust <PRTPAGE P="180"/> shall continue to be treated as a charitable remainder trust for all purposes, such as section 664, 4947(a)(2), and 4947(b)(3)(B). Upon the expiration of such period, the taxable year of the trust shall terminate and the trust shall cease to be treated as a charitable remainder trust for all purposes. If the trust continues in existence, it will be subject to the provisions of section 4947(a)(1) unless the trust is exempt from taxation under section 501(a). For purposes of determining whether the trust is exempt under section 501(a) as an organization described in section 501(c)(3), the trust shall be deemed to have been created at the time it ceases to be treated as a charitable remainder trust. </P> <P> (iii) <E T="03">Concurrent or successive remaindermen.</E> Where interests in the corpus of the trust are given to more than one organization described in section 170(c) such interests may be enjoyed by them either concurrently or successively. </P> <P> (iv) <E T="03">Alternative remaindermen.</E> The governing instrument shall provide that if an organization to or for the use of which the trust corpus is to be transferred or for the use of which the trust corpus is to be retained is not an organization described in section 170(c) at the time any amount is to be irrevocably transferred to or for the use of such organization, such amount shall be transferred to or for the use of or retained for the use of one or more alternative organizations which are described in section 170(c) at such time. Such alternative organization or organizations may be selected in any manner provided by the terms of the governing instrument. </P> <P> (b) <E T="03">Additional contributions.</E> A trust is not a charitable remainder annuity trust unless its governing instrument either prohibits additional contributions to the trust after the initial contribution or provides that for the taxable year of the trust in which the additional contribution is made: </P> <P>(1) Where no valuation date occurs after the time of the contribution and during the taxable year in which the contribution is made, the additional property shall be valued as of the time of contribution; and</P> <P> (2) The amount described in paragraph (a)(1)(i)( <E T="03">a</E> ) of this section shall be computed by multiplying the fixed percentage by the sum of (i) the net fair market value of the trust assets (excluding the value of the additional property and any earned income from and any appreciation on such property after its contribution), and (ii) that proportion of the value of the additional property (that was excluded under subdivision (i) of this paragraph), which the number of days in the period which begins with the date of contribution and ends with the earlier of the last day of such taxable year or the last day of the period described in paragraph (a)(5) of this section bears to the number of days in the period which begins with the first day of such taxable year and ends with the earlier of the last day of such taxable year or the last day of the period described in paragraph (a)(5) of this section. </P> <FP>For purposes of this section, all property passing to a charitable remainder unitrust by reason of death of the grantor shall be considered one contribution. The application of the preceding rules may be illustrated by the following examples:</FP> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>On March 2, 1971, X makes an additional contribution of property to a charitable remainder unitrust. The taxable year of the trust is the calendar year and the regular valuation date is January 1 of each year. For purposes of computing the required payout with respect to the additional contribution for the year of contribution, the additional contribution is valued on March 2, 1971, the time of contribution. The property had a value on that date of $5,000. Income from such property in the amount of $250 was received on December 31, 1971. The required payout with respect to the additional contribution for the year of contribution is $208 (5 percent × $5,000 × 305/365). The income earned after the date of the contribution and after the regular valuation date does not enter into the computation.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> On July 1, 1971, X makes an additional contribution of $10,000 to a charitable remainder unitrust. The taxable year of the trust is the calendar year and the regular valuation date is December 31 of each year. The fixed percentage is 5 percent. Between July 1, 1971, and December 31, 1971, the additional property appreciates in value to $12,500 and earns $500 of income. Because the <PRTPAGE P="181"/> regular valuation date for the year of contribution occurs after the date of the additional contribution, the additional contribution including income earned by it is valued on the regular valuation date. Thus, the required payout with respect to the additional contribution is $325.87 (5 percent × [$12,500 + $500] × 183/365). </P> </EXAMPLE> <P> (c) <E T="03">Calculation of the fair market value of the remainder interest of a charitable remainder unitrust.</E> See § 1.664-4 for rules relating to the calculation of the fair market value of the remainder interest of a charitable remainder unitrust. </P> <P> (d) <E T="03">Deduction for transfers to a charitable remainder unitrust.</E> For rules relating to a deduction for transfers to a charitable remainder unitrust, see section 170, 2055, 2106, or 2522 and the regulations thereunder. The deduction allowed by section 170 for transfers to charity is limited to the fair market value of the remainder interest of a charitable remainder unitrusts regardless of whether an organization described in section 170(c) also receives a portion of the amount described in § 1.664-3(a)(1). For a special rule relating to the reduction of the amount of a charitable contribution deduction with respect to a contribution of certain ordinary income property or capital gain property, see section 170(e)(1) (A) or (B)(i) and the regulations thereunder. For rules for postponing the time for deduction of a charitable contribution of a future interest in tangible personal property, see section 170(a)(3) and the regulations thereunder. </P> <CITA>[T.D. 7202, 37 FR 16920, Aug. 23, 1972, as amended by T.D. 8791, 63 FR 68192, Dec. 10, 1998; T.D. 8926, 66 FR 1038, Jan. 5, 2001; T.D. 9102, 69 FR 20, Jan. 2, 2004]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.664-4</SECTNO> <SUBJECT>Calculation of the fair market value of the remainder interest in a charitable remainder unitrust.</SUBJECT> <P> (a) <E T="03">Rules for determining present value.</E> For purposes of sections 170, 2055, 2106, and 2522, the fair market value of a remainder interest in a charitable remainder unitrust (as described in § 1.664-3) is its present value determined under paragraph (d) of this section. The present value determined under this section shall be computed on the basis of— </P> <P> (1) Life contingencies determined as to each life involved, from the values of l <E T="52">X</E> set forth in Table 2010CM in § 20.2031-7(d)(7)(ii) of this chapter in the case of transfers for which the valuation date is on or after June 1, 2023; or from Table 2000CM contained in § 20.2031-7A(g)(4) of this chapter in the case of transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023. See § 20.2031-7A(a) through (f) of this chapter, whichever is applicable, for transfers for which the valuation date is before May 1, 2009; </P> <P>(2) Interest at the section 7520 rate in the case of transfers for which the valuation date is after April 30, 1989, or 10 percent in the case of transfers to charitable remainder unitrusts made after November 30, 1983, for which the valuation date is before May 1, 1989. See § 20.2031-7A (a) through (c) of this chapter, whichever is applicable, for transfers for which the valuation date is before December 1, 1983; and</P> <P> (3) The assumption that the amount described in § 1.664-3(a)(1)( <E T="03">i</E> )( <E T="03">a</E> ) is distributed in accordance with the payout sequence described in the governing instrument. If the governing instrument does not prescribe when the distribution is made during the period for which the payment is made, for purposes of this section, the distribution is considered payable on the first day of the period for which the payment is made. </P> <P> (b) <E T="03">Actuarial Computations by the Internal Revenue Service.</E> The regulations in this and in related sections provide tables of actuarial factors and examples that illustrate the use of the tables in determining the value of remainder interests in property. Section 1.7520-1(c)(2) refers to government publications that provide additional tables of factors and examples of computations for more complex situations. If the computation requires the use of a factor that is not provided in this section, the Commissioner may supply the factor upon a request for a ruling. A request for a ruling must be accompanied by a recitation of the facts including the date of birth of each measuring life, and copies of the relevant documents. A request for a ruling must comply with the instructions for requesting a ruling published periodically in the Internal Revenue Bulletin (See § 601.601(d)(2)(ii)( <E T="03">b</E> ) of this chapter) <PRTPAGE P="182"/> and include payment of the required user fee. If the Commissioner furnishes the factor, a copy of the letter supplying the factor should be attached to the tax return in which the deduction is claimed. If the Commissioner does not furnish the factor, the taxpayer must furnish a factor computed in accordance with the principles set forth in this section. </P> <P> (c) <E T="03">Statement supporting deduction required.</E> Any claim for a deduction on any return for the value of a remainder interest in a charitable remainder unitrust must be supported by a full statement attached to the return showing the computation of the present value of such interest. </P> <P> (d) <E T="03">Valuation.</E> The fair market value of a remainder interest in a charitable remainder unitrust (as described in § 1.664-3) for transfers for which the valuation date is on or after June 1, 2023, is its present value determined under paragraph (e) of this section. The fair market value of a remainder interest in a charitable remainder unitrust (as described in § 1.664-3) for transfers for which the valuation date is before June 1, 2023, is its present value determined under the following sections: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,10,15"> <TTITLE> Table 1 to Paragraph <E T="01">(d)</E> </TTITLE> <BOXHD> <CHED H="1">Valuation dates</CHED> <CHED H="2">After</CHED> <CHED H="2">Before</CHED> <CHED H="1"> Applicable <LI>regulations</LI> </CHED> </BOXHD> <ROW> <ENT I="22"> </ENT> <ENT>01-01-52</ENT> <ENT>1.664-4A(a)</ENT> </ROW> <ROW> <ENT I="01">12-31-51</ENT> <ENT>01-01-71</ENT> <ENT>1.664-4A(b)</ENT> </ROW> <ROW> <ENT I="01">12-31-70</ENT> <ENT>12-01-83</ENT> <ENT>1.664-4A(c)</ENT> </ROW> <ROW> <ENT I="01">11-30-83</ENT> <ENT>05-01-89</ENT> <ENT>1.664-4A(d)</ENT> </ROW> <ROW> <ENT I="01">04-30-89</ENT> <ENT>05-01-99</ENT> <ENT>1.664-4A(e)</ENT> </ROW> <ROW> <ENT I="01">04-30-99</ENT> <ENT>05-01-09</ENT> <ENT>1.664-4A(f)</ENT> </ROW> <ROW> <ENT I="01">04-30-09</ENT> <ENT>06-01-23</ENT> <ENT>1.664-4A(g)</ENT> </ROW> </GPOTABLE> <P> (e) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is on or after June 1, 2023</E> —(1) <E T="03">In general.</E> Except as otherwise provided in paragraph (e)(2) of this section, in the case of transfers for which the valuation date is on or after June 1, 2023, the present value of a remainder interest is determined under paragraphs (e)(3) through (7) of this section, provided that, in a short taxable year, the trustee must prorate the unitrust amount as provided in § 1.664-3(a)(1)(v). See, however, § 1.7520-3(b) (relating to exceptions to the use of the prescribed tables under certain circumstances). </P> <P> (2) <E T="03">Transitional rule for valuation of charitable remainder unitrusts.</E> For purposes of section 170, 2055, 2106, 2522, or 2624, in the case of transfers to a charitable remainder unitrust for which the valuation date is after April 30, 2019, and on or before June 1, 2023, the present value of a remainder interest based on one or more measuring lives is determined under this section by using the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial factors derived from the selected mortality table, either Table 2010CM in § 20.2031-7(d)(7)(ii) of this chapter or Table 2000CM in § 20.2031-7A(g)(4) of this chapter, at the option of the donor or the decedent's executor, as the case may be. If any previously filed income tax return is amended to use the actuarial factors based on Table 2010CM, the amended return must state at the top “AMENDED PURSUANT TO TD 9974.” If any previously filed gift or estate tax return is supplemented to use the actuarial factors based on Table 2010CM, the supplemental return must state at the top “SUPPLEMENTED PURSUANT TO TD 9974.” For the convenience of taxpayers, actuarial factors based on Table 2010CM appear in the current version of Table U(1), and actuarial factors based on Table 2000CM appear in the previous version of Table U(1). Both versions of Table U(1) currently are available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). The donor or decedent's executor must consistently use the same mortality basis with respect to each interest (income, remainder, partial, etc.) in the same property, and with respect to all transfers occurring on the same valuation date. For example, gift and income tax charitable deductions with respect to the same transfer must be determined based on factors with the same mortality basis, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on factors with the same mortality basis. <PRTPAGE P="183"/> </P> <P> (3) <E T="03">Adjusted payout rate.</E> For transfers for which the valuation date is after April 30, 1989, the adjusted payout rate is determined by using the appropriate Table F in paragraph (e)(6) of this section, for the section 7520 interest rate applicable to the transfer. If the interest rate is between 4.2 and 14 percent, see paragraph (e)(6) of this section. If the interest rate is below 4.2 percent or greater than 14 percent, see paragraph (b) of this section. The adjusted payout rate is determined by multiplying the fixed percentage described in § 1.664-3(a)(1)(i)( <E T="03">a</E> ) by the factor describing the payout sequence of the trust and the number of months by which the valuation date for the first full taxable year of the trust precedes the first payout date for such taxable year. If the governing instrument does not prescribe when the distribution or distributions shall be made during the taxable year of the trust, see paragraph (a) of this section. In the case of a trust having a payout sequence for which no figures have been provided by the appropriate table, and in the case of a trust that determines the fair market value of the trust assets by taking the average of valuations on more than one date during the taxable year, see paragraph (b) of this section. </P> <P> (4) <E T="03">Period is a term of years.</E> If the period described in § 1.664-3(a)(5) is a term of years, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is after November 30, 1983, is the factor under the appropriate adjusted payout rate in Table D of paragraph (e)(6) of this section corresponding to the number of years in the term. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in Table D, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph. For purposes of this section, the valuation date is, in the case of an inter vivos transfer, the date on which the property is transferred to the trust by the donor. However, if an election is made under section 7520 and § 1.7520-2(b) to compute the present value of the charitable interest by use of the interest rate component for either of the 2 months preceding the month in which the date of transfer falls, the month so elected is the valuation date for purposes of determining the interest rate and mortality tables. In the case of a testamentary transfer under section 2055, 2106, or 2624, the valuation date is the date of death, unless the alternate valuation date is elected under section 2032, in which event, and within the limitations set forth in section 2032 and the regulations thereunder, the valuation date is the alternate valuation date. If the decedent's estate elects the alternate valuation date under section 2032 and also elects, under section 7520 and § 1.7520-2(b), to use the interest rate component for one of the 2 months preceding the alternate valuation date, the month so elected is the valuation date for purposes of determining the interest rate and mortality tables. The application of this paragraph (e)(4) may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>D transfers $100,000 to a charitable remainder unitrust on January 1. The trust instrument requires that the trust pay 8 percent of the fair market value of the trust assets as of January 1st for a term of 12 years to D in quarterly payments (March 31, June 30, September 30, and December 31). The section 7520 rate for January (the month that the transfer occurred) is 9.6 percent. Under Table F(9.6) in paragraph (e)(6) of this section, the appropriate adjustment factor is .944628 for quarterly payments payable at the end of each quarter. The adjusted payout rate is 7.557 (8% × .944628). Based on the remainder factors in Table D in paragraph (e)(6) of this section, the present value of the remainder interest is $38,950.30, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,8"> <ROW> <ENT I="01">Factor at 7.4 percent for 12 years</ENT> <ENT>.397495</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Factor at 7.6 percent for 12 years</ENT> <ENT>.387314</ENT> </ROW> <ROW> <ENT I="02">Difference</ENT> <ENT>.010181</ENT> </ROW> </GPOTABLE> <P>Interpolation adjustment:</P> <MATH SPAN="1" DEEP="54"> <MID>ER12JN00.002</MID> </MATH> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,8"> <ROW> <ENT I="01">Factor at 7.4 percent for 12 years</ENT> <ENT>.397495</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Interpolation adjustment</ENT> <ENT>.007992</ENT> </ROW> <ROW> <PRTPAGE P="184"/> <ENT I="02">Interpolated factor</ENT> <ENT>.389503</ENT> </ROW> </GPOTABLE> <P>Present value of remainder interest:</P> <FP SOURCE="FP-2">($100,000 × .389503)..........$38,950.30</FP> </EXAMPLE> <P> (5) <E T="03">Period is the life of one individual</E> —(i) <E T="03">Factor.</E> If the period described in § 1.664-3(a)(5) is the life of one individual, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is on or after June 1, 2023, is the factor obtained through the use of the formula in Figure 1 to this paragraph (e)(5)(i) to at least five decimal places. The prescribed mortality table is Table 2010CM as set forth in § 20.2031-7(d)(7)(ii) of this chapter, or for periods before June 1, 2023, the appropriate table found in § 20.2031-7A of this chapter. Table 2010CM is referenced by IRS Publication 1458, <E T="03">Actuarial Values Version 4B.</E> The mortality tables prescribed for periods before June 1, 2023, are referenced by prior versions of IRS Publication 1458. Alternatively, the remainder factors have been determined for the convenience of taxpayers and appear in Table U(1) under the appropriate adjusted payout rate. Table U(1) currently is available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Table U(1) is referenced and explained by IRS Publication 1458, <E T="03">Actuarial Valuations Version 4B,</E> which will be available within a reasonable time after June 1, 2023. For purposes of the computations described in this paragraph (e)(5), the age of an individual is the age of that individual at the individual's nearest birthday. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in the appropriate table, an exact method of obtaining the applicable remainder factors (such as through software using the actual adjusted payout rate and the actuarial formula in this paragraph (e)(5)) or a linear interpolation must be used, provided whichever method used is applied consistently in valuing all interests in the same property. The applicable remainder factors derived by an exact method or by interpolation must be expressed to at least five decimal places. The present value of the remainder interest is determined by multiplying the net fair market value (as of the valuation date as determined in § 1.664-4(e)(4)) of the property placed in trust by the factor determined under this paragraph (e)(5). If the adjusted payout rate is from 0.2 to 20.0 percent, inclusive, taxpayers may see the actuarial tables referenced and explained by IRS Publication 1458, <E T="03">Actuarial Valuations Version 4B.</E> Alternatively, the Commissioner may supply a factor upon a request for a ruling. See paragraph (b) of this section. </P> <HD SOURCE="HD1">Figure 1 to Paragraph (e)(5)(i)—Formula for Determining Unitrust Remainder Factors</HD> <GPH SPAN="2" DEEP="173"> <PRTPAGE P="185"/> <GID>ER07JN23.008</GID> </GPH> <P> (ii) <E T="03">Sample factors from actuarial Table U(1).</E> For purposes of the example in paragraph (e)(5)(iii) of this section, the following factors from Table U(1) and Table F(3.2) (see paragraph (e)(6)(ii) of this section) will be used: </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s50,12,12,12"> <TTITLE> Table 2 to Paragraph <E T="01">(e)(5)(ii)</E> </TTITLE> <TTITLE>Factors From Table U(1)—Based on Table 2010CM</TTITLE> <BOXHD> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">Age</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> </BOXHD> <ROW RUL="s"> <ENT I="01">77</ENT> <ENT>0.61491</ENT> <ENT>0.60343</ENT> <ENT>0.59223</ENT> </ROW> <ROW EXPSTB="03"> <ENT I="21"> <E T="02">Factors from Table F(3.2)</E> </ENT> </ROW> <ROW RUL="s"> <ENT I="21"> <E T="02">Factors for Computing Adjusted Payout Rates for Unitrusts</E> </ENT> </ROW> <ROW EXPSTB="03" RUL="s"> <ENT I="21"> <E T="02">Interest at 3.2 Percent</E> </ENT> </ROW> <ROW EXPSTB="01" RUL="s"> <ENT I="21"># of Months from Annual Valuation to First Payout</ENT> <ENT A="01">Adjustment Factors for Payments at End of Period</ENT> </ROW> <ROW EXPSTB="00" RUL="s"> <ENT I="21">At Least</ENT> <ENT O="oi0">But Less Than</ENT> <ENT O="oi0">Annual</ENT> <ENT O="oi0">Semiannual</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>7</ENT> <ENT>0.984374</ENT> <ENT>0.976683</ENT> </ROW> </GPOTABLE> <P> (iii) <E T="03">Example of interpolation.</E> After June 1, 2023, A, whose age is 76 years and 11 months, transfers $100,000 to a charitable remainder unitrust on January 1st. The trust instrument requires that the trust pay to A semiannually (on June 30 and December 31) 5 percent of the fair market value of the trust assets as of January 1st during A's life. The section 7520 rate for January is 3.2 percent. Under Table F(3.2), the appropriate adjustment factor is 0.976683 for semiannual payments payable at the end of the semiannual period. The adjusted payout rate is 4.883% (5% × 0.976683). Based on interpolating between the remainder factors in Table U(1), the present value of the remainder interest is $61,015, computed as illustrated in Figure 2 to this paragraph (e)(5)(iii). </P> <HD SOURCE="HD1">Figure 2 to Paragraph (e)(5)(iii)—Illustration of Unitrust Interpolation Method</HD> <GPH SPAN="2" DEEP="273"> <PRTPAGE P="186"/> <GID>ER07JN23.009</GID> </GPH> <P> (6) <E T="03">Actuarial Table D and Tables F(0.2) through F(20.0) for transfers for which the valuation date is on or after May 1, 1989</E> —(i) <E T="03">Remainder factors for charitable remainder unitrusts.</E> For transfers for which the valuation date is on or after May 1, 1989, the present value of a charitable remainder unitrust interest that is dependent upon a term of years is determined by using the formula in Figure 3 to this paragraph (e)(6)(i) and calculating the final result to at least six decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table D. Table D can be found on the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Table D is referenced and explained in IRS Publication 1458, <E T="03">Actuarial Valuations Version 4B,</E> which will be available within a reasonable time after June 1, 2023. The remainder factors from Table D also can be found in paragraph (e)(6)(iii) of this section, but only for adjusted payout rates from 4.2 to 14 percent, inclusive. For transfers for which the valuation date is on or after June 1, 2023, where the present value of a charitable remainder unitrust interest is dependent on the termination of a life interest, see paragraph (e)(5) of this section. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). </P> <HD SOURCE="HD1">Figure 3 to Paragraph (e)(6)(i)—Formula for Determining Term Certain Unitrust Remainder Factors</HD> <GPH SPAN="2" DEEP="85"> <PRTPAGE P="187"/> <GID>ER07JN23.010</GID> </GPH> <P> (ii) <E T="03">Unitrust payout rate adjustment factors.</E> For transfers for which the valuation date is on or after May 1, 1989, the unitrust payout rate adjustment factors are determined by using the formula in Figure 4 to this paragraph (e)(6)(ii) and calculating the final result to at least six decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS, for interest rates from 0.2 to 20 percent, inclusive, and appear in Tables F(0.2) through F(20.0). Tables F(0.2) through F(20.0) can be found on the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Tables F(0.2) through F(20.0) are referenced and explained in IRS Publication 1458, <E T="03">Actuarial Valuations Version 4B,</E> which will be available within a reasonable time after June 1, 2023. The factors from Table F also can be found in paragraph (e)(6)(iii) of this section, but only for interest rates from 4.2 to 14 percent, inclusive. </P> <HD SOURCE="HD1">Figure 4 to Paragraph (e)(6)(ii)—Formula for Determining Unitrust Payout Rate Adjustment Factors</HD> <GPH SPAN="2" DEEP="135"> <GID>ER07JN23.011</GID> </GPH> <P> (iii) <E T="03">Table D and Tables F(4.2) through F(14.0).</E> The unitrust remainder factors from Table D, for interest rates from 4.2 to 14 percent, inclusive, and the unitrust payout factors from Tables F(4.2) through F(14.0) are as follows: </P> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table D—Showing the Present Worth of a Remainder Interest Postponed for a Term Certain in a Charitable Remainder Unitrust</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Years</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">1</ENT> <ENT>.958000</ENT> <ENT>.956000</ENT> <ENT>.954000</ENT> <ENT>.952000</ENT> <ENT>.950000</ENT> <ENT>.948000</ENT> <ENT>.946000</ENT> <ENT>.944000</ENT> <ENT>.942000</ENT> <ENT>.940000</ENT> </ROW> <ROW> <PRTPAGE P="188"/> <ENT I="01">2</ENT> <ENT>.917764</ENT> <ENT>.913936</ENT> <ENT>.910116</ENT> <ENT>.906304</ENT> <ENT>.902500</ENT> <ENT>.898704</ENT> <ENT>.894916</ENT> <ENT>.891136</ENT> <ENT>.887364</ENT> <ENT>.883600</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.879218</ENT> <ENT>.873723</ENT> <ENT>.868251</ENT> <ENT>.862801</ENT> <ENT>.857375</ENT> <ENT>.851971</ENT> <ENT>.846591</ENT> <ENT>.841232</ENT> <ENT>.835897</ENT> <ENT>.830584</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.842291</ENT> <ENT>.835279</ENT> <ENT>.828311</ENT> <ENT>.821387</ENT> <ENT>.814506</ENT> <ENT>.807669</ENT> <ENT>.800875</ENT> <ENT>.794123</ENT> <ENT>.787415</ENT> <ENT>.780749</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.806915</ENT> <ENT>.798527</ENT> <ENT>.790209</ENT> <ENT>.781960</ENT> <ENT>.773781</ENT> <ENT>.765670</ENT> <ENT>.757627</ENT> <ENT>.749652</ENT> <ENT>.741745</ENT> <ENT>.733904</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.773024</ENT> <ENT>.763392</ENT> <ENT>.753859</ENT> <ENT>.744426</ENT> <ENT>.735092</ENT> <ENT>.725855</ENT> <ENT>.716716</ENT> <ENT>.707672</ENT> <ENT>.698724</ENT> <ENT>.689870</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.740557</ENT> <ENT>.729802</ENT> <ENT>.719182</ENT> <ENT>.708694</ENT> <ENT>.698337</ENT> <ENT>.688111</ENT> <ENT>.678013</ENT> <ENT>.668042</ENT> <ENT>.658198</ENT> <ENT>.648478</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.709454</ENT> <ENT>.697691</ENT> <ENT>.686099</ENT> <ENT>.674677</ENT> <ENT>.663420</ENT> <ENT>.652329</ENT> <ENT>.641400</ENT> <ENT>.630632</ENT> <ENT>.620022</ENT> <ENT>.609569</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.679657</ENT> <ENT>.666993</ENT> <ENT>.654539</ENT> <ENT>.642292</ENT> <ENT>.630249</ENT> <ENT>.618408</ENT> <ENT>.606765</ENT> <ENT>.595317</ENT> <ENT>.584061</ENT> <ENT>.572995</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.651111</ENT> <ENT>.637645</ENT> <ENT>.624430</ENT> <ENT>.611462</ENT> <ENT>.598737</ENT> <ENT>.586251</ENT> <ENT>.573999</ENT> <ENT>.561979</ENT> <ENT>.550185</ENT> <ENT>.538615</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.623764</ENT> <ENT>.609589</ENT> <ENT>.595706</ENT> <ENT>.582112</ENT> <ENT>.568800</ENT> <ENT>.555766</ENT> <ENT>.543003</ENT> <ENT>.530508</ENT> <ENT>.518275</ENT> <ENT>.506298</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.597566</ENT> <ENT>.582767</ENT> <ENT>.568304</ENT> <ENT>.554170</ENT> <ENT>.540360</ENT> <ENT>.526866</ENT> <ENT>.513681</ENT> <ENT>.500800</ENT> <ENT>.488215</ENT> <ENT>.475920</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.572469</ENT> <ENT>.557125</ENT> <ENT>.542162</ENT> <ENT>.527570</ENT> <ENT>.513342</ENT> <ENT>.499469</ENT> <ENT>.485942</ENT> <ENT>.472755</ENT> <ENT>.459898</ENT> <ENT>.447365</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.548425</ENT> <ENT>.532611</ENT> <ENT>.517222</ENT> <ENT>.502247</ENT> <ENT>.487675</ENT> <ENT>.473496</ENT> <ENT>.459701</ENT> <ENT>.446281</ENT> <ENT>.433224</ENT> <ENT>.420523</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.525391</ENT> <ENT>.509177</ENT> <ENT>.493430</ENT> <ENT>.478139</ENT> <ENT>.463291</ENT> <ENT>.448875</ENT> <ENT>.434878</ENT> <ENT>.421289</ENT> <ENT>.408097</ENT> <ENT>.395292</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.503325</ENT> <ENT>.486773</ENT> <ENT>.470732</ENT> <ENT>.455188</ENT> <ENT>.440127</ENT> <ENT>.425533</ENT> <ENT>.411394</ENT> <ENT>.397697</ENT> <ENT>.384427</ENT> <ENT>.371574</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.482185</ENT> <ENT>.465355</ENT> <ENT>.449079</ENT> <ENT>.433339</ENT> <ENT>.418120</ENT> <ENT>.403405</ENT> <ENT>.389179</ENT> <ENT>.375426</ENT> <ENT>.362131</ENT> <ENT>.349280</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.461933</ENT> <ENT>.444879</ENT> <ENT>.428421</ENT> <ENT>.412539</ENT> <ENT>.397214</ENT> <ENT>.382428</ENT> <ENT>.368163</ENT> <ENT>.354402</ENT> <ENT>.341127</ENT> <ENT>.328323</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.442532</ENT> <ENT>.425304</ENT> <ENT>.408714</ENT> <ENT>.392737</ENT> <ENT>.377354</ENT> <ENT>.362542</ENT> <ENT>.348282</ENT> <ENT>.334555</ENT> <ENT>.321342</ENT> <ENT>.308624</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.423946</ENT> <ENT>.406591</ENT> <ENT>.389913</ENT> <ENT>.373886</ENT> <ENT>.358486</ENT> <ENT>.343690</ENT> <ENT>.329475</ENT> <ENT>.315820</ENT> <ENT>.302704</ENT> <ENT>.290106</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table D—Showing the Present Worth of a Remainder Interest Postponed for a Term Certain in a Charitable Remainder Unitrust</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Years</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">1</ENT> <ENT>.938000</ENT> <ENT>.936000</ENT> <ENT>.934000</ENT> <ENT>.932000</ENT> <ENT>.930000</ENT> <ENT>.928000</ENT> <ENT>.926000</ENT> <ENT>.924000</ENT> <ENT>.922000</ENT> <ENT>.920000</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.879844</ENT> <ENT>.876096</ENT> <ENT>.872356</ENT> <ENT>.868624</ENT> <ENT>.864900</ENT> <ENT>.861184</ENT> <ENT>.857476</ENT> <ENT>.853776</ENT> <ENT>.850084</ENT> <ENT>.846400</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.825294</ENT> <ENT>.820026</ENT> <ENT>.814781</ENT> <ENT>.809558</ENT> <ENT>.804357</ENT> <ENT>.799179</ENT> <ENT>.794023</ENT> <ENT>.788889</ENT> <ENT>.783777</ENT> <ENT>.778688</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.774125</ENT> <ENT>.767544</ENT> <ENT>.761005</ENT> <ENT>.754508</ENT> <ENT>.748052</ENT> <ENT>.741638</ENT> <ENT>.735265</ENT> <ENT>.728933</ENT> <ENT>.722643</ENT> <ENT>.716393</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.726130</ENT> <ENT>.718421</ENT> <ENT>.710779</ENT> <ENT>.703201</ENT> <ENT>.695688</ENT> <ENT>.688240</ENT> <ENT>.680855</ENT> <ENT>.673535</ENT> <ENT>.666277</ENT> <ENT>.659082</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.681110</ENT> <ENT>.672442</ENT> <ENT>.663867</ENT> <ENT>.655383</ENT> <ENT>.646990</ENT> <ENT>.638687</ENT> <ENT>.630472</ENT> <ENT>.622346</ENT> <ENT>.614307</ENT> <ENT>.606355</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.638881</ENT> <ENT>.629406</ENT> <ENT>.620052</ENT> <ENT>.610817</ENT> <ENT>.601701</ENT> <ENT>.592701</ENT> <ENT>.583817</ENT> <ENT>.575048</ENT> <ENT>.566391</ENT> <ENT>.557847</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.599270</ENT> <ENT>.589124</ENT> <ENT>.579129</ENT> <ENT>.569282</ENT> <ENT>.559582</ENT> <ENT>.550027</ENT> <ENT>.540615</ENT> <ENT>.531344</ENT> <ENT>.522213</ENT> <ENT>.513219</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.562115</ENT> <ENT>.551420</ENT> <ENT>.540906</ENT> <ENT>.530571</ENT> <ENT>.520411</ENT> <ENT>.510425</ENT> <ENT>.500609</ENT> <ENT>.490962</ENT> <ENT>.481480</ENT> <ENT>.472161</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.527264</ENT> <ENT>.516129</ENT> <ENT>.505206</ENT> <ENT>.494492</ENT> <ENT>.483982</ENT> <ENT>.473674</ENT> <ENT>.463564</ENT> <ENT>.453649</ENT> <ENT>.443925</ENT> <ENT>.434388</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.494574</ENT> <ENT>.483097</ENT> <ENT>.471863</ENT> <ENT>.460866</ENT> <ENT>.450104</ENT> <ENT>.439570</ENT> <ENT>.429260</ENT> <ENT>.419171</ENT> <ENT>.409298</ENT> <ENT>.399637</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.463910</ENT> <ENT>.452179</ENT> <ENT>.440720</ENT> <ENT>.429527</ENT> <ENT>.418596</ENT> <ENT>.407921</ENT> <ENT>.397495</ENT> <ENT>.387314</ENT> <ENT>.377373</ENT> <ENT>.367666</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.435148</ENT> <ENT>.423239</ENT> <ENT>.411632</ENT> <ENT>.400320</ENT> <ENT>.389295</ENT> <ENT>.378550</ENT> <ENT>.368081</ENT> <ENT>.357879</ENT> <ENT>.347938</ENT> <ENT>.338253</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.408169</ENT> <ENT>.396152</ENT> <ENT>.384465</ENT> <ENT>.373098</ENT> <ENT>.362044</ENT> <ENT>.351295</ENT> <ENT>.340843</ENT> <ENT>.330680</ENT> <ENT>.320799</ENT> <ENT>.311193</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.382862</ENT> <ENT>.370798</ENT> <ENT>.359090</ENT> <ENT>.347727</ENT> <ENT>.336701</ENT> <ENT>.326002</ENT> <ENT>.315620</ENT> <ENT>.305548</ENT> <ENT>.295777</ENT> <ENT>.286297</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.359125</ENT> <ENT>.347067</ENT> <ENT>.335390</ENT> <ENT>.324082</ENT> <ENT>.313132</ENT> <ENT>.302529</ENT> <ENT>.292264</ENT> <ENT>.282326</ENT> <ENT>.272706</ENT> <ENT>.263394</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.336859</ENT> <ENT>.324855</ENT> <ENT>.313254</ENT> <ENT>.302044</ENT> <ENT>.291213</ENT> <ENT>.280747</ENT> <ENT>.270637</ENT> <ENT>.260870</ENT> <ENT>.251435</ENT> <ENT>.242322</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.315974</ENT> <ENT>.304064</ENT> <ENT>.292579</ENT> <ENT>.281505</ENT> <ENT>.270828</ENT> <ENT>.260533</ENT> <ENT>.250610</ENT> <ENT>.241044</ENT> <ENT>.231823</ENT> <ENT>.222936</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.296383</ENT> <ENT>.284604</ENT> <ENT>.273269</ENT> <ENT>.262363</ENT> <ENT>.251870</ENT> <ENT>.241775</ENT> <ENT>.232065</ENT> <ENT>.222724</ENT> <ENT>.213741</ENT> <ENT>.205101</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.278008</ENT> <ENT>.266389</ENT> <ENT>.255233</ENT> <ENT>.244522</ENT> <ENT>.234239</ENT> <ENT>.224367</ENT> <ENT>.214892</ENT> <ENT>.205797</ENT> <ENT>.197069</ENT> <ENT>.188693</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table D—Showing the Present Worth of a Remainder Interest Postponed for a Term Certain in a Charitable Remainder Unitrust</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Years</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">1</ENT> <ENT>.918000</ENT> <ENT>.916000</ENT> <ENT>.914000</ENT> <ENT>.912000</ENT> <ENT>.910000</ENT> <ENT>.908000</ENT> <ENT>.906000</ENT> <ENT>.904000</ENT> <ENT>.902000</ENT> <ENT>.900000</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.842724</ENT> <ENT>.839056</ENT> <ENT>.835396</ENT> <ENT>.831744</ENT> <ENT>.828100</ENT> <ENT>.824464</ENT> <ENT>.820836</ENT> <ENT>.817216</ENT> <ENT>.813604</ENT> <ENT>.810000</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.773621</ENT> <ENT>.768575</ENT> <ENT>.763552</ENT> <ENT>.758551</ENT> <ENT>.753571</ENT> <ENT>.748613</ENT> <ENT>.743677</ENT> <ENT>.738763</ENT> <ENT>.733871</ENT> <ENT>.729000</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.710184</ENT> <ENT>.704015</ENT> <ENT>.697886</ENT> <ENT>.691798</ENT> <ENT>.685750</ENT> <ENT>.679741</ENT> <ENT>.673772</ENT> <ENT>.667842</ENT> <ENT>.661951</ENT> <ENT>.656100</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.651949</ENT> <ENT>.644878</ENT> <ENT>.637868</ENT> <ENT>.630920</ENT> <ENT>.624032</ENT> <ENT>.617205</ENT> <ENT>.610437</ENT> <ENT>.603729</ENT> <ENT>.597080</ENT> <ENT>.590490</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.598489</ENT> <ENT>.590708</ENT> <ENT>.583012</ENT> <ENT>.575399</ENT> <ENT>.567869</ENT> <ENT>.560422</ENT> <ENT>.553056</ENT> <ENT>.545771</ENT> <ENT>.538566</ENT> <ENT>.531441</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.549413</ENT> <ENT>.541089</ENT> <ENT>.532873</ENT> <ENT>.524764</ENT> <ENT>.516761</ENT> <ENT>.508863</ENT> <ENT>.501069</ENT> <ENT>.493377</ENT> <ENT>.485787</ENT> <ENT>.478297</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.504361</ENT> <ENT>.495637</ENT> <ENT>.487046</ENT> <ENT>.478585</ENT> <ENT>.470253</ENT> <ENT>.462048</ENT> <ENT>.453968</ENT> <ENT>.446013</ENT> <ENT>.438180</ENT> <ENT>.430467</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.463003</ENT> <ENT>.454004</ENT> <ENT>.445160</ENT> <ENT>.436469</ENT> <ENT>.427930</ENT> <ENT>.419539</ENT> <ENT>.411295</ENT> <ENT>.403196</ENT> <ENT>.395238</ENT> <ENT>.387420</ENT> </ROW> <ROW> <PRTPAGE P="189"/> <ENT I="01">10</ENT> <ENT>.425037</ENT> <ENT>.415867</ENT> <ENT>.406876</ENT> <ENT>.398060</ENT> <ENT>.389416</ENT> <ENT>.380942</ENT> <ENT>.372634</ENT> <ENT>.364489</ENT> <ENT>.356505</ENT> <ENT>.348678</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.390184</ENT> <ENT>.380934</ENT> <ENT>.371885</ENT> <ENT>.363031</ENT> <ENT>.354369</ENT> <ENT>.345895</ENT> <ENT>.337606</ENT> <ENT>.329498</ENT> <ENT>.321567</ENT> <ENT>.313811</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.358189</ENT> <ENT>.348936</ENT> <ENT>.339902</ENT> <ENT>.331084</ENT> <ENT>.322475</ENT> <ENT>.314073</ENT> <ENT>.305871</ENT> <ENT>.297866</ENT> <ENT>.290054</ENT> <ENT>.282430</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.328817</ENT> <ENT>.319625</ENT> <ENT>.310671</ENT> <ENT>.301949</ENT> <ENT>.293453</ENT> <ENT>.285178</ENT> <ENT>.277119</ENT> <ENT>.269271</ENT> <ENT>.261628</ENT> <ENT>.254187</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.301854</ENT> <ENT>.292777</ENT> <ENT>.283953</ENT> <ENT>.275377</ENT> <ENT>.267042</ENT> <ENT>.258942</ENT> <ENT>.251070</ENT> <ENT>.243421</ENT> <ENT>.235989</ENT> <ENT>.228768</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.277102</ENT> <ENT>.268184</ENT> <ENT>.259533</ENT> <ENT>.251144</ENT> <ENT>.243008</ENT> <ENT>.235119</ENT> <ENT>.227469</ENT> <ENT>.220053</ENT> <ENT>.212862</ENT> <ENT>.205891</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.254380</ENT> <ENT>.245656</ENT> <ENT>.237213</ENT> <ENT>.229043</ENT> <ENT>.221137</ENT> <ENT>.213488</ENT> <ENT>.206087</ENT> <ENT>.198928</ENT> <ENT>.192001</ENT> <ENT>.185302</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.233521</ENT> <ENT>.225021</ENT> <ENT>.216813</ENT> <ENT>.208887</ENT> <ENT>.201235</ENT> <ENT>.193847</ENT> <ENT>.186715</ENT> <ENT>.179830</ENT> <ENT>.173185</ENT> <ENT>.166772</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.214372</ENT> <ENT>.206119</ENT> <ENT>.198167</ENT> <ENT>.190505</ENT> <ENT>.183124</ENT> <ENT>.176013</ENT> <ENT>.169164</ENT> <ENT>.162567</ENT> <ENT>.156213</ENT> <ENT>.150095</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.196794</ENT> <ENT>.188805</ENT> <ENT>.181125</ENT> <ENT>.173741</ENT> <ENT>.166643</ENT> <ENT>.159820</ENT> <ENT>.153262</ENT> <ENT>.146960</ENT> <ENT>.140904</ENT> <ENT>.135085</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.180657</ENT> <ENT>.172946</ENT> <ENT>.165548</ENT> <ENT>.158452</ENT> <ENT>.151645</ENT> <ENT>.145117</ENT> <ENT>.138856</ENT> <ENT>.132852</ENT> <ENT>.127096</ENT> <ENT>.121577</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table D—Showing the Present Worth of a Remainder Interest Postponed for a Term Certain in a Charitable Remainder Unitrust</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Years</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">1</ENT> <ENT>.898000</ENT> <ENT>.896000</ENT> <ENT>.894000</ENT> <ENT>.892000</ENT> <ENT>.890000</ENT> <ENT>.888000</ENT> <ENT>.886000</ENT> <ENT>.884000</ENT> <ENT>.882000</ENT> <ENT>.880000</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.806404</ENT> <ENT>.802816</ENT> <ENT>.799236</ENT> <ENT>.795664</ENT> <ENT>.792100</ENT> <ENT>.788544</ENT> <ENT>.784996</ENT> <ENT>.781456</ENT> <ENT>.777924</ENT> <ENT>.774400</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.724151</ENT> <ENT>.719323</ENT> <ENT>.714517</ENT> <ENT>.709732</ENT> <ENT>.704969</ENT> <ENT>.700227</ENT> <ENT>.695506</ENT> <ENT>.690807</ENT> <ENT>.686129</ENT> <ENT>.681472</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.650287</ENT> <ENT>.644514</ENT> <ENT>.638778</ENT> <ENT>.633081</ENT> <ENT>.627422</ENT> <ENT>.621802</ENT> <ENT>.616219</ENT> <ENT>.610673</ENT> <ENT>.605166</ENT> <ENT>.599695</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.583958</ENT> <ENT>.577484</ENT> <ENT>.571068</ENT> <ENT>.564708</ENT> <ENT>.558406</ENT> <ENT>.552160</ENT> <ENT>.545970</ENT> <ENT>.539835</ENT> <ENT>.533756</ENT> <ENT>.527732</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.524394</ENT> <ENT>.517426</ENT> <ENT>.510535</ENT> <ENT>.503720</ENT> <ENT>.496981</ENT> <ENT>.490318</ENT> <ENT>.483729</ENT> <ENT>.477214</ENT> <ENT>.470773</ENT> <ENT>.464404</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.470906</ENT> <ENT>.463613</ENT> <ENT>.456418</ENT> <ENT>.449318</ENT> <ENT>.442313</ENT> <ENT>.435402</ENT> <ENT>.428584</ENT> <ENT>.421858</ENT> <ENT>.415222</ENT> <ENT>.408676</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.422874</ENT> <ENT>.415398</ENT> <ENT>.408038</ENT> <ENT>.400792</ENT> <ENT>.393659</ENT> <ENT>.386637</ENT> <ENT>.379726</ENT> <ENT>.372922</ENT> <ENT>.366226</ENT> <ENT>.359635</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.379741</ENT> <ENT>.372196</ENT> <ENT>.364786</ENT> <ENT>.357506</ENT> <ENT>.350356</ENT> <ENT>.343334</ENT> <ENT>.336437</ENT> <ENT>.329663</ENT> <ENT>.323011</ENT> <ENT>.316478</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.341007</ENT> <ENT>.333488</ENT> <ENT>.326118</ENT> <ENT>.318896</ENT> <ENT>.311817</ENT> <ENT>.304881</ENT> <ENT>.298083</ENT> <ENT>.291422</ENT> <ENT>.284896</ENT> <ENT>.278501</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.306224</ENT> <ENT>.298805</ENT> <ENT>.291550</ENT> <ENT>.284455</ENT> <ENT>.277517</ENT> <ENT>.270734</ENT> <ENT>.264102</ENT> <ENT>.257617</ENT> <ENT>.251278</ENT> <ENT>.245081</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.274989</ENT> <ENT>.267729</ENT> <ENT>.260645</ENT> <ENT>.253734</ENT> <ENT>.246990</ENT> <ENT>.240412</ENT> <ENT>.233994</ENT> <ENT>.227734</ENT> <ENT>.221627</ENT> <ENT>.215671</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.246941</ENT> <ENT>.239886</ENT> <ENT>.233017</ENT> <ENT>.226331</ENT> <ENT>.219821</ENT> <ENT>.213486</ENT> <ENT>.207319</ENT> <ENT>.201317</ENT> <ENT>.195475</ENT> <ENT>.189791</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.221753</ENT> <ENT>.214937</ENT> <ENT>.208317</ENT> <ENT>.201887</ENT> <ENT>.195641</ENT> <ENT>.189575</ENT> <ENT>.183684</ENT> <ENT>.177964</ENT> <ENT>.172409</ENT> <ENT>.167016</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.199134</ENT> <ENT>.192584</ENT> <ENT>.186236</ENT> <ENT>.180083</ENT> <ENT>.174121</ENT> <ENT>.168343</ENT> <ENT>.162744</ENT> <ENT>.157320</ENT> <ENT>.152065</ENT> <ENT>.146974</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.178822</ENT> <ENT>.172555</ENT> <ENT>.166495</ENT> <ENT>.160634</ENT> <ENT>.154967</ENT> <ENT>.149488</ENT> <ENT>.144191</ENT> <ENT>.139071</ENT> <ENT>.134121</ENT> <ENT>.129337</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.160582</ENT> <ENT>.154609</ENT> <ENT>.148846</ENT> <ENT>.143286</ENT> <ENT>.137921</ENT> <ENT>.132746</ENT> <ENT>.127754</ENT> <ENT>.122939</ENT> <ENT>.118295</ENT> <ENT>.113817</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.144203</ENT> <ENT>.138530</ENT> <ENT>.133069</ENT> <ENT>.127811</ENT> <ENT>.122750</ENT> <ENT>.117878</ENT> <ENT>.113190</ENT> <ENT>.108678</ENT> <ENT>.104336</ENT> <ENT>.100159</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.129494</ENT> <ENT>.124123</ENT> <ENT>.118963</ENT> <ENT>.114007</ENT> <ENT>.109247</ENT> <ENT>.104676</ENT> <ENT>.100286</ENT> <ENT>.096071</ENT> <ENT>.092024</ENT> <ENT>.088140</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.116286</ENT> <ENT>.111214</ENT> <ENT>.106353</ENT> <ENT>.101694</ENT> <ENT>.097230</ENT> <ENT>.092952</ENT> <ENT>.088853</ENT> <ENT>.084927</ENT> <ENT>.081166</ENT> <ENT>.077563</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table D—Showing the Present Worth of a Remainder Interest Postponed for a Term Certain in a Charitable Remainder Unitrust</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Years</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">1</ENT> <ENT>.878000</ENT> <ENT>.876000</ENT> <ENT>.874000</ENT> <ENT>.872000</ENT> <ENT>.870000</ENT> <ENT>.868000</ENT> <ENT>.866000</ENT> <ENT>.864000</ENT> <ENT>.862000</ENT> <ENT>.860000</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.770884</ENT> <ENT>.767376</ENT> <ENT>.763876</ENT> <ENT>.760384</ENT> <ENT>.756900</ENT> <ENT>.753424</ENT> <ENT>.749956</ENT> <ENT>.746496</ENT> <ENT>.743044</ENT> <ENT>.739600</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.676836</ENT> <ENT>.672221</ENT> <ENT>.667628</ENT> <ENT>.663055</ENT> <ENT>.658503</ENT> <ENT>.653972</ENT> <ENT>.649462</ENT> <ENT>.644973</ENT> <ENT>.640504</ENT> <ENT>.636056</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.594262</ENT> <ENT>.588866</ENT> <ENT>.583507</ENT> <ENT>.578184</ENT> <ENT>.572898</ENT> <ENT>.567648</ENT> <ENT>.562434</ENT> <ENT>.557256</ENT> <ENT>.552114</ENT> <ENT>.547008</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.521762</ENT> <ENT>.515847</ENT> <ENT>.509985</ENT> <ENT>.504176</ENT> <ENT>.498421</ENT> <ENT>.492718</ENT> <ENT>.487068</ENT> <ENT>.481469</ENT> <ENT>.475923</ENT> <ENT>.470427</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.458107</ENT> <ENT>.451882</ENT> <ENT>.445727</ENT> <ENT>.439642</ENT> <ENT>.433626</ENT> <ENT>.427679</ENT> <ENT>.421801</ENT> <ENT>.415990</ENT> <ENT>.410245</ENT> <ENT>.404567</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.402218</ENT> <ENT>.395848</ENT> <ENT>.389565</ENT> <ENT>.383368</ENT> <ENT>.377255</ENT> <ENT>.371226</ENT> <ENT>.365279</ENT> <ENT>.359415</ENT> <ENT>.353631</ENT> <ENT>.347928</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.353147</ENT> <ENT>.346763</ENT> <ENT>.340480</ENT> <ENT>.334297</ENT> <ENT>.328212</ENT> <ENT>.322224</ENT> <ENT>.316332</ENT> <ENT>.310535</ENT> <ENT>.304830</ENT> <ENT>.299218</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.310063</ENT> <ENT>.303764</ENT> <ENT>.297579</ENT> <ENT>.291507</ENT> <ENT>.285544</ENT> <ENT>.279690</ENT> <ENT>.273944</ENT> <ENT>.268302</ENT> <ENT>.262764</ENT> <ENT>.257327</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.272236</ENT> <ENT>.266098</ENT> <ENT>.260084</ENT> <ENT>.254194</ENT> <ENT>.248423</ENT> <ENT>.242771</ENT> <ENT>.237235</ENT> <ENT>.231813</ENT> <ENT>.226502</ENT> <ENT>.221302</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.239023</ENT> <ENT>.233102</ENT> <ENT>.227314</ENT> <ENT>.221657</ENT> <ENT>.216128</ENT> <ENT>.210725</ENT> <ENT>.205446</ENT> <ENT>.200286</ENT> <ENT>.195245</ENT> <ENT>.190319</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.209862</ENT> <ENT>.204197</ENT> <ENT>.198672</ENT> <ENT>.193285</ENT> <ENT>.188032</ENT> <ENT>.182910</ENT> <ENT>.177916</ENT> <ENT>.173047</ENT> <ENT>.168301</ENT> <ENT>.163675</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.184259</ENT> <ENT>.178877</ENT> <ENT>.173640</ENT> <ENT>.168544</ENT> <ENT>.163588</ENT> <ENT>.158766</ENT> <ENT>.154075</ENT> <ENT>.149513</ENT> <ENT>.145076</ENT> <ENT>.140760</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.161779</ENT> <ENT>.156696</ENT> <ENT>.151761</ENT> <ENT>.146971</ENT> <ENT>.142321</ENT> <ENT>.137809</ENT> <ENT>.133429</ENT> <ENT>.129179</ENT> <ENT>.125055</ENT> <ENT>.121054</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.142042</ENT> <ENT>.137266</ENT> <ENT>.132639</ENT> <ENT>.128158</ENT> <ENT>.123819</ENT> <ENT>.119618</ENT> <ENT>.115550</ENT> <ENT>.111611</ENT> <ENT>.107798</ENT> <ENT>.104106</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.124713</ENT> <ENT>.120245</ENT> <ENT>.115927</ENT> <ENT>.111754</ENT> <ENT>.107723</ENT> <ENT>.103828</ENT> <ENT>.100066</ENT> <ENT>.096432</ENT> <ENT>.092922</ENT> <ENT>.089531</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.109498</ENT> <ENT>.105334</ENT> <ENT>.101320</ENT> <ENT>.097450</ENT> <ENT>.093719</ENT> <ENT>.090123</ENT> <ENT>.086657</ENT> <ENT>.083317</ENT> <ENT>.080098</ENT> <ENT>.076997</ENT> </ROW> <ROW> <PRTPAGE P="190"/> <ENT I="01">18</ENT> <ENT>.096139</ENT> <ENT>.092273</ENT> <ENT>.088554</ENT> <ENT>.084976</ENT> <ENT>.081535</ENT> <ENT>.078227</ENT> <ENT>.075045</ENT> <ENT>.071986</ENT> <ENT>.069045</ENT> <ENT>.066217</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.084410</ENT> <ENT>.080831</ENT> <ENT>.077396</ENT> <ENT>.074099</ENT> <ENT>.070936</ENT> <ENT>.067901</ENT> <ENT>.064989</ENT> <ENT>.062196</ENT> <ENT>.059517</ENT> <ENT>.056947</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.074112</ENT> <ENT>.070808</ENT> <ENT>.067644</ENT> <ENT>.064614</ENT> <ENT>.061714</ENT> <ENT>.058938</ENT> <ENT>.056280</ENT> <ENT>.053737</ENT> <ENT>.051303</ENT> <ENT>.048974</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(4.2)—With Interest at 4.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.989820</ENT> <ENT>.984755</ENT> <ENT>.981389</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .996577</ENT> <ENT>.986432</ENT> <ENT>.981385</ENT> <ENT>.978030</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .993166</ENT> <ENT>.983056</ENT> <ENT>.978026</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .989767</ENT> <ENT>.979691</ENT> <ENT>.974679</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .986380</ENT> <ENT>.976338</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .983004</ENT> <ENT>.972996</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .979639</ENT> <ENT>.969666</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .976286</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .972945</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .969615</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .966296</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .962989</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .959693</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(4.4)—With Interest at 4.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.989350</ENT> <ENT>.984054</ENT> <ENT>.980533</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .996418</ENT> <ENT>.985806</ENT> <ENT>.980529</ENT> <ENT>.977021</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .992849</ENT> <ENT>.982275</ENT> <ENT>.977017</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .989293</ENT> <ENT>.978757</ENT> <ENT>.973517</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .985749</ENT> <ENT>.975251</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .982219</ENT> <ENT>.971758</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .978700</ENT> <ENT>.968277</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .975195</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .971702</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .968221</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .964753</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .961298</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .957854</ENT> </ROW> </GPOTABLE> <PRTPAGE P="191"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(4.6)—With Interest at 4.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.988882</ENT> <ENT>.983354</ENT> <ENT>.979680</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .996259</ENT> <ENT>.985183</ENT> <ENT>.979676</ENT> <ENT>.976015</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .992532</ENT> <ENT>.981498</ENT> <ENT>.976011</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .988820</ENT> <ENT>.977826</ENT> <ENT>.972360</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .985121</ENT> <ENT>.974168</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .981436</ENT> <ENT>.970524</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .977764</ENT> <ENT>.966894</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .974107</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .970463</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .966832</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .963216</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .959613</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .956023</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(4.8)—With Interest at 4.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.988415</ENT> <ENT>.982657</ENT> <ENT>.978830</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT>.996101</ENT> <ENT>.984561</ENT> <ENT>.978825</ENT> <ENT>.975013</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT>.992217</ENT> <ENT>.980722</ENT> <ENT>.975008</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT>.988348</ENT> <ENT>.976898</ENT> <ENT>.971206</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT>.984494</ENT> <ENT>.973089</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT>.980655</ENT> <ENT>.969294</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT>.976831</ENT> <ENT>.965515</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT>.973022</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT>.969228</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT>.965448</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.961684</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.957934</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.954198</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(5.0)—With Interest at 5.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.987950</ENT> <ENT>.981961</ENT> <ENT>.977982</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995942</ENT> <ENT>.983941</ENT> <ENT>.977977</ENT> <ENT>.974014</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .991901</ENT> <ENT>.979949</ENT> <ENT>.974009</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .987877</ENT> <ENT>.975973</ENT> <ENT>.970057</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .983868</ENT> <ENT>.972013</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .979876</ENT> <ENT>.968069</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .975900</ENT> <ENT>.964141</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .971940</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .967997</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .964069</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .960157</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .956261</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .952381</ENT> </ROW> </GPOTABLE> <PRTPAGE P="192"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(5.2)—With Interest at 5.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.987486</ENT> <ENT>.981268</ENT> <ENT>.977137</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995784</ENT> <ENT>.983323</ENT> <ENT>.977132</ENT> <ENT>.973018</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .991587</ENT> <ENT>.979178</ENT> <ENT>.973012</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .987407</ENT> <ENT>.975050</ENT> <ENT>.968911</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .983244</ENT> <ENT>.970940</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .979099</ENT> <ENT>.966847</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .974972</ENT> <ENT>.962771</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .970862</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .966769</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .962694</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .958636</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .954594</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .950570</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(5.4)—With Interest at 5.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.987023</ENT> <ENT>.980577</ENT> <ENT>.976295</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995627</ENT> <ENT>.982707</ENT> <ENT>.976289</ENT> <ENT>.972026</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .991273</ENT> <ENT>.978409</ENT> <ENT>.972019</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .986938</ENT> <ENT>.974131</ENT> <ENT>.967769</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .982622</ENT> <ENT>.969871</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .978325</ENT> <ENT>.965629</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .974047</ENT> <ENT>.961407</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .969787</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .965546</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .961323</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .957119</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .952934</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .948767</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(5.6)—With Interest at 5.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.986562</ENT> <ENT>.979888</ENT> <ENT>.975455</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995470</ENT> <ENT>.982092</ENT> <ENT>.975449</ENT> <ENT>.971036</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .990960</ENT> <ENT>.977643</ENT> <ENT>.971029</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .986470</ENT> <ENT>.973214</ENT> <ENT>.966630</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .982001</ENT> <ENT>.968805</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .977552</ENT> <ENT>.964416</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .973124</ENT> <ENT>.960047</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .968715</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .964326</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .959958</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .955609</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .951279</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .946970</ENT> </ROW> </GPOTABLE> <PRTPAGE P="193"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(5.8)—With Interest at 5.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.986102</ENT> <ENT>.979201</ENT> <ENT>.974618</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995313</ENT> <ENT>.981480</ENT> <ENT>.974611</ENT> <ENT>.970050</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .990647</ENT> <ENT>.976879</ENT> <ENT>.970043</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .986004</ENT> <ENT>.972300</ENT> <ENT>.965496</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .981382</ENT> <ENT>.967743</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .976782</ENT> <ENT>.963206</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .972203</ENT> <ENT>.958692</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .967646</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .963111</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .958596</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .954103</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .949631</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .945180</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(6.0)—With Interest at 6.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.985643</ENT> <ENT>.978516</ENT> <ENT>.973784</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995156</ENT> <ENT>.980869</ENT> <ENT>.973776</ENT> <ENT>.969067</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .990336</ENT> <ENT>.976117</ENT> <ENT>.969059</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .985538</ENT> <ENT>.971389</ENT> <ENT>.964365</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .980764</ENT> <ENT>.966684</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .976014</ENT> <ENT>.962001</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .971286</ENT> <ENT>.957341</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .966581</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .961899</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .957239</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .952603</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .947988</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .943396</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(6.2)—With Interest at 6.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.985185</ENT> <ENT>.977833</ENT> <ENT>.972952</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .995000</ENT> <ENT>.980259</ENT> <ENT>.972944</ENT> <ENT>.968087</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .990024</ENT> <ENT>.975358</ENT> <ENT>.968079</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .985074</ENT> <ENT>.970481</ENT> <ENT>.963238</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .980148</ENT> <ENT>.965628</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .975247</ENT> <ENT>.960799</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .970371</ENT> <ENT>.955995</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .965519</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .960691</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .955887</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .951107</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .946352</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .941620</ENT> </ROW> </GPOTABLE> <PRTPAGE P="194"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(6.4)—With Interest at 6.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"> </ENT> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.984729</ENT> <ENT>.977152</ENT> <ENT>.972122</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994844</ENT> <ENT>.979652</ENT> <ENT>.972114</ENT> <ENT>.967110</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .989714</ENT> <ENT>.974600</ENT> <ENT>.967101</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .984611</ENT> <ENT>.969575</ENT> <ENT>.962115</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .979534</ENT> <ENT>.964576</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .974483</ENT> <ENT>.959602</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .969458</ENT> <ENT>.954654</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .964460</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .959487</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .954539</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .949617</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .944721</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .939850</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(6.6)—With Interest at 6.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.984274</ENT> <ENT>.976473</ENT> <ENT>.971295</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994688</ENT> <ENT>.979046</ENT> <ENT>.971286</ENT> <ENT>.966136</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .989404</ENT> <ENT>.973845</ENT> <ENT>.966127</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .984149</ENT> <ENT>.968672</ENT> <ENT>.960995</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .978921</ENT> <ENT>.963527</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .973721</ENT> <ENT>.958408</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .968549</ENT> <ENT>.953317</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .963404</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .958286</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .953196</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .948132</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .943096</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .938086</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(6.8)—With Interest at 6.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.983821</ENT> <ENT>.975796</ENT> <ENT>.970471</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994533</ENT> <ENT>.978442</ENT> <ENT>.970461</ENT> <ENT>.965165</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .989095</ENT> <ENT>.973092</ENT> <ENT>.965156</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .983688</ENT> <ENT>.967772</ENT> <ENT>.959879</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .978309</ENT> <ENT>.962481</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .972961</ENT> <ENT>.957219</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .967641</ENT> <ENT>.951985</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .962351</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .957089</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .951857</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .946653</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .941477</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .936330</ENT> </ROW> </GPOTABLE> <PRTPAGE P="195"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(7.0)—With Interest at 7.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"> </ENT> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.983368</ENT> <ENT>.975122</ENT> <ENT>.969649</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994378</ENT> <ENT>.977839</ENT> <ENT>.969639</ENT> <ENT>.964198</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .988787</ENT> <ENT>.972342</ENT> <ENT>.964187</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .983228</ENT> <ENT>.966875</ENT> <ENT>.958766</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .977700</ENT> <ENT>.961439</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .972203</ENT> <ENT>.956033</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .966736</ENT> <ENT>.950658</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .961301</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .955896</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .950522</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .945178</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .939864</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .934579</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(7.2)—With Interest at 7.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"> </ENT> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.982917</ENT> <ENT>.974449</ENT> <ENT>.968830</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994223</ENT> <ENT>.977239</ENT> <ENT>.968819</ENT> <ENT>.963233</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .988479</ENT> <ENT>.971593</ENT> <ENT>.963222</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .982769</ENT> <ENT>.965980</ENT> <ENT>.957658</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .977091</ENT> <ENT>.960400</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .971446</ENT> <ENT>.954851</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .965834</ENT> <ENT>.949335</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .960255</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .954707</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT> 10</ENT> <ENT> .949192</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT> 11</ENT> <ENT> .943708</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT> 12</ENT> <ENT> .938256</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .932836</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(7.4)—With Interest at 7.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.982467</ENT> <ENT>.973778</ENT> <ENT>.968013</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .994068</ENT> <ENT>.976640</ENT> <ENT>.968002</ENT> <ENT>.962271</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .988172</ENT> <ENT>.970847</ENT> <ENT>.962260</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .982311</ENT> <ENT>.965088</ENT> <ENT>.956552</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .976484</ENT> <ENT>.959364</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .970692</ENT> <ENT>.953673</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .964935</ENT> <ENT>.948017</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .959211</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .953521</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .947866</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .942243</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .936654</ENT> </ROW> <ROW> <PRTPAGE P="196"/> <ENT I="01">12</ENT> <ENT/> <ENT> .931099</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(7.6)—With Interest at 7.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.982019</ENT> <ENT>.973109</ENT> <ENT>.967199</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993914</ENT> <ENT>.976042</ENT> <ENT>.967187</ENT> <ENT>.961313</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .987866</ENT> <ENT>.970103</ENT> <ENT>.961301</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .981854</ENT> <ENT>.964199</ENT> <ENT>.955451</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .975879</ENT> <ENT>.958331</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .969940</ENT> <ENT>.952499</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .964037</ENT> <ENT>.946703</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .958171</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .952340</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .946544</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .940784</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .935058</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .929368</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(7.8)—With Interest at 7.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.0000000</ENT> <ENT>.981571</ENT> <ENT>.972442</ENT> <ENT>.966387</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993761</ENT> <ENT>.975447</ENT> <ENT>.966374</ENT> <ENT>.960357</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .987560</ENT> <ENT>.969361</ENT> <ENT>.960345</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .981398</ENT> <ENT>.963312</ENT> <ENT>.954353</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .975275</ENT> <ENT>.957302</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .969190</ENT> <ENT>.951329</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .963143</ENT> <ENT>.945393</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .957133</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .951161</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .945227</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .939329</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .933468</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .927644</ENT> </ROW> </GPOTABLE> <PRTPAGE P="197"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(8.0)—With Interest at 8.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.981125</ENT> <ENT>.971777</ENT> <ENT>.965578</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993607</ENT> <ENT>.974853</ENT> <ENT>.965564</ENT> <ENT>.959405</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .987255</ENT> <ENT>.968621</ENT> <ENT>.959392</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> 980944</ENT> <ENT>.962429</ENT> <ENT>.953258</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .974673</ENT> <ENT>.956276</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .968442</ENT> <ENT>.950162</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .962250</ENT> <ENT>.944088</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .956099</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .949987</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .943913</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .937879</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .931883</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .925926</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(8.2)—With Interest at 8.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.980680</ENT> <ENT>.971114</ENT> <ENT>.964771</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993454</ENT> <ENT>.974261</ENT> <ENT>.964757</ENT> <ENT>.958455</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .986951</ENT> <ENT>.967883</ENT> <ENT>.958441</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .980490</ENT> <ENT>.961547</ENT> <ENT>.952167</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .974072</ENT> <ENT>.955253</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .967695</ENT> <ENT>.949000</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .961361</ENT> <ENT>.942788</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .955068</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .948816</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .942605</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .936434</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .930304</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .924214</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(8.2)—With Interest at 8.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.980237</ENT> <ENT>.970453</ENT> <ENT>.963966</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993301</ENT> <ENT>.973670</ENT> <ENT>.963952</ENT> <ENT>.957509</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .986647</ENT> <ENT>.967148</ENT> <ENT>.957494</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .980037</ENT> <ENT>.960669</ENT> <ENT>.951080</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .973472</ENT> <ENT>.954233</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .966951</ENT> <ENT>.947841</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .960473</ENT> <ENT>.941491</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .954039</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .947648</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .941300</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .934994</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .928731</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .922509</ENT> </ROW> </GPOTABLE> <PRTPAGE P="198"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(8.6)—With Interest at 8.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.979794</ENT> <ENT>.969794</ENT> <ENT>.963164</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .993148</ENT> <ENT>.973081</ENT> <ENT>.963149</ENT> <ENT>.956565</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .986344</ENT> <ENT>.966414</ENT> <ENT>.956550</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .979586</ENT> <ENT>.959793</ENT> <ENT>.949996</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .972874</ENT> <ENT>.953217</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .966209</ENT> <ENT>.946686</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .959589</ENT> <ENT>.940199</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .953014</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .946484</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .940000</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .933559</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .927163</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .920810</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(8.8)—With Interest at 8.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.979353</ENT> <ENT>.969136</ENT> <ENT>.962364</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992996</ENT> <ENT>.972494</ENT> <ENT>.962349</ENT> <ENT>.955624</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .986041</ENT> <ENT>.965683</ENT> <ENT>.955609</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT>.979135</ENT> <ENT>.958919</ENT> <ENT>.948916</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT>.972278</ENT> <ENT>.952203</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT>.965468</ENT> <ENT>.945534</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT>.958706</ENT> <ENT>.938912</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT>.951992</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT>.945324</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT>.938703</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.932129</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.925600</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.919118</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(9.0)—With Interest at 9.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.978913</ENT> <ENT>.968481</ENT> <ENT>.961567</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992844</ENT> <ENT>.971908</ENT> <ENT>.961551</ENT> <ENT>.954686</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .985740</ENT> <ENT>.964954</ENT> <ENT>.954670</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .978686</ENT> <ENT>.958049</ENT> <ENT>.947839</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .971683</ENT> <ENT>.951193</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .964730</ENT> <ENT>.944387</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .957826</ENT> <ENT>.937629</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .950972</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .944167</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .937411</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .930703</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .924043</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .917431</ENT> </ROW> </GPOTABLE> <PRTPAGE P="199"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(9.2)—With Interest at 9.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.978474</ENT> <ENT>.967827</ENT> <ENT>.960772</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT>.992693</ENT> <ENT>.971324</ENT> <ENT>.960755</ENT> <ENT>.953752</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT>.985439</ENT> <ENT>.964226</ENT> <ENT>.953734</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT>.978238</ENT> <ENT>.957180</ENT> <ENT>.946765</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT>.971089</ENT> <ENT>.950186</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT>.963993</ENT> <ENT>.943242</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT>.956949</ENT> <ENT>.936350</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT>.949956</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT>.943014</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT>.936123</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.929283</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.922492</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.915751</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(9.4)—With Interest at 9.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.978037</ENT> <ENT>.967176</ENT> <ENT>.959980</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992541</ENT> <ENT>.970742</ENT> <ENT>.959962</ENT> <ENT>.952820</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .985138</ENT> <ENT>.963501</ENT> <ENT>.952802</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .977790</ENT> <ENT>.956315</ENT> <ENT>.945695</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .970497</ENT> <ENT>.949182</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .963258</ENT> <ENT>.942102</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .956074</ENT> <ENT>.935075</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .948942</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .941865</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .934839</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .927867</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .920946</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .914077</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(9.6)—With Interest at 9.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.977600</ENT> <ENT>.966526</ENT> <ENT>.959190</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992390</ENT> <ENT>.970161</ENT> <ENT>.959171</ENT> <ENT>.951890</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .984838</ENT> <ENT>.962778</ENT> <ENT>.951872</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .977344</ENT> <ENT>.955452</ENT> <ENT>.944628</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .969906</ENT> <ENT>.948181</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .962526</ENT> <ENT>.940965</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .955201</ENT> <ENT>.933805</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .947932</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .940718</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .933560</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .926455</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .919405</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .912409</ENT> </ROW> </GPOTABLE> <PRTPAGE P="200"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(9.8)—With Interest at 9.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.977165</ENT> <ENT>.965878</ENT> <ENT>.958402</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992239</ENT> <ENT>.969582</ENT> <ENT>.958382</ENT> <ENT>.950964</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .984539</ENT> <ENT>.962057</ENT> <ENT>.950945</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .976898</ENT> <ENT>.954591</ENT> <ENT>.943565</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .969317</ENT> <ENT>.947183</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .961795</ENT> <ENT>.939832</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .954331</ENT> <ENT>.932539</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .946924</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .939576</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .932284</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .925049</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .917870</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .910747</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(10.0)—With Interest at 10.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.976731</ENT> <ENT>.965232</ENT> <ENT>.957616</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .992089</ENT> <ENT>.969004</ENT> <ENT>.957596</ENT> <ENT>.950041</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .984240</ENT> <ENT>.961338</ENT> <ENT>.950021</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .976454</ENT> <ENT>.953733</ENT> <ENT>.942505</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .968729</ENT> <ENT>.946188</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .961066</ENT> <ENT>.938703</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .953463</ENT> <ENT>.931277</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .945920</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .938436</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .931012</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .923647</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .916340</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.909091</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(10.2)—With Interest at 10.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.976298</ENT> <ENT>.964588</ENT> <ENT>.956833</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .991939</ENT> <ENT>.968428</ENT> <ENT>.956812</ENT> <ENT>.949120</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .983943</ENT> <ENT>.960622</ENT> <ENT>.949099</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .976011</ENT> <ENT>.952878</ENT> <ENT>.941448</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .968143</ENT> <ENT>.945196</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .960338</ENT> <ENT>.937577</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .952597</ENT> <ENT>.930019</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .944918</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .937301</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .929745</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .922250</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .914816</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .907441</ENT> </ROW> </GPOTABLE> <PRTPAGE P="201"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(10.4)—With Interest at 10.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.975867</ENT> <ENT>.963946</ENT> <ENT>.956052</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .991789</ENT> <ENT>.967854</ENT> <ENT>.956031</ENT> <ENT>.948202</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .983645</ENT> <ENT>.959907</ENT> <ENT>.948181</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .975568</ENT> <ENT>.952025</ENT> <ENT>.940395</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .967558</ENT> <ENT>.944208</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .959613</ENT> <ENT>.936455</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .951734</ENT> <ENT>.928765</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .943919</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .936168</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .928481</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .920858</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .913296</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .905797</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(10.6)—With Interest at 10.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.975436</ENT> <ENT>.963305</ENT> <ENT>.955274</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .991639</ENT> <ENT>.967281</ENT> <ENT>.955252</ENT> <ENT>.947287</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .983349</ENT> <ENT>.959194</ENT> <ENT>.947265</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .975127</ENT> <ENT>.951174</ENT> <ENT>.939345</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .966974</ENT> <ENT>.943222</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .958890</ENT> <ENT>.935336</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .950873</ENT> <ENT>.927516</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .942923</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .935039</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .927222</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .919470</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .911782</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .904159</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(10.8)—With Interest at 10.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.975007</ENT> <ENT>.962667</ENT> <ENT>.954498</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .991490</ENT> <ENT>.966710</ENT> <ENT>.954475</ENT> <ENT>.946375</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .983052</ENT> <ENT>.958483</ENT> <ENT>.946352</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .974687</ENT> <ENT>.950327</ENT> <ENT>.938299</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .966392</ENT> <ENT>.942239</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .958168</ENT> <ENT>.934221</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .950014</ENT> <ENT>.926271</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .941930</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .933914</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .925966</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .918086</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .910273</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .902527</ENT> </ROW> </GPOTABLE> <PRTPAGE P="202"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(11.0)—With Interest at 11.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.974579</ENT> <ENT>.962030</ENT> <ENT>.953724</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT>.991341</ENT> <ENT>.966140</ENT> <ENT>.953700</ENT> <ENT>.945466</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT>.982757</ENT> <ENT>.957774</ENT> <ENT>.945442</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT>.974247</ENT> <ENT>.949481</ENT> <ENT>.937255</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT>.965811</ENT> <ENT>.941260</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT>.957449</ENT> <ENT>.933109</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT>.949158</ENT> <ENT>.925029</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT>.940939</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT>.932792</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT>.924715</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.916708</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.908770</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.900901</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(11.2)—With Interest at 11.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.974152</ENT> <ENT>.961395</ENT> <ENT>.952952</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT>.991192</ENT> <ENT>.965572</ENT> <ENT>.952927</ENT> <ENT>.944559</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT>.982462</ENT> <ENT>.957068</ENT> <ENT>.944534</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT>.973809</ENT> <ENT>.948638</ENT> <ENT>.936215</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT>.965232</ENT> <ENT>.940283</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT>.956731</ENT> <ENT>.932001</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT>.948304</ENT> <ENT>.923792</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT>.939952</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT>.931673</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT>.923467</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.915333</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.907272</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT>.899281</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(11.4)—With Interest at 11.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.973726</ENT> <ENT>.960762</ENT> <ENT>.952183</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .991044</ENT> <ENT>.965005</ENT> <ENT>.952157</ENT> <ENT>.943655</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .982168</ENT> <ENT>.956363</ENT> <ENT>.943630</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .973372</ENT> <ENT>.947798</ENT> <ENT>.935178</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .964654</ENT> <ENT>.939309</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .956015</ENT> <ENT>.930896</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .947452</ENT> <ENT>.922559</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .938967</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .930557</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .922223</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .913964</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .905778</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .897666</ENT> </ROW> </GPOTABLE> <PRTPAGE P="203"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(11.6)—With Interest at 11.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.973302</ENT> <ENT>.960130</ENT> <ENT>.951416</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990896</ENT> <ENT>.964440</ENT> <ENT>.951389</ENT> <ENT>.942754</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .981874</ENT> <ENT>.955660</ENT> <ENT>.942728</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .972935</ENT> <ENT>.946959</ENT> <ENT>.934145</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .964077</ENT> <ENT>.938338</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .955300</ENT> <ENT>.929795</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .946603</ENT> <ENT>.921330</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .937985</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .929445</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .920984</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .912599</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .904290</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .896057</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(11.8)—With Interest at 11.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.972878</ENT> <ENT>.959501</ENT> <ENT>.950651</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990748</ENT> <ENT>.963877</ENT> <ENT>.950624</ENT> <ENT>.941855</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .981582</ENT> <ENT>.954959</ENT> <ENT>.941828</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .972500</ENT> <ENT>.946124</ENT> <ENT>.933114</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .963502</ENT> <ENT>.937370</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .954588</ENT> <ENT>.928698</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .945756</ENT> <ENT>.920105</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .937006</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .928337</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .919748</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .911238</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .902807</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .894454</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(12.0)—With Interest at 12.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.972456</ENT> <ENT>.958873</ENT> <ENT>.949888</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990600</ENT> <ENT>.963315</ENT> <ENT>.949860</ENT> <ENT>.940960</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .981289</ENT> <ENT>.954260</ENT> <ENT>.940932</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .972065</ENT> <ENT>.945290</ENT> <ENT>.932087</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .962928</ENT> <ENT>.936405</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .953877</ENT> <ENT>.927603</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .944911</ENT> <ENT>.918884</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .936029</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .927231</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .918515</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .909882</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .901329</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .892857</ENT> </ROW> </GPOTABLE> <PRTPAGE P="204"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(12.2)—With Interest at 12.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.972034</ENT> <ENT>.958247</ENT> <ENT>.949128</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990453</ENT> <ENT>.962754</ENT> <ENT>.949099</ENT> <ENT>.940067</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .980997</ENT> <ENT>.953563</ENT> <ENT>.940038</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .971632</ENT> <ENT>.944460</ENT> <ENT>.931063</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .962356</ENT> <ENT>.935443</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .953168</ENT> <ENT>.926512</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .944069</ENT> <ENT>.917667</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .935056</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .926129</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .917287</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .908530</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .899856</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .891266</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(12.4)—With Interest at 12.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"> </ENT> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.971614</ENT> <ENT>.957623</ENT> <ENT>.948370</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990306</ENT> <ENT>.962195</ENT> <ENT>.948340</ENT> <ENT>.939176</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .980706</ENT> <ENT>.952868</ENT> <ENT>.939147</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .971199</ENT> <ENT>.943631</ENT> <ENT>.930043</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .961785</ENT> <ENT>.934484</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .952461</ENT> <ENT>.925425</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .943228</ENT> <ENT>.916454</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .934085</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .925030</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .916063</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .907183</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .898389</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .889680</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(12.6)—With Interest at 12.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">but less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.971195</ENT> <ENT>.957000</ENT> <ENT>.947614</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990159</ENT> <ENT>.961638</ENT> <ENT>.947583</ENT> <ENT>.938289</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .980416</ENT> <ENT>.952175</ENT> <ENT>.938258</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .970768</ENT> <ENT>.942805</ENT> <ENT>.929025</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .961215</ENT> <ENT>.933527</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .951756</ENT> <ENT>.924341</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .942390</ENT> <ENT>.915245</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .933117</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .923934</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .914842</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .905840</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .896926</ENT> </ROW> <ROW> <PRTPAGE P="205"/> <ENT I="01">12</ENT> <ENT/> <ENT> .888099</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(12.8)—With Interest at 12.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">but less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.970777</ENT> <ENT>.956379</ENT> <ENT>.946860</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .990013</ENT> <ENT>.961082</ENT> <ENT>.946828</ENT> <ENT>.937403</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .980126</ENT> <ENT>.951484</ENT> <ENT>.937372</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .970337</ENT> <ENT>.941981</ENT> <ENT>.928011</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .960647</ENT> <ENT>.932574</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .951053</ENT> <ENT>.923260</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .941554</ENT> <ENT>.914040</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .932151</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .922842</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .913625</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .904501</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .895468</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .886525</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(13.0)—With Interest at 13.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.970360</ENT> <ENT>.955760</ENT> <ENT>.946108</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989867</ENT> <ENT>.960528</ENT> <ENT>.946075</ENT> <ENT>.936521</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .979836</ENT> <ENT>.950795</ENT> <ENT>.936489</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .969908</ENT> <ENT>.941160</ENT> <ENT>.926999</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .960079</ENT> <ENT>.931623</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .950351</ENT> <ENT>.922183</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .940721</ENT> <ENT>.912838</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .931188</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .921753</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .912412</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .903167</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .894015</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .884956</ENT> </ROW> </GPOTABLE> <PRTPAGE P="206"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(13.2)—With Interest at 13.2 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.969945</ENT> <ENT>.955143</ENT> <ENT>.945359</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989721</ENT> <ENT>.959975</ENT> <ENT>.945325</ENT> <ENT>.935641</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .979548</ENT> <ENT>.950107</ENT> <ENT>.935608</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .969479</ENT> <ENT>.940341</ENT> <ENT>.925991</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .959514</ENT> <ENT>.930675</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .949651</ENT> <ENT>.921109</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .939889</ENT> <ENT>.911641</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .930228</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .920667</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .911203</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .901837</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .892567</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .883392</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(13.4)—With Interest at 13.4 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.969530</ENT> <ENT>.954527</ENT> <ENT>.944611</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989575</ENT> <ENT>.959423</ENT> <ENT>.944577</ENT> <ENT>.934764</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .979260</ENT> <ENT>.949422</ENT> <ENT>.934730</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .969051</ENT> <ENT>.939524</ENT> <ENT>.924986</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .958949</ENT> <ENT>.929730</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .948953</ENT> <ENT>.920038</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .939060</ENT> <ENT>.910447</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .929271</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .919584</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .909998</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .900511</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .891124</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .881834</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(13.6)—With Interest at 13.6 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.969117</ENT> <ENT>.953913</ENT> <ENT>.943866</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989430</ENT> <ENT>.958873</ENT> <ENT>.943831</ENT> <ENT>.933890</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .978972</ENT> <ENT>.948738</ENT> <ENT>.933854</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .968624</ENT> <ENT>.938710</ENT> <ENT>.923984</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .958386</ENT> <ENT>.928788</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .948256</ENT> <ENT>.918971</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .938233</ENT> <ENT>.909257</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .928316</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .918504</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .908796</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .899190</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .889686</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .880282</ENT> </ROW> </GPOTABLE> <PRTPAGE P="207"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(13.8)—With Interest at 13.8 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first full taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.968704</ENT> <ENT>.953301</ENT> <ENT>.943123</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989285</ENT> <ENT>.958325</ENT> <ENT>.943087</ENT> <ENT>.933018</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .978685</ENT> <ENT>.948056</ENT> <ENT>.932982</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .968199</ENT> <ENT>.937898</ENT> <ENT>.922985</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .957824</ENT> <ENT>.927849</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .947561</ENT> <ENT>.917907</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .937408</ENT> <ENT>.908072</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .927364</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .917428</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .907598</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .897873</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .888252</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .878735</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="15C,15C,15C,15C,15C,15C"> <TTITLE>Table F(14.0)—With Interest at 14.0 Percent, Showing Factors for Computation of the Adjusted Payout Rate for Certain Valuations</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1"> 1 <LI>Number of months by which the valuation date for the first rull taxable year of the trust precedes the first payout</LI> </CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1"> 2 <LI>Factors for payout at the end of each period</LI> </CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"/> </ROW> <ROW> <ENT I="22"> </ENT> <ENT> 1</ENT> <ENT>1.000000</ENT> <ENT>.968293</ENT> <ENT>.952691</ENT> <ENT>.942382</ENT> </ROW> <ROW> <ENT I="01"> 1</ENT> <ENT> 2</ENT> <ENT> .989140</ENT> <ENT>.957778</ENT> <ENT>.942345</ENT> <ENT>.932148</ENT> </ROW> <ROW> <ENT I="01"> 2</ENT> <ENT> 3</ENT> <ENT> .978399</ENT> <ENT>.947377</ENT> <ENT>.932111</ENT> </ROW> <ROW> <ENT I="01"> 3</ENT> <ENT> 4</ENT> <ENT> .967774</ENT> <ENT>.937088</ENT> <ENT>.921989</ENT> </ROW> <ROW> <ENT I="01"> 4</ENT> <ENT> 5</ENT> <ENT> .957264</ENT> <ENT>.926912</ENT> </ROW> <ROW> <ENT I="01"> 5</ENT> <ENT> 6</ENT> <ENT> .946868</ENT> <ENT>.916846</ENT> </ROW> <ROW> <ENT I="01"> 6</ENT> <ENT> 7</ENT> <ENT> .936586</ENT> <ENT>.906889</ENT> </ROW> <ROW> <ENT I="01"> 7</ENT> <ENT> 8</ENT> <ENT> .926415</ENT> </ROW> <ROW> <ENT I="01"> 8</ENT> <ENT> 9</ENT> <ENT> .916354</ENT> </ROW> <ROW> <ENT I="01"> 9</ENT> <ENT>10</ENT> <ENT> .906403</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT> .896560</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT> .886824</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT/> <ENT> .877193</ENT> </ROW> </GPOTABLE> <P> (7) <E T="03">Actuarial Table U(1) for transfers for which the valuation date is on or after June 1, 2023.</E> The present value of a remainder interest in a charitable remainder unitrust that is dependent on the termination of a life interest is determined by using the section 7520 rate, Tables F(0.2) through (20.0) (see paragraph (e)(6)(ii) of this section), and the formula in paragraph (e)(5)(i) of this section to derive a remainder factor from the appropriate mortality table to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table U(1). For transfers for which the valuation date is on or after June 1, 2023, the actuarial tables are currently available, at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables.</E> These actuarial tables are referenced and explained by IRS Publication 1458, <E T="03">Actuarial Valuations Version 4B</E> (2023). This publication will be available within a reasonable time after June 1, 2023. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). <PRTPAGE P="208"/> </P> <P> (f) <E T="03">Applicability date.</E> This section applies on and after June 1, 2023. </P> <CITA>[T.D. 8540, 59 FR 30117, June 10, 1994, as amended by T.D. 8819, 64 FR 23199, Apr. 30, 1999; T.D. 8886, 65 FR 36919, 36943, June 12, 2000; T.D. 9448, 74 FR 21465, May 7, 2009; T.D. 9540, 76 FR 49595, Aug. 10, 2011; T.D. 9974, 88 FR 37433, June 7, 2023]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">treatment of excess distributions of trusts applicable to taxable years beginning before january 1, 1969</HD> <SECTION> <SECTNO>§ 1.665(a)-0</SECTNO> <SUBJECT>Excess distributions by trusts; scope of subpart D.</SUBJECT> <P>Subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code, in the case of trusts other than foreign trusts created by U.S. persons, is designed generally to prevent a shift of tax burden to a trust from a beneficiary or beneficiaries. In the case of a foreign trust created by a U.S. person, subpart D is designed to prevent certain other tax avoidance possibilities. To accomplish these ends, subpart D provides special rules for treatment of amounts paid, credited, or required to be distributed by a complex trust (subject to subpart C (section 661 and following) of such part I) in any year in excess of distributable net income for that year. Such an excess distribution is defined as an accumulation distribution, subject to the limitations in section 665 (b) or (c). An accumulation distribution, in the case of a trust other than a foreign trust created by a U.S. person, is “thrown back” to each of the 5 preceding years in inverse order. In the case of a foreign trust created by a U.S. person such an accumulation distribution is “thrown back,” in inverse order, to each of the preceding years to which the Internal Revenue Code of 1954 applies. That is, an accumulation distribution will be taxed to the beneficiaries of the trust in the year the distribution is made or required, but, in general, only to the extent of the distributable net income of those years which was not in fact distributed. However, with respect to a distribution by a trust other than a foreign trust created by a U.S. person, the resulting tax will not be greater than the aggregate of the taxes that would have been attributable to the amount thrown back to previous years had they been included in gross income of the beneficiaries in those years. In the case of a foreign trust created by a U.S. person, the resulting tax is computed under the provisions of section 669. To prevent double taxation, both in the case of a foreign trust created by a U.S. person, and a trust other than a foreign trust created by a U.S. person, the beneficiaries receive a credit for any taxes previously paid by the trust which are attributable to the excess thrown back and which are creditable under the provisions of chapter 1 of the Internal Revenue Code. Subpart D does not apply to any estate.</P> <CITA>[T.D. 6989, 34 FR 733, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(a)-1</SECTNO> <SUBJECT>Undistributed net income.</SUBJECT> <P> (a) The term <E T="03">undistributed net income</E> means for any taxable year the distributable net income of the trust for that year as determined under section 643(a), less: </P> <P>(1) The amount of income required to be distributed currently and any other amounts properly paid or credited or required to be distributed to beneficiaries in the taxable year as specified in paragraphs (1) and (2) of section 661(a), and</P> <P>(2) The amount of taxes imposed on the trust, as defined in § 1.665(d)-1.</P> <P>The application of the rule in this paragraph to the first year of a trust in which income is accumulated may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>Assume that under the terms of the trust, $10,000 of income is required to be distributed currently to A and the trustee has discretion to make additional distributions to A. During the taxable year 1954 the trust had distributable net income of $30,100 derived from royalties and the trustee made distributions of $20,000 to A. The taxable income of the trust is $10,000 on which a tax of $2,640 is paid. The undistributed net income of the trust as of the close of the taxable year 1954 is $7,460 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income</ENT> <ENT>$30,100</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Income currently distributable to A</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to A</ENT> <ENT>10,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes imposed on the trust (see § 1.665(d)-1)</ENT> <ENT>2,640</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>22,640</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>7,460</ENT> </ROW> </GPOTABLE> <PRTPAGE P="209"/> <FP>See also paragraphs (e)(1) and (f)(1) of § 1.668(b)-2 for additional illustrations of the application of the rule in this paragraph to the first year of a trust in which income is accumulated.</FP> </EXAMPLE> <P>(b) The undistributed net income of a foreign trust created by a U.S. person for any taxable year is the distributable net income of such trust (see § 1.643(a)-6 and the examples set forth in paragraph (b) thereof), less:</P> <P>(1) The amount of income required to be distributed currently and any other amounts properly paid or credited or required to be distributed to beneficiaries in the taxable year as specified in paragraphs (1) and (2) of section 661(a), and</P> <P>(2) The amount of taxes imposed on such trust by chapter 1 of the Internal Revenue Code, which are attributable to items of income which are required to be included in such distributable net income. For purposes of subparagraph (2) of this paragraph, the amount of taxes imposed on the trust (for any taxable year), by chapter 1 of the Internal Revenue Code is the amount of taxes imposed pursuant to the provisions of section 871 which is properly allocable to the undistributed portion of the distributable net income. See § 1.665(d)-1. The amount of taxes imposed pursuant to the provisions of section 871 is the difference between the total tax imposed pursuant to the provisions of that section on the foreign trust created by a U.S. person for the year and the amount which would have been imposed on such trust had all the distributable net income, as determined under section 643(a), been distributed. The application of the rule in this paragraph may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A trust was created in 1952 under the laws of Country X by the transfer to a trustee in Country X of money or property by a U.S. person. The entire trust constitutes a foreign trust created by a U.S. person. The governing instrument of the trust provides that $7,000 of income is required to be distributed currently to a U.S. beneficiary and gives the trustee discretion to make additional distributions to the beneficiary. During the taxable year 1963 the trust had income of $10,000 from dividends of a U.S. corporation (on which Federal income taxes of $3,000 were imposed pursuant to the provisions of section 871 and withheld under section 1441 resulting in the receipt by the trust of cash in the amount of $7,000), $20,000 in capital gains from the sale of stock of a Country Y corporation, and $30,000 from dividends of a Country X corporation, none of the gross income of which was derived from sources within the United States. The trustee did not file a U.S. income tax return for the taxable year 1963. The distributable net income of the trust before distributions to the beneficiary for 1963 is $60,000 ($57,000 of which is cash). During 1963 the trustee made distributions to the U.S. beneficiary equaling one-half of the trust's distributable net income or $30,000. Thus, the U.S. beneficiary is treated as having had distributed to him $5,000 (composed of $3,500 as a cash distribution and $1,500 as the tax imposed pursuant to the provisions of section 871 and withheld under section 1441), representing one-half of the income from U.S. sources; $10,000 in cash, representing one-half of the capital gains from the sale of stock of the Country Y corporation; and $15,000 in cash, representing one-half of the income from Country X sources for a total of $30,000. The undistributed net income of the trust at the close of taxable year 1963 is $28,500 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income</ENT> <ENT>$60,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">(1) Amounts distributed to the beneficiary—</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary</ENT> <ENT>$7,000</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary</ENT> <ENT>21,500</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary</ENT> <ENT>1,500</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>30,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">(2) Amount of taxes imposed on the trust under chapter 1 of the Code (See § 1.665(d)-1)</ENT> <ENT>1,500</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="03">Total</ENT> <ENT>31,500</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>28,500</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The facts are the same as in example 1 except that property has been transferred to the trust by a person other than a U.S. person, and during 1963 the foreign trust created by a U.S. person was 60 percent of the entire foreign trust. The trustee paid no income taxes to Country X in 1963.</P> <P>(1) The undistributed net income of the foreign trust created by a U.S. person for 1963 is $17,100, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="11">Distributable net income (60% of each item of gross income of entire trust):</ENT> </ROW> <ROW> <ENT I="02">60% of $10,000 U.S. dividends</ENT> <ENT>$6,000</ENT> </ROW> <ROW> <ENT I="02">60% of $20,000 Country X capital gains</ENT> <ENT>12,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">60% of $30,000 Country X dividends</ENT> <ENT>18,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>36,000</ENT> </ROW> <ROW> <PRTPAGE P="210"/> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="12">(i) Amounts distributed to the beneficiary—</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary (60% of $7,000)</ENT> <ENT>$4,200</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary (60% of $21,500)</ENT> <ENT>12,900</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary (60% of $1,500)</ENT> <ENT>900</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>18,000</ENT> </ROW> <ROW RUL="n,n,s"> <ENT I="02">(ii) Amount of taxes imposed on the trust under chapter 1 of the Code (See § 1.665(d)-1) (60% of $1,500)</ENT> <ENT>$900</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="03">Total</ENT> <ENT>$18,900</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>17,100</ENT> </ROW> </GPOTABLE> <P>(2) The undistributed net income of the portion of the entire trust which is not a foreign trust created by a U.S. person for 1963 is $11,400, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="11">Distributed net income (40% of each item of gross income of entire trust)</ENT> </ROW> <ROW> <ENT I="02">40% of $10,000 U.S. dividends</ENT> <ENT>$4,000</ENT> </ROW> <ROW> <ENT I="02">40% of $20,000 Country X capital gains</ENT> <ENT>8,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">40% of Country X dividends</ENT> <ENT>12,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>24,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="12">(i) Amounts distributed to the beneficiary—</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary (40% of $7,000)</ENT> <ENT>$2,800</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary (40% of $21,500)</ENT> <ENT>8,600</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary (40% of $1,500)</ENT> <ENT>600</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>12,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">(ii) Amount of taxes imposed on the trust under chapter 1 of the Code (See § 1.665(d)-1) (40% of $1,500)</ENT> <ENT>$600</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="03">Total</ENT> <ENT>$12,600</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>11,400</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P>(c) However, the undistributed net income for any year to which an accumulation distribution for a later year may be thrown back may be reduced by accumulation distributions in intervening years and also by any taxes imposed on the trust which are deemed to be distributed under section 666 by reason of the accumulation distributions. On the other hand, undistributed net income for any year will not be reduced by any distributions in an intervening year which are excluded from the definition of an accumulation distribution under section 665(b), or which are excluded under section 663(a)(1), relating to gifts, bequests, etc. See paragraph (f)(5) of § 1.668(b)-2 for an illustration of the reduction of undistributed net income for any year by a subsequent accumulation distribution.</P> <CITA>[T.D. 6989, 34 FR 733, 741, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(b)-1</SECTNO> <SUBJECT>Accumulation distributions of trusts other than certain foreign trusts; in general.</SUBJECT> <P> (a) Subject to the limitations set forth in § 1.665(b)-2, in the case of a trust other than a foreign trust created by a U.S. person, the term <E T="03">accumulation distribution</E> for any taxable year means an amount (if in excess of $2,000), by which the amounts properly paid, credited, or required to be distributed within the meaning of section 661(a)(2) for that year exceed the distributable net income (determined under section 643(a)) of the trust, reduced (but not below zero) by the amount of income required to be distributed currently. (In computing the amount of an accumulation distribution pursuant to the preceding sentence, there is taken into account amounts applied or distributed for the support of a dependent under the circumstances specified in section 677(b) or section 678(c) out of corpus or out of other than income for the taxable year and amounts used to discharge or satisfy any person's legal obligation as that term is used in § 1.662(a)-4.) If the distribution as so computed is $2,000 or less, it is not an accumulation distribution within the meaning of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code. If the distribution exceeds $2,000, then the full amount is an accumulation distribution for the purposes of subpart D. </P> <P> (b) Although amounts properly paid, credited, or required to be distributed under section 661(a)(2) do not exceed the income of the trust during the taxable year, an accumulation distribution may result if such amounts exceed distributable net income reduced (but not below zero) by the amount required to be distributed currently. This may result from the fact that expenses allocable to corpus are taken into account in determining taxable income and hence distributable net income. However, in the case of a trust other than <PRTPAGE P="211"/> a foreign trust created by a U.S. person, the provisions of subpart D will not apply unless there is undistributed net income in at least one of the five preceding taxable years. See section 666 and the regulations thereunder. </P> <P>(c) The provisions of paragraphs (a) and (b) of this section may be illustrated by the following examples (it is assumed in each case that the exclusions provided in § 1.665(b)-2 do not apply):</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A trustee properly makes a distribution to a beneficiary of $20,000 during the taxable year 1956, of which $10,000 is income required to be distributed currently to the beneficiary. The distributable net income of the trust is $15,000. There is an accumulation distribution of $5,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income required to be distributed currently (section 661(a)(1))</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>10,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Distributable net income</ENT> <ENT>$15,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Income required to be distributed currently</ENT> <ENT>10,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Balance of distributable net income</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Under the terms of the trust instrument, an annuity of $15,000 is required to be paid to A out of income each year and the trustee may in his discretion make distributions out of income or corpus to B. During the taxable year the trust had income of $18,000, as defined in section 643(b), and expenses allocable to corpus of $5,000. Distributable net income amounted to $13,000. The trustee distributed $15,000 of income to A and in the exercise of his discretion, paid $5,000 to B. There is an accumulation distribution of $5,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income required to be distributed currently to A (section 661(a)(1))</ENT> <ENT>15,000</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>5,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Distributable net income</ENT> <ENT>$13,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Income required to be distributed currently to A</ENT> <ENT>15,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Balance of distributable net income</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution to B</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>Under the terms of a trust instrument, the trustee may either accumulate the trust income or make distributions to A and B. The trustee may also invade corpus for the benefit of A and B. During the taxable year, the trust had income as defined in section 643(b) of $22,000 and expenses of $5,000 allocable to corpus. Distributable net income amounts to $17,000. The trustee distributed $10,000 each to A and B during the taxable year. There is an accumulation distribution of $3,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: income required to be distributed currently</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Distributable net income</ENT> <ENT>17,000</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution</ENT> <ENT>3,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P>(d) There are not taken into account, in computing the accumulation distribution for any taxable year, any amounts deemed distributed in that year because of an accumulation distribution in a later year.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 734, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(b)-2</SECTNO> <SUBJECT>Exclusions from accumulation distributions in the case of trusts (other than a foreign trust created by a U.S. person).</SUBJECT> <P>(a) In the case of a trust other than a foreign trust created by a U.S. person, certain amounts paid, credited, or required to be distributed to a beneficiary are excluded under section 665(b) in determining whether there is an accumulation distribution for the purposes of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code. These exclusions are solely for the purpose of determining the amount allocable to preceding years under section 666 and in no way affect the determination under subpart C (section 661 and following) of such part I of the beneficiary's tax liability for the year of distribution. Further, amounts excluded from accumulation distributions do not reduce the amount of undistributed net income for the 5 years preceding the year of distribution.</P> <P>(b) The amounts excluded from the computation of an accumulation distribution are discussed in the following subparagraphs:</P> <P> (1) <E T="03">Distributions from accumulations while a beneficiary is under 21.</E> (i) The first exception to the definition of an accumulation distribution is for amounts paid, credited, or required to be distributed to a beneficiary who was under 21 years of age or unborn when it was accumulated. A distribution is to be considered as so paid, credited, or <PRTPAGE P="212"/> required to be distributed to the extent, and only to the extent, that there is no undistributed net income for taxable years preceding the year of distribution other than undistributed net income accumulated while the beneficiary was under 21. If a distribution can be made from income accumulated either before or after a beneficiary reaches 21, it will be considered as made from the most recently accumulated income, and it will be so considered even though the governing instrument directs that distributions be charged first against the earliest accumulations. </P> <P>(ii) As was indicated in paragraph (a) of this section, a distribution of an amount excepted from the definition of an accumulation distribution will not reduce undistributed net income for the purpose of determining the effect of a future accumulation distribution. Thus, a distribution to a beneficiary of income accumulated before he reached 21 would not reduce the undistributed net income includible in a future accumulation distribution to another beneficiary. However, all future distributions to the same beneficiary, or to another beneficiary to whom a distribution would be excepted under the provisions of this subparagraph, would be excepted from the definition of an accumulation distribution to the extent that they could not be paid, credited, or required to be distributed from other accumulated income.</P> <P>(iii) The following examples illustrate the application of the foregoing rules of this subparagraph (in each of these examples it is assumed that the exceptions in section 665(b) (2), (3), and (4) do not apply):</P> <P> ( <E T="03">a</E> ) Income is to be accumulated until A reaches 21 when the corpus and accumulated income are to be distributed to him. The distribution is not an accumulation distribution. </P> <P> ( <E T="03">b</E> ) Income is to be accumulated until A is 21, when it is to be distributed to him but the corpus is to remain in trust. A distribution of the accumulated income to A when he reaches 21 is not an accumulation distribution. </P> <P> ( <E T="03">c</E> ) Income is to be accumulated and added to corpus until A reaches 21, when he is to receive one-third of the corpus (including accumulations). Thereafter all the income is to be paid to A until he is 23 when the remaining corpus (including accumulations) is to be paid to him. If A dies under that age any undistributed portion is to be paid to B. Distributions to A at 21 and 23 out of accumulations are not accumulation distributions even though they include accumulated income. However, if A died at the age of 22, when B was 23, a distribution to B would be an accumulation distribution to the extent of income accumulations since B reached 21, and the amount of undistributed net income includible in the distribution will not be reduced by the previous distribution to A. </P> <P> ( <E T="03">d</E> ) Income is to be accumulated and added to corpus until A is 21. After he is 21, he is entitled to all the income and, in addition, to distributions of corpus in the discretion of the trustee. When he reaches 25 he is entitled to the corpus. Distributions to A are not accumulation distributions, whether they are discretionary or upon termination of the trust. </P> <P> ( <E T="03">e</E> ) The facts are the same as in the preceding example, except that income is to be accumulated until A is 23. Distributions to A are accumulation distributions to the extent of income accumulated after A reached 21. </P> <P> ( <E T="03">f</E> ) Income may be distributed among a testator's children or accumulated and added to corpus until the youngest child is 21, when the corpus is to be distributed to the testator's then living descendants. Upon termination of the trust, the corpus is distributed to A, age 21; B, age 23; and C, the child of a deceased child, age 3. The distributions to A and C are not accumulation distributions. The distribution to B is an accumulation distribution to the extent of income accumulated after he reaches 21. (If the terms of the trust were such that it was subject to the separate share treatment under section 663(c), the distribution to B would be an accumulation distribution only to the extent of income accumulated for B's separate share since he reached 21.) </P> <P> ( <E T="03">g</E> ) Income may be distributed to A or accumulated and added to corpus during A's life. Upon the death of A the corpus is to be distributed to B. B is 23 at A's death. The distribution is an accumulation distribution to the extent <PRTPAGE P="213"/> of income accumulated since B reached 21. </P> <P> (2) <E T="03">Emergency distributions.</E> The second exclusion from the definition of an accumulation distribution is for amounts properly paid or credited to a beneficiary to meet his emergency needs. Whether or not a distribution falls within this exclusion depends upon the facts and circumstances causing the distribution. A distribution based upon an unforeseen or unforeseeable combination of circumstances requiring immediate help to the beneficiary would qualify for the exclusion. However, the beneficiary must be in actual need of the distribution and the fact that he had other sufficient resources would tend to negate the conclusion that a distribution was to meet his emergency needs. Ordinary distributions for the support, maintenance, or education of the beneficiary would not qualify for the exclusion. </P> <P> (3) <E T="03">Certain distributions at specified ages.</E> The third exclusion from the definition of an accumulation distribution is for amounts properly paid or credited to a beneficiary upon the beneficiary's attaining a specified age or ages; provided, (i) the total number of such distributions with respect to that beneficiary cannot exceed 4; (ii) the period between each such distribution is 4 years or more; and (iii) on January 1, 1954, such distributions were required by the specific terms of the governing instrument. Any discretionary invasion of corpus at other times is not excluded under this subparagraph, but does not affect the status of distributions that would otherwise be excluded. If more than four distributions are required to be made to a particular beneficiary at specified ages if he survives to receive them, none of the distributions will be excluded, even though the beneficiary dies before he receives more than four. On the other hand, a direction to make additional distributions to a remainderman will not affect the status of distributions required to be made to the primary beneficiary. For example, a trust agreement provided on January 1, 1954, that when A reached age 25 he would receive one-eighth of the corpus and accumulated income, as then constituted, and similar distributions at ages 30, 35, and 40. It also provided for similar distributions to B after A's death, and for additional discretionary distributions to both A and B. Required distributions to both A and B are excluded, regardless of whether discretionary distributions are made, but discretionary distributions are not excluded. On the other hand, if an additional distribution to A was directed when he reached 45, no distributions to him would be excluded, regardless of when he died. </P> <P> (4) <E T="03">Certain final distributions.</E> (i) The last exception to the definition of an accumulation distribution is for amounts properly paid or credited to a beneficiary as a final distribution of a trust if the final distribution is made more than 9 years after the date of the last transfer to such trust. </P> <P> (ii) The term <E T="03">last transfer to such trust</E> includes only transfers, whether by the original grantor or by a third person, made with a donative intent. A transfer arising out of a property right held by the trust is excluded, such as a transfer by a debtor in satisfaction of his indebtedness, or a distribution in liquidation or reorganization of a corporation. If the terms of two or more trusts include cross-remainders on the deaths of life beneficiaries, the donative transfers occurred at the time the trusts were created. The addition of the corpus of one trust to that of another when a remainder falls in is therefore not a new transfer within the meaning of section 665(b)(4). </P> <P> (iii) For example, under the terms of a trust created July 1, 1950, with an original corpus of $100,000, by H for the benefit of his wife, W, the income of the trust is to be accumulated and added to corpus. Upon the expiration of a 10-year period, the trust is to terminate and its assets, including all accumulated income, are to be distributed to W. No transfers were made by H or other persons to the trust after it was created. Both the trust and W file returns on the calendar year basis. In accordance with its terms, the trust terminated on June 30, 1960, and on August 1, 1960, the trustee made a final distribution of the assets of the trust to W, consisting of investments derived from $100,000 of donated principal, accumulated income of $30,000 attributable to the period July 1, 1950, <PRTPAGE P="214"/> through December 31, 1959, and income of $3,000 attributable to the period the trust was in existence during 1960. Subpart D is inapplicable to the $3,000 of income of the trust for 1960 since that amount would be deductible by the trust and includible in W's gross income for that year to the extent provided in subpart C. However, the balance of the distribution will qualify as an exclusion from the provisions of subpart D. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 735, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(b)-3</SECTNO> <SUBJECT>Exclusions under section 663(a)(1).</SUBJECT> <P>Subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, has no application to an amount which qualifies as an exclusion under section 663(a)(1), relating to gifts, bequests, etc.</P> </SECTION> <SECTION> <SECTNO>§ 1.665(c)-1</SECTNO> <SUBJECT>Accumulation distributions of certain foreign trusts; in general.</SUBJECT> <P> (a) In the case of a foreign trust created by a U.S. person, the term <E T="03">accumulation distribution</E> for any taxable year means an amount by which the amounts properly paid, credited, or required to be distributed within the meaning of section 661(a)(2) for that year exceed the distributable net income (determined under section 643(a)) of the trust, reduced (but not below zero) by the amount of income required to be distributed currently. (In computing the amount of an accumulation distribution pursuant to the preceding sentence, there is taken into account amounts applied or distributed for the support of a dependent under circumstances specified in section 677(b) and section 678(c) out of corpus or out of other than income for the taxable year and amounts used to discharge or satisfy any person's legal obligation as that term is used in § 1.662(a)-4.) </P> <P>(b) Although amounts properly paid, credited, or required to be distributed under section 661(a)(2) do not exceed the income of the trust during the taxable year, an accumulation distribution may result if such amounts exceed distributable net income reduced (but not below zero) by the amount required to be distributed currently. This may result from the fact that expenses allocable to corpus are taken into account in determining taxable income and hence distributable net income. However, the provisions of subpart D will not apply unless there is undistributed net income in at least one of the preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. See section 666 and the regulations thereunder.</P> <P>(c) The provisions of paragraphs (a) and (b) of this section may be illustrated by the examples provided in paragraph (c) of § 1.665(b)-1.</P> <CITA>[T.D. 6989, 34 FR 735, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(c)-2</SECTNO> <SUBJECT>Indirect payments to the beneficiary.</SUBJECT> <P> (a) <E T="03">In general.</E> Except as provided in paragraph (b) of this section, for purposes of section 665 any amount paid to a U.S. person which is from a payor who is not a U.S. person and which is derived directly or indirectly from a foreign trust created by a U.S. person shall be deemed in the year of payment to the U.S. person to have been directly paid to the U.S. person by the trust. For example, if a nonresident alien receives a distribution from a foreign trust created by a U.S. person and then pays the amount of the distribution over to a U.S. person, the payment of such amount to the U.S. person represents an accumulation distribution to the U.S. person from the trust to the extent that the amount received would have been an accumulation distribution had the trust paid the amount directly to the U.S. person in the year in which the payment was received by the U.S. person. This section also applies in a case where a nonresident alien receives indirectly an accumulation distribution from a foreign trust created by a U.S. person and then pays it over to a U.S. person. An example of such a transaction is one where the foreign trust created by a U.S. person makes the distribution to an intervening foreign trust created by either a U.S. person or a person other than a U.S. person and the intervening trust distributes the amount received to a nonresident alien who in turn pays it over to a U.S. person. Under these circumstances, it is deemed that the payment received by the U.S. person was <PRTPAGE P="215"/> received directly from a foreign trust created by a U.S. person. </P> <P> (b) <E T="03">Limitation.</E> In the case of a distribution to a beneficiary who is a U.S. person, paragraph (a) of this section does not apply if the distribution is received by such beneficiary under circumstances indicating lack of intent on the part of the parties to circumvent the purposes for which section 7 of the Revenue Act of 1962 (76 Stat. 985) was enacted. </P> <CITA>[T.D. 6989, 34 FR 735, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(d)-1</SECTNO> <SUBJECT>Taxes imposed on the trust.</SUBJECT> <P> (a) For the purpose of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, the term <E T="03">taxes imposed on the trust</E> means (for any taxable year) the amount of Federal income taxes which are properly allocable to the undistributed portion of the distributable net income. This amount is the difference between the total taxes of the trust for the year and the amount which would have been paid by the trust had all of the distributable net income, as determined under section 643(a), been distributed. Thus, in determining the amount of taxes imposed on the trust for the purposes of subpart D, there is excluded the portion of the taxes paid by the trust which is attributable to items of gross income which are not includible in distributable net income, such as capital gains allocable to corpus. The rule stated in this paragraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(1) Under the terms of a trust which reports on the calendar year basis the income may be accumulated or distributed to A in the discretion of the trustee and capital gains are allocable to corpus. During the taxable year 1954, the trust had income of $20,000 from royalties, long-term capital gains of $10,000, and expenses of $2,000. The trustee in his discretion made a distribution of $10,000 to A. The taxes imposed on the trust for the purposes of this subpart are $2,713, determined as shown below.</P> <P>(2) The distributable net income of the trust computed under section 643(a) is $18,000 (royalties of $20,000 less expenses of $2,000). The total taxes paid by the trust are $3,787, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Royalties</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Capital gains</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Gross income</ENT> <ENT>30,000</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Expenses</ENT> <ENT>$2,000</ENT> </ROW> <ROW> <ENT I="02">Distributions to A</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>17,100</ENT> </ROW> <ROW> <ENT I="03">Taxable income</ENT> <ENT>12,900</ENT> </ROW> <ROW> <ENT I="01">Total income taxes</ENT> <ENT>3,787</ENT> </ROW> </GPOTABLE> <P>(3) The amount of taxes which would have been paid by the trust, had all of the distributable net income ($18,000) of the trust been distributed to A, is $1,074, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Taxable income of the trust</ENT> <ENT>$12,900</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Undistributed portion of distributable net income ($18,000−$10,000)</ENT> <ENT>8,000</ENT> </ROW> <ROW> <ENT I="03">Balance of taxable income</ENT> <ENT>4,900</ENT> </ROW> <ROW> <ENT I="01">Income taxes on $4,900</ENT> <ENT>1,074</ENT> </ROW> </GPOTABLE> <P>(4) The amount of taxes imposed on the trust as defined in this paragraph is $2,713, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW> <ENT I="01">Total taxes</ENT> <ENT>$3,787</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxes which would have been paid by the trust had all of the distributable net income been distributed</ENT> <ENT>1,074</ENT> </ROW> <ROW> <ENT I="02">Taxes imposed on the trust as defined in this paragraph</ENT> <ENT>2,713</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P>(b) If in any subsequent year an accumulation distribution is made by the trust which results in a throwback to the taxable year, the taxes of the taxable year allocable to the undistributed portion of distributable net income (the taxes imposed on the trust), after the close of the subsequent year, are the taxes prescribed in paragraph (a) of this section reduced by the taxes of the taxable year allowed as credits to beneficiaries on account of amounts deemed distributed on the last day of the taxable year under section 666. See paragraph (f)(4) of § 1.668(b)-2 for an illustration of the application of this paragraph.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960. Redesignated by T.D. 6989, 34 FR 735, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(e)-1</SECTNO> <SUBJECT>Preceding taxable year.</SUBJECT> <P> (a) <E T="03">Definition.</E> For purposes of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code of 1954, the term <E T="03">preceding taxable year</E> does not include any taxable year to which such part I does not apply. See section 683 and regulations thereunder. Accordingly, the provisions of such subpart D may not, in general, be applied to any taxable year which begins before 1954 or ends before <PRTPAGE P="216"/> August 17, 1954. For example, if a trust (reporting on the calendar year basis) makes a distribution during the calendar year 1955 of income accumulated during prior years and the distribution exceeds the distributable net income of 1955, the excess distribution may be allocated under such subpart D to 1954, but it may not be allocated to 1953 and preceding years, since the Internal Revenue Code of 1939 applies to those years. </P> <P> (b) <E T="03">Simple trusts subject to subpart D.</E> An accumulation distribution may be properly allocated to a preceding taxable year in which the trust qualified as a simple trust (that is, qualified for treatment under subpart B (section 651 and following) of such part I). In such event, the trust is treated for such preceding taxable year in all respects as if it were a trust to which subpart C (section 661 and following) of such part I applies. An example of such a circumstance would be in the case of a trust (required under the trust instrument to distribute all of its income currently) which received in the preceding taxable year extraordinary dividends or taxable stock dividends which the trustee in good faith allocated to corpus, but which are subsequently determined to be currently distributable to the beneficiary. See section 643(a)(4) and § 1.643(a)-4. The trust would qualify for treatment under such subpart C for the year of distribution of the extraordinary dividends or taxable stock dividends, because the distribution is not out of income of the current taxable year and would be treated as other amounts properly paid or credited or required to be distributed for such taxable year within the meaning of section 661(a)(2). Also, in the case of a trust other than a foreign trust created by a U.S. person, the distribution would qualify as an accumulation distribution for the purposes of such subpart D if in excess of $2,000 and not excepted under section 665(b) and the regulations thereunder. In the case of a foreign trust created by a U.S. person, the distribution, regardless of the amount, would qualify as an accumulation distribution for the purposes of subpart D. For the purposes only of such subpart D, the trust would be treated as subject to the provisions of such subpart C for the preceding taxable year in which the extraordinary or taxable stock dividends were received and in computing undistributed net income for such preceding year, the extraordinary or taxable stock dividends would be included in distributable net income under section 643(a). The rule stated in the preceding sentence would also apply if the distribution in the later year were made out of corpus without regard to a determination that the extraordinary dividends or taxable stock dividends in question were currently distributable to the beneficiary. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 735, Jan. 17, 1969. Redesignated by T.D. 6989, 34 FR 735, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(e)-2</SECTNO> <SUBJECT>Application of separate share rule.</SUBJECT> <P>In trusts to which the separate share rule of section 663(c) is applicable for any taxable year, subpart D (section 665 and following), part I, subchapter J, of the Code, is applied as if each share were a separate trust. Thus, “undistributed net income” and the amount of an “accumulation distribution” are computed separately for each share. The “taxes imposed on the trust” are allocated as follows:</P> <P>(a) There is first allocated to each separate share that portion of the “taxes imposed on the trust”, computed before the allowance of credits under section 642(a), which bears the same relation to the total that the distributable net income of the separate share bears to the distributable net income of the trust, adjusted for this purpose as follows:</P> <P>(1) There is excluded from distributable net income of the trust and of each separate share any tax-exempt interest, foreign income of a foreign trust, and excluded dividends, to the extent such amounts are included in distributable net income pursuant to section 643(a) (5), (6), and (7); and</P> <P> (2) The distributable net income of the trust is reduced by any deductions allowable under section 661 for amounts paid, credited, or required to be distributed during the taxable year, and the distributable net income of each separate share is reduced by any such deduction allocable to that share. <PRTPAGE P="217"/> </P> <P>(b) The taxes so determined for each separate share are then reduced by that portion of the credits against tax allowable to the trust under section 642(a) in computing the “taxes imposed on the trust” which bear the same relation to the total that the items of income allocable to the separate share with respect to which the credit is allowed bear to the total of such items of the trust. The amount of taxes imposed on the trust allocable to a separate share as so determined is then reduced by the amount of the taxes allowed under sections 667 and 668 as a credit to a beneficiary of the separate share on account of any accumulation distribution determined for any taxable year intervening between the year for which the determination is made and the year of an accumulation distribution with respect to which the determination is made. See paragraph (b) of § 1.665(d)-1.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 741, Jan. 17, 1969. Redesignated by T.D. 6989, 34 FR 736, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(a)-1A</SECTNO> <SUBJECT>Amount allocated.</SUBJECT> <P> (a) <E T="03">In general.</E> In the case of a trust that is subject to subpart C of part I of subchapter J of chapter 1 of the Code (relating to estates and trusts that may accumulate income or that distribute corpus), section 666(a) prescribes rules for determining the taxable years from which an accumulation distribution will be deemed to have been made and the extent to which the accumulation distribution is considered to consist of undistributed net income. In general, an accumulation distribution made in taxable years beginning after December 31, 1969, is deemed to have been made first from the earliest preceding taxable year of the trust for which there is undistributed net income. An accumulation distribution made in a taxable year beginning before January 1, 1970, is deemed to have been made first from the most recent preceding taxable year of the trust for which there is undistributed net income. See § 1.665(e)-1A for the definition of “preceding taxable year.” </P> <P> (b) <E T="03">Distributions by domestic trusts</E> —(1) <E T="03">Taxable years beginning after December 31, 1973.</E> An accumulation distribution made by a trust (other than a foreign trust created by a U.S. person) in any taxable year beginning after December 31, 1973, is allocated to the preceding taxable years of the trust (defined in § 1.665(e)-1A(a)(1)(ii) as those beginning after December 31, 1968) according to the amount of undistributed net income of the trust for such years. For this purpose, an accumulation distribution is first to be allocated to the earliest such preceding taxable year in which there is undistributed net income and shall then be allocated, beginning with the next earliest, to any remaining preceding taxable years of the trust. The portion of the accumulation distribution allocated to the earliest preceding taxable year is the amount of the undistributed net income for that preceding taxable year. The portion of the accumulation distribution allocated to any preceding taxable year subsequent to the earliest such preceding taxable year is the excess of the accumulation distribution over the aggregate of the undistributed net income for all earlier preceding taxable years. See paragraph (d) of this section for adjustments to undistributed net income for prior distributions. The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>In 1977, a domestic trust reporting on the calendar year basis makes an accumulation distribution of $33,000. Therefore, years before 1969 are ignored. In 1969, the trust had $6,000 of undistributed net income; in 1970, $4,000; in 1971, none; in 1972, $7,000; in 1973, $5,000; in 1974, $8,000; in 1975, $6,000; and $4,000 in 1976. The accumulation distribution is deemed distributed $6,000 in 1969, $4,000 in 1970, none in 1971, $7,000 in 1972, $5,000 in 1973, $8,000 in 1974, and $3,000 in 1975.</P> </EXAMPLE> <P> (2) <E T="03">Taxable years beginning after December 31, 1969, and before January 1, 1974.</E> If a trust (other than a foreign trust created by a U.S. person) makes an accumulation distribution in a taxable year beginning after December 31, 1969, and before January 1, 1974, the distribution will be deemed distributed in the same manner as accumulation distributions qualifying under subparagraph (1) of this paragraph, except that the first year to which the distribution may be thrown back cannot be earlier than the fifth taxable year of the trust <PRTPAGE P="218"/> preceding the year in which the accumulation distribution is made. Thus, for example, in the case of an accumulation distribution made in the taxable year of a domestic trust which begins on January 1, 1972, the taxable year of the trust beginning on January 1, 1967, would be the first year in which the distribution was deemed made, assuming that there was undistributed net income for 1967. See also § 1.665(e)-1A(a)(1). The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>In 1973, a domestic trust, reporting on the calendar year basis, makes an accumulation distribution of $25,000. In 1968, the fifth year preceding 1973, the trust had $7,000 of undistributed net income; in 1969, none; in 1970, $12,000; in 1971, $4,000; in 1972, $4,000. The accumulation distribution is deemed distributed in the amounts of $7,000 in 1968, none in 1969, $12,000 in 1970, $4,000 in 1971, and $2,000 in 1972.</P> </EXAMPLE> <P> (3) <E T="03">Taxable years beginning after December 31, 1968, and before January 1, 1970.</E> Accumulation distributions made in taxable years of the trust beginning after December 31, 1968, and before January 1, 1970, are allocated to prior years according to § 1.666(a)-1. </P> <P> (c) <E T="03">Distributions by foreign trusts</E> —(1) <E T="03">Foreign trusts created solely by U.S. persons</E> —(i) <E T="03">Taxable years beginning after December 31, 1969.</E> If a foreign trust created by a U.S. person makes an accumulation distribution in any taxable year beginning after December 31, 1969, the distribution is allocated to the trust's preceding taxable years (defined in § 1.665(e)-1A(a)(2) as those beginning after Dec. 31, 1953, and ending after Aug. 16, 1954) according to the amount of undistributed net income of the trust for such years. For this purpose, an accumulation distribution is first allocated to the earliest such preceding taxable year in which there is undistributed net income and shall then be allocated in turn, beginning with the next earliest, to any remaining preceding taxable years of the trust. The portion of the accumulation distribution allocated to the earliest preceding taxable year is the amount of the undistributed net income for that preceding taxable year. The portion of the accumulation distribution allocated to any preceding taxable year subsequent to the earliest such preceding taxable year is the excess of the accumulation distribution over the aggregate of the undistributed net income for all earlier preceding taxable years. See paragraph (d) of this section for adjustments to undistributed net income for prior distributions. The provisions of this subdivision may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>In 1971, a foreign trust created by a U.S. person, reporting on the calendar year basis, makes an accumulation distribution of $50,000. In 1961, the trust had $12,000 of undistributed net income; in 1962, none; in 1963, $10,000; in 1964, $8,000; in 1965, $5,000; in 1966, $14,000; in 1967, none; in 1968, $3,000; in 1969, $2,000; and in 1970, $1,000. The accumulation distribution is deemed distributed in the amounts of $12,000 in 1961, none in 1962, $10,000 in 1963, $8,000 in 1964, $5,000 in 1965, $14,000 in 1966, none in 1967, and $1,000 in 1968.</P> </EXAMPLE> <P> (ii) <E T="03">Taxable years beginning after December 31, 1968, and before January 1, 1970.</E> Accumulation distributions made in taxable years of the trust beginning after December 31, 1968, and before January 1, 1970, are allocated to prior years according to § 1.666(a)-1. </P> <P> (2) <E T="03">Foreign trusts created partly by U.S. persons</E> —(i) <E T="03">Taxable years beginning after December 31, 1969.</E> If a trust that is in part a foreign trust created by a U.S. person and in part a foreign trust created by a person other than a U.S. person makes an accumulation distribution in any year after December 31, 1969, the distribution is deemed made from the undistributed net income of the foreign trust created by a U.S. person in the proportion that the total undistributed net income for all preceding years of the foreign trust created by the U.S. person bears to the total undistributed net income for all years of the entire foreign trust. In addition, such distribution is deemed made from the undistributed net income of the foreign trust created by a person other than a U.S. person in the proportion that the total undistributed net income for all preceding years of the foreign trust created by a person other than a U.S. person bears to the total undistributed net income for all years of the entire foreign trust. Accordingly, an accumulation distribution of such a trust is composed of two portions with one portion relating to the undistributed net income of the <PRTPAGE P="219"/> foreign trust created by the U.S. person and the other portion relating to the undistributed net income of the foreign trust created by the person other than a U.S. person. For these purposes, each portion of an accumulation distribution made in any taxable year is first allocated to each of such preceding taxable years in turn, beginning with the earliest preceding taxable year, as defined in § 1.665(e)-1A(a), of the applicable foreign trusts, to the extent of the undistributed net income for the such trust for each of those years. Thus, each portion of an accumulation distribution is deemed to have been made from the earliest accumulated income of the applicable trust. If the foreign trust created by a U.S. person makes an accumulation distribution in any year beginning after December 31, 1969, the distribution is included in the beneficiary's income for that year to the extent of the undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. The provisions of this subdivision may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust is created in 1962 under the laws of Country X by the transfer to a trustee in Country X of property by both a U.S. person and a person other than a U.S. person. Both the trust and the only beneficiary of the trust (who is a U.S. person) report their taxable income on a calendar year basis. On March 31, 1974, the trust makes an accumulation distribution of $150,000 to the beneficiary. The distributable net income of both the portion of the trust which is a foreign trust created by a U.S. person and the portion of the trust which is a foreign trust created by a person other than a U.S. person for each year is computed in accordance with the provisions of paragraph (b)(3) of § 1.643(d)-1 and the undistributed net income for each portion of the trust for each year is computed as described in paragraph (b) of § 1.665(a)-1A. For taxable years 1962 through 1973, the portion of the trust which is a foreign trust created by a U.S. person and the portion of the trust which is a foreign trust created by a person other than a U.S. person had the following amounts of undistributed net income:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,13.5,14.6"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed net income-portion of the trust created by a U.S. person</CHED> <CHED H="1">Undistributed net income-portion of the trust created by a person other than a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1962</ENT> <ENT>$7,000</ENT> <ENT>$4,000</ENT> </ROW> <ROW> <ENT I="01">1963</ENT> <ENT>12,000</ENT> <ENT>7,000</ENT> </ROW> <ROW> <ENT I="01">1964</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1965</ENT> <ENT>11,000</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">1966</ENT> <ENT>8,000</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="01">1967</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1968</ENT> <ENT>4,000</ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="01">1969</ENT> <ENT>17,000</ENT> <ENT>8,000</ENT> </ROW> <ROW> <ENT I="01">1970</ENT> <ENT>16,000</ENT> <ENT>9,000</ENT> </ROW> <ROW> <ENT I="01">1971</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1972</ENT> <ENT>25,000</ENT> <ENT>12,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1973</ENT> <ENT>20,000</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01"> Totals</ENT> <ENT>120,000</ENT> <ENT>60,000</ENT> </ROW> </GPOTABLE> <FP>The accumulation distribution in the amount of $150,000 is deemed to have been distributed in the amount of $100,000 (120,000/180,000 × $150,000) from the portion of the trust which is a foreign trust created by a U.S. person and in the amount of $39,000, which is less than $50,000 (60,000/180,000 × $150,000), from the portion of the trust which is a foreign trust created by a person other than a U.S. person computed as follows:</FP> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,12.4,14.6"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Throwback to preceding years of foreign trust created by a U.S. person</CHED> <CHED H="1">Throwback to preceding years of portion of the entire foreign trust which is not a foreign trust created by a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1962</ENT> <ENT>$7,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1963</ENT> <ENT>12,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1964</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1965</ENT> <ENT>$11,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1966</ENT> <ENT>8,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1967</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1968</ENT> <ENT>4,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1969</ENT> <ENT>17,000</ENT> <ENT>$8,000</ENT> </ROW> <ROW> <ENT I="01">1970</ENT> <ENT>16,000</ENT> <ENT>9,000</ENT> </ROW> <ROW> <ENT I="01">1971</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1972</ENT> <ENT>$25,000</ENT> <ENT>$12,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1973</ENT> <ENT>None</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01"> Totals</ENT> <ENT>100,000</ENT> <ENT>39,000</ENT> </ROW> </GPOTABLE> <FP> Pursuant to this paragraph, the accumulation distribution in the amount of $100,000 from the portion of the trust which is a foreign trust created by a U.S. person is included in the beneficiary's income for 1974, as the amount represents undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. The accumulation distribution in the amount of $50,000 from the portion of the trust which is a foreign trust created by a person other than a U.S. person is included in the beneficiary's income for 1974 to the extent of the undistributed net income of the trust for the preceding years beginning after December 31, 1968. Accordingly, with respect to the portion of the trust which is a foreign trust created by a person other than a U.S. person, only the undistributed net income for the years 1969 through 1973, which totals $39,000, <PRTPAGE P="220"/> is includible in the beneficiary's income for 1974. Thus, of the $150,000 distribution made in 1974, the beneficiary is required to include a total of $139,000 in his income for 1974. The balance of $11,000 is deemed to represent a distribution of corpus. </FP> </EXAMPLE> <P> (ii) <E T="03">Taxable years beginning after December 31, 1968, and before January 1, 1970.</E> Accumulation distributions made in taxable years of the trust beginning after December 31, 1968, and before January 1, 1970, are allocated to prior years according to § 1.666(a)-1. </P> <P> (3) <E T="03">Foreign trusts created by non-U.S. persons.</E> To the extent that a foreign trust is a foreign trust created by a person other than a U.S. person, an accumulation distribution is included in the beneficiary's income for the year paid, credited, or required to be distributed to the extent provided under paragraph (b) of this section. </P> <P> (d) <E T="03">Reduction of undistributed net income for prior accumulation distributions.</E> For the purposes of allocating to any preceding taxable year an accumulation distribution of the taxable year, the undistributed net income of such preceding taxable year is reduced by the amount from such year deemed distributed in any accumulation distribution of undistributed net income made in any taxable year intervening between such preceding taxable year and the taxable year. Accordingly, for example, if a trust has undistributed net income for 1974 and makes accumulation distributions during the taxable years 1978 and 1979, in determining that part of the 1979 accumulation distribution that is thrown back to 1974 the undistributed net income for 1974 is first reduced by the amount of the undistributed net income for 1974 deemed distributed in the 1978 accumulation distribution. </P> <P> (e) <E T="03">Rule when no undistributed net income.</E> If, before the application of the provisions of subpart D to an accumulation distribution for the taxable year, there is no undistributed net income for a preceding taxable year, then no portion of the accumulation distribution is undistributed net income deemed distributed on the last day of such preceding taxable year. Thus, if an accumulation distribution is made during the taxable year 1975 from a trust whose earliest preceding taxable year is taxable year 1970, and the trust had no undistributed net income for 1970, then no portion of the 1975 accumulation distribution is undistributed net income deemed distributed on the last day of 1970. </P> <CITA>[T.D. 7204, 37 FR 17143, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(b)-1A</SECTNO> <SUBJECT>Total taxes deemed distributed.</SUBJECT> <P>(a) If an accumulation distribution is deemed under § 1.666(a)-1A to be distributed on the last day of a preceding taxable year and the amount is not less than the undistributed net income for such preceding taxable year, then an additional amount equal to the “taxes imposed on the trust attributable to the undistributed net income” (as defined in § 1.665(d)-1A(b)) for such preceding taxable year is also deemed distributed under section 661(a)(2). For example, a trust has undistributed net income of $8,000 for the taxable year 1974. The taxes imposed on the trust attributable to the undistributed net income are $3,032. During the taxable year 1977, an accumulation distribution of $8,000 is made to the beneficiary, which is deemed under § 1.666(a)-1A to have been distributed on the last day of 1974. The 1977 accumulation distribution is not less than the 1974 undistributed net income. Accordingly, the taxes of $3,032 imposed on the trust attributable to the undistributed net income for 1974 are also deemed to have been distributed on the last day of 1974. Thus, a total of $11,032 will be deemed to have been distributed on the last day of 1974.</P> <P>(b) For the purpose of paragraph (a) of this section, the undistributed net income of any preceding taxable year and the taxes imposed on the trust for such preceding taxable year attributable to such undistributed net income are computed after taking into account any accumulation distributions of taxable years intervening between such preceding taxable year and the taxable year. See paragraph (d) of § 1.666(a)-1A.</P> <CITA>[T.D. 7204, 37 FR 17145, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <PRTPAGE P="221"/> <SECTNO>§ 1.666(c)-1A</SECTNO> <SUBJECT>Pro rata portion of taxes deemed distributed.</SUBJECT> <P>(a) If an accumulation distribution is deemed under § 1.666(a)-1A to be distributed on the last day of a preceding taxable year and the amount is less than the undistributed net income for such preceding taxable year, then an additional amount is also deemed distributed under section 661(a)(2). The additional amount is equal to the “taxes imposed on the trust attributable to the undistributed net income” (as defined in § 1.665(a)-1A(b)) for such preceding taxable year, multiplied by a fraction, the numerator of which is the amount of the accumulation distribution allocated to such preceding taxable year and the denominator of which is the undistributed net income for such preceding taxable year. See paragraph (b) of example 1 and paragraphs (c) and (f) of example 2 in § 1.666(c)-2A for illustrations of this paragraph.</P> <P>(b) For the purpose of paragraph (a) of this section, the undistributed net income of any preceding taxable year and the taxes imposed on the trust for such preceding taxable year attributable to such undistributed net income are computed after taking into account any accumulation distributions of any taxable years intervening between such preceding taxable year and the taxable year. See paragraph (d) of § 1.666(a)-1A and paragraph (c) of example 1 and paragraphs (e) and (h) of example 2 in § 1.666(c)-2A.</P> <CITA>[T.D. 7204, 37 FR 17145, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(c)-2A</SECTNO> <SUBJECT>Illustration of the provisions of section 666 (a), (b), and (c).</SUBJECT> <P>The application of the provisions of §§ 1.666(a)-1A, 1.666(b)-1A, and 1.666(c)-1A may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(a) A trust created on January 1, 1974, makes accumulation distributions as follows:</P> <LDRWK> <FL-2>1979</FL-2> <LDRFIG>$7,000</LDRFIG> <FL-2>1980</FL-2> <LDRFIG>26,000</LDRFIG> </LDRWK> <FP>For 1974 through 1978, the undistributed portion of distributable net income, taxes imposed on the trust attributable to the undistributed net income, and undistributed net income are as follows:</FP> <GPOTABLE COLS="4" OPTS="L2" CDEF="s8,8.2,11.4,6.2"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed portion of distributable net income</CHED> <CHED H="1">Taxes imposed on the trust attributable to the undistributed net income</CHED> <CHED H="1">Undistributed net income</CHED> </BOXHD> <ROW> <ENT I="01">1974</ENT> <ENT>$12,100</ENT> <ENT>$3,400</ENT> <ENT>$8,700</ENT> </ROW> <ROW> <ENT I="01">1975</ENT> <ENT>16,100</ENT> <ENT>5,200</ENT> <ENT>10,900</ENT> </ROW> <ROW> <ENT I="01">1976</ENT> <ENT>6,100</ENT> <ENT>1,360</ENT> <ENT>4,740</ENT> </ROW> <ROW> <ENT I="01">1977</ENT> <ENT>None</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1978</ENT> <ENT>10,100</ENT> <ENT>2,640</ENT> <ENT>7,460</ENT> </ROW> </GPOTABLE> <FP>The trust has no undistributed capital gain.</FP> <P>(b) Since the entire amount of the accumulation distribution for 1979 ($7,000) is less than the undistributed net income for 1974 ($8,700), an additional amount of $2,736 (7,000/8,700 × $3,400) is deemed distributed under section 666(c).</P> <P>(c) In allocating the accumulation distribution for 1980, the amount of undistributed net income for 1974 will reflect the accumulation distribution for 1979. The undistributed net income for 1974 will then be $1,700 and the taxes imposed on the trust for 1974 will be $664, determined as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed net income as of the close of 1974</ENT> <ENT>$8,700</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Accumulation distribution (1979)</ENT> <ENT>7,000</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Balance (undistributed net income as of the close of 1979)</ENT> <ENT>1,700</ENT> </ROW> <ROW> <ENT I="01">Taxes imposed on the trust attributable to the undistributed net income as of the close of 1979 (1,700/8,700 × $3,400)</ENT> <ENT>664</ENT> </ROW> </GPOTABLE> <P>(d) The accumulation distribution of $26,000 for 1980 is deemed to have been made on the last day of the preceding taxable years of the trust to the extent of $24,800, the total of the undistributed net income for such years, as shown in the tabulation below. In addition, $9,864, the total taxes imposed on the trust attributable to the undistributed net income for such years is also deemed to have been distributed on the last day of such years, as shown below:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s8,11.6,11.6"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed net income</CHED> <CHED H="1">Taxes imposed on the trust</CHED> </BOXHD> <ROW> <ENT I="01">1974</ENT> <ENT>$1,700</ENT> <ENT>$664</ENT> </ROW> <ROW> <ENT I="01">1975</ENT> <ENT>10,900</ENT> <ENT>5,200</ENT> </ROW> <ROW> <ENT I="01">1976</ENT> <ENT>4,740</ENT> <ENT>1,360</ENT> </ROW> <ROW> <ENT I="01">1977</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1978</ENT> <ENT>7,460</ENT> <ENT>2,640</ENT> </ROW> <ROW> <ENT I="01">1979</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> (a) Under the terms of a trust instrument, the trustee has discretion to accumulate or distribute the income to X and to invade corpus for the benefit of X. The entire income of the trust is from royalties. Both X and the trust report on the calendar year basis. All of the income for 1974 was accumulated. The distributable net income of the trust for the taxable year 1974 is $20,100 and the income taxes paid by the trust for 1974 attributable to the undistributed net income are $7,260. All of the income for 1975 and 1976 was distributed and in addition the trustee made accumulation distributions <PRTPAGE P="222"/> within the meaning of section 665(b) of $5,420 for each year. </P> <P>(b) The undistributed net income of the trust determined under section 665(a) as of the close of 1974, is $12,840, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>$20,100</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Taxes imposed on the trust attributable to the undistributed net income</ENT> <ENT>7,260</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income as of the close of 1974</ENT> <ENT>12,840</ENT> </ROW> </GPOTABLE> <P>(c) The accumulation distribution of $5,420 made during the taxable year 1975 is deemed under section 666(a) to have been made on December 31, 1974. Since this accumulation distribution is less than the 1974 undistributed net income of $12,840, a portion of the taxes imposed on the trust for 1974 is also deemed under section 666(c) to have been distributed on December 31, 1974. The total amount deemed to have been distributed to X on December 31, 1974 is $8,484, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Accumulation distribution</ENT> <ENT>$5,420</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes deemed distributed (5,420/ 12,840 × $7,260)</ENT> <ENT>3,064</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>8,484</ENT> </ROW> </GPOTABLE> <P>(d) After the application of the provisions of subpart D to the accumulation distribution of 1975, the undistributed net income of the trust for 1974 is $7,420, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed net income as of the close of 1974</ENT> <ENT>$12,840</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: 1975 accumulation distribution deemed distributed on December 31, 1974 (paragraph (c) of this example)</ENT> <ENT>5,420</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income for 1974 as of the close of 1975</ENT> <ENT>7,420</ENT> </ROW> </GPOTABLE> <P>(e) The taxes imposed on the trust attributable to the undistributed net income for the taxable year 1974, as adjusted to give effect to the 1975 accumulation distribution, amount to $4,196, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Taxes imposed on the trust attributable to undistributed net income as of the close of 1974</ENT> <ENT>$7,260</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Taxes deemed distributed in 1974</ENT> <ENT>3,064</ENT> </ROW> <ROW> <ENT I="03">Taxes attributable to the undistributed net income determined as of the close of 1975</ENT> <ENT>4,196</ENT> </ROW> </GPOTABLE> <P>(f) The accumulation distribution of $5,420 made during the taxable year 1976 is, under section 666(a), deemed a distribution to X on December 31, 1974, within the meaning of section 661(a)(2). Since the accumulation distribution is less than the 1974 adjusted undistributed net income of $7,420, the trust is deemed under section 666(c) also to have distributed on December 31, 1974, a portion of the taxes imposed on the trust for 1974. The total amount deemed to be distributed on December 31, 1974, with respect to the accumulation distribution made in 1976, is $8,484, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Accumulation distribution</ENT> <ENT>$5,420</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes deemed distributed (5,420/ 7,420 × $4,196)</ENT> <ENT>3,064</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>8,484</ENT> </ROW> </GPOTABLE> <P>(g) After the application of the provisions of subpart D to the accumulation distribution of 1976, the undistributed net income of the trust for 1974 is $2,000, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed net income for 1974 as of the close of 1975</ENT> <ENT>$7,420</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: 1976 accumulation distribution deemed distributed on December 31, 1974 (paragraph (f) of this example)</ENT> <ENT>5,420</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income for 1974 as of the close of 1976</ENT> <ENT>2,000</ENT> </ROW> </GPOTABLE> <P>(h) The taxes imposed on the trust attributable to the undistributed net income of the trust for the taxable year 1974, determined as of the close of the taxable year 1976, amount to $1,132 ($4,196 less $3,064).</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17145, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(d)-1A</SECTNO> <SUBJECT>Information required from trusts.</SUBJECT> <P> (a) <E T="03">Adequate records required.</E> For all taxable years of a trust, the trustee must retain copies of the trust's income tax return as well as information pertaining to any adjustments in the tax shown as due on the return. The trustee shall also keep the records of the trust required to be retained by section 6001 and the regulations thereunder for each taxable year as to which the period of limitations on assessment of tax under section 6501 has not expired. If the trustee fails to produce such copies and records, and such failure is due to circumstances beyond the reasonable control of the trustee or any predecessor trustee, the trustee may reconstruct the amount of corpus, accumulated income, etc., from competent sources (including, to the extent permissible, Internal Revenue Service records). To the extent that an accurate reconstruction can be made for a taxable year, the requirements of this paragraph shall be deemed satisfied for such year. </P> <P> (b) <E T="03">Rule when information is not available</E> —(1) <E T="03">Accumulation distributions.</E> If adequate records (as required by paragraph (a) of this section) are not available to determine the proper application of subpart D to an accumulation distribution made in a taxable year by a trust, such accumulation distribution <PRTPAGE P="223"/> shall be deemed to consist of undistributed net income earned during the earliest preceding taxable year (as defined in § 1.665(e)-1A) of the trust in which it can be established that the trust was in existence. If adequate records are available for some years, but not for others, the accumulation distribution shall be allocated first to the earliest preceding taxable year of the trust for which there are adequate records and then to each subsequent preceding taxable year for which there are adequate records. To the extent that the distribution is not allocated in such manner to years for which adequate records are available, it will be deemed distributed on the last day of the earliest preceding taxable year of the trust in which it is established that the trust was in existence and for which the trust has no records. The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust makes a distribution in 1975 of $100,000. The trustee has adequate records for 1973, 1974, and 1975. The records show that the trust is on the calendar year basis, had distributable net income in 1975 of $20,000, and undistributed net income in 1974 of $15,000, and in 1973 of $16,000. The trustee has no other records of the trust except for a copy of the trust instrument showing that the trust was established on January 1, 1965. He establishes that the loss of the records was due to circumstances beyond his control. Since the distribution is made in 1975, the earliest “preceding taxable year”, as defined in § 1.665(e)-1A, is 1969. Since $80,000 of the distribution is an accumulation distribution, and $31,000 thereof is allocated to 1974 and 1973, $49,000 is deemed to have been distributed on the last day of 1969.</P> </EXAMPLE> <P> (2) <E T="03">Taxes.</E> (i) If an amount is deemed under this paragraph to be undistributed net income allocated to a preceding taxable year for which adequate records are not available, there shall be deemed to be “taxes imposed on the trust” for such preceding taxable year an amount equal to the taxes that the trust would have paid if the deemed undistributed net income were the amount remaining when the taxes were subtracted from taxable income of the trust for such year. For example, assume that an accumulation distribution in 1975 of $100,000 is deemed to be undistributed net income from 1971, and that the taxable income required to produce $100,000 after taxes in 1971 would be $284,966. Therefore the amount deemed to be “taxes imposed on the trust” for such preceding taxable year is $184,966. </P> <P>(ii) The credit allowed by section 667(b) shall not be allowed for any amount deemed under this subparagraph to be “taxes imposed on the trust.”</P> <CITA>[T.D. 7204, 37 FR 17146, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(a)-1</SECTNO> <SUBJECT>Amount allocated.</SUBJECT> <P>(a)(1) If a trust other than a foreign trust created by a U.S. person makes an accumulation distribution in any taxable year, the distribution is included in the beneficiary's gross income for that year to the extent of the undistributed net income of the trust for the preceding 5 years. It is therefore necessary to determine the extent to which there is undistributed net income for the preceding 5 years. For this purpose, an accumulation distribution made in any taxable year is allocated to each of the 5 preceding taxable years in turn, beginning with the most recent year, to the extent of the undistributed net income of each of those years. Thus, an accumulation distribution is deemed to have been made from the most recently accumulated income of the trust.</P> <P>(2) If a foreign trust created by a U.S. person makes an accumulation distribution in any year after December 31, 1962, the distribution is included in the beneficiary's gross income for that year to the extent of the undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. It is therefore necessary to determine the extent to which there is undistributed net income for such preceding taxable years. For this purpose, an accumulation distribution made in any taxable year is first allocated to each of such preceding taxable years in turn, beginning with the most recent year, to the extent of the undistributed net income of each of those years. Thus, an accumulation distribution is deemed to have been made from the most recently accumulated income of the trust.</P> <P> (3) If a trust that is in part a foreign trust created by a U.S. person and in <PRTPAGE P="224"/> part a foreign trust created by a person other than a U.S. person makes an accumulation distribution in any year after December 31, 1962, the distribution is deemed made from the undistributed net income of the foreign trust created by a U.S. person in the proportion that the total undistributed net income for all preceding years of the foreign trust created by the U.S. person bears to the total undistributed net income for all years of the entire foreign trust. In addition, such distribution is deemed made from the undistributed net income of the foreign trust created by a person other than a U.S. person in the proportion that the total undistributed net income for all preceding years of the foreign trust created by a person other than a U.S. person bears to the total undistributed net income for all years of the entire foreign trust. Accordingly, an accumulation distribution of such a trust is composed of two portions with one portion relating to the undistributed net income of the foreign trust created by the U.S. person and the other portion relating to the undistributed net income of the foreign trust created by the person other than a U.S. person. For these purposes, each portion of an accumulation distribution made in any taxable year is first allocated to each of such preceding taxable years in turn, beginning with the most recent year, to the extent of the undistributed net income for the applicable foreign trust for each of those years. Thus, each portion of an accumulation distribution is deemed to have been made from the most recently accumulated income of the applicable trust. If the foreign trust created by a U.S. person makes an accumulation distribution in any year after December 31, 1962, the distribution is included in the beneficiary's gross income for that year to the extent of the undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. If the foreign trust created by a person other than a U.S. person makes an accumulation distribution in any taxable year, the distribution is included in the beneficiary's gross income for that year to the extent of the undistributed net income of the trust for the preceding 5 years. </P> <P> (b) If, before the application of the provisions of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, to an accumulation distribution for the taxable year, there is no undistributed net income for a preceding taxable year, then no portion of the accumulation distribution is deemed distributed on the last day of such preceding taxable year. Thus, if an accumulation distribution is made during the taxable year 1960 and the trust had no undistributed net income for the taxable year 1959, then no portion of the 1960 accumulation distribution is deemed distributed on the last day of 1959. For purposes of subpart D, the term <E T="03">5 preceding taxable years</E> includes only the 5 taxable years immediately preceding the taxable year in which the accumulation distribution is made and which are subject to part I (section 641 and following) of such subchapter J even though the trust has no undistributed net income during one or more of those years. </P> <P>(c) Paragraphs (a) and (b) of this section may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>In 1964, a domestic trust, reporting on the calendar year basis, makes an accumulation distribution of $25,000. In 1963, the trust had $7,000 of undistributed net income; in 1962, none; in 1961, $12,000; in 1960, $4,000; in 1959, $4,000. The accumulation distribution is deemed distributed $7,000 in 1963, none in 1962, $12,000 in 1961, $4,000 in 1960, and $2,000 in 1959.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>In 1964, a foreign trust created by a U.S. person, reporting on the calendar year basis, makes an accumulation distribution of $50,000. In 1963, the trust had $12,000 of undistributed net income; in 1962, none; in 1961, $10,000; in 1960, $8,000; in 1959, $5,000; in 1958, $14,000; in 1957, none; in 1956, $3,000; in 1955, $2,000; and in 1954, $1,000. The accumulation distribution is deemed distributed $12,000 in 1963, none in 1962, $10,000 in 1961, $8,000 in 1960, $5,000 in 1959, $14,000 in 1958, none in 1957, $1,000 in 1956.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> A trust is created in 1952 under the laws of Country X by the transfer to a trustee in Country X of money and property by both a U.S. person and a person other than a U.S. person. Both the trust and the only beneficiary of the trust (who is a U.S. person) report their taxable income on a calendar year basis. On March 31, 1964, the trust makes an accumulation distribution of <PRTPAGE P="225"/> $150,000 to the U.S. beneficiary. The distributable net income of both the portion of the trust which is a foreign trust created by a U.S. person and the portion of the trust which is a foreign trust created by a person other than a U.S. person for each year is computed in accordance with the provisions of paragraph (b)(3) of § 1.643(d)-1 and the undistributed net income for each portion of the trust for each year is computed as described in paragraph (b) of § 1.665(a)-1. For the taxable years 1952 through 1963, the portion of the trust which is a foreign trust created by a U.S. person and the portion of the trust which is a foreign trust created by a person other than a U.S. person had the following amounts of undistributed net income: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,14.4,14.4"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed net income—portion of the trust created by a U.S. person</CHED> <CHED H="1">Undistributed net income—portion of the trust created by a person other than a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1963</ENT> <ENT>$20,000</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">1962</ENT> <ENT>25,000</ENT> <ENT>12,000</ENT> </ROW> <ROW> <ENT I="01">1961</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1960</ENT> <ENT>16,000</ENT> <ENT>9,000</ENT> </ROW> <ROW> <ENT I="01">1959</ENT> <ENT>17,000</ENT> <ENT>8,000</ENT> </ROW> <ROW> <ENT I="01">1958</ENT> <ENT>4,000</ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>8,000</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>11,000</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">1954</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1953</ENT> <ENT>12,000</ENT> <ENT>7,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1952</ENT> <ENT>7,000</ENT> <ENT>4,000</ENT> </ROW> <ROW> <ENT I="02">Totals</ENT> <ENT>120,000</ENT> <ENT>60,000</ENT> </ROW> </GPOTABLE> <FP>The accumulation distribution in the amount of $150,000 is deemed to have been distributed in the amount of $100,000 (120,000/180,000 × $150,000) from the portion of the trust which is a foreign trust created by a U.S. person, and in the amount of $50,000 (60,000/180,000 × $150,000) from the portion of the trust which is a foreign trust created by a person other than a U.S. person computed as follows:</FP> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,14.4,14.4"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Throwback to preceding years of foreign trust created by a U.S. person</CHED> <CHED H="1">Throwback to preceding years of portion of the entire foreign trust which is not a foreign trust created by a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1963</ENT> <ENT>$20,000</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">1962</ENT> <ENT>25,000</ENT> <ENT>12,000</ENT> </ROW> <ROW> <ENT I="01">1961</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1960</ENT> <ENT>16,000</ENT> <ENT>9,000</ENT> </ROW> <ROW> <ENT I="01">1959</ENT> <ENT>17,000</ENT> <ENT>8,000</ENT> </ROW> <ROW> <ENT I="01">1958</ENT> <ENT>4,000</ENT> <ENT>2,000</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>8,000</ENT> <ENT>3,000</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>10,000</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">1954</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1953</ENT> <ENT>None</ENT> <ENT>1,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1952</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="02">Totals</ENT> <ENT>100,000</ENT> <ENT>50,000</ENT> </ROW> </GPOTABLE> <FP>Pursuant to paragraph (a)(3) of this section, the accumulation distribution in the amount of $100,000 from the portion of the trust which is a foreign trust created by a U.S. person is included in the beneficiary's gross income for 1964, as this amount represents undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. The accumulation distribution in the amount of $50,000 from the portion of the trust which is a foreign trust created by a person other than a U.S. person is included in the beneficiary's gross income for 1964 to the extent of the undistributed net income of the trust for the preceding 5 years. Accordingly, with respect to the portion of the trust which is a foreign trust created by a person other than a U.S. person only the undistributed net income for the years 1959 through 1963 which totals $39,000 is includible in the beneficiary's gross income for 1964. Thus, of the $150,000 distribution made in 1964, the beneficiary is required to include a total of $139,000 in his gross income for 1964.</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>Assume the same facts as in example 3 and, in addition, that by December 31, 1964, the undistributed net income for 1964 is determined to be $20,000, and that in accordance with the provisions of paragraph (b)(3) of § 1.643(d)-1 and paragraph (b) of § 1.665(a)-1, $10,000 is allocated to the portion of the trust which is a foreign trust created by a U.S. person and $10,000 is allocated to the portion of the trust which is a foreign trust created by a person other than a U.S. person. On March 31, 1965, the trust makes an accumulation distribution of $25,000 to the U.S. beneficiary. For the taxable years 1952 through 1964, the portion of the trust which is a foreign trust created by a U.S. person and the portion of the trust which is a foreign trust created by a person other than a U.S. person had the following amounts of undistributed net income:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,14.4,14.4"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed net income—portion of the trust created by a U.S. person</CHED> <CHED H="1">Undistributed net income—portion of the trust created by a person other than a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1964</ENT> <ENT>$10,000</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">1963</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1962</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1961</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1960</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1959</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1958</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>1,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1954</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1953</ENT> <ENT>12,000</ENT> <ENT>6,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1952</ENT> <ENT>7,000</ENT> <ENT>4,000</ENT> </ROW> <ROW> <ENT I="02">Totals</ENT> <ENT>30,000</ENT> <ENT>20,000</ENT> </ROW> </GPOTABLE> <FP> The accumulation distribution is deemed to have been distributed in the amount of <PRTPAGE P="226"/> $15,000 (30,000/50,000 × $25,000), from the portion of the trust which is a foreign trust created by a U.S. person, and in the amount of $10,000 (20,000/50,000 × $25,000) from the portion of the trust which is a foreign trust created by a person other than a U.S. person computed as follows: </FP> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,14.4,14.4"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Throwback to preceding years of foreign trust created by U.S. person</CHED> <CHED H="1">Throwback to preceding years of portion of the entire foreign trust which is not a foreign trust created by a U.S. person</CHED> </BOXHD> <ROW> <ENT I="01">1964</ENT> <ENT>$10,000</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">1963</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1962</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1961</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1960</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1959</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1958</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>1,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1954</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1953</ENT> <ENT>4,000</ENT> <ENT>None</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">1952</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="02">Totals</ENT> <ENT>15,000</ENT> <ENT>10,000</ENT> </ROW> </GPOTABLE> <FP>Pursuant to paragraph (a)(3) of this section, only $11,000 of the accumulation distribution in the amount of $15,000 from the portion of the trust which is a foreign trust created by a U.S. person is includible in the beneficiary's gross income for 1965 as the $11,000 amount represents undistributed net income of the trust for the trust's preceding taxable years which began after December 31, 1953, and ended after August 16, 1954. The accumulation distribution in the amount of $10,000 from the portion of the trust which is a foreign trust created by a person other than a U.S. person is included in the beneficiary's gross income for 1965 to the extent of the undistributed net income of the trust for the preceding 5 years. Accordingly, the entire $10,000 (representing the undistributed net income for the year 1964) is includible in the beneficiary's gross income for 1965. Thus, of the $25,000 distribution made in 1965, the beneficiary is required to include a total of $21,000 in his gross income for 1965.</FP> </EXAMPLE> <P>(d) For the purposes of allocating to any preceding taxable year an accumulation distribution of the taxable year, the undistributed net income of such preceding taxable year is computed without regard to the accumulation distribution of the taxable year or of taxable years following the taxable year. However, accumulation distributions of any taxable years intervening between such preceding taxable year and the taxable year are taken into account. Accordingly, if a trust has undistributed net income for the taxable year 1954 and makes an accumulation distribution during the taxable year 1955, the undistributed net income for 1954 is computed without regard to the accumulation distribution for 1955 or any subsequent year. If the trust makes a further accumulation distribution for 1956, the undistributed net income for 1954 is computed without regard to the accumulation distribution for 1956 or subsequent years; but in determining the undistributed net income for 1954 for purposes of the 1956 accumulation distribution the accumulation distribution for 1955 will be taken into account.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 736, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(b)-1</SECTNO> <SUBJECT>Total taxes deemed distributed.</SUBJECT> <P>(a) If an accumulation distribution is deemed under § 1.666(a)-1 to be distributed on the last day of a preceding taxable year and the amount is not less than the undistributed net income for such preceding taxable year, then an additional amount equal to the “taxes imposed on the trust” (as defined in § 1.665(d)-1) for such preceding taxable year is likewise deemed distributed under section 661(a)(2). For example, a trust has taxable income of $11,032 (not including any capital gains) and undistributed net income of $8,000 for the taxable year 1954. The taxes imposed on the trust are $3,032. During the taxable year 1955, an accumulation distribution of $8,000 is made to the beneficiary, which is deemed under § 1.666(a)-1 to have been distributed on the last day of 1954. The taxes imposed on the trust for 1954 of $3,032 are also deemed to have been distributed on the last day of 1954 since the 1955 accumulation distribution is not less than the 1954 undistributed net income. Thus, a total of $11,032 will be deemed to have been distributed on the last day of 1954 because of the accumulation distribution of $8,000 made in 1955.</P> <P> (b) For the purpose of paragraph (a) of this section, the undistributed net income of any preceding taxable year is computed without regard to the accumulation distribution of the taxable year or any taxable year following such <PRTPAGE P="227"/> taxable year. However, any accumulation distribution of taxable years intervening between such preceding taxable year and the taxable year are taken into account. See paragraph (d) of § 1.666(a)-1 and paragraphs (f)(5) and (g)(1) of § 1.668(b)-2. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 741, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(c)-1</SECTNO> <SUBJECT>Pro rata portion of taxes deemed distributed.</SUBJECT> <P>(a) If an accumulation distribution is deemed under § 1.666(a)-1 to be distributed on the last day of a preceding taxable year and the amount is less than the undistributed net income for such preceding taxable year, then an additional amount is likewise deemed distributed under section 661(a)(2). The additional amount is equal to the taxes imposed on the trust, as defined in § 1.665(d)-1, for such preceding taxable year, multiplied by the fraction of which the numerator is the amount of the accumulation distribution and the denominator is the undistributed net income for such preceding taxable year. See paragraph (b) of example 1 and paragraphs (c) and (f) of example 2 in § 1.666(c)-2, and paragraph (f)(2) of § 1.668(b)-2 for illustrations of this paragraph.</P> <P>(b) For the purpose of paragraph (a) of this section, the undistributed net income of any preceding taxable year is computed without regard to the accumulation distribution of the taxable year or any taxable year following the taxable year. However, accumulation distributions of any taxable years intervening between such preceding taxable year and the taxable year are taken into account. See paragraph (d) of § 1.666(a)-1, paragraph (c) of example 1 and paragraphs (e) and (h) of example 2 in § 1.666(c)-2 and paragraph (f)(5)(iii) of § 1.668(b)-2.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 741, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.666(c)-2</SECTNO> <SUBJECT>Illustration of the provisions of section 666.</SUBJECT> <P>The application of the provisions of §§ 1.666(a)-1, 1.666(b)-1, and 1.666(c)-1 may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(a) A trust makes accumulation distributions as follows:</P> <LDRWK> <FL-2>  1959</FL-2> <LDRFIG>$7,000</LDRFIG> <FL-2>  1960</FL-2> <LDRFIG>25,000</LDRFIG> </LDRWK> <FP>For 1954 through 1958, the undistributed portion of distributable net income taxes imposed on the trust, and undistributed net income are as follows:</FP> <GPOTABLE COLS="4" OPTS="L1" CDEF="s8,9.5,6.2,6.2"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed portion of distributable net income</CHED> <CHED H="1">Taxes imposed on the trust</CHED> <CHED H="1">Undistributed net income</CHED> </BOXHD> <ROW> <ENT I="01">1958</ENT> <ENT>$12,100</ENT> <ENT>$3,400</ENT> <ENT>$8,700</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>16,100</ENT> <ENT>5,200</ENT> <ENT>10,900</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>6,100</ENT> <ENT>1,360</ENT> <ENT>4,740</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>None</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1954</ENT> <ENT>10,100</ENT> <ENT>2,640</ENT> <ENT>7,460</ENT> </ROW> </GPOTABLE> <P>(b) Since the entire amount of the accumulation distribution for 1959 ($7,000), determined without regard to the accumulation distribution for 1960, is less than the undistributed net income for 1958 ($8,700), an additional amount of $2,736 (7,000/ 8,700 × $3,400) is likewise deemed distributed under section 666(c).</P> <P>(c) In allocating the accumulation distribution for 1960, the undistributed net income for 1958 will take into account the accumulation distribution for 1959, and the additional amount of taxes imposed on the trust for 1958 deemed distributed. The undistributed net income for 1958 will then be $1,906; and the taxes imposed on the trust for 1958 will then be $458, determined as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Undistributed portion of distributable net income as of the close of 1958</ENT> <ENT>$12,100</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Accumulation distribution (1959)</ENT> <ENT>$7,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes deemed distributed under section 666(c) (7,000/8,700 × $3,400)</ENT> <ENT>2,736</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>9,736</ENT> </ROW> <ROW> <ENT I="03">Balance (undistributed portion of distributable net income as of the close of 1959)</ENT> <ENT>2,364</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW> <ENT I="03">Balance</ENT> <ENT>2,264</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes imposed on the trust (income taxes on $2,264)</ENT> <ENT>458</ENT> </ROW> <ROW> <ENT I="01">Undistributed portion of distributable net income as of the close of 1959</ENT> <ENT>2,364</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income taxes attributable thereto</ENT> <ENT>458</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income for 1958 as of the close of 1959</ENT> <ENT>1,906</ENT> </ROW> </GPOTABLE> <P> (d) The accumulation distribution of $25,000 for 1960 is deemed to have been made on the last day of the 5 preceding taxable years of the trust to the extent of $17,546, the total of the undistributed net income for such years, as shown in the tabulation below. In addition, $7,018, the total taxes imposed on the trust for such years is also deemed to <PRTPAGE P="228"/> have been distributed on the last day of such years, as shown below: </P> <GPOTABLE COLS="3" OPTS="L1" CDEF="s15,9.5,9.5"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Undistributed net income</CHED> <CHED H="1">Taxes imposed on the trust</CHED> </BOXHD> <ROW> <ENT I="01">1959</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1958</ENT> <ENT>$1,906</ENT> <ENT>$458</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>10,900</ENT> <ENT>5,200</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>4,740</ENT> <ENT>1,360</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>None</ENT> <ENT>None</ENT> </ROW> </GPOTABLE> <P>(e) No portion of the 1960 accumulation distribution is deemed made on the last day of 1954 because, as to 1960, 1954 is the sixth preceding taxable year.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(a) Under the terms of a trust instrument, the trustee has discretion to accumulate or distribute the income to X and to invade corpus for the benefit of X. The entire income of the trust is from royalties. Both X and the trust report on the calendar year basis. All of the income for 1954 was accumulated. The distributable net income of the trust for the taxable year 1954 is $20,100 and the income taxes paid by the trust for 1954 with respect to its distributable net income are $7,260. All of the income for 1955 and 1956 was distributed and in addition the trustee made accumulation distributions within the meaning of section 665(b) of $6,420 for each year.</P> <P>(b) The undistributed net income of the trust determined under section 665(a) as of the close of 1954, is $12,840, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>$20,100</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Taxes imposed on the trust</ENT> <ENT>7,260</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income as of the close of 1954</ENT> <ENT>12,840</ENT> </ROW> </GPOTABLE> <P>(c) The accumulation distribution of $6,420 made during the taxable year 1955 is deemed under section 666(a) to have been made on December 31, 1954. Since this accumulation distribution is less than the 1954 undistributed net income of $12,840, a portion of the taxes imposed on the trust for 1954 is also deemed under section 666(c) to have been distributed on December 31, 1954. The total amount deemed to have been distributed to X on December 31, 1954, is $10,050, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Accumulation distribution</ENT> <ENT>$6,420</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes deemed distributed (6,420/ 12,840 × $7,260)</ENT> <ENT>3,630</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>10,050</ENT> </ROW> </GPOTABLE> <P>(d) After the application of the provisions of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, to the accumulation distribution of 1955, the undistributed portion of the distributable net income of the trust for 1954, is $10,050, and the taxes imposed with respect thereto are $2,623, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Distributable net income as of the close of 1954</ENT> <ENT>$20,100</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: 1955 accumulation distribution and taxes deemed distributed on December 31, 1954 (paragraph (c) of this example)</ENT> <ENT>10,050</ENT> </ROW> <ROW> <ENT I="03">Undistributed portion of the 1954 distributable net income adjusted as of the close of 1955</ENT> <ENT>10,050</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW> <ENT I="03">Balance</ENT> <ENT>9,950</ENT> </ROW> <ROW> <ENT I="01">Income taxes on $9,950</ENT> <ENT>2,623</ENT> </ROW> </GPOTABLE> <P>(e) The undistributed net income of the trust for the taxable year 1954, as adjusted to give effect to the 1955 accumulation distribution, is $7,427, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed portion of distributable net income as of the close of 1955</ENT> <ENT>$10,050</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income taxes applicable thereto</ENT> <ENT>2,623</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income determined as of the close of 1955</ENT> <ENT>7,427</ENT> </ROW> </GPOTABLE> <P>(f) Inasmuch as all of the income of the trust for the taxable year 1955 was distributed to X, the trust had no undistributed net income for that year. Accordingly, the accumulation distribution of $6,420 made during the taxable year 1956 is, under section 666(a), deemed a distribution to X on December 31, 1954, within the meaning of section 661(a)(2). Since this accumulation distribution is less than the 1954 adjusted undistributed net income of $7,427, the trust is deemed under section 666(c) also to have distributed on December 31, 1954, a portion of the taxes imposed on the trust for 1954. The total amount deemed to be distributed on December 31, 1954, with respect to the accumulation distribution made in 1956, is $8,687, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Accumulation distribution</ENT> <ENT>$6,420</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes deemed distributed (6,420/ 7,427 × $2,623)</ENT> <ENT>2,267</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>8,687</ENT> </ROW> </GPOTABLE> <P>(g) After the application of the provisions of subpart D to the accumulation distribution of 1956, the undistributed portion of the distributable net income of the trust for 1954, is $1,363, and the taxes imposed on the trust with respect thereto are $253, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed portion of distributable net income as of the close of 1955</ENT> <ENT>$10,050</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: 1956 accumulation distribution and taxes deemed distributed on December 31, 1954 (paragraph (f) of this example)</ENT> <ENT>8,687</ENT> </ROW> <ROW> <ENT I="03">Undistributed portion of distributable net income as of the close of 1956</ENT> <ENT>1,363</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW> <ENT I="03">Balance</ENT> <ENT>1,263</ENT> </ROW> <ROW> <ENT I="01">Income taxes on $1,263</ENT> <ENT>253</ENT> </ROW> </GPOTABLE> <P>(h) The undistributed net income of the trust for the taxable year 1954, determined as of the close of the taxable year 1956, is $1,110 ($1,363 less $253).</P> </EXAMPLE> </SECTION> <SECTION> <PRTPAGE P="229"/> <SECTNO>§ 1.667-1</SECTNO> <SUBJECT>Denial of refund to trusts.</SUBJECT> <P>(a) If an amount is deemed under section 666 to be an amount paid, credited, or required to be distributed on the last day of a preceding taxable year, the trust is not allowed a refund or credit of the amount of “taxes imposed on the trust”, as defined in § 1.665(d)-1, which would not have been payable for the preceding taxable year had the trust in fact made such distribution on the last day of such year. However, such taxes are allowed as a credit under section 668(b) against the tax of the beneficiaries who are treated as having received the distributions in the preceding taxable year. The amount of taxes which may not be refunded or credited to the trust under this paragraph and which are allowed as a credit under section 668(b) against the tax of the beneficiaries, is an amount equal to the excess of:</P> <P>(1) The taxes imposed on the trust (as defined in section 665(d) and § 1.655(d)-1) for any preceding taxable year (computed without regard to the accumulation distribution for the taxable year) over</P> <P>(2) The amount of taxes for such preceding taxable year which would be imposed on the undistributed portion of distributable net income of the trust for such preceding taxable year after the application of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, on account of the accumulation distribution determined for the taxable year.</P> <FP>It should be noted that the credit under section 667 is computed by the use of a different ratio from that used for computing the amount of taxes deemed distributed under section 666(c).</FP> <P>(b) Paragraph (a) of this section may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>In 1954, a trust of which A is the sole beneficiary has taxable income of $20,000 (including capital gains of $5,100 allocable to corpus less a personal exemption of $100), on which a tax of $7,260 is paid.</P> <FP>The undistributed portion of distributable net income is $15,000, to which $6,160 of the tax is allocable under section 665. The undistributed net income is therefore $8,840 ($15,000 minus $6,160). In 1955, the trust makes an accumulation distribution of $8,840. Under section 666(b), the total taxes for 1954 attributable to the undistributed net income are deemed distributed, so $15,000 is deemed distributed. The amount of the tax which may not be refunded to the trust under section 667 and the credit to which A is entitled under section 668(b) is the excess of $6,160 over zero, since after the distribution and the application of subpart D there is no remaining undistributed portion of distributable net income for 1954.</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The same trust as in example 1 of this paragraph distributes $5,000 in 1955, rather than $8,840. The amount of the tax which may not be refunded to the trust but which is available to A as a credit is $4,044, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Accumulation distribution in 1955</ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes deemed distributed under section 666(c) (5,000/8,840 × $6,160)</ENT> <ENT>3,484</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Total amount deemed distributed out of the undistributed portion of distributable net income</ENT> <ENT>8,484</ENT> </ROW> <ROW> <ENT I="01">Tax attributable to the undistributed portion of distributable net income ($15,000) before 1955 distribution (see example 1 of this paragraph)</ENT> <ENT>6,160</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Tax on $11,516 (taxable income of $20,000 minus $8,484, amount deemed distributed)</ENT> <ENT>$3,216</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Tax on $5,000 (capital gains of $5,100, less personal exemption of $100, allocable to corpus)</ENT> <ENT>1,100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Tax attributable to undistributed portion of distributable net income after 1955 distribution</ENT> <ENT>2,116</ENT> </ROW> <ROW> <ENT I="03">Refund disallowed to the trust and credit available to A in 1955</ENT> <ENT>4,044</ENT> </ROW> </GPOTABLE> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 741, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.667(a)-1A</SECTNO> <RESERVED>[Reserved]</RESERVED> </SECTION> <SECTION> <SECTNO>§ 1.667(b)-1A</SECTNO> <SUBJECT>Authorization of credit to beneficiary for taxes imposed on the trust.</SUBJECT> <P> (a) <E T="03">Determination of credit</E> —(1) <E T="03">In general.</E> Section 667(b) allows under certain circumstances a credit (without interest) against the tax imposed by subtitle A of the Code on the beneficiary for the taxable year in which the accumulation distribution is required to be included in income under section 668(a). In the case of an accumulation distribution consisting only of undistributed net income, the amount of such credit is the total of the taxes deemed distributed to such beneficiary under section 666 (b) and (c) as a result of such accumulation distribution for preceding taxable years of the trust on the last day of which such beneficiary was in being, less the amount of such <PRTPAGE P="230"/> taxes for such preceding taxable years taken into account in reducing the amount of partial tax determined under § 1.668(b)-1A. In the case of an accumulation distribution consisting only of undistributed capital gain, the amount of such credit is the total of the taxes deemed distributed as a result of the accumulation distribution to such beneficiary under section 669 (d) and (e) for preceding taxable years of the trust on the last day of which such beneficiary was in being, less the amount of such taxes for such preceding taxable years taken into account in reducing the amount of partial tax determined under § 1.669(b)-1A. In the case of an accumulation distribution consisting of both undistributed net income and undistributed capital gain, a credit will not be available unless the total taxes deemed distributed to the beneficiary for all preceding taxable years as a result of the accumulation distribution exceeds the beneficiary's partial tax determined under §§ 1.668(b)-1A and 1.669(b)-1A without reference to the taxes deemed distributed. A credit is not allowed for any taxes deemed distributed as a result of an accumulation distribution to a beneficiary by reason of sections 666 (b) and (c) or sections 669 (d) and (e) for a preceding taxable year of the trust before the beneficiary was born or created. However, if as a result of an accumulation distribution the total taxes deemed distributed under sections 668(a)(2) and 668(a)(3) in preceding taxable years before the beneficiary was born or created exceed the partial taxes attributable to amounts deemed distributed in such years, such excess may be used to offset any liability for partial taxes attributable to amounts deemed distributed as a result of the same accumulation distribution in preceding taxable years after the beneficiary was born or created. </P> <P> (2) <E T="03">Exact method.</E> In the case of the tax computed under the exact method provided in §§ 1.668(b)-1A(b) and 1.669(b)-1A(b), the credit allowed by this section is computed as follows: </P> <P>(i) Compute the total taxes deemed distributed under §§ 1.666(b)-1A and 1.666(c)-1A or §§ 1.669(d)-1A and 1.669(e)-1A, whichever are appropriate, for the preceding taxable years of the trust on the last day of which the beneficiary was in being.</P> <P>(ii) Compute the total of the amounts of tax determined under § 1.668(b)-1A(b)(1) or § 1.669(b)-1A(b) (1), whichever is appropriate, for the prior taxable years of the beneficiary in which he was in being.</P> <FP>If the amount determined under subdivision (i) of this subparagraph does not exceed the amount determined under subdivision (ii) of this subparagraph, no credit is allowable. If the amount determined under subdivision (i) of this subparagraph exceeds the amount determined under subdivision (ii) of this subparagraph, the credit allowable is the lesser of the amount of such excess or the amount of taxes deemed distributed to the beneficiary for all preceding taxable years to the extent that such taxes are not used in § 1.668(b)-1A(b)(2) or § 1.669(b)-1A(b)(2) in determining the beneficiary's partial tax under section 668(a)(2) or 668(a)(3). The application of this subparagraph may be illustrated by the following example:</FP> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>An accumulation distribution made in 1975 is deemed distribution in 1973 and 1974, years in which the beneficiary was in being. The taxes deemed distributed in such years are $4,000 and $2,000, respectively, totaling $6,000. The amounts of tax computed under § 1.668(b)-1A(b)(1) attributable to the amounts thrown back are $3,000 and $2,000, respectively, totaling $5,000. The credit allowable under this subparagraph is therefore $1,000 ($6,000 less $5,000).</P> </EXAMPLE> <P> (3) <E T="03">Short-cut method.</E> In the case of the tax computed under the short-cut method provided in § 1.668(b)-1A(c) or § 1.669(b)-1A(c), the credit allowed by this section is computed as follows: </P> <P>(i) Compute the total taxes deemed distributed in all preceding taxable years of the trust under §§ 1.666(b)-1A and 1.666(c)-1A or §§ 1.669(d)-1A and 1.669(e)-1A, whichever are appropriate.</P> <P>(ii) Compute the beneficiary's partial tax determined under either § 1.668(b)-1A(c)(1)(v) or § 1.669(b)-1A (c)(1)(v), whichever is appropriate.</P> <FP> If the amount determined under subdivision (i) of this subparagraph does not exceed the amount determined under subdivision (ii) of this subparagraph, no credit is allowable. If the amount determined under subdivision <PRTPAGE P="231"/> (i) of this subparagraph exceeds the amount determined under subdivision (ii) of this subparagraph, </FP> <P>(iii) Compute the total taxes deemed distributed under §§ 1.666(b)-1A and 1.666(c)-1A or §§ 1.669(d)-1A and 1.669(e)-1A, which are appropriate, for the preceding taxable years of the trust on the last day of which the beneficiary was in being.</P> <P>(iv) Multiply the amount by which subdivision (i) of this subparagraph exceeds subdivision (ii) of this subparagraph by a fraction, the numerator of which is the amount determined under subdivision (iii) of this subparagraph and the denominator of which is the amount determined under subdivision (i) of this subparagraph. The result is the allowable credit. The application of this subparagraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>An accumulation distribution that consists only of undistributed net income is made in 1975. The taxes deemed distributed in the preceding years under §§ 1.666(b)-1A and 1.666(c)-1A are $15,000. The amount determined under § 1.668(b)-1A(c)(1)(v) is $12,000. The beneficiary was in being on the last day of all but one preceding taxable year in which the accumulation distribution was deemed made, and the taxes deemed distributed in those years was $10,000. Therefore, the excess of the subdivision (i) amount over the subdivision (ii) amount is $3,000, and is multiplied by 10,000/15,000, resulting in an answer of $2,000, which is the credit allowable when computed under the short-cut method.</P> </EXAMPLE> <P> (b) <E T="03">Year of credit.</E> The credit to which a beneficiary is entitled under this section is allowed for the taxable year in which the accumulation distribution (to which the credit relates) is required to be included in the income of the beneficiary under section 668(a). Any excess over the total tax liability of the beneficiary for such year is treated as an overpayment of tax by the beneficiary. See section 6401(b) and the regulations thereunder. </P> <CITA>[T.D. 7204, 37 FR 17147, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-1A</SECTNO> <SUBJECT>Amounts treated as received in prior taxable years; inclusion in gross income.</SUBJECT> <P>(a) Section 668(a) provides that the total of the amounts treated under sections 666 and 669 as having been distributed by the trust on the last day of a preceding taxable year of the trust shall be included in the income of the beneficiary or beneficiaries receiving them. The total of such amounts is includable in the income of each beneficiary to the extent the amounts would have been included under section 662 (a)(2) and (b) as if the total had actually been an amount properly paid by the trust under section 661 (a)(2) on the last day of such preceding taxable year. The total is included in the income of the beneficiary for the taxable year of the beneficiary in which such amounts are in fact paid, credited, or required to be distributed unless the taxable year of the beneficiary differs from the taxable year of the trust (see section 662(c) and the regulations thereunder). The character of the amounts treated as received by a beneficiary in prior taxable years, including taxes deemed distributed, in the hands of the beneficiary is determined by the rules set forth in section 662(b) and the regulations thereunder.</P> <P>(b) Any deduction allowed to the trust in computing distributable net income for a preceding taxable year (such as depreciation, depletion, etc.) is not deemed allocable to a beneficiary because of amounts included in a beneficiary's gross income under this section since the deduction has already been utilized in reducing the amount included in the beneficiary's income.</P> <P> (c) For purposes of applying section 668(a)(3), a trust shall be considered to be other than a “trust which is not required to distribute all of its income currently” for each taxable year prior to the first taxable year beginning after December 31, 1968, and ending after November 30, 1969, in which income is accumulated. Income will not be deemed to have been accumulated for purposes of applying section 668(a)(3) in a year if the trustee makes a determination, as evidenced by a statement on the return, to distribute all of the trust's income for such year and also makes a good faith determination as to the amount of such income and actually distributed for such year the entire amount so determined. The term “income,” as used in the preceding two sentences, is defined in §§ 1.643(b)-1 and 1.643(b)-2. Since, under such definitions, certain items may be <PRTPAGE P="232"/> included in distributable net income but are not, under applicable local law, “income” (as, for example, certain extraordinary dividends), a trust that has undistributed net income from such sources might still qualify as a trust that has not accumulated income. Also, for example, if a trust establishes a reserve for depreciation or depletion and applicable local law permits the deduction for such reserve in the computation of “income,” amounts so added to the reserve do not constitute an accumulation of income. If a trust has separate shares, and any share accumulates income, all shares of the trust will be considered to have accumulated income for purposes of section 668(a)(3). Amounts retained by a trust or a portion of a trust that is subject to subpart E (sections 671-678) shall not be considered accumulated income. </P> <P>(d) See section 1302(a)(2)(B) to the effect that amounts included in the income of a beneficiary of a trust under section 668(a) are not eligible for income averaging.</P> <CITA>[T.D. 7204, 37 FR 17148, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-2A</SECTNO> <SUBJECT>Allocation among beneficiaries; in general.</SUBJECT> <P>The portion of the total amount includible in income under § 1.668(a)-1A which is includible in the income of a particular beneficiary is based upon the ratio determined under the second sentence of section 662(a)(2) for the taxable year (and not for the preceding taxable year). This section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) Under the terms of a trust instrument, the trustee may accumulate the income or make distributions to A and B. The trustee may also invade corpus for the benefit of A and B. The distributable net income of the trust for taxable year 1975 is $10,000. The trust had undistributed net income for taxable year 1973, the first year of the trust, of $5,000, to which a tax of $1,100 was allocable. On May 1, 1975, the trustee distributes $10,000 to A, and on November 29, 1975, he distributes $5,000 to B. Thus, of the total distribution of $15,000, A received two-thirds and B receives one-third.</P> <P>(b) For the purposes of determining the amounts includible in the beneficiaries' gross income for 1975, the trust is deemed to have made the following distributions:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,8"> <ROW> <ENT I="01">Amount distributed out of 1975 income (distributable net income)</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Accumulation distribution deemed distributed by the trust on the last day of 1973 under section 666(a)</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">Taxes imposed on the trust attributable to the undistributed net income deemed distributed under section 666(b)</ENT> <ENT>1,100</ENT> </ROW> </GPOTABLE> <P>(c) A will include in his income for 1975 two-thirds of each item shown in paragraph (b) of this example. Thus, he will include in gross income $6,666.67 (10,000/15,000 × $10,000) of the 1975 distributable net income of the trust as provided in section 662(a)(2) (which is not an amount includable in his income under § 1.668(a)-1A(a)). He will include in his income $3,333.33 (10,000/15,000 × $5,000) of the accumulation distribution and $733.33 (10,000/15,000 × $1,100) of the taxes imposed on the trust, as provided in section 668(a).</P> <P>(d) B will include in his income for 1975 one-third of each item shown in paragraph (b) of this example, computed in the manner shown in paragraph (c) of this example.</P> <P>(e) To the extent the total accumulation distribution consists of undistributed net income and undistributed capital gain, A and B shall be treated as receiving a pro rata share of each for the preceding taxable year 1973.</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17148, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-3A</SECTNO> <SUBJECT>Determination of tax.</SUBJECT> <P>In a taxable year in which an amount is included in a beneficiary's income under § 1.668(a)-1A(a), the tax on the beneficiary for such taxable year is determined only as provided in section 668 and consists of the sum of:</P> <P>(a) A partial tax computed on (1) the beneficiary's taxable income reduced by (2) an amount equal to the total amounts includible in his income under § 1.668(a)-1A(a), at the rate and in the manner as if section 668 had not been enacted,</P> <P>(b) A partial tax determined as provided in § 1.668(b)-1A, and</P> <P>(c) In the case of a beneficiary of a trust which is not required to distribute all of its income currently, a partial tax determined as provided in § 1.669(b)-1A.</P> <CITA>[T.D. 7204, 37 FR 17148, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-1A</SECTNO> <SUBJECT>Tax on distribution.</SUBJECT> <P> (a) <E T="03">In general.</E> The partial tax imposed on the beneficiary by section 668(a)(2) shall be the lesser of: </P> <P>(1) The tax computed under paragraph (b) of this section (the “exact” method), or</P> <P> (2) The tax computed under paragraph (c) of this section (the “short-cut” method), <PRTPAGE P="233"/> </P> <FP>except as provided in § 1.668(b)-4A (relating to failure to furnish proper information) and paragraph (d) of this section (relating to disallowance of short-cut method). For purposes of this paragraph, the method used in the return shall be accepted as the method that produces the lesser tax. The beneficiary's choice of the two methods is not dependent upon the method that he uses to compute his partial tax imposed by section 668(a)(3).</FP> <P> (b) <E T="03">Computation of partial tax by the exact method.</E> The partial tax referred to in paragraph (a)(1) of this section is computed as follows: </P> <P>(1) First, compute the tax attributable to the section 666 amounts for each of the preceding taxable years. For purposes of this paragraph, the “section 666 amounts” for a preceding taxable year are the amounts deemed distributed under section 666(a) on the last day of the preceding taxable year, plus the amount of taxes deemed distributed on such day under section 666 (b) or (c). The tax attributable to such amounts in each prior taxable year of the beneficiary is the difference between the tax for such year computed with the inclusion of the section 666 amounts in the beneficiary's gross income and the tax for such year computed without including them in such gross income. Tax computations for each such year shall reflect a taxpayer's marital, dependency, exemption, and filing status for such year. To the extent the undistributed net income of a trust deemed distributed in an accumulation distribution includes amounts received as an accumulation distribution from another trust, for purposes of this paragraph they shall be considered as amounts deemed distributed by the trust under section 666(a) on the last day of each of the preceding taxable years in which such amounts were accumulated by such other trust. For example, assume trust Z, a calendar year trust, received in its taxable year 1975 an accumulation distribution from trust Y, a calendar year trust, that included undistributed net income and taxes of trust Y for the taxable years 1972, 1973, and 1974. To the extent an accumulation distribution made by trust Z in its taxable year 1976 includes such undistributed net income and taxes, it shall be considered an accumulation distribution by trust Z in the taxable year 1976 and under section 666(a) will be deemed distributed on the last day of the preceding taxable years 1972, 1973, and 1974.</P> <P>(2) From the sum of the taxes for the prior taxable years attributable to the section 666 amounts (computed in accordance with subparagraph (1) of this paragraph), subtract so much of the amount of taxes deemed distributed to the beneficiary under §§ 1.666(b)-1A and 1.666(c)-1A as does not exceed such sum. The resulting amount, if any, is the partial tax, computed under the exact method, for the taxable year in which the accumulation distribution is paid, credited, or required to be distributed to the beneficiary.</P> <P>(3) The provisions of this paragraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(i) Assume that in 1979 a trust makes an accumulation distribution of $15,000 to A. The accumulation distribution is allocated under section 666(a) in the amounts of $5,000 to 1971, $4,000 to 1972, and $6,000 to 1973. Under section 666 (b) and (c), taxes in the amounts of $935, $715, and $1,155 (totaling $2,805) are deemed distributed in 1971, 1972, and 1973, respectively.</P> <P>(ii) A, the beneficiary, had taxable income and paid income tax in 1971-73 as follows:</P> <GPOTABLE COLS="3" OPTS="L1" CDEF="s15,9.6,9.6"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Taxable income</CHED> <CHED H="1">Tax</CHED> </BOXHD> <ROW> <ENT I="01">1971</ENT> <ENT>$10,000</ENT> <ENT>$2,190</ENT> </ROW> <ROW> <ENT I="01">1972</ENT> <ENT>12,000</ENT> <ENT>2,830</ENT> </ROW> <ROW> <ENT I="01">1973</ENT> <ENT>14,000</ENT> <ENT>3,550</ENT> </ROW> </GPOTABLE> <P>(iii) Taxes attributable to the section 666 amounts (paragraph (i) of this example) are $6,979, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW> <ENT I="28">1971</ENT> </ROW> <ROW> <ENT I="01">Taxable income including section 666 amounts ($10,000 + $5,000 + $935)</ENT> <ENT>$15,935</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Tax on $15,935</ENT> <ENT>$4,305</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Tax paid by A in 1971</ENT> <ENT>2,190</ENT> </ROW> <ROW> <ENT I="01">Tax attributable to 1971 section 666 amounts</ENT> <ENT>2,115</ENT> </ROW> <ROW> <ENT I="28">1972</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Taxable income including section 666 amounts ($12,000 + $4,000 + $715)</ENT> <ENT>$16,715</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Tax on $16,715</ENT> <ENT>$4,620</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Tax paid by A in 1972</ENT> <ENT>2,830</ENT> </ROW> <ROW> <ENT I="01">Tax attributable to 1972 section 666 amounts</ENT> <ENT>1,790</ENT> </ROW> <ROW> <ENT I="28">1973</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Taxable income including section 666 amounts ($14,000 + $6,000 + $1,155)</ENT> <ENT>$21,155</ENT> </ROW> <ROW EXPSTB="01"> <PRTPAGE P="234"/> <ENT I="01">Tax on $21,155</ENT> <ENT>$6,624</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Tax paid by A in 1973</ENT> <ENT>3,550</ENT> </ROW> <ROW> <ENT I="01">Tax attributable to 1973 section 666 amounts</ENT> <ENT>3,074</ENT> </ROW> <ROW> <ENT I="11">Total tax attributable to section 666 amounts:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">1971</ENT> <ENT>$2,115</ENT> </ROW> <ROW> <ENT I="02">1972</ENT> <ENT>1,790</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">1973</ENT> <ENT>3,074</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>6,979</ENT> </ROW> </GPOTABLE> <P>(iv) The partial tax computed under the exact method is $4,174, computed by subtracting the taxes deemed distributed ($2,805) from the tax attributable to the section 666 amounts ($6,979).</P> </EXAMPLE> <P> (c) <E T="03">Computation of tax by the short- cut method.</E> (1) The tax referred to in paragraph (a)(2) of this section is computed as follows: </P> <P> (i) First, determine the number of preceding taxable years of the trust on the last day of which an amount is deemed under section 666(a) to have been distributed. For purposes of the preceding sentence, the preceding taxable years of a trust that has received an accumulation distribution from another trust shall include the taxable years of such other trust in which an amount was deemed distributed in such accumulation distribution. For example, assume trust Z, a calendar year trust, received in its taxable year 1975 an accumulation distribution from trust Y, a calendar year trust, that included undistributed net income of trust Y for the taxable years 1972, 1973, and 1974. To the extent an accumulation distribution made by trust Z in its taxable year 1976 includes such undistributed net income, it shall be considered an accumulation distribution by trust Z in the taxable year 1976 and under section 666(a) will be deemed distributed on the last day of the preceding taxable years 1972, 1973, and 1974. For purposes of this subparagraph, such number of preceding taxable years of the trust shall not include any preceding taxable year of the trust in which the undistributed net income deemed distributed is less than 25 percent of ( <E T="03">a</E> ) the total amounts deemed under section 666(a) to be undistributed net income from preceding taxable years divided by ( <E T="03">b</E> ) the number of such preceding taxable years of the trust on the last day of which an amount is deemed under section 666(a) to have been distributed without application of this sentence. For example, assume that an accumulation distribution of $90,000 made to a beneficiary in 1979 is deemed distributed in the amounts of $29,000 in each of the years 1972, 1973, and 1974, and $3,000 in 1975. The number of preceding taxable years on the last day of which an amount was deemed distributed without reference to the second sentence of this subparagraph is four. However, the distribution deemed made in 1975 ($3,000) is less than $5,625, which is 25 percent of ( <E T="03">a</E> ) the total undistributed net income deemed distributed under section 666(a) ($90,000) divided by ( <E T="03">b</E> ) the number of such preceding taxable years (4), or $22,500. Therefore, for purposes of this subparagraph the accumulation distribution is deemed distributed in only 3 preceding taxable years (1972, 1973, and 1974). </P> <P>(ii) Second, divide the amount (representing the accumulation distribution and taxes deemed distributed) required under section 668(a) to be included in the income of the beneficiary for the taxable year by the number of preceding taxable years of the trust on the last day of which an amount is deemed under section 666(a) to have been distributed (determined as provided in subdivision (i) of this subparagraph). The amount determined under this subdivision, including taxes deemed distributed, consists of the same proportion of each class of income as the total of each class of income deemed distributed in the accumulation distribution bears to the total undistributed net income from such preceding taxable years deemed distributed in the accumulation distribution. For example, assume that an amount of $50,000 is deemed distributed under section 666(a) from undistributed net income of 5 preceding taxable years of the trust, and consists of $25,000 of interest, $15,000 of dividends, and $10,000 of net rental income. Taxes attributable to such amounts in the amount of $10,000 are also deemed distributed. The amount determined under this subdivision, $12,000 ($50,000 income plus $10,000 tax divided by 5 years), is deemed to consist of $6,000 in interest, $3,600 in dividends, and $2,400 in net rental income.</P> <P> (iii) Third, compute the tax of the beneficiary for each of the 3 taxable years immediately preceding the year <PRTPAGE P="235"/> in which the accumulation distribution is paid, credited, or required to be distributed to him, </P> <P> ( <E T="03">a</E> ) With the inclusion in gross income of the beneficiary for each of such 3 years of the amount determined under subdivision (ii) of this subparagraph, and </P> <P> ( <E T="03">b</E> ) Without such inclusion. </P> <FP> The difference between the amount of tax computed under ( <E T="03">a</E> ) of this subdivision for each year and the amount computed under ( <E T="03">b</E> ) of this subdivision for that year is the additional tax resulting from the inclusion in gross income for that year of the amount determined under subdivision (ii) of this subparagraph. For example, assume that a distribution of $12,000, is includible in the income of each of the beneficiary's 3 preceding taxable years when his income (without the inclusion of the accumulation distribution) was $20,000, $30,000, and $40,000. The inclusion of $12,000 in income would produce taxable income of $32,000, $42,000, and $52,000, and the tax attributable to such increases would be $4,000, $5,000, and $6,000, respectively. </FP> <P>(iv) Fourth, add the additional taxes resulting from the application of subdivision (iii) of this subparagraph and then divide this amount by 3. For example, if these additional taxes are $4,000, $5,000, and $6,000 for the 3 preceding taxable years, this amount would be $5,000 ($4,000 + $5,000 + $6,000 divided by 3).</P> <P>(v) Fifth, the resulting amount is then multiplied by the number of preceding taxable years of the trust on the last day of which an amount is deemed under section 666(a) to have been distributed (previously determined under subdivision (i) of this subparagraph). For example, if an amount is deemed distributed for 5 preceding taxable years, the resulting amount would be five times the $5,000 amount.</P> <P>(vi) Sixth, the resulting amount, less so much of the amount of taxes deemed distributed to the beneficiary under §§ 1.666(b)-1A and 1.666(c)-1A as does not exceed such resulting amount, is the tax under the short-cut method provided in section 668(b)(1)(B).</P> <P>(2) The computation of the tax by the short-cut method may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>In 1971, X creates a trust which is to accumulate its income and pay the income to Y when Y reaches 30. Y is 19. Over the 11 years of the trust, the trust earns $1,200 of interest income annually and has expenses each year of $100 allocable to the production of income. The trust pays a total tax of $1,450 on the accumulated income. In 1981, when Y reaches 30, the $9,550 of accumulated undistributed net income and the $1,100 of current net income are distributed to Y. Y is treated as having received a total distribution of $11,000 (the $9,550 accumulation distribution plus the taxes paid by the trust which are deemed to have been distributed to Y). The income of the current year (1981) is taxed directly to Y. The computation is as follows: $11,000 (accumulation distribution plus taxes) divided by 10 (number of years out of which distribution was made) equals $1,100. The $1,100 added to the income of the beneficiary's preceding 3 years produces increases in tax as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,8.6"> <ROW> <ENT I="02">1980</ENT> <ENT>$350</ENT> </ROW> <ROW> <ENT I="02">1979</ENT> <ENT>300</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">1978</ENT> <ENT>250</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>900</ENT> </ROW> </GPOTABLE> <FP>$900 (total additional tax) divided by 3 equals $300 (average annual increase in tax). $300 (average annual increase in tax) times 10 equals $3,000, from which is deducted the amount of taxes ($1,450) paid by the trust attributable to the undistributed net income deemed distributed. The amount of tax to be paid currently under the short-cut method is therefore $1,550.</FP> </EXAMPLE> <P> (d) <E T="03">Disallowance of short-cut method.</E> If, in any prior taxable year of the beneficiary in which any part of the accumulation distribution of undistributed net income is deemed to have been distributed under section 666(a) to such beneficiary, any part of prior accumulation distributions of undistributed net income by each of two or more other trusts is deemed under section 666(a) to have been distributed to such beneficiary, then the short-cut method under paragraph (c) of this section may not be used and the partial tax imposed by section 668(a)(2) shall be computed only under the exact method under paragraph (b) of this section. For example, assume that, in 1978, trust X makes an accumulation distribution of undistributed net income to A, who is on the calendar year basis, and part of the accumulation distribution is deemed under section 666(a) to have been distributed on March 31, 1974. In 1977, A had received an accumulation <PRTPAGE P="236"/> distribution of undistributed net income from both trust Y and trust Z. Part of the accumulation distribution from trust Y was deemed under section 666(a) to have been distributed to A on June 30, 1974, and part of the accumulation distribution from trust Z was deemed under section 666(a) to have been distributed to A on December 31, 1974. Because there were portions of accumulation distributions of undistributed net income from two other trusts deemed distributed within the same prior taxable year of A (1974), the 1978 accumulation distribution from trust X may not be computed under the short-cut method provided in paragraph (c) of this section. Therefore the exact method under paragraph (b) of this section must be used to compute the tax imposed by section 666(a)(2). </P> <CITA>[T.D. 7204, 37 FR 17149, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-2A</SECTNO> <SUBJECT>Special rules applicable to section 668.</SUBJECT> <P> (a) <E T="03">Rule when beneficiary not in existence on the last day of a taxable year.</E> If a beneficiary was not in existence on the last day of a preceding taxable year of the trust with respect to which a distribution is deemed made under section 666(a), it shall be assumed, for purposes of the computations under paragraphs (b) and (c) of § 1.668(b)-1A, that the beneficiary: </P> <P>(1) Was in existence on such last day,</P> <P>(2) Was a calendar year taxpayer,</P> <P>(3) Had no gross income other than the amounts deemed distributed to him from such trust in his calendar year in which such last day occurred and from all other trusts from which amounts are deemed to have been distributed to him in such calendar year,</P> <P>(4) If an individual, was unmarried and had no dependents,</P> <P>(5) Had no deductions other than the standard deduction, if applicable, under section 141 for such calendar year, and</P> <P>(6) Was entitled to the personal exemption under section 151 or 642(b).</P> <FP>For example, assume that part of an accumulation distribution made in 1980 is deemed under section 666(a) to have been distributed to the beneficiary, A, in 1973; $10,000 of a prior accumulation distribution was deemed distributed in 1973. A was born on October 9, 1975. It will be assumed for purposes of § 1.668(b)-1A that A was alive in 1973, was on the calendar year basis, had no income other than (i) the $10,000 from the earlier accumulation distribution deemed distributed in 1973, and (ii) the part of the 1980 distribution deemed distributed in 1973, and had no deductions other than the personal exemption provided in section 151. It should be noted that the standard deduction for 1973 will be available to A with respect to the distribution only to the extent it qualifies as “earned income” in the hands of the trust. See section 141(e) and the regulations thereunder and § 1.652(b)-1. If A were a trust or estate created after 1973, the same assumptions would apply, except that the trust or estate would not be entitled to the standard deduction and would receive the personal exemption provided under section 642(b) in the same manner as allowed under such section for A's first actual taxable year.</FP> <P> (b) <E T="03">Effect of other distributions.</E> The income of the beneficiary, for any of his prior taxable years for which a tax is being recomputed under § 1.668(b)-1A, shall include any amounts of prior accumulation distributions (including prior capital gain distributions) deemed distributed under sections 666 and 669 in such prior taxable year. For purposes of the preceding sentence, a “prior accumulation distribution” is a distribution from the same or another trust which was paid, credited, or required to be distributed in a prior taxable year of the beneficiary. The term “prior accumulation distribution” also includes accumulation distributions of other trusts which were paid, credited, or required to be distributed to the beneficiary in the same taxable year and which the beneficiary has determined under paragraph (c) of this section to treat as having been distributed before the accumulation distribution for which tax is being computed under § 1.668(b)-1A. Any capital gain distribution from the same trust paid, credited, or required to be distributed in the same taxable year of the beneficiary shall not be considered under this paragraph to be a “prior capital gain distribution.” </P> <P> (c) <E T="03">Multiple distributions in the same taxable year.</E> For purposes of paragraph <PRTPAGE P="237"/> (b) of this section, accumulation distributions made from more than one trust in the same taxable year of the beneficiary, regardless of when in the taxable year they were actually made, shall be treated as having been made consecutively, in whichever order the beneficiary may determine. However, the beneficiary must treat them as having been made in the same order for the purpose of computing the partial tax on the several accumulation distributions. The beneficiary shall indicate the order he has determined to deem the accumulation distributions to have been received by him on his return for the taxable year. A failure by him so to indicate, however, shall not affect his right to make such determination. The purpose of this rule is to assure that the tax resulting from the later (as so deemed under this paragraph) distribution is computed with the inclusion of the earlier distribution in the taxable base and that the tax resulting from the earlier (as so deemed under this paragraph) distribution is computed with the later distribution excluded from the taxable base. </P> <P> (d) <E T="03">Examples.</E> The provisions of paragraphs (b) and (c) of this section may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>In 1978, trust X made an accumulation distribution of undistributed net income to A, a calendar year taxpayer, of which $3,000 was deemed to have been distributed in 1974. In 1980, trust X makes another accumulation distribution of undistributed net income to A, $10,000 of which is deemed under section 666 to have been distributed in 1974. Also in 1980, trust Y makes an accumulation distribution of undistributed net income to A, of which $5,000 is deemed under section 666 to have been distributed in 1974. A determines to treat the 1980 distribution from trust Y as having been made prior to the 1980 distribution from trust X. In computing the tax on the 1980 trust Y distribution, A's gross income for 1974 includes (i) the $3,000 deemed distributed from the 1978 distribution, and (ii) the $5,000 deemed distributed in 1974 from the 1980 trust Y accumulation distribution. To compute A's tax under the exact method for 1974 on the $10,000 from the 1980 trust X accumulation distribution deemed distributed in 1974, A's gross income for 1974 includes (i) the $10,000, (ii) the $3,000 previously deemed distributed in 1974 from the 1978 trust X accumulation distribution, and (iii) the $5,000 deemed distribution in 1974 from the 1980 trust Y accumulation distribution.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>In 1978, trust T makes an accumulation distribution of undistributed net income to B, a calendar year taxpayer. Determination of the tax on the accumulation distribution under the short-cut method requires the use of B's gross income for 1975, 1976, and 1977. In 1977, B received an accumulation distribution of undistributed net income from trust U, of which $2,000 was deemed to have been distributed in 1975, and $3,000 in 1976. B's gross income for 1975, for purposes of using the short-cut method to determine the tax from the trust T accumulation distribution, will be deemed to include the $2,000 deemed distributed in 1975 by trust U, and his gross income for 1976 will be deemed to include the $3,000 deemed distributed by trust U in 1976.</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17151, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-3A</SECTNO> <SUBJECT>Computation of the beneficiary's income and tax for a prior taxable year.</SUBJECT> <P> (a) <E T="03">Basis for computation.</E> (1) The beneficiary's income and tax paid for any prior taxable year for which a recomputation is involved under either the exact method or the short-cut method shall be determined by reference to the information required to be furnished by him under § 1.668(b)-4A(a). The gross income, related deductions, and taxes paid for a prior taxable year of the beneficiary as finally determined shall be used for computation purposes. The term “as finally determined” has reference to the final status of the gross income, deductions, credits, and taxes of the taxable year after the expiration of the period of limitations or after completion of any court action regarding the tax for the taxable year. </P> <P> (2) If any computations rely on the beneficiary's return for a prior taxable year for which the applicable period of limitations on assessment under section 6501 has expired, and such return shows a mathematical error on its face which resulted in the wrong amount of tax being paid for such year, the determination of both the tax for such year computed with the inclusion of the section 666 amount in the beneficiary's gross income and the tax for such year computed without including such amounts in such gross income shall be based upon the return after the correction of such mathematical errors, and <PRTPAGE P="238"/> the beneficiary shall be credited for the correct amount of tax that should have been properly paid. </P> <P> (b) <E T="03">Effect of allocation of undistributed net income on items based on amount of income and with respect to a net operating loss, a charitable contributions carryover, or a capital loss carryover.</E> (1) In computing the tax for any taxable year under either the exact method or the short-cut method, any item which depends upon the amount of gross income, adjusted gross income, or taxable income shall be recomputed to take into consideration the amount of undistributed net income allocated to such year. For example, if $1,000 of undistributed net income is allocated to 1970, adjusted gross income for 1970 is increased from $5,000 to $6,000. The allowable 50 percent charitable deduction under section 170(b)(1)(A) is then increased and the amount of the nondeductible medical expenses under section 213 (3 percent of adjusted gross income) is also increased. </P> <P>(2) In computing the tax attributable to the undistributed net income deemed distributed to the beneficiary in any of his prior taxable years under either the exact method or the short-cut method, the effect of amounts of undistributed net income on a net operating loss carryback or carryover, a charitable contributions carryover, or a capital loss carryback or carryover, shall be taken into account. In determining the amount of tax attributable to such deemed distribution, a computation shall also be made for any taxable year which is affected by a net operating loss carryback or carryover, by a charitable contributions carryover, or by a capital loss carryback or carryover determined by reference to the taxable year to which amounts are allocated under either method and which carryback or carryover is reduced or increased by such amounts so allocated. The provisions of this subparagraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>In 1978, a trust makes an accumulation distribution of undistributed net income to X of $50,000 that is deemed under section 666(a) to have been distributed in 1972. X had income in 1972, 1973, and 1973, and had a net operating loss in 1975 that offset his taxable income (computed as provided in § 1.172-5) for those years, as follows:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s15,9.3,12.5"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Actual income (or loss)</CHED> <CHED H="1">Income after net operating loss carryback (n.o.l.c.b.)</CHED> </BOXHD> <ROW> <ENT I="01">1972</ENT> <ENT>$10,000</ENT> <ENT>$0</ENT> </ROW> <ROW> <ENT I="01">1973</ENT> <ENT>50,000</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">1974</ENT> <ENT>50,000</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="01">1975</ENT> <ENT>(100,000)</ENT> <ENT>0</ENT> </ROW> </GPOTABLE> <P>As a result of the allocation of the 1973 accumulation distribution to 1972, X's income for 1972, 1973, 1974, and 1975, after taking into account the 1975 n.o.l.c.b., is deemed to be as follows:</P> <GPOTABLE COLS="2" OPTS="L2" CDEF="s15,r110"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Income deemed to have been earned after consideration of n.o.l.c.b., and accumulation distribution</CHED> </BOXHD> <ROW> <ENT I="01">1972</ENT> <ENT>0 ($10,000 + $50,000−$60,000 n.o.l.c.b.).</ENT> </ROW> <ROW> <ENT I="01">1973</ENT> <ENT>$10,000 ($50,000−$40,000 balance of n.o.l.c.b.).</ENT> </ROW> <ROW> <ENT I="01">1974</ENT> <ENT>$50,000.</ENT> </ROW> <ROW> <ENT I="01">1975</ENT> <ENT>0.</ENT> </ROW> </GPOTABLE> <P>Therefore, the tax on the 1978 accumulation distribution to X is the tax X would have paid in 1973 and 1974 had he had the above income in such years.</P> </EXAMPLE> <P> (c) <E T="03">Averaging.</E> A beneficiary who uses the exact method may recompute his tax for a prior taxable year by using income averaging for all of his actual income for that year, plus the amount deemed distributed in that year under section 666, even though he may not have actually used section 1301 to determine his income tax for such taxable year. For purposes of such recomputation, the beneficiary's income for all other taxable years involved must include any amounts deemed distributed in such years from the current and all prior accumulation distributions. See § 1.668(b)-4A(c)(3) for additional information requirements. The beneficiary may not apply the provisions of this paragraph to a taxable year in which an amount is deemed to be income by reason of § 1.666(d)-1A(b). The accumulation distribution itself is not eligible for income averaging in the years in which it is paid, credited, or required to be distributed. See section 1302 (a)(2)(B) and the regulations thereunder. </P> <CITA>[T.D. 7204, 37 FR 17151, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-4A</SECTNO> <SUBJECT>Information requirements with respect to beneficiary.</SUBJECT> <P> (a) <E T="03">Information to be supplied by beneficiary</E> —(1) <E T="03">In general.</E> The beneficiary must supply the information required by subparagraph (3) of this paragraph for any prior taxable year for which a <PRTPAGE P="239"/> recomputation is required under either the exact method or the short-cut method. Such information shall be filed with the beneficiary's return for the year in which the tax under section 668(a)(2) is imposed. </P> <P> (2) <E T="03">Failure to furnish.</E> If the beneficiary fails to furnish the information required by this paragraph for any prior year involved in the exact method, he may not use such method and the tax computed under paragraph (c) of § 1.668(b)-1A (the short-cut method) shall be deemed to be the amount of partial tax imposed by section 668(a)(2). See, however, paragraph (b) of this section for an exception to this rule where the short-cut method is not permitted. If he cannot furnish the information required for a prior year involved in the short-cut method, such year will be recomputed on the basis of the best information available. </P> <P> (3) <E T="03">Information required.</E> The beneficiary shall file the following items with his income tax return for the taxable year in which the accumulation distribution is included in income: </P> <P>(i) A statement showing the gross income, adjustments, deductions, credits, taxes paid, and computations for each of his taxable years for which a computation is required under the method by which he computes his partial tax imposed by section 668(a)(2). Such statement shall include such amounts for the taxable year as adjusted by any events subsequent to such year, such as any adjustment resulting from the determination of a deficiency or an overpayment, or from a court action regarding the tax.</P> <P>(ii) A copy of the statement required by this subparagraph to be furnished by the beneficiary for any prior taxable year in which an accumulation distribution was received by him which was also deemed distributed in whole or in part in the prior taxable year for which the statement under subdivision (i) of this subparagraph is required.</P> <P>(iii) A copy of any statements furnished the beneficiary by the trustee (such as schedules E and J of Form 1041, etc.) with regard to the current taxable year or any prior taxable year for which a statement is furnished under subdivision (i) of this subparagraph.</P> <P> (b) <E T="03">Exception.</E> If by reason of § 1.668(b)-1A(e) the beneficiary may not compute the partial tax on the accumulation distribution under § 1.668(b)-1A(c) (the short-cut method), the provisions of subparagraph (2) of paragraph (a) of this section shall not apply. In such case, if the beneficiary fails to provide the information required by subparagraph (3) of paragraph (a) of this section for any prior taxable year, the district director shall, by utilizing whatever information is available to him (including information supplied by the beneficiary), determine the beneficiary's income and related expenses for such prior taxable year. </P> <P> (c) <E T="03">Records to be supplied by the beneficiary</E> —(1) <E T="03">Year when return was filed.</E> If the beneficiary filed an income tax return for a taxable year for which a recomputation is necessary, and the period of limitations on assessment under section 6501 for such year has expired as of the filing of the return for the year in which the accumulation distribution was made, then a copy of such return, plus proof of any changes of liability for such year due to the determination of a deficiency or an overpayment, court action, etc., shall, to the extent they verify the statements required under paragraph (a) of this section, serve as proof of such statements. If the period of limitations on assessment under section 6501 for a prior taxable year has not expired as of the filing of the beneficiary's return for the year in which the accumulation distribution was received, then the records required by section 6001 to be retained by the beneficiary for such prior taxable year shall serve as the basis of proof of the statements required to be filed under paragraph (a) of this section. </P> <P> (2) <E T="03">Year for which no return was filed.</E> If the beneficiary did not file a return for a taxable year for which a recomputation is necessary, he shall be deemed to have had in such year, in the absence of proof to the contrary, gross income in the amount equal to the maximum amount of gross income that he could have received without having had to file a return under section 6012 for such year. </P> <P> (3) <E T="03">Distributions deemed averaged.</E> In order for a beneficiary to use income <PRTPAGE P="240"/> averaging with respect to a prior taxable year (see § 1.668(b)-3A(c)), he must furnish all the information that would support the computation under section 1301 as if the distribution were actually received and averaged in such prior taxable year, even if a portion of the information relates to years in which no amount was deemed distributed to the beneficiary. </P> <CITA>[T.D. 7204, 37 FR 17152, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-1</SECTNO> <SUBJECT>Amounts treated as received in prior taxable years; inclusion in gross income.</SUBJECT> <P>(a) Section 668(a) provides that the total of the amounts treated under section 666 as having been distributed by the trust on the last day of a preceding taxable year of the trust shall be included in the gross income of the beneficiary or beneficiaries receiving them. The total of such amounts is includible in the gross income of each beneficiary to the extent the amounts would have been included under section 662 (a)(2) and (b) if the total had actually been paid by the trust on the last day of such preceding taxable year. The total is included in the gross income of the beneficiary for the taxable year of the beneficiary in which such amounts are in fact paid, credited, or required to be distributed unless the taxable year of the beneficiary differs from the taxable year of the trust (see section 662(c) and the regulations thereunder). The character of the amounts treated as received by a beneficiary in prior taxable years, including taxes deemed distributed, in the hands of the beneficiary is determined by the rules set forth in section 662(b) and the regulations thereunder. See paragraphs (h)(1)(ii) and (j)(1)(ii) of § 1.668(b)-2.</P> <P>(b) The total of the amounts treated under section 666 as having been distributed by the trust on the last day of a preceding taxable year of the trust are included as prescribed in paragraph (a) of this section in the gross income of the beneficiary even though as of that day the beneficiary would not have been entitled to receive them had they actually been distributed on that day.</P> <P>(c) Any deduction allowed to the trust in computing distributable net income for a preceding taxable year (such as depreciation, depletion, etc.) is not deemed allocable to a beneficiary because of amounts included in a beneficiary's gross income under this section since the deduction has already been utilized in reducing the amount included in the beneficiary's income.</P> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-2</SECTNO> <SUBJECT>Allocation among beneficiaries; in general.</SUBJECT> <P>The portion of the total amount includible in gross income under § 1.668 (a)-1 which is includible in the gross income of a particular beneficiary is based upon the ratio determined under the second sentence of section 662(a)(2) for the taxable year (and not for the preceding taxable year). This section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(a) Under the terms of a trust instrument, the trustee may accumulate the income or make distributions to A and B. The trustee may also invade corpus for the benefit of A and B. The distributable net income of the trust for the taxable year 1955 is $10,000. The trust had undistributed net income for the taxable year 1954 of $5,000, to which a tax of $1,100 was allocable. During the taxable year 1955, the trustee distributes $10,000 to A and $5,000 to B. Thus, of the total distribution of $15,000, A received two-thirds and B received one-third.</P> <P>(b) For the purposes of determining the amounts includible in the beneficiaries' gross income for 1955, the trust is deemed to have made the following distributions:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s100,8"> <ROW> <ENT I="01">Amount distributed out of 1955 income (distributable net income)</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Accumulation distribution deemed distributed by the trust on the last day of 1954 under section 666(a)</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="01">Taxes imposed on the trust deemed distributed under section 666(b)</ENT> <ENT>1,100</ENT> </ROW> </GPOTABLE> <P>(c) A will include in his gross income for 1955 two-thirds of each item shown in paragraph (b) of this example. Thus, he will include in gross income $6,666.67 (10,000/ 15,000 × $10,000) of the 1955 distributable net income of the trust as provided in section 662(a)(2), and $3,333.33 (10,000/ 15,000 × $5,000) of the accumulation distribution and $733.33 (10,000/15,000 × $1,100) of the taxes imposed on the trust as provided in section 668(a).</P> <P>(d) B will include in his gross income for 1955 one-third of each item shown in paragraph (b) of this example, computed in the manner shown in paragraph (c) of this example.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-3</SECTNO> <SUBJECT>Excluded amounts.</SUBJECT> <P> When a trust pays, credits, or is required to distribute to a beneficiary <PRTPAGE P="241"/> amounts which are excluded under section 665(b) (1), (2), (3), or (4) from the computation of an accumulation distribution, the amount includible under subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, in the gross income of the beneficiaries pursuant to § 1.668(a)-1 is first allocated to the beneficiaries as provided in § 1.668(a)-2 and, second, the amount allocable to the beneficiary receiving amounts which are excluded under section 665(b) (1), (2), (3), or (4) is reduced by the excluded amounts. This section may be illustrated by the following examples, in which it is assumed the trusts and beneficiaries report on the calendar year basis and the income of the trusts was derived entirely from taxable interest: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(a) A trust in 1957 has income as defined in section 643(b) of $35,000 and expenses allocable to corpus of $5,000. Its distributable net income is, therefore, $30,000 ($35,000−$5,000). The undistributed net income of the trust and the taxes imposed on the trust were $12,840 and $7,260, respectively, for each of the years 1956, 1955, and 1954. The terms of the trust instrument provide for the accumulation of income during the minority of beneficiaries A and B. However, the trustee may make discretionary distributions to either beneficiary after he becomes 21 years of age. Also, the trustee may invade corpus for the benefit of A and B. B became 21 years of age on January 1, 1957, and, as of that date, A was 25 years old. The trustee distributed $50,000 each to A and B during 1957.</P> <P>(b) Since each beneficiary received one-half of the total amount distributed by the trust, each must include in gross income under section 662(a)(2) one-half ($15,000) of the distributable net income ($30,000) of the trust for 1957.</P> <P>(c) The excess distribution of $35,000 ($50,000−$15,000) received by B is excluded from the determination of an accumulation distribution under section 665(b)(1) and accordingly is not includible in B's gross income under section 668(a). Nor is such amount treated as an accumulation distribution for the purpose of determining the amount includible in A's gross income under section 668(a).</P> <P>(d) The accumulation distribution of the trust is $35,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,9,9"> <ROW> <ENT I="01">Total distribution by the trust</ENT> <ENT/> <ENT>$100,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Distributable net income for 1957</ENT> <ENT>$30,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Excess distribution to B</ENT> <ENT>35,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>65,000</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution to A</ENT> <ENT>35,000</ENT> </ROW> </GPOTABLE> <P>(e) The accumulation distribution of $35,000 will be allocated to the preceding taxable years 1956, 1955, and 1954, and the trust will be deemed to have made the following distributions to A on the last day of those years:</P> <GPOTABLE COLS="5" OPTS="L2" CDEF="s15,8,8,8,8"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">1956</CHED> <CHED H="1">1955</CHED> <CHED H="1">1954</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">Undistributed net income</ENT> <ENT>$12,840</ENT> <ENT>$12,840</ENT> <ENT>$9,320</ENT> <ENT>$35,000</ENT> </ROW> <ROW RUL="n,s,s,s,s"> <ENT I="01">Taxes imposed on the trust</ENT> <ENT>7,260</ENT> <ENT>7,260</ENT> <ENT>5,270</ENT> <ENT>19,790</ENT> </ROW> <ROW> <ENT I="01">Total</ENT> <ENT>20,100</ENT> <ENT>20,100</ENT> <ENT>14,590</ENT> <ENT>54,790</ENT> </ROW> </GPOTABLE> <FP>Thus, A will include $54,790 in his gross income for 1957 under section 668(a). A will, however, receive credit against his tax under section 668(b).</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(a) Under the terms of a trust the trustee may make discretionary distributions out of income to A during her life. The balance of the income is to be accumulated during the minority of her son, B, and is to be distributed to him when he becomes 21 years of age. Thereafter the trustee may also make discretionary payments of income to B. Also, the trustee may invade corpus for the benefit of A and B. B became 21 years of age on December 31, 1955. The distributable net income of the trust for 1955 is $30,000. It had undistributed net income of $12,840 for the preceding taxable year 1954 and the taxes imposed on the trust for such year were $7,260. The trustee distributed $15,000 to A during 1955 and on December 31, 1955, he distributed $60,000 to B, which represented income accumulated during his minority.</P> <P>(b) Since B received four-fifths of the total amount ($75,000) distributed by the trust during 1955, he must include in his gross income under section 662(a)(2) four-fifths ($24,000) of the distributable net income ($30,000) of the trust for 1955. A will include in her gross income under section 662(a)(2) one-fifth ($6,000) of the distributable net income ($30,000) of the trust for 1955.</P> <P>(c) The excess distribution of $36,000 ($60,000−$24,000) received by B is excluded from the determination of an accumulation distribution under section 665(b)(1) and accordingly is not includible in his gross income under section 668(a).</P> <P>(d) The amount treated as an accumulation distribution for the purpose of determining the amount includible in A's gross income for 1955 under section 668(a) is $9,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,9,9"> <ROW> <ENT I="01">Total distribution by the trust</ENT> <ENT/> <ENT>$75,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Distributable net income for 1955</ENT> <ENT>$30,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Excess distribution to B</ENT> <ENT>36,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>66,000</ENT> </ROW> <ROW> <PRTPAGE P="242"/> <ENT I="03">Amount treated as an accumulation distribution</ENT> <ENT>9,000</ENT> </ROW> </GPOTABLE> <P>(e) Inasmuch as the amount of $9,000 is less than the total undistributed net income of the trust ($12,840) for the preceding taxable year 1954, a pro rata portion of the taxes imposed on the trust for that year are also deemed distributed by the trust. Thus, A will include $14,089 in her gross income for 1955 under section 668 (a) computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,9,9"> <ROW> <ENT I="28"> <E T="03">1954</E> </ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Accumulation distribution</ENT> <ENT>$9,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes imposed on the trust (9,000/ 12,840 × $7,260)</ENT> <ENT>5,089</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>14,089</ENT> </ROW> </GPOTABLE> <FP>A will, however, receive credit against her tax under section 668(b).</FP> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.668(a)-4</SECTNO> <SUBJECT>Tax attributable to throwback.</SUBJECT> <P>(a) The tax attributable to amounts deemed distributed under section 666 is imposed on the beneficiary for the taxable year of the beneficiary in which the accumulation distribution is made unless the taxable year of the beneficiary is different from that of the trust (see section 662(c) and the regulations thereunder). In the case of a trust (other than a foreign trust created by a U.S. person), the tax cannot be greater than the aggregate of the taxes attributable to those amounts had they been included, in accordance with the provisions of section 662 (a)(2) and (b), in the gross income of the beneficiary for the preceding taxable year or years in which they were deemed distributed. In the case of a foreign trust created by a U.S. person, the tax on the beneficiary shall be computed in accordance with the provisions of section 669 and the regulations thereunder. The tax liability of the beneficiary of a trust (other than a foreign trust created by a U.S. person), including the portion of an entire foreign trust which does not constitute a foreign trust created by a U.S. person (see § 1.643(d)-1), for the taxable year is computed in the following manner:</P> <P>(1) First, compute the amount of tax for the taxable year attributable to the section 666 amounts which are included in the gross income of the beneficiary for the year. The tax attributable to those amounts is the difference between the tax for the taxable year computed with the inclusion of the section 666 amounts in gross income and the tax computed without including them in gross income.</P> <P>(2) Next, compute the tax attributable to the section 666 amounts for each of the preceding taxable years as if they had been included in gross income for those years. The tax attributable to such amounts in each such preceding taxable year is the difference between the tax for such preceding year computed with the inclusion of the section 666 amounts in gross income and the tax for such year computed without including them in gross income. The tax computation for each preceding year shall reflect the taxpayer's marital and dependency status for that year.</P> <P> (3) The total tax for the taxable year is the tax for that year computed without including the section 666 amounts, <E T="03">plus:</E> </P> <P>(i) The amount of the tax for the taxable year attributable to the section 666 amounts (computed in accordance with subparagraph (1) of this paragraph), or (ii) The sum of the taxes for the preceding taxable years attributable to the section 666 amounts (computed in accordance with subparagraph (2) of this paragraph),</P> <FP>whichever is the smaller.</FP> <P>(b) The provisions of paragraph (a) of this section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(1) During the taxable year 1956, $10,000 is deemed distributed under section 666 to a beneficiary, of which $6,000 is deemed distributed by the trust on the last day of 1955 and $4,000 on the last day of 1954. The beneficiary had taxable income (after deductions) from other sources of $5,000 for 1956, $10,000 for 1955, and $10,000 for 1954. The beneficiary's tax liability for 1956 is $4,730 determined as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW> <ENT I="28"> <E T="03">Year 1956</E> </ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Tax on $15,000 (taxable income including section 666 amounts)</ENT> <ENT>$4,730</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax on $5,000 (taxable income excluding section 666 amounts)</ENT> <ENT>1,100</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Tax attributable to section 666 amounts</ENT> <ENT>3,630</ENT> </ROW> <ROW> <ENT I="28"> <E T="03">Year 1955</E> </ENT> </ROW> <ROW> <ENT I="01">Tax on $16,000 (taxable income including section 666 amounts)</ENT> <ENT>$5,200</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax on $10,000 (taxable income excluding section 666 amounts)</ENT> <ENT>2,640</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Tax attributable to section 666 amounts</ENT> <ENT>2,560</ENT> </ROW> <ROW> <PRTPAGE P="243"/> <ENT I="28"> <E T="03">Year 1954</E> </ENT> </ROW> <ROW> <ENT I="01">Tax on $14,000 (taxable income including section 666 amounts)</ENT> <ENT>$4,260</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax on $10,000 (taxable income excluding section 666 amounts)</ENT> <ENT>2,640</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Tax attributable to section 666 amounts</ENT> <ENT>1,620</ENT> </ROW> </GPOTABLE> <P>(2) Inasmuch as the tax of $3,630 attributable to the section 666 amounts as computed at 1956 rates is less than the aggregate of the taxes of $4,180 ($2,560 plus $1,620) determined for the preceding taxable years the amount of $3,630 is added to the tax ($1,100) computed for 1956 without including the section 666 amounts.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 737, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-1</SECTNO> <SUBJECT>Credit for taxes paid by the trust.</SUBJECT> <P>(a) The taxes imposed on a complex trust for a taxable year which would not have been payable by the trust if amounts deemed under section 666 to have been distributed in the year had in fact been distributed in the year are not allowable as a refund to the trust but are allowable as a credit against the tax of the beneficiaries to whom the amounts described in section 666(a) are distributed.</P> <P>(b) The credit to which a beneficiary is entitled under section 668(b) is allowed for the taxable year in which the accumulation distribution (to which the credit relates) is required to be included in the gross income of the beneficiary. Any excess over the total tax liability of the beneficiary is treated as an overpayment of tax by the beneficiary.</P> <P>(c) The beneficiary is entitled to a portion of the credit described in paragraph (a) of this section in the ratio which the amount of the accumulation distribution to him bears to the accumulation distributions to all the beneficiaries.</P> </SECTION> <SECTION> <SECTNO>§ 1.668(b)-2</SECTNO> <SUBJECT>Illustration of the provisions of subpart D.</SUBJECT> <P>The provisions of subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code, other than provisions relating to a foreign trust created by a U.S. person, may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> (a) <E T="03">Facts.</E> (1) Under the terms of a trust instrument, one-half of the trust income is required to be distributed currently to beneficiary A. The trustee may in his discretion accumulate the balance of the income of the trust or he may make distributions to B out of income or corpus. The trust is to terminate upon the death of A and the corpus is to be distributed to B. Capital gains are allocable to corpus. All of the expenses of the trust are charges against income. The trust instrument provides for a reserve for depreciation, so that depreciation is deductible in computing distributable net income. The trust and both beneficiaries report on the calendar year basis. The trust had long-term capital gains of $20,000 for 1954, and $10,000 for 1955, which were allocated to corpus. The distributable net income of the trust as determined under section 643(a) for 1954, 1955, 1956, and 1957 is deemed to consist of the following items of income: </P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,8,7"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Dividends</CHED> <CHED H="1">Rents</CHED> <CHED H="1">Interest (taxable)</CHED> <CHED H="1">Interest (exempt)</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">1954</ENT> <ENT>$15,000</ENT> <ENT>$20,000</ENT> <ENT>$10,000</ENT> <ENT>$5,000</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>10,000</ENT> <ENT>15,000</ENT> <ENT>10,000</ENT> <ENT>5,000</ENT> <ENT>40,000</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>10,000</ENT> <ENT>20,000</ENT> <ENT>15,000</ENT> <ENT>5,000</ENT> <ENT>50,000</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>10,000</ENT> <ENT>15,000</ENT> <ENT>15,000</ENT> <ENT>5,000</ENT> <ENT>45,000</ENT> </ROW> </GPOTABLE> <P>(2) One-half ($7,500) of the dividends for 1954 was received by the trust on or before July 31, 1954, and the balance was received after that date.</P> <P>(3) The following distributions were made by the trustee to A and B during the taxable years 1954 through 1957:</P> <GPOTABLE COLS="3" OPTS="L1" CDEF="s25,8.4,8.4"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">A</CHED> <CHED H="1">B</CHED> </BOXHD> <ROW> <ENT I="01">1954</ENT> <ENT>$25,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>20,000</ENT> <ENT>None</ENT> </ROW> <ROW> <ENT I="01">1956</ENT> <ENT>25,000</ENT> <ENT>$45,000</ENT> </ROW> <ROW> <ENT I="01">1957</ENT> <ENT>22,500</ENT> <ENT>29,550</ENT> </ROW> </GPOTABLE> <P> (b) <E T="03">Distributions to A.</E> A is deemed to have received one-half of each item of income entering into the computation of distributable net income as shown in paragraph (a)(1) of this example. See § 1.662(a)-2 for rules for the treatment of currently distributable income in the hands of the beneficiary. </P> <P> (c) <E T="03">Tax liability of the trust</E> —(1) <E T="03">1954.</E> (i) The tax liability of the trust for the taxable year 1954 is $13,451, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income under section 643(a) (paragraph (a)(1) of this example)</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="11">Less amounts not includible in gross income:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Tax-exempt interest</ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Dividend exclusion</ENT> <ENT>50</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>5,050</ENT> </ROW> <ROW> <ENT I="03">Distributable net income as adjusted</ENT> <ENT>44,950</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Add: Capital gains (long-term)</ENT> <ENT>20,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>64,950</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Distributions to A</ENT> <ENT>$22,475</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>$10,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <PRTPAGE P="244"/> <ENT I="22"> </ENT> <ENT>32,575</ENT> </ROW> <ROW> <ENT I="03">Taxable income</ENT> <ENT>32,375</ENT> </ROW> <ROW> <ENT I="01">Alternative tax</ENT> <ENT>13,601</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Dividend received credit</ENT> <ENT>150</ENT> </ROW> <ROW> <ENT I="03">Tax liability</ENT> <ENT>13,451</ENT> </ROW> </GPOTABLE> <P>(ii) See paragraph (b) of this example for character of income deemed distributed to A and section 661 for rules for computing the amount deductible by a trust for distributions to beneficiaries. Inasmuch as one-half of the dividends of the trust is deemed to be distributed to A, $25 of such distribution is deemed to be made from the dividend exclusion of $50, and the balance from dividends included in the gross income of the trust (that is, since the year 1954 is involved, $3,725 from dividends received on or before July 31, 1954, and $3,750 from dividends received after July 31, 1954). The trust is entitled to a dividend received credit attributable to the dividends of $3,750 received after July 31, 1954, which were not distributed to any beneficiary during the taxable year.</P> <P> (2) <E T="03">1955.</E> (i) The tax liability of the trust for the taxable year 1955 is $8,189, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income under section 643(a) (paragraph (a)(1) of this example)</ENT> <ENT>$40,000</ENT> </ROW> <ROW> <ENT I="11">Less amounts not includible in gross income:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Tax-exempt interest</ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Dividend exclusion</ENT> <ENT>50</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>5,050</ENT> </ROW> <ROW> <ENT I="03">Distributable net income as adjusted</ENT> <ENT>34,950</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Add: Capital gains (long-term)</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>44,950</ENT> </ROW> <ROW> <ENT I="11">Deductions:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Distributions to A</ENT> <ENT>$17,475</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>22,575</ENT> </ROW> <ROW> <ENT I="03">Taxable income</ENT> <ENT>22,375</ENT> </ROW> <ROW> <ENT I="01">Alternative tax</ENT> <ENT>8,388</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Dividend received credit</ENT> <ENT>199</ENT> </ROW> <ROW> <ENT I="03">Tax liability</ENT> <ENT>8,189</ENT> </ROW> </GPOTABLE> <P>(ii) See paragraph (b) of this example for character of income deemed distributed to A and section 661 for rules for computing the amount deductible by a trust for distributions to beneficiaries. Inasmuch as one-half ($4,975) of the dividends of $9,950 ($10,000 less dividend exclusion of $50) included in the gross income of the trust is deemed distributed to A, the trust is entitled to a dividend received credit with respect to the dividends of $4,975 which were not distributed to any beneficiary during the taxable year.</P> <P> (3) <E T="03">1956 and 1957.</E> The trust had no tax liability for the taxable years 1956 and 1957 since all of its income was distributed during such years. </P> <P> (d) <E T="03">Accumulation distributions.</E> (1) Accumulation distributions of $20,000 and $7,050, as defined in section 665(b), were made to B during the years 1956 and 1957, respectively, computed as shown below: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,8,8"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">1956</CHED> <CHED H="1">1957</CHED> </BOXHD> <ROW> <ENT I="01">Distributable net income of the trust as computed under section 643(a)</ENT> <ENT>$50,000</ENT> <ENT>$45,000</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">Less. Income currently distributable to A</ENT> <ENT>25,000</ENT> <ENT>22,500</ENT> </ROW> <ROW> <ENT I="03">Balance of income</ENT> <ENT>25,000</ENT> <ENT>22,500</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">Other amounts distributed to B</ENT> <ENT>45,000</ENT> <ENT>29,550</ENT> </ROW> <ROW> <ENT I="03">Accumulation distributions to B</ENT> <ENT>20,000</ENT> <ENT>7,050</ENT> </ROW> </GPOTABLE> <P>(2) B is deemed to have received one-half of each item of income entering into the computation of distributable net income (shown in paragraph (a)(1) of this example) for the years 1956 and 1957.</P> <P>(3) The accumulation distribution for 1956 must first be allocated to the preceding taxable years as provided in section 666. After the application of the provisions of subpart D to the 1956 accumulation distribution and to the undistributed net incomes of the preceding taxable years, a similar allocation must be made of the 1957 accumulation distribution.</P> <P> (e) <E T="03">Throwback of 1956 accumulation distribution to 1955.</E> The accumulation distribution of $20,000 for 1956 must be allocated to the first preceding taxable year 1955, before allocation is made to the second preceding taxable year 1954. </P> <P> (1) <E T="03">1955 Undistributed net income.</E> (i) The undistributed net income of the trust for 1955, determined as of the close of 1955, is $12,885, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="21">Distributable net income as computed under section 643(a) (paragraph (a)(1) of this example)</ENT> <ENT>$40,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Distributions to A</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes imposed on the trust</ENT> <ENT>7,115</ENT> </ROW> <ROW RUL="n,s"> <ENT I="22"> </ENT> <ENT>27,115</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income as of the close of 1955</ENT> <ENT>12,885</ENT> </ROW> </GPOTABLE> <P>(ii) The taxes imposed on the trust of $7,115 are that portion of the taxes paid by the trust for 1955 which is attributable to the undistributed portion of distributable net income included in the taxable income of the trust (the “balance” in the computation below) and is determined as follows:</P> <GPOTABLE COLS="4" OPTS="L0" CDEF="s25,8,8,8"> <ROW EXPSTB="02"> <ENT I="01">Taxable income (paragraph (c)(2)(i) of this example</ENT> <ENT>$22,375</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Capital gains allocable to corpus</ENT> <ENT>$10,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>$5,000</ENT> </ROW> <ROW RUL="n,s,n,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s,n"> <ENT I="22"> </ENT> <ENT>5,100</ENT> </ROW> <ROW EXPSTB="02" RUL="n,s"> <ENT I="01">Portion of taxable income allocable to corpus</ENT> <ENT>4,900</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Balance</ENT> <ENT>17,475</ENT> </ROW> <ROW> <PRTPAGE P="245"/> <ENT I="01">Total taxes paid by the trust</ENT> <ENT>8,189</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes on income ($4,900) allocable to corpus</ENT> <ENT>1,074</ENT> </ROW> <ROW> <ENT I="03">Taxes imposed on the trust (section 665(c))</ENT> <ENT>7,115</ENT> </ROW> </GPOTABLE> <P>(iii) The amount of $1,074 is the taxes which the trust would have paid for 1955 had all of the distributable net income been distributed during the year.</P> <P> (2) <E T="03">Allocation of 1956 accumulation distribution to the preceding taxable year 1955.</E> The portion of the 1956 accumulation distribution which is deemed under section 666(a) to be distributed to B on the last day of 1955 (the first preceding taxable year) is $12,885, an amount equal to the undistributed net income for 1955. An additional amount equal to the taxes imposed on the trust ($7,115) is, under section 666(b), also deemed to be distributed to B on the last day of 1955. Thus, a total of $20,000 ($12,885 plus $7,115) is deemed to be distributed to B on December 31, 1955, by reason of the allocation of the 1956 accumulation distribution to the first preceding taxable year. See paragraph (h) of this example for the treatment of the amount of $20,000 in the hands of B. </P> <P> (3) <E T="03">Character of amounts deemed distributed.</E> Inasmuch as one-half of the 1955 distributable net income of the trust as determined under section 643(a) was currently distributable to A and the balance of such income is deemed under section 666 to be distributed to B on December 31, 1955, the distribution to B is deemed to consist of one-half of each item of income entering into the computation of the 1955 distributable net income; that is, dividends of $5,000, rents of $7,500, taxable interest of $5,000, and tax-exempt interest of $2,500. </P> <P> (4) <E T="03">Credit for taxes paid by the trust.</E> The amount of the taxes for the year 1955 which may not be refunded or credited to the trust under section 667 and which is allowed as a credit against the tax of B for 1956 under section 668(b) is $7,115. See also paragraph (h)(3) of this example. </P> <P> (5) <E T="03">Effect of application of provisions of subpart D to the year 1955.</E> After the allocation of the 1956 accumulation distribution to the preceding taxable year 1955, the undistributed portion of the distributable net income, the undistributed net income, and the taxes imposed on the trust for 1955 are zero. The portion of the 1956 accumulation distribution which is unabsorbed by the 1955 undistributed net income is $7,115, determined as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">1956 accumulation distribution (paragraph (d)(1) of this example)</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Amount allocable to 1955</ENT> <ENT>12,885</ENT> </ROW> <ROW> <ENT I="03">Balance allocable to second preceding taxable year 1954</ENT> <ENT>7,115</ENT> </ROW> </GPOTABLE> <P> (f) <E T="03">Throwback of 1956 accumulation distribution to 1954.</E> The unabsorbed portion of the 1956 accumulation distribution of $7,115 is allocable to the second preceding taxable year 1954 and is treated under section 666 as a distribution to B on the last day of such year. </P> <P> (1) <E T="03">1954 Undistributed net income.</E> (i) The undistributed net income of the trust for 1954, determined as of the close of 1954, is $14,155, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income as computed under section 643(a) (paragraph (a)(1) of this example)</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Distributions to A</ENT> <ENT>$25,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes imposed on the trust</ENT> <ENT>10,845</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>35,845</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income as of the close of 1954</ENT> <ENT>14,155</ENT> </ROW> </GPOTABLE> <P>(ii) The taxes imposed on the trust of $10,845 are that portion of the taxes paid by the trust for 1954 which is attributable to the undistributed portion of distributable net income included in the taxable income of the trust (the “balance” in the computation below in this subdivision) and is determined as follows:</P> <GPOTABLE COLS="4" OPTS="L0" CDEF="s25,8,8,8"> <ROW EXPSTB="02"> <ENT I="01">Taxable income (paragraph (c)(1)(i) of this example)</ENT> <ENT>$32,375</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="01">Capital gains allocable to corpus</ENT> <ENT>$20,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Capital gain deduction</ENT> <ENT>$10,000</ENT> </ROW> <ROW RUL="n,s,n,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s,n"> <ENT I="22"> </ENT> <ENT>10,100</ENT> </ROW> <ROW EXPSTB="02" RUL="n,s"> <ENT I="03">Portion of taxable income allocable to corpus</ENT> <ENT>9,900</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Balance</ENT> <ENT>22,475</ENT> </ROW> <ROW> <ENT I="01">Total taxes paid by the trust</ENT> <ENT>13,451</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes on income ($9,900) allocable to corpus</ENT> <ENT>2,606</ENT> </ROW> <ROW> <ENT I="03">Taxes imposed on the trust (section 665(c))</ENT> <ENT>10,845</ENT> </ROW> </GPOTABLE> <P>(iii) The amount of $2,606 is the taxes which the trust would have paid for 1954 had all of the distributable net income been distributed during that year.</P> <P> (2) <E T="03">Allocation of 1956 accumulation distribution to the second preceding taxable year 1954.</E> Since the unabsorbed portion of the 1956 accumulation distribution of $7,115 is less than the 1954 undistributed net income of $14,155, the trust is deemed under section 666(c) to have also distributed an additional amount ($5,451) equal to a pro rata portion (7,115/14,155 × $10,845) of the taxes imposed on the trust for 1954. Thus, a total of $12,566 ($7,115 plus $5,451) is deemed to be distributed to B on December 31, 1954, by reason of the throwback of the 1956 accumulation distribution. See paragraph (h) of this example for the treatment of the amount of $12,566 in the hands of B. </P> <P> (3) <E T="03">Character of amounts deemed distributed to B.</E> The amount of $12,566 which, under section 666, is deemed to be distributed to B on December 31, 1954, is deemed to be composed of the following items of income of the trust: Dividends, $3,770 (15,000/50,000 × $12,566); rents, $5,026 (20,000/50,000 × $12,566); taxable interest, $2,513 (10,000/50,000 × $12,566); and <PRTPAGE P="246"/> tax-exempt interest, $1,257 (5,000/50,000 × $12,566). One-half of the dividends of $3,770 is considered as distributed from the dividends received by the trust on or before July 31, 1954, of which $13 (3,770/15,000 × $50) is deemed distributed from the dividends excluded under section 116, and the other half as distributed from the dividends received after July 31, 1954. Thus, of the total of $12,566 deemed distributed to B, $11,296 is considered as made from income included in the gross income of the trust and $1,270 from non-taxable income of the trust. </P> <P> (4) <E T="03">Credit for taxes paid by the trust.</E> The amount of the taxes for the year 1954 which may not be refunded or credited to the trust under section 667 and which is allowed as a credit against the tax of B for 1956 under section 668(b), because of the allocation of the 1956 accumulation distribution to 1954, is $5,401, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Taxable income of the trust as of the close of 1954 (paragraph (c)(1) of this example)</ENT> <ENT>$32,375</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Amount deemed distributed to B under section 666 from the taxable income of the trust</ENT> <ENT>11,296</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Taxable income adjusted as of the close of 1956</ENT> <ENT>21,079</ENT> </ROW> <ROW> <ENT I="01">(Taxes on $21,079 (alternative tax)</ENT> <ENT>$8,050</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes on income allocable to corpus (subparagraph (1)(ii) of this paragraph)</ENT> <ENT>$2,606</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Taxes imposed on the trust determined as of the close of 1956</ENT> <ENT>5,444</ENT> </ROW> <ROW> <ENT I="01">Taxes imposed on the trust determined as of the close of 1954</ENT> <ENT>$10,845</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Taxes imposed on the trust determined as of the close of 1956</ENT> <ENT>5,444</ENT> </ROW> <ROW> <ENT I="03">Amount of taxes allowed as a credit to B under section 668(b)</ENT> <ENT>5,401</ENT> </ROW> </GPOTABLE> <P> (5) <E T="03">Effect of application of provisions of subpart D to the year 1954.</E> (i) The undistributed portion of the distributable net income of the trust for the year 1954, determined as of the close of 1956, is $12,434, computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Distributable net income (section 643(a))</ENT> <ENT>$50,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Amount currently distributable to A</ENT> <ENT>$25,000</ENT> </ROW> <ROW> <ENT I="02">Amount deemed distributed to B under section 666</ENT> <ENT>12,566</ENT> </ROW> <ROW RUL="n,s"> <ENT I="11"> </ENT> <ENT>————</ENT> <ENT>37,566</ENT> </ROW> <ROW EXPSTB="01"> <ENT I="03">Undistributed portion of distributable net income as of the close of 1956</ENT> <ENT>12,434</ENT> </ROW> </GPOTABLE> <P>(ii) The amount of $12,434 is deemed to consist of dividends of $3,730, rents of $4,974, taxable interest of $2,487, and tax-exempt interest of $1,243, determined as follows:</P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s30,8.2,7.2,8.2,8.2,8.2"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Dividends</CHED> <CHED H="1">Rents</CHED> <CHED H="1">Interest (taxable)</CHED> <CHED H="1">Interest (exempt)</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW RUL="n,d,d,d,d,d"> <ENT I="01">Trust income</ENT> <ENT>$15,000</ENT> <ENT>$20,000</ENT> <ENT>$10,000</ENT> <ENT>$5,000</ENT> <ENT> <SU>1</SU>  $50,000 </ENT> </ROW> <ROW> <ENT I="11">Distributions:</ENT> </ROW> <ROW> <ENT I="02">To A</ENT> <ENT>7,500</ENT> <ENT>10,000</ENT> <ENT>5,000</ENT> <ENT>2,500</ENT> <ENT> <SU>2</SU>  25,000 </ENT> </ROW> <ROW RUL="n,d,d,d,d,d"> <ENT I="02">To B</ENT> <ENT>3,770</ENT> <ENT>5,026</ENT> <ENT>2,513</ENT> <ENT>1,257</ENT> <ENT> <SU>3</SU>  12,566 </ENT> </ROW> <ROW RUL="n,d,d,d,d,d"> <ENT I="03">Total</ENT> <ENT>11,270</ENT> <ENT>15,026</ENT> <ENT>7,513</ENT> <ENT>3,757</ENT> <ENT>37,566</ENT> </ROW> <ROW> <ENT I="01">Balance</ENT> <ENT>3,730</ENT> <ENT>4,974</ENT> <ENT>2,487</ENT> <ENT>1,243</ENT> <ENT>12,434</ENT> </ROW> <TNOTE> <SU>1</SU>  See paragraph (a)(1) of this example. </TNOTE> <TNOTE> <SU>2</SU>  See paragraph (b) of this example. </TNOTE> <TNOTE> <SU>3</SU>  See paragraph (f)(3) of this example. </TNOTE> </GPOTABLE> <P>(iii) The undistributed net income of the trust for 1954, determined as of the close of 1956, is $6,990, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">Undistributed portion of distributable net income as of the close of 1956</ENT> <ENT>$12,434</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Taxes imposed on the trust determined as of the close of 1956 (subparagraph (4) of this paragraph)</ENT> <ENT>5,444</ENT> </ROW> <ROW> <ENT I="02">Undistributed net income as of the close of 1956</ENT> <ENT>6,990</ENT> </ROW> </GPOTABLE> <P> (g) <E T="03">Throwback of 1957 accumulation distribution.</E> Inasmuch as all of the income of the trust for the first preceding taxable year 1956 was distributed during such year and the trust had no undistributed net income for the second preceding taxable year 1955 after the application of subpart D to the accumulation distribution made during 1956, the 1957 accumulation distribution of $7,050 is allocable to the third preceding taxable year 1954. See paragraph (d)(1) of this example for computation of the accumulation distribution. </P> <P> (1) <E T="03">Allocation of 1957 accumulation distribution to the preceding taxable year 1954.</E> The portion of the 1957 accumulation distribution which is deemed under section 666(a) to be distributed to B on the last day of 1954 is $6,990, an amount equal to the undistributed net income of the trust for 1954, determined as of the close of 1956. An additional amount equal to the taxes imposed on the trust ($5,444), determined as of the close of 1956, is under section 666(b) also deemed to be distributed to B on the last day of 1954. See paragraph (f) (4) and (5) of this example. Thus, a total of $12,434 ($6,990 plus $5,444) is <PRTPAGE P="247"/> deemed to be distributed to B on December 31, 1954, by reason of the allocation of the 1957 accumulation distribution to the taxable year 1954. See paragraph (j) of this example for the treatment of the amount of $12,434 in the hands of B. </P> <P> (2) <E T="03">Character of amounts deemed distributed.</E> Inasmuch as the balance of the 1954 distributable net income of the trust is deemed under section 666 to be distributed to B on December 31, 1954, the distribution is deemed to consist of dividends of $3,730, rents of $4,974, taxable interest of $2,487, and tax-exempt interest of $1,243. See paragraph (f)(5)(ii) of this example. </P> <P> (3) <E T="03">Credit for taxes paid by the trust.</E> The amount of taxes for the year 1954 which may not be refunded or credited to the trust under section 667 and which is allowed as a credit against the tax of B under section 668(b) is $5,444, the amount of taxes imposed on the trust determined as of the close of 1956. See paragraph (f)(4) of this example. </P> <P> (4) <E T="03">Effect of application of provisions of subpart D to the year 1954.</E> After the allocation of the 1957 accumulation distribution to the preceding taxable year 1954, the undistributed portion of the distributable net income, the undistributed net income, and the taxes imposed on the trust for 1954 are zero. The balance of $60 ($7,050 less $6,990) of the 1957 accumulation distribution remaining after the allocation of the accumulation distribution to the year 1954, may not be allocated to the year 1953 since that year is not subject to the provisions of the Internal Revenue Code of 1954. </P> <P> (h) <E T="03">Determination of B's tax liability; taxable year 1956</E> —(1) <E T="03">Amount of trust income includible in gross income.</E> (i) Of the amount of $45,000 distributed by the trust to B during the taxable year 1956, $25,000 is treated as a distribution out of trust income for that year within the meaning of section 662(a)(2), and $20,000 as an accumulation distribution within the meaning of section 665(b) (see paragraph (d) of this example). However, $12,885 plus taxes of $7,115 is deemed distributed to B on December 31, 1955, and $7,115 plus taxes of $5,451 on December 31, 1954, under section 666 by reason of the accumulation distribution made during 1956, and these amounts are includible in B's gross income for 1956 to the extent that they would have been includible in his gross income under section 662 (a)(2) and (b) for 1955 and 1954, respectively, had they been distributed on the last day of those years. </P> <P>(ii) The amounts distributed to B out of trust income for the year 1956, and the amounts deemed distributed out of income for the preceding taxable years 1955 and 1954 have the following character for the purpose of determining the amount includible in B's gross income for 1956:</P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s5,6,7,7,7,8"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Dividends</CHED> <CHED H="1">Rents</CHED> <CHED H="1">Interest (taxable)</CHED> <CHED H="1">Interest (exempt)</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">1956</ENT> <ENT>$5,000</ENT> <ENT>$10,000</ENT> <ENT>$7,500</ENT> <ENT>$2,500</ENT> <ENT> <SU>1</SU>  $25,000 </ENT> </ROW> <ROW> <ENT I="01">1955</ENT> <ENT>5,000</ENT> <ENT>7,500</ENT> <ENT>5,000</ENT> <ENT>2,500</ENT> <ENT> <SU>2</SU>  20,000 </ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">1954</ENT> <ENT>3,770</ENT> <ENT>5,026</ENT> <ENT>2,513</ENT> <ENT>1,257</ENT> <ENT> <SU>3</SU>  12,566 </ENT> </ROW> <ROW> <ENT I="01">Total</ENT> <ENT>13,770</ENT> <ENT>22,526</ENT> <ENT>15,013</ENT> <ENT>6,257</ENT> <ENT>57,566</ENT> </ROW> <TNOTE> <SU>1</SU>  See paragraph (d)(2) of this example. </TNOTE> <TNOTE> <SU>2</SU>  See paragraph (e)(3) of this example. </TNOTE> <TNOTE> <SU>3</SU>  See paragraph (f)(3) of this example. </TNOTE> </GPOTABLE> <FP>Thus, B will include in gross income for 1956 dividends of $13,770 (subject to the dividend exclusion), rents of $22,526, and taxable interest of $15,013, and will exclude the tax-exempt interest of $6,257.</FP> <P> (2) <E T="03">Computation of tax.</E> (i) For the purpose of computing B's tax liability, it is assumed that he was single during the taxable years 1954, 1955, and 1956, and that his taxable income (derived from salary) for each of the years 1954 and 1955 amounted to $13,400 on which a tax of $4,002 was paid for each year. It is also assumed that his income (other than distributions from the trust) for 1956 was $15,000 derived from salary, and he had allowable deductions of $10,600, which included the deduction for personal exemption. </P> <P>(ii) The computation of the tax for the taxable year 1956 attributable to the section 666 amounts which are included in B's gross income for such year, as provided in paragraph (a)(1) of § 1.668(a)-4, is as follows:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,9,9"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">(1) Section 666 amounts excluded</CHED> <CHED H="1">(2) Section 666 amounts included</CHED> </BOXHD> <ROW> <ENT I="01">Salary</ENT> <ENT>$15,000</ENT> <ENT>$15,000</ENT> </ROW> <ROW> <ENT I="11">Income from trust:</ENT> </ROW> <ROW> <ENT I="02">Dividends ($50 excluded)</ENT> <ENT>4,950</ENT> <ENT>13,720</ENT> </ROW> <ROW> <ENT I="02">Rents</ENT> <ENT>10,000</ENT> <ENT>22,526</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxable interest</ENT> <ENT>7,500</ENT> <ENT>15,013</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>37,450</ENT> <ENT>66,259</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Allowable deductions</ENT> <ENT>10,600</ENT> <ENT>10,600</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Taxable income</ENT> <ENT>26,850</ENT> <ENT>55,659</ENT> </ROW> <ROW> <ENT I="01">Total tax</ENT> <ENT>11,267</ENT> <ENT>31,064</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Dividend received credit</ENT> <ENT>198</ENT> <ENT>475</ENT> </ROW> <ROW> <ENT I="03">Tax liability</ENT> <ENT>$11,069</ENT> <ENT>30,589</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax on income from which section 666 amounts are excluded</ENT> <ENT/> <ENT>11,069</ENT> </ROW> <ROW> <ENT I="03">1956 tax attributable to section 666 amounts</ENT> <ENT/> <ENT>19,520</ENT> </ROW> </GPOTABLE> <FP>Only that portion of the dividends received by the trust after July 31, 1954, and deemed distributed to B under section 666, on the last day of such year is included in computing the dividend received credit shown in column (2). See paragraph (f)(3) of this example.</FP> <P> (iii) The computation of the taxes for the preceding taxable years attributable to the section 666 amounts which are deemed distributed by the trust on the last day of these <PRTPAGE P="248"/> years, as provided in paragraph (a)(2) of § 1.668(a)-4, is as follows: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,9,9"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Preceding taxable years</CHED> <CHED H="2">First 1955</CHED> <CHED H="2">Second 1954</CHED> </BOXHD> <ROW> <ENT I="01">Taxable income previously reported</ENT> <ENT>$13,400</ENT> <ENT>$13,400</ENT> </ROW> <ROW> <ENT I="11">Section 666 amounts:</ENT> </ROW> <ROW> <ENT I="02">Dividends ($50 excluded)</ENT> <ENT>4,950</ENT> <ENT>3,720</ENT> </ROW> <ROW> <ENT I="02">Rents</ENT> <ENT>7,500</ENT> <ENT>5,026</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxable interest</ENT> <ENT>5,000</ENT> <ENT>2,513</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Taxable income as adjusted</ENT> <ENT>30,850</ENT> <ENT>24,659</ENT> </ROW> <ROW> <ENT I="01">Total tax</ENT> <ENT>13,747</ENT> <ENT>9,949</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Dividend received credit</ENT> <ENT>198</ENT> <ENT>75</ENT> </ROW> <ROW> <ENT I="03">Balance of tax</ENT> <ENT>13,549</ENT> <ENT>9,874</ENT> </ROW> <ROW RUL="n,s,s"> <ENT I="01">Tax liability</ENT> <ENT>4,002</ENT> <ENT>4,002</ENT> </ROW> <ROW> <ENT I="03">Tax attributable to section 666 amounts</ENT> <ENT>9,547</ENT> <ENT>5,872</ENT> </ROW> </GPOTABLE> <FP>Only that portion ($1,885) of the dividends received by the trust after July 31, 1954, and deemed distributed under section 666 on the last day of that year, is included in computing the dividend received credit of $75 for the year 1954. See paragraph (f)(3) of this example.</FP> <P>(iv) Inasmuch as the aggregate of the taxes of $15,419 ($9,547 plus $5,872) attributable to the section 666 amounts as determined for the preceding taxable years is less than the tax of $19,520 determined for the taxable year 1956, the amount of $15,419 shall be added to the tax computed for 1956 without including the section 666 amounts. Thus, B's tax liability for 1956 is $26,488 ($11,069 plus $15,419).</P> <P> (3) <E T="03">Credits against the tax.</E> B is allowed under section 668(b) a credit of $12,516 ($5,401 for 1954 and $7,115 for 1955) against his 1956 tax liability for the taxes paid by the trust for the preceding taxable years and which may not be refunded or credited to the trust under section 667. See paragraphs (e)(4) and (f)(4) of this example. </P> <P>(i) [Reserved]</P> <P> (j) <E T="03">Taxable year 1957</E> —(1) <E T="03">Amount of trust income includible in gross income.</E> (i) Of the amount of $29,550 distributed by the trust to B during the taxable year 1957, $22,500 is treated as a distribution out of trust income for that year within the meaning of section 662(a)(2), and $7,050 as an accumulation distribution within the meaning of section 665(b) (see paragraph (d) of this example). However, $6,990 plus taxes of $5,444 is deemed distributed to B on December 31, 1954, under section 666 by reason of the accumulation distribution made during 1957, and that amount is includible in B's gross income for 1957, to the extent that it would have been includible in his gross income under section 662 (a)(2) and (b) for 1954, had it been distributed on the last day of that year. </P> <P>(ii) The amounts deemed distributed to B out of trust income for the year 1957 and the preceding taxable year 1954 are deemed to have the following character for the purpose of determining the amount includible in B's gross income for 1957:</P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s15,6,6,7,7,8"> <BOXHD> <CHED H="1">Year</CHED> <CHED H="1">Dividends</CHED> <CHED H="1">Rents</CHED> <CHED H="1">Interest (taxable)</CHED> <CHED H="1">Interest (exempt)</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">1957</ENT> <ENT>$5,000</ENT> <ENT>$7,500</ENT> <ENT>$7,500</ENT> <ENT>$2,500</ENT> <ENT> <SU>1</SU>  $22,500 </ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">1954</ENT> <ENT>3,730</ENT> <ENT>4,974</ENT> <ENT>2,487</ENT> <ENT>1,243</ENT> <ENT> <SU>2</SU>  12,434 </ENT> </ROW> <ROW> <ENT I="01">Total</ENT> <ENT>8,730</ENT> <ENT>12,474</ENT> <ENT>9,987</ENT> <ENT>3,743</ENT> <ENT>34,934</ENT> </ROW> <TNOTE> <SU>1</SU>  See paragraph (d)(2) of this example. </TNOTE> <TNOTE> <SU>2</SU>  See paragraph (g)(2) of this example. </TNOTE> </GPOTABLE> <FP>Thus, B will include in gross income for the year 1957 dividends of $8,730 (subject to the dividend exclusion), rents of $12,474, and taxable interest of $9,987 and will exclude the tax-exempt interest of $3,743.</FP> <P> (2) <E T="03">Computation of tax.</E> (i) For the purpose of computing B's tax liability for 1957, it is assumed that he was single for the entire year and had income (other than distributions from the trust) of $15,000 from salary. Also, he had allowable deductions of $8,100, which included the deductions for personal exemption. </P> <P>(ii) The computation of the tax for the taxable year 1957 attributable to the section 666 amounts which are included in B's gross income for that year, as provided in paragraph (a)(1) of § 1.668(a)-4, is as follows:</P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,9,9"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Section 666 amounts excluded</CHED> <CHED H="1">Section 666 amounts included</CHED> </BOXHD> <ROW> <ENT I="01">Salary</ENT> <ENT>$15,000</ENT> <ENT>$15,000</ENT> </ROW> <ROW> <ENT I="11">Trust income:</ENT> </ROW> <ROW> <ENT I="02">Dividends ($50 excluded)</ENT> <ENT>4,950</ENT> <ENT>8,680</ENT> </ROW> <ROW> <ENT I="02">Rents</ENT> <ENT>7,500</ENT> <ENT>12,474</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxable interest</ENT> <ENT>7,500</ENT> <ENT>9,987</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>34,950</ENT> <ENT>46,141</ENT> </ROW> <ROW RUL="n,s"> <ENT I="11">Less: Allowable deductions</ENT> <ENT>8,100</ENT> <ENT>8,100</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Taxable income</ENT> <ENT>26,850</ENT> <ENT>38,041</ENT> </ROW> <ROW> <ENT I="02">Total tax</ENT> <ENT>11,267</ENT> <ENT>18,388</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Dividends received credit</ENT> <ENT>198</ENT> <ENT>275</ENT> </ROW> <ROW> <ENT I="03">Tax liability</ENT> <ENT>11,069</ENT> <ENT>18,113</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Tax on income from which section 666 amounts are excluded</ENT> <ENT/> <ENT>11,069</ENT> </ROW> <ROW> <ENT I="03">1957 tax attributable to section 666 amounts</ENT> <ENT/> <ENT>7,044</ENT> </ROW> </GPOTABLE> <FP>See explanation following computation in paragraph (h)(2)(ii) of this example with respect to the computation of the dividend received credit on dividends received by the trust in 1954.</FP> <P> (iii) The amount of tax, computed at 1954 rates, attributable to the section 666 amounts which are deemed to have been distributed by the trust on the last day of 1954, is $6,939, computed as follows: <PRTPAGE P="249"/> </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,9,9"> <ROW EXPSTB="01"> <ENT I="01">1954 taxable income as adjusted (paragraph (h)(2)(iii) of this example)</ENT> <ENT>$24,659</ENT> </ROW> <ROW> <ENT I="11">Section 666 amounts:</ENT> </ROW> <ROW> <ENT I="02">Dividends</ENT> <ENT>3,730</ENT> </ROW> <ROW> <ENT I="02">Rents</ENT> <ENT>4,974</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxable interest</ENT> <ENT>2,487</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Taxable income as adjusted</ENT> <ENT>35,850</ENT> </ROW> <ROW> <ENT I="01">Total tax</ENT> <ENT>16,963</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Dividends received credit</ENT> <ENT>150</ENT> </ROW> <ROW> <ENT I="03">Balance of tax</ENT> <ENT>16,813</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Tax liability for 1954</ENT> <ENT>$4,002</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Tax attributable to 1956 accumulation distribution this example)</ENT> <ENT>5,872</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>9,874</ENT> </ROW> <ROW> <ENT I="02">Tax attributable to the section 666 amounts distributed in 1957</ENT> <ENT>6,939</ENT> </ROW> </GPOTABLE> <FP>Only that portion ($3,750) of the dividends received by the trust after July 31, 1954, and deemed distributed under section 666 on the last day of that year, is included in computing the dividend received credit of $150. See paragraphs (f)(3) and (g)(2) of this example.</FP> <P>(iv) Inasmuch as the tax of $6,939 attributable to the section 666 amounts as determined for the preceding taxable year 1954 is less than the tax of $7,044 attributable to these amounts for the year 1957, the amount of $6,939 shall be added to the tax computed for 1957 without including in gross income the section 666 amounts. Thus, B's tax liability for 1957 is $18,008 ($11,069 plus $6,939).</P> <P> (3) <E T="03">Credit against the tax.</E> B is allowed under section 668(b) a credit of $5,444 against his 1957 tax liability for the balance of the taxes paid by the trust for 1954 and which may not be refunded or credited to the trust under section 667. See paragraph (g)(3) of this example. </P> </EXAMPLE> <SECAUTH>(Sec. 669(a) as amended by sec. 331(a), Tax Reform Act 1969 (83 Stat. 592))</SECAUTH> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 738, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(a)-1</SECTNO> <SUBJECT>Limitation on tax.</SUBJECT> <P> (a) <E T="03">In general.</E> Section 669 provides that, at the election of a beneficiary who is a U.S. person (as defined in section 7701(a)(30)) and who satisfies the requirements of section 669(b) (that certain information with respect to the operation and accounts of the trust be supplied), the tax attributable to the amounts treated under section 668(a) as having been received by him, from a foreign trust created by a U.S. person, on the last day of a preceding taxable year of the trust shall not be greater than the tax computed under section 669(a)(1)(A) (the computation under this provision will hereinafter be referred to as the “exact throwback” method) or under section 669(a)(1)(B) (the computation under this provision will hereinafter be referred to as the “short-cut throwback” method). This election of the beneficiary with respect to the taxable year of the beneficiary in which the distribution is made shall be made with the district director before the expiration of the period of limitations for assessment provided in section 6501 for such taxable year. </P> <P> (b) <E T="03">Where no election is made.</E> If the beneficiary does not make the election provided in section 669(a) in the manner required in section 669(b) and § 1.669(b)-2, or furnish the information with respect to the operation and accounts of the foreign trust created by a U.S. person required by section 669(b) and § 1.669(b)-1, the tax on an accumulation distribution treated under section 668(a) as having been received by him from such foreign trust on the last day of a preceding taxable year of the trust shall be computed without reference to section 668 or 669. In such case, the entire accumulation distribution will be included in the gross income of the beneficiary in the year in which it is paid, credited, or required to be distributed, and tax for such year will be computed on the basis of the beneficiary's total taxable income for the year after taking into account such inclusion in gross income. </P> <P> (c) <E T="03">Year for which tax is payable.</E> The tax, regardless of the manner in which computed, of the beneficiary which is attributable to an accumulation distribution is imposed on the beneficiary for the taxable year of the beneficiary in which the accumulation distribution is made to him unless the taxable year of the beneficiary is different from that of the trust. See section 662(c) and § 1.662(c)-1. </P> <CITA>[T.D. 6989, 34 FR 738, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(a)-2</SECTNO> <SUBJECT>Rules applicable to section 669 computations.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) Section 668(a) provides that the total of the amounts treated under section 666 as having been distributed by the foreign trust created by a U.S. person on the last day of a preceding taxable year of such <PRTPAGE P="250"/> trust shall be included in the gross income of the beneficiary or the beneficiaries who are U.S. persons receiving them. The total of such amounts is includible in the gross income of each beneficiary to the extent the amount would have been included in his gross income under section 662 (a)(2) and (b) if the total had actually been paid by the trust on the last day of such preceding taxable year. The total is included in the gross income of the beneficiary for the taxable year of the beneficiary in which such amounts are in fact paid, credited, or required to be distributed unless the taxable year of the beneficiary differs from the taxable year of the trust (see section 662(c) and § 1.662(c)-1). The character of the amounts treated as received by a beneficiary in prior taxable years, including taxes deemed distributed, in the hands of the beneficiary is determined by the rules contained in section 662(b) and §§ 1.662(b)-1 and 1.662(b)-2. </P> <P>(2) The total of the amounts treated under section 666 as having been distributed by the trust on the last day of a preceding taxable year of the trust are included as prescribed in subparagraph (1) of this paragraph in the gross income of the beneficiary even though as of that day the beneficiary would not have been entitled to receive them had they actually been distributed on that day.</P> <P>(3) Any deduction allowed to the trust in computing distributable net income for a preceding taxable year (such as depreciation, depletion, etc.) is not deemed allocable to a beneficiary because of the amounts included in a beneficiary's gross income under this section since the deduction has already been utilized in reducing the amount included in the beneficiary's income.</P> <P> (b) <E T="03">Allocation among beneficiaries of a foreign trust.</E> Where there is more than one beneficiary the portion of the total amount includible in gross income under paragraph (a) of this section which is includible in the gross income of a beneficiary who is a U.S. person is based upon the ratio determined under the second sentence of section 662(a)(2) for the taxable year in which distributed (and not for the preceding taxable year). This paragraph may be illustrated by the example in § 1.668(a)-2. </P> <P> (c) <E T="03">Treatment of income taxes paid by the trust</E> —(1) <E T="03">Current distributions.</E> The income taxes imposed by the provisions of section 871 on the income of a foreign trust created by a U.S. person shall be included in the gross income of the beneficiary, who is a U.S. person, for the taxable year in which such income is paid, credited, or required to be distributed to the beneficiary. </P> <P> (2) <E T="03">Accumulation distribution.</E> (i) If an accumulation distribution is deemed under § 1.666(a)-1 to be distributed on the last day of a preceding taxable year and the amount is not less than the undistributed net income for such preceding taxable year, then an additional amount equal to the taxes imposed on the trust pursuant to the provisions of section 871 for such preceding taxable year is likewise deemed distributed under section 661(a)(2). </P> <P>(ii) If an accumulation distribution is deemed under § 1.666(a)-1 to be distributed on the last day of a preceding taxable year and the amount is less than the undistributed net income for such preceding taxable year, then an additional amount (representing taxes) is likewise deemed distributed under section 661(a)(2). The additional amount is equal to the taxes imposed on the trust pursuant to the provisions of section 871 for such preceding taxable year, multiplied by the fraction the numerator of which is the amount of the accumulation distribution attributable to such preceding taxable year and the denominator of which is the undistributed net income for such preceding taxable year.</P> <P> (3) <E T="03">Credits under sections 32 and 668(b).</E> Credit under section 32 is allowable to the beneficiary for income taxes withheld at source under subchapters A and B of chapter 3 and which are deemed distributed to him. Credit under section 668(b) is allowable to the beneficiary for income taxes imposed upon the foreign trust by section 871(b). These credits shall be allowed against the tax of the beneficiary for the taxable year of the beneficiary in which the income is paid, credited, or required to be distributed to him, or in which the accumulation distribution to which such taxes relate is made to him. <PRTPAGE P="251"/> </P> <P> (d) <E T="03">Credit for foreign income taxes paid by the trust.</E> To the extent provided in section 901, credit under section 33 is allowable to the beneficiary for the foreign taxes paid or accrued by the trust to a foreign country. </P> <CITA>[T.D. 6989, 34 FR 738, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(a)-3</SECTNO> <SUBJECT>Tax computed by the exact throwback method.</SUBJECT> <P> (a) <E T="03">Tax attributable to amounts treated as received in preceding taxable years.</E> If a taxpayer elects to compute the tax, on amounts deemed distributed under section 666, by the exact throwback method provided in section 669(a)(1)(A), the tax liability of the beneficiary for the taxable year in which the accumulation distribution is paid, credited, or required to be distributed is computed as provided in paragraph (b) of this section. The beneficiary may not elect to use the exact throwback method of computing his tax on an accumulation distribution as provided in section 669(a)(1)(A) if he were not alive on the last day of each preceding taxable year of the foreign trust created by a U.S. person with respect to which a distribution is deemed made under section 666(a). Thus, if a portion of an amount received as an accumulation distribution was accumulated by the trust during years before the beneficiary was born, the beneficiary is not permitted to elect the exact throwback method provided in section 669(a)(1)(A). See § 1.669(a)-4 for the computation of the tax on an accumulation distribution by the short-cut throwback method provided in section 669(a)(1)(B) under these circumstances. </P> <P> (b) <E T="03">Computation of tax.</E> The tax referred to in paragraph (a) of this section is computed as follows: </P> <P>(1) First, compute the tax attributable to the section 666 amounts for each of the preceding taxable years. To determine the section 666 amounts attributable to each of the preceding taxable years, see § 1.666(a)-1. The tax attributable to such amounts in each such preceding taxable year is the difference between the tax for such preceding taxable year computed with the inclusion of the section 666 amounts in gross income, and the tax for such year computed without including them in gross income. Tax computations for each preceding year shall reflect the taxpayer's marital and dependency status for that year.</P> <P>(2) Second, add</P> <P>(i) The sum of the taxes for the preceding taxable years attributable to the section 666 amounts (computed in accordance with subparagraph (1) of this paragraph), and</P> <P>(ii) The tax for the taxable year of the beneficiary in which the accumulation distribution is paid, credited, or required to be distributed to him, computed without including the section 666 amounts in gross income.</P> <FP>The total of these amounts is the beneficiary's tax, computed under section 669(a)(1)(A) for the taxable year in which the accumulation distribution is paid, credited, or required to be distributed to him.</FP> <P> (c) <E T="03">Effect of prior election.</E> In computing the tax attributable to an accumulation distribution for the taxable year in which such accumulation distribution is paid, credited, or required to be distributed to him, the beneficiary in computing the tax attributable to section 666 amounts for each of the preceding taxable years, must include in his gross income for each such year the section 666 amounts deemed distributed to him in such year resulting from prior accumulation distributions made to him in taxable years prior to the current taxable year. These section 666 amounts resulting from such prior accumulation distributions must be included in the gross income for such preceding taxable year even though the tax on the accumulation distribution of such prior taxable year was computed by the short-cut throwback method provided in section 669(a)(1)(B) and § 1.669(a)-4. </P> <CITA>[T.D. 6989, 34 FR 739, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(a)-4</SECTNO> <SUBJECT>Tax attributable to short-cut throwback method.</SUBJECT> <P> (a) <E T="03">Manner of computing tax.</E> If a beneficiary has elected under section 669(a) to compute the tax on the amounts deemed distributed under section 666 by the short-cut throwback method provided in section 669(a)(1)(B), the tax liability of the beneficiary for the taxable year is computed in the following manner: <PRTPAGE P="252"/> </P> <P>(1) First, determine the number of preceding taxable years of the trust, on the last day of which an amount is deemed under section 666(a) to have been distributed. In any case where there has been a prior accumulation distribution with respect to which the beneficiary has elected to compute his tax either by the exact throwback method or by the short-cut throwback method, or to which the next to the last sentence of section 668(a) has applied, for purposes of an election to use the short-cut throwback method with respect to a subsequent accumulation distribution, in determining the number of preceding taxable years of the trust with respect to which an amount of the subsequent accumulation distribution is deemed distributed to a beneficiary under section 666(a), there shall be excluded any preceding taxable year during which any part of the prior accumulation distribution was deemed distributed to the beneficiary. For example, assume that an accumulation distribution of $90,000 made to a beneficiary in 1963 is deemed distributed in the amounts of $25,000 in each of the years 1962, 1961, and 1960, and in the amount of $15,000 in 1959, and a subsequent accumulation distribution of $85,000 made to the same beneficiary in 1964 is deemed distributed in the amount of $10,000 during 1959, and $25,000 during each of the years 1958, 1957, and 1956. The accumulation distribution made in 1963 is deemed distributed in 4 preceding taxable years of the trust (1962, 1961, 1960, and 1959). Inasmuch as the year 1959 was a year during which part of the 1963 accumulation distribution was deemed distributed, for purposes of determining the number of preceding taxable years in which the accumulation distribution of $85,000 made in 1964 is deemed distributed, the year 1959 is excluded and the $85,000 accumulation distribution is deemed distributed in three preceding taxable years (1958, 1957, and 1956),</P> <P>(2) Second, divide the number of preceding taxable years of the trust, on the last day of which an amount is deemed under section 666(a) to have been distributed (determined as provided in subparagraph (1) of this paragraph) into the amount (representing an accumulation distribution made by a foreign trust created by a U.S. person) required to be included under section 669(a) in the gross income of the beneficiary for the taxable year,</P> <P>(3) Third, compute the tax of the beneficiary for the current taxable year (the year in which the accumulation distribution is paid, credited, or required to be distributed to him) and for each of the 2 taxable years immediately preceding such year,</P> <P>(i) With the inclusion in gross income of the beneficiary for each of such 3 years of the amount determined under subparagraph (2) of this paragraph, and</P> <P>(ii) Without such inclusion.</P> <FP> The difference between the amount of tax computed under subdivision (i) of this subparagraph for each year and the amount computed under subdivision (ii) of this subparagraph for that year is the additional tax resulting from the inclusion in gross income for that year of the amount determined under subparagraph (2) of this paragraph. If the number of preceding taxable years of the trust, on the last day of which an amount is deemed under section 666(a) to have been distributed, is less than three, the taxable years of the beneficiary for which this recomputation is made shall equal the number of years in which an amount is deemed under section 666(a) to have been distributed, commencing with the taxable year of the beneficiary in which the accumulation distribution is paid, credited, or required to be distributed to him. If the beneficiary was not alive during one of the two taxable years immediately preceding the taxable year, the tax resulting from the inclusion of the amount determined in subparagraph (2) of this paragraph in the gross income of the beneficiary will be computed only for the taxable year in which the accumulation distribution was paid, credited, or required to be distributed to him and the preceding year during which the beneficiary was alive. In the event the beneficiary was not alive during either of the 2 years immediately preceding the taxable year in which the accumulation distribution was paid, credited, or required to be distributed, the tax shall be computed on the basis of the beneficiary's taxable year without regard to the inclusion in income required by <PRTPAGE P="253"/> section 668(a) of any amount other than pursuant to section 669(a)(1)(B). For example, assume that a foreign trust created by a U.S. person accumulates $3,000 of income in 1964 and $7,000 in 1963 and then distributes the accumulated income on January 1, 1965, to a beneficiary who is a U.S. person. The limitation on tax is determined by recomputing the beneficiary's gross income for 1964 and 1965 by adding $5,000 to his gross income for each year. If the same distribution were made to an infant who was born in 1965, the limitation on tax would be computed by adding $5,000 to his gross income for such year. In the case of the infant, the resulting increase in tax would be multiplied by two to arrive at the limitation on the increase in his tax for 1965 attributable to such distribution. </FP> <P>(4) Fourth, add the additional taxes resulting from the application of subparagraph (3) of this paragraph for the taxable year and the 2 taxable years (or the 1 taxable year, where applicable) immediately preceding the year in which the accumulation distribution is paid, credited, or required to be distributed and then divide this amount by three (or two, where applicable). The resulting amount is then multiplied by the number of preceding taxable years of the trust on the last day of which an amount is deemed under section 666(a) to have been distributed (previously determined under subparagraph (1) of this paragraph). The resulting amount is the tax, under the short-cut throwback method provided in section 669(a)(1)(B), which is attributable to the amounts treated under section 668(a) as having been received by the beneficiary from a foreign trust created by a U.S. person on the last day of the preceding taxable year.</P> <P>(5) Fifth, add the amount determined under subparagraph (4) of this paragraph to the beneficiary's tax for the taxable year in which the accumulation distribution was paid, credited, or required to be distributed to him, computed without inclusion of the accumulation distribution in gross income for that year. The total is the beneficiary's income tax for such year.</P> <P> (b) <E T="03">Credit for tax paid by trust.</E> The income taxes deemed distributed to a beneficiary in the manner described in paragraphs (c) and (d) of § 1.669(a)-2 are included in the beneficiary's gross income for purposes of the computations required by this section. To the extent provided in § 1.669(a)-2, credits for such taxes are allowable to the beneficiary. In the computations under the short-cut throwback method provided in section 669(a)(1)(B), the rules set forth in section 662(b) and § 1.662(b)-1 shall be applied in determining the character, in the hands of the beneficiary, of the amounts, including taxes includible in the distribution or deemed distributed, treated as received by a beneficiary in prior taxable years. For example, if one-fifth of such amounts represents tax-free income, then one-fifth of the amount determined under paragraph (a)(2) of this section shall be treated as tax-free income. </P> <CITA>[T.D. 6989, 34 FR 739, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(b)-1</SECTNO> <SUBJECT>Information requirements.</SUBJECT> <P>The election of a beneficiary who is a U.S. person to apply the limitations on tax provided in section 669(a) shall not be effective unless the beneficiary, at or before the time the election is made, supplies, in a letter addressed to the district director for the internal revenue district in which the taxpayer files his return (or the Director of International Operations where appropriate), or in a statement attached to his return, the following information with respect to the operation and accounts of the foreign trust created by a U.S. person for each of the preceding taxable years, on the last day of which an amount is deemed distributed under section 666(a):</P> <P> (a) The gross income of the trust: The gross income should be separated to show the amount of each type of income received by the trust and to identify its source. For example, the beneficiary should list separately, by type (dividends, rents, capital gains, taxable interest, exempt interest, etc.) and source (name and country of payor), each item of income included in the gross income of the trust. For this purpose, the gross income of the trust includes gross income from U.S. sources which is exempt from taxation under section 894. <PRTPAGE P="254"/> </P> <P>(b) The amount of tax withheld under section 1441 by the United States on income from sources within the United States.</P> <P>(c) The amount of the tax paid to each foreign country by the trust.</P> <P>(d) The expenses of the trust attributable to each type of income disclosed in paragraph (b) of this section, and the general expenses of the trust.</P> <P>(e) The distributions, if any, made by the trust to the beneficiaries (including those who are not U.S. persons). These distributions should be separated into amounts of income required to be distributed currently within the meaning of section 661(a)(1), and any other amounts properly paid, credited, or required to be distributed within the meaning of section 661(a)(2).</P> <P>(f) Any other information which is necessary for the computation of tax on the accumulation distribution as provided in section 669(a).</P> <P>(g) If the foreign trust created by a U.S. person is less than the entire foreign trust, the information listed in paragraphs (a) through (f) of this section shall also be furnished with respect to that portion of the entire foreign trust which is not a foreign trust created by a U.S. person.</P> <CITA>[T.D. 6989, 34 FR 740, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.669(b)-2</SECTNO> <SUBJECT>Manner of exercising election.</SUBJECT> <P> (a) <E T="03">By whom election is to be made.</E> Except as otherwise provided in this paragraph, a taxpayer whose tax liability is affected by the election shall make the election provided in section 669(a). In the case of a partnership, or a corporation electing under the provisions of subchapter S, chapter 1 of the Code, the election shall be exercised by the partnership or such corporation. </P> <P> (b) <E T="03">Time and manner of making election.</E> The election under section 669(a) may be made, or revoked, at any time before the expiration of the period provided in section 6501 for assessment of the tax. If an election is revoked, a new election may be made at any time before the expiration of such period. The election (or a revocation of an election) may be made in a letter addressed to the district director of internal revenue for the district in which the taxpayer files his tax return (or the Director of International Operations where appropriate) or may be made in a statement attached to the return. In any case where all the information described in § 1.669(b)-1 is not furnished at or before the time the beneficiary signifies his intention of making an election and by reason thereof an election has not been made, and subsequent thereto, but before the expiration of the period provided in section 6501 for the assessment of the tax, there is furnished the required information not previously furnished, the election will be considered as made at the time such additional information is furnished. </P> <CITA>[T.D. 6989, 34 FR 740, Jan. 17, 1969]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">Unitrust Actuarial Tables Applicable Before June 1, 2023.</HD> <SECTION> <SECTNO>§ 1.664-4A</SECTNO> <SUBJECT>Valuation of charitable remainder interests for which the valuation date is before June 1, 2023.</SUBJECT> <P> (a) <E T="03">Valuation of charitable remainder interests for which the valuation date is before January 1, 1952.</E> There was no provision for the qualification of a charitable remainder unitrust under section 664 until 1969. See § 20.2031-7A(a) of this chapter (Estate Tax Regulations) for the determination of the present value of a charitable interest for which the valuation date is before January 1, 1952. </P> <P> (b) <E T="03">Valuation of charitable remainder interests for which the valuation date is after December 31, 1951, and before January 1, 1971.</E> No charitable deduction is allowable for a transfer to a unitrust for which the valuation date is after the effective dates of the Tax Reform Act of 1969 unless the unitrust meets the requirements of section 664. See § 20.2031-7A(b) of this chapter (Estate Tax Regulations) for the determination of the present value of a charitable remainder interest for which the valuation date is after December 31, 1951, and before January 1, 1971. </P> <P> (c) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is after December 31, 1970, and before December 1, 1983.</E> For the determination of the present value of a charitable remainder unitrust for which the valuation date is after December 31, 1970, <PRTPAGE P="255"/> and before December 1, 1983, see § 20.2031-7A(c) of this chapter (Estate Tax Regulations) and former § 1.664-4(d) (as contained in the 26 CFR part 1 edition revised as of April 1, 1994). </P> <P> (d) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is after November 30, 1983, and before May 1, 1989</E> —(1) <E T="03">In general.</E> Except as otherwise provided in paragraph (d)(2) of this section, in the case of transfers made after November 30, 1983, for which the valuation date is before May 1, 1989, the present value of a remainder interest that is dependent on a term of years or the termination of the life of one individual is determined under paragraphs (d)(3) through (d)(6) of this section, provided that the amount of the payout as of any payout date during any taxable year of the trust is not larger than the amount that the trust could distribute on such date under § 1.664-3(a)(1)(v) if the taxable year of the trust were to end on such date. The present value of the remainder interest in the trust is determined by computing the adjusted payout rate (as defined in paragraph (d)(3) of this section) and following the procedure outlined in paragraph (d)(4) or (d)(5) of this section, whichever is applicable. The present value of a remainder interest that is dependent on a term of years is computed under paragraph (d)(4) of this section. The present value of a remainder interest that is dependent on the termination of the life of one individual is computed under paragraph (d)(5) of this section. See paragraph (d)(2) of this section for testamentary transfers for which the valuation date is after November 30, 1983, and before August 9, 1984. </P> <P> (2) <E T="03">Rules for determining the present value for testamentary transfers where the decedent dies after November 30, 1983, and before August 9, 1984.</E> For purposes of section 2055 or 2106, if— </P> <P>(i) The decedent dies after November 30, 1983, and before August 9, 1984; or</P> <P>(ii) On December 1, 1983, the decedent was mentally incompetent so that the disposition of the property could not be changed, and the decedent died after November 30, 1983, without regaining competency to dispose of the decedent's property, or died within 90 days of the date on which the decedent first regained competency, the present value determined under this section of a remainder interest is determined in accordance with paragraph (d)(1) and paragraphs (d)(3) through (d)(6) of this section, or § 1.664-4A(c), at the option of the taxpayer.</P> <P> (3) <E T="03">Adjusted payout rate.</E> The adjusted payout rate is determined by multiplying the fixed percentage described in paragraph (a)(1)(i)( <E T="03">a</E> ) of § 1.664-3 by the figure in column (2) of Table F(1) which describes the payout sequence of the trust opposite the number in column (1) of Table F(1) which corresponds to the number of months by which the valuation date for the first full taxable year of the trust precedes the first payout date for such taxable year. If the governing instrument does not prescribe when the distribution shall be made during the taxable year of the trust, see § 1.664-4(a). In the case of a trust having a payout sequence for which no figures have been provided by Table F (1) and in the case of a trust which determines the fair market value of the trust assets by taking the average of valuations on more than one date during the taxable year, see § 1.664-4(b). </P> <P> (4) <E T="03">Period is a term of years.</E> If the period described in § 1.664-3(a)(5) is a term of years, the factor which is used in determining the present value of the remainder interest is the factor under the appropriate adjusted payout rate in Table D in § 1.664-4(e)(6) that corresponds to the number of years in the term. If the adjusted payout rate is an amount which is between adjusted payout rates for which factors are provided in Table D, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph (d)(4). For purposes of this section, the term <E T="03">appropriate valuation date</E> means the date on which the property is transferred to the trust by the donor except that, for purposes of section 2055 or 2106, it means the date of death unless the alternate valuation date is elected in accordance with section 2032 and the regulations thereunder in <PRTPAGE P="256"/> which event it means the alternate valuation date. If the adjusted payout rate is greater than 14 percent, see § 1.664-4(b). The application of this paragraph (d)(4) may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>D transfers $100,000 to a charitable remainder unitrust on January 1, 1985. The trust instrument requires that the trust pay to D semiannually (on June 30 and December 31) 10 percent of the fair market value of the trust assets as of June 30th for a term of 15 years. The adjusted payout rate is 9.767 percent (10% × 0.976731). The present value of the remainder interest is $21,404.90, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,1.6"> <ROW> <ENT I="01">Factor at 9.6 percent for 15 years</ENT> <ENT>0.220053</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Factor at 9.8 percent for 15 years</ENT> <ENT>.212862</ENT> </ROW> <ROW> <ENT I="03">Difference</ENT> <ENT>.007191</ENT> </ROW> </GPOTABLE> <MATH SPAN="1" DEEP="24"> <MID>EC14NO91.134</MID> </MATH> <FP SOURCE="FP-2">9.767% − 9.6 ÷ 0.2% == ÷ .007191</FP> <FP>X === .006004</FP> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,2.6"> <ROW> <ENT I="01">Factor at 9.6 percent for 15 years</ENT> <ENT>0.220053</ENT> </ROW> <ROW> <ENT I="01">Less: X</ENT> <ENT>.006004</ENT> </ROW> <ROW> <ENT I="03">Interpolated factor</ENT> <ENT>.214049</ENT> </ROW> <ROW> <ENT I="11">Present value of remainder interest = $100,000 × 0.214049 = $21,404.90</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (5) <E T="03">Period is the life of one individual.</E> If the period described in paragraph (a)(5) of § 1.664-3 is the life of one individual, the factor that is used in determining the present value of the remainder interest is the factor under the appropriate adjusted payout rate in column (2) of Table E in paragraph (d)(6) of this section opposite the number in column (1) that corresponds to the age of the individual whose life measures the period. For purposes of the computations described in this paragraph (b)(5), the age of an individual is to be taken as the age of that individual at the individual's nearest birthday. If the adjusted payout rate is an amount which is between adjusted payout rates for which factors are provided for in Table E, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph (b)(5). If the adjusted payout rate is greater than 14 percent, see § 1.664-4(b). The application of this paragraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A, who will be 50 years old on April 15, 1985, transfers $100,000 to a charitable remainder unitrust on January 1, 1985. The trust instrument requires that the trust pay to A at the end of each taxable year of the trust 10 percent of the fair market value of the trust assets as of the beginning of each taxable year of the trust. The adjusted payout rate is 9.091 percent (10 percent × .909091). The present value of the remainder interest is $15,259.00 computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s50,7"> <ROW> <ENT I="01">Factor at 9 percent at age 50</ENT> <ENT>0.15472</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Factor at 9.2 percent at age 50</ENT> <ENT>.15003</ENT> </ROW> <ROW> <ENT I="03">Difference</ENT> <ENT>.00469</ENT> </ROW> <ROW> <ENT I="28">9.091% − 9% ÷ 0.2% = X ÷ 0.00469</ENT> </ROW> <ROW> <ENT I="28">x = 0.00213</ENT> </ROW> <ROW> <ENT I="01">Factor at 9 percent at age 50</ENT> <ENT>.15472</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: X</ENT> <ENT>.00213</ENT> </ROW> <ROW> <ENT I="03">Interpolated factor</ENT> <ENT>.15259</ENT> </ROW> <ROW> <ENT I="28">Present value of remainder interest =</ENT> </ROW> <ROW> <ENT I="28">$100,000 × 0.15259 = $15,259.00</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (6) <E T="03">Actuarial tables for transfers for which the valuation date is after November 30, 1983, and before May 1, 1989.</E> Table D in § 1.664-4(e)(6) and the following tables shall be used in the application of the provisions of this section: </P> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">2.2%</CHED> <CHED H="2">2.4%</CHED> <CHED H="2">2.6%</CHED> <CHED H="2">2.8%</CHED> <CHED H="2">3.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.23253</ENT> <ENT>.20635</ENT> <ENT>.18364</ENT> <ENT>.16394</ENT> <ENT>.14683</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.22196</ENT> <ENT>.19506</ENT> <ENT>.17170</ENT> <ENT>.15139</ENT> <ENT>.13372</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.22597</ENT> <ENT>.19884</ENT> <ENT>.17523</ENT> <ENT>.15468</ENT> <ENT>.13676</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.23039</ENT> <ENT>.20304</ENT> <ENT>.17920</ENT> <ENT>.15840</ENT> <ENT>.14024</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.23503</ENT> <ENT>.20747</ENT> <ENT>.18340</ENT> <ENT>.16237</ENT> <ENT>.14397</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.23988</ENT> <ENT>.21211</ENT> <ENT>.18783</ENT> <ENT>.16656</ENT> <ENT>.14793</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.24489</ENT> <ENT>.21693</ENT> <ENT>.19243</ENT> <ENT>.17094</ENT> <ENT>.15207</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.25004</ENT> <ENT>.22189</ENT> <ENT>.19718</ENT> <ENT>.17546</ENT> <ENT>.15637</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.25534</ENT> <ENT>.22701</ENT> <ENT>.20209</ENT> <ENT>.18016</ENT> <ENT>.16084</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.26080</ENT> <ENT>.23230</ENT> <ENT>.20718</ENT> <ENT>.18503</ENT> <ENT>.16549</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.26640</ENT> <ENT>.23774</ENT> <ENT>.21243</ENT> <ENT>.19008</ENT> <ENT>.17031</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.27217</ENT> <ENT>.24335</ENT> <ENT>.21786</ENT> <ENT>.19530</ENT> <ENT>.17532</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.27807</ENT> <ENT>.24911</ENT> <ENT>.22344</ENT> <ENT>.20068</ENT> <ENT>.18049</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.28407</ENT> <ENT>.25497</ENT> <ENT>.22913</ENT> <ENT>.20618</ENT> <ENT>.18579</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.29013</ENT> <ENT>.26089</ENT> <ENT>.23489</ENT> <ENT>.21175</ENT> <ENT>.19115</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.29621</ENT> <ENT>.26684</ENT> <ENT>.24067</ENT> <ENT>.21735</ENT> <ENT>.19655</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.30229</ENT> <ENT>.27279</ENT> <ENT>.24647</ENT> <ENT>.22296</ENT> <ENT>.20196</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.30838</ENT> <ENT>.27876</ENT> <ENT>.25228</ENT> <ENT>.22859</ENT> <ENT>.20739</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.31451</ENT> <ENT>.28477</ENT> <ENT>.25813</ENT> <ENT>.23427</ENT> <ENT>.21287</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.32070</ENT> <ENT>.29085</ENT> <ENT>.26407</ENT> <ENT>.24003</ENT> <ENT>.21844</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.32699</ENT> <ENT>.29704</ENT> <ENT>.27012</ENT> <ENT>.24591</ENT> <ENT>.22413</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.33339</ENT> <ENT>.30335</ENT> <ENT>.27629</ENT> <ENT>.25192</ENT> <ENT>.22996</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.33991</ENT> <ENT>.30977</ENT> <ENT>.28259</ENT> <ENT>.25807</ENT> <ENT>.23592</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.34655</ENT> <ENT>.31634</ENT> <ENT>.28904</ENT> <ENT>.26437</ENT> <ENT>.24205</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.35334</ENT> <ENT>.32306</ENT> <ENT>.29566</ENT> <ENT>.27085</ENT> <ENT>.24836</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.36031</ENT> <ENT>.32998</ENT> <ENT>.30248</ENT> <ENT>.27754</ENT> <ENT>.25490</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.36746</ENT> <ENT>.33710</ENT> <ENT>.30952</ENT> <ENT>.28446</ENT> <ENT>.26167</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.37481</ENT> <ENT>.34443</ENT> <ENT>.31678</ENT> <ENT>.29161</ENT> <ENT>.26869</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.38236</ENT> <ENT>.35197</ENT> <ENT>.32427</ENT> <ENT>.29901</ENT> <ENT>.27596</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.39006</ENT> <ENT>.35968</ENT> <ENT>.33194</ENT> <ENT>.30660</ENT> <ENT>.28344</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.39793</ENT> <ENT>.36757</ENT> <ENT>.33980</ENT> <ENT>.31439</ENT> <ENT>.29113</ENT> </ROW> <ROW> <PRTPAGE P="257"/> <ENT I="01">31</ENT> <ENT>.40594</ENT> <ENT>.37561</ENT> <ENT>.34783</ENT> <ENT>.32237</ENT> <ENT>.29902</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.41410</ENT> <ENT>.38383</ENT> <ENT>.35605</ENT> <ENT>.33054</ENT> <ENT>.30711</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.42240</ENT> <ENT>.39220</ENT> <ENT>.36444</ENT> <ENT>.33890</ENT> <ENT>.31541</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.43084</ENT> <ENT>.40072</ENT> <ENT>.37299</ENT> 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<ENT>.89794</ENT> <ENT>.89124</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.92278</ENT> <ENT>.91620</ENT> <ENT>.90968</ENT> <ENT>.90324</ENT> <ENT>.89686</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.92673</ENT> <ENT>.92046</ENT> <ENT>.91426</ENT> <ENT>.90812</ENT> <ENT>.90204</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.93027</ENT> <ENT>.92429</ENT> <ENT>.91837</ENT> <ENT>.91251</ENT> <ENT>.90670</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.93341</ENT> <ENT>.92768</ENT> <ENT>.92201</ENT> <ENT>.91639</ENT> <ENT>.91082</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.93612</ENT> <ENT>.93062</ENT> <ENT>.92516</ENT> <ENT>.91976</ENT> <ENT>.91440</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.93841</ENT> <ENT>.93309</ENT> <ENT>.92782</ENT> <ENT>.92259</ENT> <ENT>.91740</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.94044</ENT> <ENT>.93529</ENT> <ENT>.93018</ENT> <ENT>.92512</ENT> <ENT>.92009</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.94223</ENT> <ENT>.93723</ENT> <ENT>.93226</ENT> <ENT>.92733</ENT> <ENT>.92244</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.94392</ENT> <ENT>.93905</ENT> <ENT>.93421</ENT> <ENT>.92942</ENT> <ENT>.92466</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.94559</ENT> <ENT>.94086</ENT> <ENT>.93615</ENT> <ENT>.93149</ENT> <ENT>.92685</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.94709</ENT> <ENT>.94248</ENT> <ENT>.93790</ENT> <ENT>.93334</ENT> <ENT>.92882</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.94873</ENT> <ENT>.94424</ENT> <ENT>.93979</ENT> <ENT>.93536</ENT> <ENT>.93096</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.95077</ENT> <ENT>.94645</ENT> <ENT>.94216</ENT> <ENT>.93789</ENT> <ENT>.93365</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.95278</ENT> <ENT>.94862</ENT> <ENT>.94449</ENT> <ENT>.94037</ENT> <ENT>.93628</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.95570</ENT> <ENT>.95178</ENT> <ENT>.94787</ENT> <ENT>.94399</ENT> <ENT>.94012</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.96017</ENT> <ENT>.95662</ENT> <ENT>.95309</ENT> <ENT>.94957</ENT> <ENT>.94607</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.96616</ENT> <ENT>.96313</ENT> <ENT>.96010</ENT> <ENT>.95709</ENT> <ENT>.95408</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.97515</ENT> <ENT>.97291</ENT> <ENT>.97067</ENT> <ENT>.96843</ENT> <ENT>.96620</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.98900</ENT> <ENT>.98800</ENT> <ENT>.98700</ENT> <ENT>.98600</ENT> <ENT>.98500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Years</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">3.2%</CHED> <CHED H="2">3.4%</CHED> <CHED H="2">3.6%</CHED> <CHED H="2">3.8%</CHED> <CHED H="2">4.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.13196</ENT> <ENT>.11901</ENT> <ENT>.10774</ENT> <ENT>.09791</ENT> <ENT>.08933</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.11834</ENT> <ENT>.10493</ENT> <ENT>.09324</ENT> <ENT>.08303</ENT> <ENT>.07410</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.12113</ENT> <ENT>.10749</ENT> <ENT>.09557</ENT> <ENT>.08514</ENT> <ENT>.07601</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.12437</ENT> <ENT>.11050</ENT> <ENT>.09835</ENT> <ENT>.08770</ENT> <ENT>.07837</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.12787</ENT> <ENT>.11376</ENT> <ENT>.10138</ENT> <ENT>.09052</ENT> <ENT>.08098</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.13159</ENT> <ENT>.11725</ENT> <ENT>.10465</ENT> <ENT>.09357</ENT> <ENT>.08382</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.13549</ENT> <ENT>.12092</ENT> <ENT>.10810</ENT> <ENT>.09680</ENT> <ENT>.08684</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.13956</ENT> <ENT>.12476</ENT> <ENT>.11171</ENT> <ENT>.10019</ENT> <ENT>.09002</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.14380</ENT> <ENT>.12877</ENT> <ENT>.11549</ENT> <ENT>.10376</ENT> <ENT>.09337</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.14822</ENT> <ENT>.13296</ENT> <ENT>.11946</ENT> <ENT>.10751</ENT> <ENT>.09691</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.15282</ENT> <ENT>.13734</ENT> <ENT>.12361</ENT> <ENT>.11144</ENT> <ENT>.10063</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.15761</ENT> <ENT>.14190</ENT> <ENT>.12795</ENT> <ENT>.11556</ENT> <ENT>.10454</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.16257</ENT> <ENT>.14663</ENT> <ENT>.13247</ENT> <ENT>.11986</ENT> <ENT>.10863</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.16764</ENT> <ENT>.15149</ENT> <ENT>.13711</ENT> <ENT>.12428</ENT> <ENT>.12283</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.17279</ENT> <ENT>.15643</ENT> <ENT>.14182</ENT> <ENT>.12878</ENT> <ENT>.11712</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.17798</ENT> <ENT>.16140</ENT> <ENT>.14657</ENT> <ENT>.13331</ENT> <ENT>.12143</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.18318</ENT> <ENT>.16638</ENT> <ENT>.15133</ENT> <ENT>.13785</ENT> <ENT>.12576</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.18840</ENT> <ENT>.17138</ENT> <ENT>.15611</ENT> <ENT>.14241</ENT> <ENT>.13010</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.19367</ENT> <ENT>.17643</ENT> <ENT>.16094</ENT> <ENT>.14702</ENT> <ENT>.13449</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.19903</ENT> <ENT>.18157</ENT> <ENT>.16586</ENT> <ENT>.15172</ENT> <ENT>.13897</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.20452</ENT> <ENT>.18685</ENT> <ENT>.17092</ENT> <ENT>.15655</ENT> <ENT>.14358</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.21014</ENT> <ENT>.19226</ENT> <ENT>.17612</ENT> <ENT>.16153</ENT> <ENT>.14833</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.21591</ENT> <ENT>.19783</ENT> <ENT>.18146</ENT> <ENT>.16665</ENT> <ENT>.15324</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.22185</ENT> <ENT>.20356</ENT> <ENT>.18698</ENT> <ENT>.17195</ENT> <ENT>.15832</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.22798</ENT> <ENT>.20949</ENT> <ENT>.19270</ENT> <ENT>.17746</ENT> <ENT>.16361</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.23434</ENT> <ENT>.21565</ENT> <ENT>.19866</ENT> <ENT>.18321</ENT> <ENT>.16914</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.24094</ENT> <ENT>.22207</ENT> <ENT>.20489</ENT> <ENT>.18922</ENT> <ENT>.17494</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.24780</ENT> <ENT>.22875</ENT> <ENT>.21138</ENT> <ENT>.19551</ENT> <ENT>.18102</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.25492</ENT> <ENT>.23570</ENT> <ENT>.21814</ENT> <ENT>.20208</ENT> <ENT>.18739</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.26226</ENT> <ENT>.24288</ENT> <ENT>.22514</ENT> <ENT>.20889</ENT> <ENT>.19400</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.26982</ENT> <ENT>.25029</ENT> <ENT>.23239</ENT> <ENT>.21596</ENT> <ENT>.20088</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.27759</ENT> <ENT>.25792</ENT> <ENT>.23985</ENT> <ENT>.22324</ENT> <ENT>.20798</ENT> </ROW> <ROW> <ENT I="01">32</ENT> 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I="01">96</ENT> <ENT>.91226</ENT> <ENT>.90716</ENT> <ENT>.90211</ENT> <ENT>.89709</ENT> <ENT>.89212</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.91510</ENT> <ENT>.91015</ENT> <ENT>.90525</ENT> <ENT>.90038</ENT> <ENT>.89555</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.91759</ENT> <ENT>.91277</ENT> <ENT>.90800</ENT> <ENT>.90326</ENT> <ENT>.89855</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.91993</ENT> <ENT>.91524</ENT> <ENT>.91058</ENT> <ENT>.90596</ENT> <ENT>.90137</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.92225</ENT> <ENT>.91768</ENT> <ENT>.91315</ENT> <ENT>.90865</ENT> <ENT>.90417</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.92433</ENT> <ENT>.91987</ENT> <ENT>.91544</ENT> <ENT>.91104</ENT> <ENT>.90667</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.92659</ENT> <ENT>.92225</ENT> <ENT>.91793</ENT> <ENT>.91364</ENT> <ENT>.90938</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.92943</ENT> <ENT>.92524</ENT> <ENT>.92107</ENT> <ENT>.91692</ENT> <ENT>.91280</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.93221</ENT> <ENT>.92816</ENT> <ENT>.92413</ENT> <ENT>.92012</ENT> <ENT>.91614</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.93627</ENT> <ENT>.93244</ENT> <ENT>.92863</ENT> <ENT>.92483</ENT> <ENT>.92105</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.94257</ENT> <ENT>.93909</ENT> <ENT>.93562</ENT> <ENT>.93217</ENT> <ENT>.92872</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.95107</ENT> <ENT>.94808</ENT> <ENT>.94509</ENT> <ENT>.94211</ENT> <ENT>.93914</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.96396</ENT> <ENT>.96173</ENT> <ENT>.95950</ENT> <ENT>.95728</ENT> <ENT>.95505</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.98400</ENT> <ENT>.98300</ENT> <ENT>.98200</ENT> <ENT>.98100</ENT> <ENT>.98000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.08183</ENT> <ENT>.07527</ENT> <ENT>.06952</ENT> <ENT>.06448</ENT> <ENT>.06005</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.06629</ENT> <ENT>.05945</ENT> <ENT>.05344</ENT> <ENT>.04817</ENT> <ENT>.04354</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.06801</ENT> <ENT>.06098</ENT> <ENT>.05481</ENT> <ENT>.04939</ENT> <ENT>.04460</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.07017</ENT> <ENT>.06297</ENT> <ENT>.05663</ENT> <ENT>.05104</ENT> <ENT>.04611</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.07259</ENT> <ENT>.06520</ENT> <ENT>.05868</ENT> <ENT>.05294</ENT> <ENT>.04786</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.07523</ENT> <ENT>.06765</ENT> <ENT>.06096</ENT> <ENT>.05505</ENT> <ENT>.04982</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.07805</ENT> <ENT>.07029</ENT> <ENT>.06342</ENT> <ENT>.05734</ENT> <ENT>.05195</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.08103</ENT> <ENT>.07307</ENT> <ENT>.06603</ENT> <ENT>.05978</ENT> <ENT>.05423</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.08418</ENT> <ENT>.07603</ENT> <ENT>.06880</ENT> <ENT>.06238</ENT> <ENT>.05666</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.08752</ENT> <ENT>.07917</ENT> <ENT>.07175</ENT> <ENT>.06516</ENT> <ENT>.05928</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.09103</ENT> <ENT>.08249</ENT> <ENT>.07488</ENT> <ENT>.06811</ENT> <ENT>.06206</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.09473</ENT> <ENT>.08600</ENT> <ENT>.07820</ENT> <ENT>.07125</ENT> <ENT>.06503</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.09861</ENT> <ENT>.08968</ENT> <ENT>.08169</ENT> <ENT>.07456</ENT> <ENT>.06817</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.10261</ENT> <ENT>.09348</ENT> <ENT>.08530</ENT> <ENT>.07799</ENT> <ENT>.07142</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.10669</ENT> <ENT>.09735</ENT> <ENT>.08899</ENT> <ENT>.08148</ENT> <ENT>.07474</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.11080</ENT> <ENT>.10126</ENT> <ENT>.09269</ENT> <ENT>.08500</ENT> <ENT>.07808</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.11491</ENT> <ENT>.10516</ENT> <ENT>.09640</ENT> <ENT>.08852</ENT> <ENT>.08142</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.11903</ENT> <ENT>.10908</ENT> <ENT>.10012</ENT> <ENT>.09204</ENT> <ENT>.08475</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.12321</ENT> <ENT>.11304</ENT> <ENT>.10387</ENT> <ENT>.09560</ENT> <ENT>.08812</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.12747</ENT> <ENT>.11709</ENT> <ENT>.10771</ENT> <ENT>.09923</ENT> <ENT>.09156</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.13186</ENT> <ENT>.12126</ENT> <ENT>.11168</ENT> <ENT>.10300</ENT> <ENT>.09513</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.13639</ENT> <ENT>.12558</ENT> <ENT>.11578</ENT> <ENT>.10690</ENT> <ENT>.09883</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.14108</ENT> <ENT>.13005</ENT> <ENT>.12004</ENT> <ENT>.11094</ENT> <ENT>.10268</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.14594</ENT> <ENT>.13469</ENT> <ENT>.12446</ENT> <ENT>.11516</ENT> <ENT>.10669</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.15101</ENT> <ENT>.13954</ENT> <ENT>.12910</ENT> <ENT>.11958</ENT> <ENT>.11091</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.15632</ENT> <ENT>.14464</ENT> <ENT>.13398</ENT> <ENT>.12426</ENT> <ENT>.11537</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.16191</ENT> <ENT>.15001</ENT> <ENT>.13914</ENT> <ENT>.12920</ENT> <ENT>.12011</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.16778</ENT> <ENT>.15567</ENT> <ENT>.14459</ENT> <ENT>.13444</ENT> <ENT>.12514</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.17394</ENT> <ENT>.16162</ENT> <ENT>.15032</ENT> <ENT>.13997</ENT> <ENT>.13046</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.18035</ENT> <ENT>.16782</ENT> <ENT>.15632</ENT> <ENT>.14575</ENT> <ENT>.13604</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.18702</ENT> <ENT>.17429</ENT> <ENT>.16259</ENT> <ENT>.15181</ENT> <ENT>.14189</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.19393</ENT> <ENT>.18100</ENT> <ENT>.16909</ENT> <ENT>.15811</ENT> <ENT>.14799</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.20109</ENT> <ENT>.18797</ENT> <ENT>.17586</ENT> <ENT>.16468</ENT> <ENT>.15436</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.20851</ENT> <ENT>.19520</ENT> <ENT>.18290</ENT> <ENT>.17152</ENT> <ENT>.16100</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.21618</ENT> <ENT>.20268</ENT> <ENT>.19018</ENT> <ENT>.17861</ENT> <ENT>.16789</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.22411</ENT> <ENT>.21043</ENT> <ENT>.19775</ENT> <ENT>.18599</ENT> <ENT>.17508</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.23228</ENT> <ENT>.21844</ENT> <ENT>.20558</ENT> <ENT>.19363</ENT> <ENT>.18253</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.24071</ENT> <ENT>.22670</ENT> <ENT>.21367</ENT> <ENT>.20154</ENT> <ENT>.19026</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.24938</ENT> <ENT>.23521</ENT> <ENT>.22201</ENT> <ENT>.20971</ENT> <ENT>.19825</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.25827</ENT> <ENT>.24396</ENT> <ENT>.23060</ENT> <ENT>.21814</ENT> <ENT>.20650</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.26741</ENT> <ENT>.25295</ENT> <ENT>.23945</ENT> <ENT>.22682</ENT> <ENT>.21502</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.27679</ENT> <ENT>.26220</ENT> <ENT>.24855</ENT> <ENT>.23577</ENT> <ENT>.22381</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.28642</ENT> <ENT>.27172</ENT> <ENT>.25793</ENT> <ENT>.24501</ENT> <ENT>.23289</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.29629</ENT> <ENT>.28147</ENT> <ENT>.26756</ENT> <ENT>.25450</ENT> <ENT>.24224</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.30639</ENT> <ENT>.29147</ENT> <ENT>.27745</ENT> <ENT>.26426</ENT> <ENT>.25186</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.31669</ENT> <ENT>.30169</ENT> <ENT>.28756</ENT> 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<ENT>.86213</ENT> <ENT>.85679</ENT> <ENT>.85150</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.87844</ENT> <ENT>.87321</ENT> <ENT>.86803</ENT> <ENT>.86289</ENT> <ENT>.85780</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.88319</ENT> <ENT>.87815</ENT> <ENT>.87314</ENT> <ENT>.86818</ENT> <ENT>.86327</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.88719</ENT> <ENT>.88230</ENT> <ENT>.87745</ENT> <ENT>.87264</ENT> <ENT>.86787</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.89076</ENT> <ENT>.88601</ENT> <ENT>.88129</ENT> <ENT>.87661</ENT> <ENT>.87197</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.89388</ENT> <ENT>.88925</ENT> <ENT>.88465</ENT> <ENT>.88009</ENT> <ENT>.87556</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.89682</ENT> <ENT>.89230</ENT> <ENT>.88781</ENT> <ENT>.88336</ENT> <ENT>.87894</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.89973</ENT> <ENT>.89533</ENT> <ENT>.89095</ENT> <ENT>.88660</ENT> <ENT>.88228</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.90233</ENT> <ENT>.89802</ENT> <ENT>.89374</ENT> <ENT>.88948</ENT> <ENT>.88526</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.90515</ENT> <ENT>.90094</ENT> <ENT>.89676</ENT> <ENT>.89260</ENT> <ENT>.88848</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.90871</ENT> <ENT>.90464</ENT> <ENT>.90059</ENT> <ENT>.89656</ENT> <ENT>.89256</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.91217</ENT> <ENT>.90823</ENT> <ENT>.90431</ENT> <ENT>.90040</ENT> <ENT>.89652</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.91729</ENT> <ENT>.91354</ENT> <ENT>.90981</ENT> <ENT>.90610</ENT> <ENT>.90240</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.92529</ENT> <ENT>.92187</ENT> <ENT>.91846</ENT> <ENT>.91507</ENT> <ENT>.91169</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.93617</ENT> <ENT>.93322</ENT> <ENT>.93027</ENT> <ENT>.92732</ENT> <ENT>.92439</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.95283</ENT> <ENT>.95062</ENT> <ENT>.94840</ENT> <ENT>.94619</ENT> <ENT>.94398</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97900</ENT> <ENT>.97800</ENT> <ENT>.97700</ENT> <ENT>.97600</ENT> <ENT>.97500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.05615</ENT> <ENT>.05272</ENT> <ENT>.04969</ENT> <ENT>.04701</ENT> <ENT>.04464</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.03945</ENT> <ENT>.03585</ENT> <ENT>.03268</ENT> <ENT>.02986</ENT> <ENT>.02737</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.04039</ENT> <ENT>.03667</ENT> <ENT>.03337</ENT> <ENT>.03046</ENT> <ENT>.02787</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.04176</ENT> <ENT>.03791</ENT> <ENT>.03450</ENT> <ENT>.03147</ENT> <ENT>.02879</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.04336</ENT> <ENT>.03938</ENT> <ENT>.03585</ENT> <ENT>.03272</ENT> <ENT>.02993</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.04518</ENT> <ENT>.04107</ENT> <ENT>.03741</ENT> <ENT>.03416</ENT> <ENT>.03127</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.04717</ENT> <ENT>.04292</ENT> <ENT>.03914</ENT> <ENT>.03577</ENT> <ENT>.03276</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.04929</ENT> <ENT>.04490</ENT> <ENT>.04099</ENT> <ENT>.03750</ENT> <ENT>.03438</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.05158</ENT> <ENT>.04704</ENT> <ENT>.04300</ENT> <ENT>.03938</ENT> <ENT>.03615</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.05404</ENT> <ENT>.04936</ENT> <ENT>.04518</ENT> <ENT>.04143</ENT> <ENT>.03808</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.05666</ENT> <ENT>.05183</ENT> <ENT>.04751</ENT> <ENT>.04364</ENT> <ENT>.04016</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.05947</ENT> <ENT>.05449</ENT> <ENT>.05003</ENT> <ENT>.04602</ENT> <ENT>.04242</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.06245</ENT> <ENT>.05731</ENT> <ENT>.05271</ENT> <ENT>.04856</ENT> <ENT>.04484</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.06554</ENT> <ENT>.06025</ENT> <ENT>.05549</ENT> <ENT>.05121</ENT> <ENT>.04735</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.06869</ENT> <ENT>.06324</ENT> <ENT>.05834</ENT> <ENT>.05391</ENT> <ENT>.04992</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.07186</ENT> <ENT>.06625</ENT> <ENT>.06119</ENT> <ENT>.05662</ENT> <ENT>.05250</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.07502</ENT> <ENT>.06924</ENT> <ENT>.06403</ENT> <ENT>.05931</ENT> <ENT>.05504</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.07817</ENT> <ENT>.07223</ENT> <ENT>.06685</ENT> <ENT>.06199</ENT> <ENT>.05757</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.08136</ENT> <ENT>.07524</ENT> <ENT>.06970</ENT> <ENT>.06468</ENT> <ENT>.06012</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.08462</ENT> <ENT>.07832</ENT> <ENT>.07261</ENT> <ENT>.06743</ENT> <ENT>.06272</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.08800</ENT> <ENT>.08152</ENT> <ENT>.07564</ENT> <ENT>.07029</ENT> <ENT>.06542</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.09151</ENT> <ENT>.08485</ENT> <ENT>.07879</ENT> <ENT>.07327</ENT> <ENT>.06824</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.09516</ENT> <ENT>.08831</ENT> <ENT>.08207</ENT> <ENT>.07638</ENT> <ENT>.07119</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.09897</ENT> <ENT>.09193</ENT> <ENT>.08551</ENT> <ENT>.07964</ENT> <ENT>.07428</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.10299</ENT> <ENT>.09576</ENT> <ENT>.08915</ENT> <ENT>.08310</ENT> <ENT>.07756</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.10725</ENT> <ENT>.09982</ENT> <ENT>.09302</ENT> <ENT>.08679</ENT> <ENT>.08108</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.11179</ENT> <ENT>.10416</ENT> <ENT>.09717</ENT> <ENT>.09075</ENT> <ENT>.08486</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.11661</ENT> <ENT>.10878</ENT> <ENT>.10160</ENT> <ENT>.09500</ENT> <ENT>.08892</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.12173</ENT> <ENT>.11370</ENT> <ENT>.10632</ENT> <ENT>.09953</ENT> <ENT>.09328</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.12710</ENT> <ENT>.11888</ENT> <ENT>.11130</ENT> <ENT>.10432</ENT> <ENT>.09788</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.13276</ENT> <ENT>.12433</ENT> <ENT>.11656</ENT> <ENT>.10938</ENT> <ENT>.10276</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.13865</ENT> <ENT>.13002</ENT> <ENT>.12205</ENT> <ENT>.11469</ENT> <ENT>.10787</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.14482</ENT> <ENT>.13599</ENT> <ENT>.12783</ENT> <ENT>.12026</ENT> <ENT>.11326</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.15126</ENT> <ENT>.14223</ENT> <ENT>.13387</ENT> <ENT>.12612</ENT> <ENT>.11892</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.15796</ENT> <ENT>.14874</ENT> <ENT>.14018</ENT> <ENT>.13223</ENT> <ENT>.12485</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.16494</ENT> <ENT>.15553</ENT> <ENT>.14678</ENT> <ENT>.13864</ENT> <ENT>.13107</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.17221</ENT> <ENT>.16260</ENT> <ENT>.15366</ENT> <ENT>.14533</ENT> <ENT>.13757</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.17975</ENT> <ENT>.16996</ENT> <ENT>.16082</ENT> <ENT>.15231</ENT> <ENT>.14435</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.18756</ENT> <ENT>.17758</ENT> <ENT>.16826</ENT> <ENT>.15955</ENT> <ENT>.15142</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.19563</ENT> <ENT>.18547</ENT> <ENT>.17597</ENT> <ENT>.16708</ENT> <ENT>.15875</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.20397</ENT> <ENT>.19364</ENT> <ENT>.18395</ENT> <ENT>.17488</ENT> <ENT>.16638</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.21259</ENT> <ENT>.20209</ENT> <ENT>.19223</ENT> <ENT>.18298</ENT> <ENT>.17430</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.22152</ENT> <ENT>.21084</ENT> <ENT>.20082</ENT> <ENT>.19140</ENT> <ENT>.18254</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.23071</ENT> <ENT>.21988</ENT> <ENT>.20969</ENT> <ENT>.20010</ENT> <ENT>.19107</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.24019</ENT> <ENT>.22920</ENT> <ENT>.21885</ENT> <ENT>.20910</ENT> <ENT>.19991</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.24992</ENT> <ENT>.23878</ENT> <ENT>.22828</ENT> <ENT>.21837</ENT> <ENT>.20902</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.25991</ENT> <ENT>.24864</ENT> <ENT>.23799</ENT> <ENT>.22793</ENT> <ENT>.21842</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.27016</ENT> <ENT>.25876</ENT> <ENT>.24798</ENT> <ENT>.23777</ENT> <ENT>.22812</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.28070</ENT> <ENT>.26918</ENT> <ENT>.25826</ENT> <ENT>.24792</ENT> <ENT>.23812</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.29150</ENT> <ENT>.27987</ENT> <ENT>.26883</ENT> <ENT>.25837</ENT> <ENT>.24843</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.30258</ENT> <ENT>.29084</ENT> <ENT>.27970</ENT> <ENT>.26911</ENT> <ENT>.25905</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.31391</ENT> <ENT>.30208</ENT> <ENT>.29084</ENT> <ENT>.28014</ENT> <ENT>.26996</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.32548</ENT> <ENT>.31358</ENT> <ENT>.30224</ENT> <ENT>.29144</ENT> <ENT>.28115</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.33729</ENT> <ENT>.32532</ENT> <ENT>.31390</ENT> <ENT>.30302</ENT> <ENT>.29263</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.34931</ENT> <ENT>.33728</ENT> <ENT>.32579</ENT> <ENT>.31482</ENT> <ENT>.30434</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.36152</ENT> <ENT>.34945</ENT> <ENT>.33790</ENT> <ENT>.32686</ENT> <ENT>.31631</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.37392</ENT> <ENT>.36181</ENT> <ENT>.35022</ENT> <ENT>.33912</ENT> <ENT>.32850</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.38652</ENT> <ENT>.37438</ENT> <ENT>.36276</ENT> <ENT>.35162</ENT> <ENT>.34093</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.39929</ENT> <ENT>.38715</ENT> <ENT>.37550</ENT> <ENT>.36432</ENT> <ENT>.35359</ENT> </ROW> <ROW> <ENT 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I="01">99</ENT> <ENT>.87455</ENT> <ENT>.87019</ENT> <ENT>.86586</ENT> <ENT>.86157</ENT> <ENT>.85730</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.87800</ENT> <ENT>.87374</ENT> <ENT>.86951</ENT> <ENT>.86532</ENT> <ENT>.86115</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.88106</ENT> <ENT>.87689</ENT> <ENT>.87275</ENT> <ENT>.86863</ENT> <ENT>.86455</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.88437</ENT> <ENT>.88030</ENT> <ENT>.87625</ENT> <ENT>.87222</ENT> <ENT>.86822</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.88858</ENT> <ENT>.88463</ENT> <ENT>.88070</ENT> <ENT>.87679</ENT> <ENT>.87290</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.89266</ENT> <ENT>.88882</ENT> <ENT>.88500</ENT> <ENT>.88120</ENT> <ENT>.87741</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.89872</ENT> <ENT>.89506</ENT> <ENT>.89141</ENT> <ENT>.88778</ENT> <ENT>.88417</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.90832</ENT> <ENT>.90496</ENT> <ENT>.90161</ENT> <ENT>.89828</ENT> <ENT>.89496</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.92146</ENT> <ENT>.91854</ENT> <ENT>.91562</ENT> <ENT>.91271</ENT> <ENT>.90981</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.94177</ENT> <ENT>.93956</ENT> <ENT>.93736</ENT> <ENT>.93516</ENT> <ENT>.93296</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97400</ENT> <ENT>.97300</ENT> <ENT>.97200</ENT> <ENT>.97100</ENT> <ENT>.97000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted Payout Rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.04253</ENT> <ENT>.04066</ENT> <ENT>.03899</ENT> <ENT>.03751</ENT> <ENT>.03618</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.02516</ENT> <ENT>.02320</ENT> <ENT>.02145</ENT> <ENT>.01989</ENT> <ENT>.01850</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02557</ENT> <ENT>.02353</ENT> <ENT>.02171</ENT> <ENT>.02008</ENT> <ENT>.01862</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02640</ENT> <ENT>.02427</ENT> <ENT>.02237</ENT> <ENT>.02067</ENT> <ENT>.01915</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.02744</ENT> <ENT>.02523</ENT> <ENT>.02325</ENT> <ENT>.02147</ENT> <ENT>.01988</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.02868</ENT> <ENT>.02638</ENT> <ENT>.02431</ENT> <ENT>.02246</ENT> <ENT>.02080</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.03008</ENT> <ENT>.02767</ENT> <ENT>.02552</ENT> <ENT>.02359</ENT> <ENT>.02185</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.03159</ENT> <ENT>.02909</ENT> <ENT>.02685</ENT> <ENT>.02483</ENT> <ENT>.02302</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.03325</ENT> <ENT>.03065</ENT> <ENT>.02831</ENT> <ENT>.02621</ENT> <ENT>.02432</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.03507</ENT> <ENT>.03236</ENT> <ENT>.02993</ENT> <ENT>.02774</ENT> <ENT>.02576</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.03704</ENT> <ENT>.03423</ENT> <ENT>.03170</ENT> <ENT>.02941</ENT> <ENT>.02735</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.03918</ENT> <ENT>.03626</ENT> <ENT>.03363</ENT> <ENT>.03125</ENT> <ENT>.02910</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.04148</ENT> <ENT>.03845</ENT> <ENT>.03571</ENT> <ENT>.03323</ENT> <ENT>.03099</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.04387</ENT> <ENT>.04073</ENT> <ENT>.03788</ENT> <ENT>.03531</ENT> <ENT>.03297</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.04632</ENT> <ENT>.04305</ENT> <ENT>.04010</ENT> <ENT>.03742</ENT> <ENT>.03499</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.04876</ENT> <ENT>.04538</ENT> <ENT>.04231</ENT> <ENT>.03953</ENT> <ENT>.03699</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.05118</ENT> <ENT>.04767</ENT> <ENT>.04449</ENT> <ENT>.04159</ENT> <ENT>.03896</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.05357</ENT> <ENT>.04994</ENT> <ENT>.04663</ENT> <ENT>.04362</ENT> <ENT>.04088</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.05598</ENT> <ENT>.05221</ENT> <ENT>.04878</ENT> <ENT>.04565</ENT> <ENT>.04280</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.05843</ENT> <ENT>.05453</ENT> <ENT>.05097</ENT> <ENT>.04772</ENT> <ENT>.04476</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.06099</ENT> <ENT>.05694</ENT> <ENT>.05325</ENT> <ENT>.04988</ENT> <ENT>.04679</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.06365</ENT> <ENT>.05946</ENT> <ENT>.05564</ENT> <ENT>.05213</ENT> <ENT>.04893</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.06644</ENT> <ENT>.06210</ENT> <ENT>.05813</ENT> <ENT>.05449</ENT> <ENT>.05116</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.06937</ENT> <ENT>.06488</ENT> <ENT>.06076</ENT> <ENT>.05699</ENT> <ENT>.05352</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.07249</ENT> <ENT>.06784</ENT> 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<ENT>.83552</ENT> <ENT>.82105</ENT> <ENT>.82661</ENT> <ENT>.82221</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.84487</ENT> <ENT>.84048</ENT> <ENT>.83612</ENT> <ENT>.82179</ENT> <ENT>.82750</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.84910</ENT> <ENT>.84481</ENT> <ENT>.84054</ENT> <ENT>.83631</ENT> <ENT>.83211</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.85307</ENT> <ENT>.84887</ENT> <ENT>.84469</ENT> <ENT>.84055</ENT> <ENT>.83644</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.85701</ENT> <ENT>.85290</ENT> <ENT>.84882</ENT> <ENT>.84476</ENT> <ENT>.84073</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.86049</ENT> <ENT>.85645</ENT> <ENT>.85244</ENT> <ENT>.84846</ENT> <ENT>.84451</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.86424</ENT> <ENT>.86029</ENT> <ENT>.85637</ENT> <ENT>.85247</ENT> <ENT>.84859</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.86904</ENT> <ENT>.86520</ENT> <ENT>.86138</ENT> <ENT>.85758</ENT> <ENT>.85381</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.87365</ENT> <ENT>.86991</ENT> <ENT>.86619</ENT> <ENT>.86249</ENT> <ENT>.85880</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.88058</ENT> <ENT>.87700</ENT> <ENT>.87343</ENT> <ENT>.86988</ENT> <ENT>.86635</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.89165</ENT> <ENT>.88835</ENT> <ENT>.88506</ENT> <ENT>.88179</ENT> <ENT>.87852</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.90692</ENT> <ENT>.90404</ENT> <ENT>.90116</ENT> <ENT>.89829</ENT> <ENT>.89542</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.93077</ENT> <ENT>.92858</ENT> <ENT>.92639</ENT> <ENT>.92420</ENT> <ENT>.92201</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96900</ENT> <ENT>.96800</ENT> <ENT>.96700</ENT> <ENT>.96600</ENT> <ENT>.96500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03499</ENT> <ENT>.03392</ENT> <ENT>.03296</ENT> <ENT>.03209</ENT> <ENT>.03130</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01725</ENT> <ENT>.01613</ENT> <ENT>.01513</ENT> <ENT>.01422</ENT> <ENT>.01340</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01732</ENT> <ENT>.01615</ENT> <ENT>.01509</ENT> <ENT>.01414</ENT> <ENT>.01329</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01778</ENT> <ENT>.01656</ENT> <ENT>.01545</ENT> <ENT>.01446</ENT> <ENT>.01356</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01846</ENT> <ENT>.01717</ENT> <ENT>.01601</ENT> <ENT>.01497</ENT> <ENT>.01402</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01930</ENT> <ENT>.01796</ENT> <ENT>.01674</ENT> <ENT>.01574</ENT> <ENT>.01465</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.02029</ENT> <ENT>.01888</ENT> <ENT>.01761</ENT> <ENT>.01645</ENT> <ENT>.01541</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.02138</ENT> <ENT>.01991</ENT> <ENT>.01857</ENT> <ENT>.01736</ENT> <ENT>.01627</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.02261</ENT> <ENT>.02106</ENT> <ENT>.01966</ENT> <ENT>.01839</ENT> <ENT>.01724</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.02397</ENT> <ENT>.02236</ENT> <ENT>.02089</ENT> <ENT>.01956</ENT> <ENT>.01835</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.02548</ENT> <ENT>.02379</ENT> <ENT>.02225</ENT> <ENT>.02086</ENT> <ENT>.01959</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.02715</ENT> <ENT>.02538</ENT> <ENT>.02377</ENT> <ENT>.02231</ENT> <ENT>.02098</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.02895</ENT> <ENT>.02710</ENT> <ENT>.02542</ENT> <ENT>.02389</ENT> <ENT>.02250</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.03085</ENT> <ENT>.02892</ENT> <ENT>.02716</ENT> <ENT>.02556</ENT> <ENT>.02410</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.03278</ENT> <ENT>.03076</ENT> <ENT>.02893</ENT> <ENT>.02725</ENT> <ENT>.02572</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.03469</ENT> <ENT>.03259</ENT> <ENT>.03067</ENT> <ENT>.02892</ENT> <ENT>.02732</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.03656</ENT> <ENT>.03437</ENT> <ENT>.03237</ENT> <ENT>.03054</ENT> <ENT>.02886</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.03938</ENT> <ENT>.03610</ENT> <ENT>.03401</ENT> <ENT>.03210</ENT> <ENT>.03035</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.04020</ENT> <ENT>.03782</ENT> <ENT>.03564</ENT> <ENT>.03364</ENT> <ENT>.03181</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.04204</ENT> <ENT>.03956</ENT> <ENT>.03729</ENT> <ENT>.03520</ENT> <ENT>.03328</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.04397</ENT> <ENT>.04138</ENT> <ENT>.03901</ENT> <ENT>.03683</ENT> <ENT>.03483</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.04599</ENT> <ENT>.04329</ENT> <ENT>.04081</ENT> <ENT>.03853</ENT> <ENT>.03644</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.04810</ENT> <ENT>.04529</ENT> <ENT>.04270</ENT> <ENT>.04032</ENT> <ENT>.03813</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.05033</ENT> <ENT>.04740</ENT> <ENT>.04470</ENT> <ENT>.04222</ENT> <ENT>.03992</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.05273</ENT> <ENT>.04968</ENT> <ENT>.04686</ENT> <ENT>.04427</ENT> <ENT>.04187</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.05534</ENT> <ENT>.05216</ENT> <ENT>.04922</ENT> <ENT>.04651</ENT> <ENT>.04400</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.05819</ENT> <ENT>.05488</ENT> <ENT>.05182</ENT> <ENT>.04898</ENT> <ENT>.04636</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.06130</ENT> <ENT>.05785</ENT> <ENT>.05466</ENT> <ENT>.05170</ENT> <ENT>.04896</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.06468</ENT> <ENT>.06109</ENT> <ENT>.05777</ENT> <ENT>.05468</ENT> <ENT>.05182</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.06830</ENT> <ENT>.06457</ENT> <ENT>.06110</ENT> <ENT>.05789</ENT> <ENT>.05490</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.07217</ENT> <ENT>.06829</ENT> <ENT>.06469</ENT> <ENT>.06134</ENT> <ENT>.05822</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.07627</ENT> <ENT>.07224</ENT> <ENT>.06849</ENT> <ENT>.06500</ENT> <ENT>.06174</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.08062</ENT> <ENT>.07644</ENT> <ENT>.07254</ENT> <ENT>.06891</ENT> <ENT>.06552</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.08524</ENT> <ENT>.08090</ENT> <ENT>.07686</ENT> <ENT>.07308</ENT> <ENT>.06955</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.09012</ENT> <ENT>.08562</ENT> <ENT>.08142</ENT> <ENT>.07749</ENT> <ENT>.07382</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.09528</ENT> <ENT>.09062</ENT> <ENT>.08626</ENT> <ENT>.08218</ENT> <ENT>.07836</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.10071</ENT> <ENT>.09589</ENT> <ENT>.09137</ENT> <ENT>.08714</ENT> <ENT>.08317</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.10643</ENT> <ENT>.10144</ENT> <ENT>.09676</ENT> <ENT>.09237</ENT> <ENT>.08825</ENT> </ROW> <ROW> <ENT 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<ROW> <ENT I="01">86</ENT> <ENT>.71723</ENT> <ENT>.71112</ENT> <ENT>.70508</ENT> <ENT>.69912</ENT> <ENT>.69323</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.73050</ENT> <ENT>.72460</ENT> <ENT>.71877</ENT> <ENT>.71300</ENT> <ENT>.70731</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.74285</ENT> <ENT>.73715</ENT> <ENT>.73151</ENT> <ENT>.72593</ENT> <ENT>.72042</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.75454</ENT> <ENT>.74903</ENT> <ENT>.74358</ENT> <ENT>.73819</ENT> <ENT>.73286</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.76591</ENT> <ENT>.76060</ENT> <ENT>.75534</ENT> <ENT>.75014</ENT> <ENT>.74499</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.77688</ENT> <ENT>.77176</ENT> <ENT>.76670</ENT> <ENT>.76169</ENT> <ENT>.75672</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.78709</ENT> <ENT>.78217</ENT> <ENT>.77729</ENT> <ENT>.77245</ENT> <ENT>.76766</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.79635</ENT> <ENT>.79160</ENT> <ENT>.78690</ENT> <ENT>.78223</ENT> <ENT>.77761</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.80461</ENT> <ENT>.80002</ENT> <ENT>.79547</ENT> <ENT>.79096</ENT> <ENT>.78648</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.81180</ENT> <ENT>.80735</ENT> <ENT>.80394</ENT> <ENT>.79856</ENT> <ENT>.79421</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.81784</ENT> <ENT>.81351</ENT> <ENT>.80921</ENT> <ENT>.80494</ENT> <ENT>.80071</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.82324</ENT> <ENT>.81901</ENT> <ENT>.81481</ENT> <ENT>.81065</ENT> <ENT>.80651</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.82794</ENT> <ENT>.82380</ENT> <ENT>.81969</ENT> <ENT>.81562</ENT> <ENT>.81157</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.83235</ENT> <ENT>.82830</ENT> <ENT>.83427</ENT> <ENT>.82028</ENT> <ENT>.81631</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.83674</ENT> <ENT>.83276</ENT> <ENT>.82882</ENT> <ENT>.82490</ENT> <ENT>.82101</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.84058</ENT> <ENT>.83668</ENT> <ENT>.83280</ENT> <ENT>.82895</ENT> <ENT>.82512</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.84474</ENT> <ENT>.84091</ENT> <ENT>.83710</ENT> <ENT>.83332</ENT> <ENT>.82956</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.85006</ENT> <ENT>.84633</ENT> <ENT>.84262</ENT> <ENT>.83893</ENT> <ENT>.83526</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.85514</ENT> <ENT>.85150</ENT> <ENT>.84787</ENT> <ENT>.84427</ENT> <ENT>.84068</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.86284</ENT> <ENT>.85934</ENT> <ENT>.85585</ENT> <ENT>.85239</ENT> <ENT>.84893</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.87527</ENT> <ENT>.87204</ENT> <ENT>.86881</ENT> <ENT>.86559</ENT> <ENT>.86239</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.89257</ENT> <ENT>.88972</ENT> <ENT>.88688</ENT> <ENT>.88404</ENT> <ENT>.88121</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.91983</ENT> <ENT>.91765</ENT> <ENT>.91547</ENT> <ENT>.91330</ENT> <ENT>.91113</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96400</ENT> <ENT>.96300</ENT> <ENT>.96200</ENT> <ENT>.96100</ENT> <ENT>.96000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03059</ENT> <ENT>.02995</ENT> <ENT>.02936</ENT> <ENT>.02882</ENT> <ENT>.02833</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01267</ENT> <ENT>.01200</ENT> <ENT>.01139</ENT> <ENT>.01084</ENT> <ENT>.01033</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01251</ENT> <ENT>.01181</ENT> <ENT>.01117</ENT> <ENT>.01059</ENT> <ENT>.01006</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01274</ENT> <ENT>.01200</ENT> <ENT>.01133</ENT> <ENT>.01072</ENT> <ENT>.01016</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.01316</ENT> <ENT>.01239</ENT> <ENT>.01168</ENT> <ENT>.01103</ENT> <ENT>.01044</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01375</ENT> <ENT>.01293</ENT> <ENT>.01218</ENT> <ENT>.01150</ENT> <ENT>.01088</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01446</ENT> <ENT>.01360</ENT> <ENT>.01281</ENT> <ENT>.01209</ENT> <ENT>.01144</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01527</ENT> <ENT>.01436</ENT> <ENT>.01353</ENT> <ENT>.01277</ENT> <ENT>.01208</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01619</ENT> <ENT>.01523</ENT> <ENT>.01436</ENT> <ENT>.01356</ENT> <ENT>.01283</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01725</ENT> <ENT>.01624</ENT> <ENT>.01532</ENT> <ENT>.01448</ENT> <ENT>.01370</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01843</ENT> <ENT>.01737</ENT> <ENT>.01640</ENT> <ENT>.01551</ENT> <ENT>.01470</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01976</ENT> <ENT>.01865</ENT> <ENT>.01763</ENT> <ENT>.01669</ENT> <ENT>.01583</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.02122</ENT> <ENT>.02005</ENT> <ENT>.01898</ENT> <ENT>.01800</ENT> <ENT>.01709</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.02276</ENT> <ENT>.02153</ENT> <ENT>.02041</ENT> <ENT>.01937</ENT> <ENT>.01842</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.02432</ENT> <ENT>.02303</ENT> <ENT>.02185</ENT> <ENT>.02077</ENT> <ENT>.01977</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02585</ENT> <ENT>.02451</ENT> <ENT>.02327</ENT> <ENT>.02213</ENT> <ENT>.02108</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02732</ENT> <ENT>.02591</ENT> <ENT>.02462</ENT> <ENT>.02342</ENT> <ENT>.02232</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02874</ENT> <ENT>.02726</ENT> <ENT>.02590</ENT> <ENT>.02465</ENT> <ENT>.02349</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.03013</ENT> <ENT>.02858</ENT> <ENT>.02715</ENT> <ENT>.02584</ENT> <ENT>.02462</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.03152</ENT> <ENT>.02990</ENT> <ENT>.02841</ENT> <ENT>.02703</ENT> <ENT>.02575</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.03298</ENT> <ENT>.03128</ENT> <ENT>.02971</ENT> <ENT>.02826</ENT> <ENT>.02692</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.03451</ENT> <ENT>.03272</ENT> <ENT>.03108</ENT> <ENT>.02956</ENT> <ENT>.02815</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.03611</ENT> <ENT>.03424</ENT> <ENT>.03251</ENT> <ENT>.03091</ENT> <ENT>.02944</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.03781</ENT> <ENT>.03585</ENT> <ENT>.03404</ENT> <ENT>.03236</ENT> <ENT>.03081</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.03965</ENT> <ENT>.03760</ENT> <ENT>.03570</ENT> <ENT>.03393</ENT> <ENT>.03230</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.04168</ENT> <ENT>.03953</ENT> <ENT>.03753</ENT> <ENT>.03568</ENT> <ENT>.03396</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.04393</ENT> <ENT>.04168</ENT> <ENT>.03958</ENT> <ENT>.03764</ENT> <ENT>.03583</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.04642</ENT> <ENT>.04406</ENT> <ENT>.04186</ENT> <ENT>.03982</ENT> <ENT>.03792</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.04916</ENT> <ENT>.04669</ENT> <ENT>.04439</ENT> <ENT>.04224</ENT> <ENT>.04025</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.05212</ENT> <ENT>.04953</ENT> <ENT>.04712</ENT> <ENT>.04487</ENT> <ENT>.04277</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.05531</ENT> <ENT>.05260</ENT> <ENT>.05008</ENT> <ENT>.04772</ENT> <ENT>.04552</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.05871</ENT> <ENT>.05588</ENT> <ENT>.05324</ENT> <ENT>.05077</ENT> <ENT>.04846</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.06236</ENT> <ENT>.05940</ENT> <ENT>.05663</ENT> <ENT>.05405</ENT> <ENT>.05163</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.06625</ENT> <ENT>.06316</ENT> <ENT>.06027</ENT> <ENT>.05756</ENT> <ENT>.05502</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.07038</ENT> <ENT>.06716</ENT> <ENT>.06414</ENT> <ENT>.06131</ENT> <ENT>.05865</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.07478</ENT> <ENT>.07142</ENT> <ENT>.06827</ENT> <ENT>.06531</ENT> <ENT>.06253</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.07944</ENT> <ENT>.07595</ENT> <ENT>.07266</ENT> <ENT>.06957</ENT> <ENT>.06667</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.08438</ENT> <ENT>.08074</ENT> <ENT>.07732</ENT> <ENT>.07410</ENT> <ENT>.07106</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.08958</ENT> <ENT>.08580</ENT> <ENT>.08223</ENT> <ENT>.07888</ENT> <ENT>.07571</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.09506</ENT> <ENT>.09112</ENT> <ENT>.08742</ENT> <ENT>.08392</ENT> <ENT>.08061</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.10081</ENT> <ENT>.09673</ENT> <ENT>.09288</ENT> <ENT>.08924</ENT> <ENT>.08580</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.10687</ENT> <ENT>.10263</ENT> <ENT>.09863</ENT> <ENT>.09484</ENT> <ENT>.09126</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.11325</ENT> <ENT>.10886</ENT> <ENT>.10471</ENT> <ENT>.10078</ENT> <ENT>.09705</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.11993</ENT> <ENT>.11539</ENT> <ENT>.11109</ENT> <ENT>.10701</ENT> <ENT>.10314</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.12694</ENT> <ENT>.12224</ENT> <ENT>.11779</ENT> <ENT>.11356</ENT> <ENT>.10955</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.13424</ENT> <ENT>.12939</ENT> <ENT>.12478</ENT> <ENT>.12040</ENT> <ENT>.11624</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.14186</ENT> <ENT>.13686</ENT> <ENT>.13210</ENT> <ENT>.12757</ENT> <ENT>.12326</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.14980</ENT> <ENT>.14464</ENT> <ENT>.13973</ENT> <ENT>.13505</ENT> <ENT>.13059</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.15810</ENT> <ENT>.15278</ENT> <ENT>.14772</ENT> <ENT>.14289</ENT> <ENT>.13828</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.16674</ENT> <ENT>.16127</ENT> <ENT>.15605</ENT> <ENT>.15107</ENT> <ENT>.14631</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.17574</ENT> <ENT>.17012</ENT> <ENT>.16475</ENT> <ENT>.15962</ENT> <ENT>.15472</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.18510</ENT> <ENT>.17932</ENT> <ENT>.17381</ENT> <ENT>.16853</ENT> <ENT>.16348</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.19480</ENT> <ENT>.18888</ENT> <ENT>.18322</ENT> <ENT>.17779</ENT> <ENT>.17260</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.20484</ENT> <ENT>.19878</ENT> <ENT>.19298</ENT> <ENT>.18741</ENT> <ENT>.18208</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.21520</ENT> <ENT>.20901</ENT> <ENT>.20306</ENT> <ENT>.19735</ENT> <ENT>.19188</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.22589</ENT> <ENT>.21955</ENT> <ENT>.21347</ENT> <ENT>.20763</ENT> <ENT>.20202</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.23688</ENT> <ENT>.23041</ENT> <ENT>.22420</ENT> <ENT>.21822</ENT> <ENT>.21248</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.24820</ENT> <ENT>.24161</ENT> <ENT>.23527</ENT> <ENT>.22917</ENT> <ENT>.22329</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.25984</ENT> <ENT>.25313</ENT> <ENT>.24667</ENT> <ENT>.24044</ENT> <ENT>.23444</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.27184</ENT> <ENT>.26501</ENT> <ENT>.25843</ENT> <ENT>.25209</ENT> <ENT>.24596</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.28417</ENT> <ENT>.27724</ENT> <ENT>.27055</ENT> <ENT>.26409</ENT> <ENT>.25786</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.29688</ENT> <ENT>.28985</ENT> <ENT>.28306</ENT> <ENT>.27650</ENT> <ENT>.27015</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.30996</ENT> <ENT>.30284</ENT> <ENT>.29596</ENT> <ENT>.28929</ENT> <ENT>.28285</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.32341</ENT> <ENT>.31621</ENT> <ENT>.30924</ENT> <ENT>.30249</ENT> <ENT>.29595</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.33721</ENT> <ENT>.32994</ENT> <ENT>.32289</ENT> <ENT>.31605</ENT> <ENT>.30943</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.35134</ENT> <ENT>.34401</ENT> <ENT>.33689</ENT> <ENT>.32999</ENT> <ENT>.32329</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.36580</ENT> <ENT>.35841</ENT> <ENT>.35124</ENT> <ENT>.34427</ENT> <ENT>.33750</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.38055</ENT> <ENT>.37312</ENT> <ENT>.36590</ENT> <ENT>.35889</ENT> <ENT>.35206</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.39559</ENT> <ENT>.38814</ENT> <ENT>.38089</ENT> <ENT>.37383</ENT> <ENT>.36696</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.41096</ENT> <ENT>.40349</ENT> <ENT>.39622</ENT> <ENT>.38913</ENT> <ENT>.38222</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.42665</ENT> <ENT>.41918</ENT> <ENT>.41190</ENT> <ENT>.40480</ENT> <ENT>.39787</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.44273</ENT> <ENT>.43527</ENT> <ENT>.42799</ENT> <ENT>.42089</ENT> <ENT>.41395</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.45919</ENT> <ENT>.45176</ENT> <ENT>.44450</ENT> <ENT>.43741</ENT> <ENT>.43049</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.47594</ENT> <ENT>.46856</ENT> <ENT>.46134</ENT> <ENT>.45428</ENT> <ENT>.44738</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.49283</ENT> <ENT>.48550</ENT> <ENT>.47834</ENT> <ENT>.47132</ENT> <ENT>.46446</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.50969</ENT> <ENT>.50244</ENT> <ENT>.49534</ENT> <ENT>.48838</ENT> <ENT>.48157</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.52646</ENT> <ENT>.51929</ENT> <ENT>.51226</ENT> <ENT>.50537</ENT> <ENT>.49862</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.54309</ENT> <ENT>.53601</ENT> <ENT>.52907</ENT> <ENT>.52226</ENT> <ENT>.51558</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.55960</ENT> <ENT>.55263</ENT> <ENT>.54579</ENT> <ENT>.53907</ENT> <ENT>.53247</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.57606</ENT> <ENT>.56921</ENT> <ENT>.56248</ENT> <ENT>.55586</ENT> <ENT>.54935</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.59253</ENT> <ENT>.58580</ENT> <ENT>.57919</ENT> <ENT>.57269</ENT> <ENT>.56629</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.60887</ENT> <ENT>.60229</ENT> <ENT>.59581</ENT> <ENT>.58943</ENT> <ENT>.58315</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.62498</ENT> <ENT>.61855</ENT> <ENT>.61221</ENT> <ENT>.60597</ENT> <ENT>.59982</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.64086</ENT> <ENT>.63459</ENT> <ENT>.62840</ENT> <ENT>.62230</ENT> <ENT>.61629</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.65660</ENT> <ENT>.65049</ENT> <ENT>.64447</ENT> <ENT>.63852</ENT> <ENT>.63266</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.67224</ENT> <ENT>.66631</ENT> <ENT>.66046</ENT> <ENT>.65468</ENT> <ENT>.64898</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.68742</ENT> <ENT>.68167</ENT> <ENT>.67600</ENT> <ENT>.67040</ENT> <ENT>.66486</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.70168</ENT> <ENT>.69611</ENT> <ENT>.69061</ENT> <ENT>.68518</ENT> <ENT>.67980</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.71497</ENT> <ENT>.70958</ENT> <ENT>.70425</ENT> <ENT>.69897</ENT> <ENT>.69376</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.72758</ENT> <ENT>.72236</ENT> <ENT>.71720</ENT> <ENT>.71208</ENT> <ENT>.70702</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.73989</ENT> <ENT>.73484</ENT> <ENT>.72985</ENT> <ENT>.72490</ENT> <ENT>.72000</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.75180</ENT> <ENT>.74693</ENT> <ENT>.74210</ENT> <ENT>.73732</ENT> <ENT>.73259</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.76292</ENT> <ENT>.75821</ENT> <ENT>.75355</ENT> <ENT>.74894</ENT> <ENT>.74436</ENT> </ROW> <ROW> <PRTPAGE P="263"/> <ENT I="01">93</ENT> <ENT>.77302</ENT> <ENT>.76848</ENT> <ENT>.76397</ENT> <ENT>.75951</ENT> <ENT>.75508</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.78204</ENT> <ENT>.77764</ENT> <ENT>.77328</ENT> <ENT>.76895</ENT> <ENT>.76466</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.78991</ENT> <ENT>.78563</ENT> <ENT>.78139</ENT> <ENT>.77719</ENT> <ENT>.77302</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.79651</ENT> <ENT>.79234</ENT> <ENT>.78821</ENT> <ENT>.78411</ENT> <ENT>.78003</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.80241</ENT> <ENT>.79834</ENT> <ENT>.79430</ENT> <ENT>.79029</ENT> <ENT>.78630</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.80755</ENT> <ENT>.80356</ENT> <ENT>.79960</ENT> <ENT>.79567</ENT> <ENT>.79176</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.81236</ENT> <ENT>.80845</ENT> <ENT>.80456</ENT> <ENT>.80071</ENT> <ENT>.79687</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.81715</ENT> <ENT>.81331</ENT> <ENT>.80949</ENT> <ENT>.80571</ENT> <ENT>.80195</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.82132</ENT> <ENT>.81754</ENT> <ENT>.81379</ENT> <ENT>.81006</ENT> <ENT>.80636</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.82582</ENT> <ENT>.82211</ENT> <ENT>.81842</ENT> <ENT>.81476</ENT> <ENT>.81111</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.83162</ENT> <ENT>.82799</ENT> <ENT>.82439</ENT> <ENT>.82080</ENT> <ENT>.81724</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.83711</ENT> <ENT>.83356</ENT> <ENT>.83003</ENT> <ENT>.82652</ENT> <ENT>.82302</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.84550</ENT> <ENT>.84208</ENT> <ENT>.83867</ENT> <ENT>.83528</ENT> <ENT>.83191</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.85920</ENT> <ENT>.85602</ENT> <ENT>.85285</ENT> <ENT>.84969</ENT> <ENT>.84655</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.87839</ENT> <ENT>.87558</ENT> <ENT>.87277</ENT> <ENT>.86997</ENT> <ENT>.86718</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.90896</ENT> <ENT>.90679</ENT> <ENT>.90463</ENT> <ENT>.90246</ENT> <ENT>.90030</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95900</ENT> <ENT>.95800</ENT> <ENT>.95700</ENT> <ENT>.95600</ENT> <ENT>.95500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout Rate</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02788</ENT> <ENT>.02747</ENT> <ENT>.02709</ENT> <ENT>.02673</ENT> <ENT>.02641</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00987</ENT> <ENT>.00945</ENT> <ENT>.00906</ENT> <ENT>.00871</ENT> <ENT>.00838</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00957</ENT> <ENT>.00913</ENT> <ENT>.00872</ENT> <ENT>.00835</ENT> <ENT>.00800</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00965</ENT> <ENT>.00918</ENT> <ENT>.00875</ENT> <ENT>.00836</ENT> <ENT>.00799</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00991</ENT> <ENT>.00941</ENT> <ENT>.00896</ENT> <ENT>.00854</ENT> <ENT>.00815</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01031</ENT> <ENT>.00979</ENT> <ENT>.00931</ENT> <ENT>.00887</ENT> <ENT>.00846</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01084</ENT> <ENT>.01028</ENT> <ENT>.00978</ENT> <ENT>.00931</ENT> <ENT>.00888</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01144</ENT> <ENT>.01086</ENT> <ENT>.01032</ENT> <ENT>.00983</ENT> <ENT>.00937</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01216</ENT> <ENT>.01154</ENT> <ENT>.01097</ENT> <ENT>.01044</ENT> <ENT>.00996</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01299</ENT> <ENT>.01234</ENT> <ENT>.01174</ENT> <ENT>.01118</ENT> <ENT>.01067</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01395</ENT> <ENT>.01326</ENT> <ENT>.01262</ENT> <ENT>.01204</ENT> <ENT>.01149</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01504</ENT> <ENT>.01432</ENT> <ENT>.01364</ENT> <ENT>.01302</ENT> <ENT>.01245</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01626</ENT> <ENT>.01549</ENT> <ENT>.01478</ENT> <ENT>.01413</ENT> <ENT>.01352</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01755</ENT> <ENT>.01674</ENT> <ENT>.01599</ENT> <ENT>.01530</ENT> <ENT>.01466</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01885</ENT> <ENT>.01800</ENT> <ENT>.01721</ENT> <ENT>.01648</ENT> <ENT>.01581</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02011</ENT> <ENT>.01922</ENT> <ENT>.01839</ENT> <ENT>.01762</ENT> <ENT>.01691</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02130</ENT> <ENT>.02036</ENT> <ENT>.01949</ENT> <ENT>.01869</ENT> <ENT>.01794</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02243</ENT> <ENT>.02144</ENT> <ENT>.02052</ENT> <ENT>.01967</ENT> <ENT>.01888</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.02350</ENT> <ENT>.02246</ENT> <ENT>.02150</ENT> <ENT>.02061</ENT> <ENT>.01978</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.02457</ENT> <ENT>.02348</ENT> <ENT>.02247</ENT> <ENT>.02153</ENT> <ENT>.02065</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.02569</ENT> <ENT>.02454</ENT> <ENT>.02347</ENT> <ENT>.02248</ENT> <ENT>.02156</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.02685</ENT> <ENT>.02564</ENT> <ENT>.02452</ENT> <ENT>.02347</ENT> <ENT>.02250</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.02806</ENT> <ENT>.02679</ENT> <ENT>.02561</ENT> <ENT>.02451</ENT> <ENT>.02348</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.02936</ENT> <ENT>.02802</ENT> <ENT>.02677</ENT> <ENT>.02561</ENT> <ENT>.02453</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.03078</ENT> <ENT>.02937</ENT> <ENT>.02805</ENT> <ENT>.02683</ENT> <ENT>.02569</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.03236</ENT> <ENT>.03087</ENT> <ENT>.02949</ENT> <ENT>.02820</ENT> <ENT>.02699</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.03415</ENT> <ENT>.03258</ENT> <ENT>.03112</ENT> <ENT>.02975</ENT> <ENT>.02848</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.03615</ENT> <ENT>.03450</ENT> <ENT>.03295</ENT> <ENT>.03151</ENT> <ENT>.03017</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.03838</ENT> <ENT>.03664</ENT> <ENT>.03502</ENT> <ENT>.03350</ENT> <ENT>.03208</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.04081</ENT> <ENT>.03898</ENT> <ENT>.03727</ENT> <ENT>.03567</ENT> <ENT>.03416</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.04346</ENT> <ENT>.04154</ENT> <ENT>.03973</ENT> <ENT>.03804</ENT> <ENT>.03646</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.04630</ENT> <ENT>.04427</ENT> <ENT>.04237</ENT> <ENT>.04059</ENT> <ENT>.03892</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.04936</ENT> <ENT>.04723</ENT> <ENT>.04523</ENT> <ENT>.04335</ENT> <ENT>.04159</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.05264</ENT> <ENT>.05041</ENT> <ENT>.04831</ENT> <ENT>.04633</ENT> <ENT>.04448</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.05615</ENT> <ENT>.05381</ENT> <ENT>.05160</ENT> <ENT>.04952</ENT> <ENT>.04757</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.05992</ENT> <ENT>.05746</ENT> <ENT>.05514</ENT> <ENT>.05296</ENT> <ENT>.05090</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.06393</ENT> <ENT>.06135</ENT> <ENT>.05892</ENT> <ENT>.05663</ENT> <ENT>.05447</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.06820</ENT> <ENT>.06550</ENT> <ENT>.06295</ENT> <ENT>.06055</ENT> <ENT>.05828</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.07272</ENT> <ENT>.06990</ENT> <ENT>.06723</ENT> <ENT>.06471</ENT> <ENT>.06233</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.07749</ENT> <ENT>.07454</ENT> <ENT>.07175</ENT> <ENT>.06912</ENT> <ENT>.06662</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.08254</ENT> <ENT>.07946</ENT> <ENT>.07655</ENT> <ENT>.07379</ENT> <ENT>.07117</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.08787</ENT> <ENT>.08466</ENT> <ENT>.08162</ENT> <ENT>.07073</ENT> <ENT>.07599</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.09352</ENT> <ENT>.09018</ENT> <ENT>.08700</ENT> <ENT>.08399</ENT> <ENT>.08112</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.09947</ENT> <ENT>.09599</ENT> <ENT>.09268</ENT> <ENT>.08953</ENT> <ENT>.08654</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.10573</ENT> <ENT>.10211</ENT> <ENT>.09866</ENT> <ENT>.09539</ENT> <ENT>.09227</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.11229</ENT> <ENT>.10852</ENT> <ENT>.10494</ENT> <ENT>.10152</ENT> <ENT>.09827</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.11916</ENT> <ENT>.11525</ENT> <ENT>.11153</ENT> <ENT>.10798</ENT> <ENT>.10459</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.12634</ENT> <ENT>.12229</ENT> <ENT>.11843</ENT> <ENT>.11474</ENT> <ENT>.11122</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.13388</ENT> <ENT>.12969</ENT> <ENT>.12568</ENT> <ENT>.12186</ENT> <ENT>.11820</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.14177</ENT> <ENT>.13743</ENT> <ENT>.13329</ENT> <ENT>.12932</ENT> <ENT>.12553</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.15003</ENT> <ENT>.14555</ENT> <ENT>.14126</ENT> <ENT>.13716</ENT> <ENT>.13322</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.15865</ENT> <ENT>.15402</ENT> <ENT>.14959</ENT> <ENT>.14534</ENT> <ENT>.14127</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.16763</ENT> <ENT>.16286</ENT> <ENT>.15828</ENT> <ENT>.15390</ENT> <ENT>.14969</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.17696</ENT> <ENT>.17205</ENT> <ENT>.16734</ENT> <ENT>.16281</ENT> <ENT>.15847</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.18662</ENT> <ENT>.18157</ENT> <ENT>.17672</ENT> <ENT>.17206</ENT> <ENT>.16758</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.19662</ENT> <ENT>.19144</ENT> <ENT>.18645</ENT> <ENT>.18165</ENT> <ENT>.17703</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.20695</ENT> <ENT>.20163</ENT> <ENT>.19651</ENT> <ENT>.19157</ENT> <ENT>.18682</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.21763</ENT> <ENT>.21218</ENT> <ENT>.20693</ENT> <ENT>.20186</ENT> <ENT>.19698</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.22865</ENT> <ENT>.22307</ENT> <ENT>.21769</ENT> <ENT>.21250</ENT> <ENT>.20749</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.24005</ENT> <ENT>.23435</ENT> <ENT>.22885</ENT> <ENT>.22353</ENT> <ENT>.21839</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.25183</ENT> <ENT>.24601</ENT> <ENT>.24038</ENT> <ENT>.23494</ENT> <ENT>.22969</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.26401</ENT> <ENT>.25808</ENT> <ENT>.25234</ENT> <ENT>.24678</ENT> <ENT>.24141</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.27661</ENT> <ENT>.27056</ENT> <ENT>.26471</ENT> <ENT>.25905</ENT> <ENT>.25356</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.28961</ENT> <ENT>.28347</ENT> <ENT>.27752</ENT> <ENT>.27175</ENT> <ENT>.26615</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.30300</ENT> <ENT>.29677</ENT> <ENT>.29072</ENT> <ENT>.28486</ENT> <ENT>.27916</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.31678</ENT> <ENT>.31046</ENT> <ENT>.30433</ENT> <ENT>.29837</ENT> <ENT>.29259</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.33093</ENT> <ENT>.32454</ENT> <ENT>.31832</ENT> <ENT>.31228</ENT> <ENT>.30641</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.34542</ENT> <ENT>.33897</ENT> <ENT>.33268</ENT> <ENT>.32657</ENT> <ENT>.32062</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.36027</ENT> <ENT>.35376</ENT> <ENT>.34742</ENT> <ENT>.34124</ENT> <ENT>.33522</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.37550</ENT> <ENT>.36894</ENT> <ENT>.36255</ENT> <ENT>.35632</ENT> <ENT>.35024</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.39111</ENT> <ENT>.38452</ENT> <ENT>.37809</ENT> <ENT>.37182</ENT> <ENT>.36570</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.40719</ENT> <ENT>.40058</ENT> <ENT>.39412</ENT> <ENT>.38782</ENT> <ENT>.38166</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.42372</ENT> <ENT>.41710</ENT> <ENT>.41064</ENT> <ENT>.40432</ENT> <ENT>.39814</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.44062</ENT> <ENT>.43402</ENT> <ENT>.42756</ENT> <ENT>.42124</ENT> <ENT>.41506</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.45774</ENT> <ENT>.45116</ENT> <ENT>.44471</ENT> <ENT>.43840</ENT> <ENT>.43223</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.47489</ENT> <ENT>.46834</ENT> <ENT>.46193</ENT> <ENT>.45565</ENT> <ENT>.44949</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.49199</ENT> <ENT>.48550</ENT> <ENT>.47913</ENT> <ENT>.47288</ENT> <ENT>.46675</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.50902</ENT> <ENT>.50258</ENT> <ENT>.49626</ENT> <ENT>.49006</ENT> <ENT>.48397</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.52598</ENT> <ENT>.51962</ENT> <ENT>.51336</ENT> <ENT>.50721</ENT> <ENT>.50117</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.54295</ENT> <ENT>.53667</ENT> <ENT>.53049</ENT> <ENT>.52441</ENT> <ENT>.51843</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.55999</ENT> <ENT>.55380</ENT> <ENT>.54771</ENT> <ENT>.54171</ENT> <ENT>.53581</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.57697</ENT> <ENT>.57088</ENT> <ENT>.56489</ENT> <ENT>.55899</ENT> <ENT>.55317</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.59375</ENT> <ENT>.58778</ENT> <ENT>.58190</ENT> <ENT>.57610</ENT> <ENT>.57039</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.61036</ENT> <ENT>.60451</ENT> <ENT>.59875</ENT> <ENT>.59306</ENT> <ENT>.58746</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.62687</ENT> <ENT>.62116</ENT> <ENT>.61553</ENT> <ENT>.60997</ENT> <ENT>.60448</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.64335</ENT> <ENT>.63779</ENT> <ENT>.63230</ENT> <ENT>.62688</ENT> <ENT>.62152</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.65939</ENT> <ENT>.65398</ENT> <ENT>.64864</ENT> <ENT>.64337</ENT> <ENT>.63816</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.67449</ENT> <ENT>.66924</ENT> <ENT>.66405</ENT> <ENT>.65892</ENT> <ENT>.65384</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.68860</ENT> <ENT>.68350</ENT> <ENT>.67845</ENT> <ENT>.67346</ENT> <ENT>.66852</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.70202</ENT> <ENT>.69706</ENT> <ENT>.69216</ENT> <ENT>.68731</ENT> <ENT>.68250</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.71515</ENT> <ENT>.71035</ENT> <ENT>.70559</ENT> <ENT>.70088</ENT> <ENT>.69622</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.72790</ENT> <ENT>.72325</ENT> <ENT>.71865</ENT> <ENT>.71409</ENT> <ENT>.70957</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.73982</ENT> <ENT>.73533</ENT> <ENT>.73087</ENT> <ENT>.72646</ENT> <ENT>.72208</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.75069</ENT> <ENT>.74634</ENT> <ENT>.74202</ENT> <ENT>.73774</ENT> <ENT>.73350</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.76040</ENT> <ENT>.75618</ENT> <ENT>.75199</ENT> <ENT>.74784</ENT> <ENT>.74372</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.76888</ENT> <ENT>.76477</ENT> <ENT>.76070</ENT> <ENT>.75666</ENT> <ENT>.75265</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.77599</ENT> <ENT>.77199</ENT> <ENT>.76801</ENT> <ENT>.76406</ENT> <ENT>.76014</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.78235</ENT> <ENT>.77843</ENT> <ENT>.77454</ENT> <ENT>.77067</ENT> <ENT>.76684</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.78789</ENT> <ENT>.78404</ENT> <ENT>.78022</ENT> <ENT>.77642</ENT> <ENT>.77266</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.79307</ENT> <ENT>.78929</ENT> <ENT>.78554</ENT> <ENT>.78181</ENT> <ENT>.77811</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.79821</ENT> <ENT>.79450</ENT> <ENT>.79081</ENT> <ENT>.78715</ENT> <ENT>.78351</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.80268</ENT> <ENT>.79902</ENT> <ENT>.79539</ENT> <ENT>.79178</ENT> <ENT>.78819</ENT> </ROW> <ROW> <PRTPAGE P="264"/> <ENT I="01">102</ENT> <ENT>.80749</ENT> <ENT>.80389</ENT> <ENT>.80031</ENT> <ENT>.79676</ENT> <ENT>.79322</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.81370</ENT> <ENT>.81018</ENT> <ENT>.80668</ENT> <ENT>.80319</ENT> <ENT>.79973</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.81955</ENT> <ENT>.81609</ENT> <ENT>.81265</ENT> <ENT>.80923</ENT> <ENT>.80582</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.82855</ENT> <ENT>.82520</ENT> <ENT>.82187</ENT> <ENT>.81856</ENT> <ENT>.81526</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.84341</ENT> <ENT>.84029</ENT> <ENT>.83718</ENT> <ENT>.83408</ENT> <ENT>.83099</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.86439</ENT> <ENT>.86162</ENT> <ENT>.85884</ENT> <ENT>.85608</ENT> <ENT>.85332</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.89815</ENT> <ENT>.89599</ENT> <ENT>.89384</ENT> <ENT>.89169</ENT> <ENT>.88955</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95400</ENT> <ENT>.95300</ENT> <ENT>.95200</ENT> <ENT>.95100</ENT> <ENT>.95000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02610</ENT> <ENT>.02582</ENT> <ENT>.02556</ENT> <ENT>.02531</ENT> <ENT>.02508</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00807</ENT> <ENT>.00779</ENT> <ENT>.00753</ENT> <ENT>.00729</ENT> <ENT>.00707</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00769</ENT> <ENT>.00739</ENT> <ENT>.00712</ENT> <ENT>.00686</ENT> <ENT>.00663</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00766</ENT> <ENT>.00735</ENT> <ENT>.00706</ENT> <ENT>.00679</ENT> <ENT>.00654</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00780</ENT> <ENT>.00747</ENT> <ENT>.00716</ENT> <ENT>.00688</ENT> <ENT>.00662</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00808</ENT> <ENT>.00773</ENT> <ENT>.00741</ENT> <ENT>.00711</ENT> <ENT>.00683</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00848</ENT> <ENT>.00811</ENT> <ENT>.00776</ENT> <ENT>.00744</ENT> <ENT>.00715</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00894</ENT> <ENT>.00855</ENT> <ENT>.00819</ENT> <ENT>.00785</ENT> <ENT>.00753</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00951</ENT> <ENT>.00909</ENT> <ENT>.00871</ENT> <ENT>.00835</ENT> <ENT>.00801</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01019</ENT> <ENT>.00975</ENT> <ENT>.00934</ENT> <ENT>.00896</ENT> <ENT>.00860</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01099</ENT> <ENT>.01052</ENT> <ENT>.01008</ENT> <ENT>.00967</ENT> <ENT>.00930</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01191</ENT> <ENT>.01142</ENT> <ENT>.01095</ENT> <ENT>.01052</ENT> <ENT>.01012</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01295</ENT> <ENT>.01243</ENT> <ENT>.01194</ENT> <ENT>.01148</ENT> <ENT>.01106</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01406</ENT> <ENT>.01351</ENT> <ENT>.01299</ENT> <ENT>.01251</ENT> <ENT>.01206</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01518</ENT> <ENT>.01459</ENT> <ENT>.01405</ENT> <ENT>.01354</ENT> <ENT>.01306</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01625</ENT> <ENT>.01563</ENT> <ENT>.01506</ENT> <ENT>.01452</ENT> <ENT>.01402</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01724</ENT> <ENT>.01659</ENT> <ENT>.01599</ENT> <ENT>.01542</ENT> <ENT>.01489</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01815</ENT> <ENT>.01747</ENT> <ENT>.01683</ENT> <ENT>.01624</ENT> <ENT>.01568</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01901</ENT> <ENT>.01829</ENT> <ENT>.01761</ENT> <ENT>.01699</ENT> <ENT>.01640</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01984</ENT> <ENT>.01908</ENT> <ENT>.01837</ENT> <ENT>.01771</ENT> <ENT>.01709</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.02070</ENT> <ENT>.01990</ENT> <ENT>.01915</ENT> <ENT>.01846</ENT> <ENT>.01780</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.02160</ENT> <ENT>.02075</ENT> <ENT>.01996</ENT> <ENT>.01923</ENT> <ENT>.01854</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.02253</ENT> <ENT>.02164</ENT> <ENT>.02080</ENT> <ENT>.02003</ENT> <ENT>.01930</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.02352</ENT> <ENT>.02258</ENT> <ENT>.02170</ENT> <ENT>.02088</ENT> <ENT>.02010</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.02462</ENT> <ENT>.02362</ENT> <ENT>.02269</ENT> <ENT>.02182</ENT> <ENT>.02100</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02586</ENT> <ENT>.02481</ENT> <ENT>.02382</ENT> <ENT>.02289</ENT> <ENT>.02203</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02729</ENT> <ENT>.02617</ENT> <ENT>.02512</ENT> <ENT>.02414</ENT> <ENT>.02322</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02891</ENT> <ENT>.02772</ENT> <ENT>.02662</ENT> <ENT>.02558</ENT> <ENT>.02460</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.03074</ENT> <ENT>.02949</ENT> <ENT>.02832</ENT> <ENT>.02722</ENT> <ENT>.02618</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.03276</ENT> <ENT>.03143</ENT> <ENT>.03019</ENT> <ENT>.02902</ENT> <ENT>.02792</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.03497</ENT> <ENT>.03357</ENT> <ENT>.03225</ENT> <ENT>.03102</ENT> <ENT>.02985</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.03735</ENT> <ENT>.03587</ENT> <ENT>.03448</ENT> <ENT>.03317</ENT> <ENT>.03193</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.03993</ENT> <ENT>.03837</ENT> <ENT>.03690</ENT> <ENT>.03551</ENT> <ENT>.03420</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.04273</ENT> <ENT>.04108</ENT> <ENT>.03952</ENT> <ENT>.03806</ENT> <ENT>.03667</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.04572</ENT> <ENT>.04399</ENT> <ENT>.04234</ENT> <ENT>.04079</ENT> <ENT>.03933</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.04896</ENT> <ENT>.04713</ENT> <ENT>.04539</ENT> <ENT>.04376</ENT> <ENT>.04221</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.05243</ENT> <ENT>.05049</ENT> <ENT>.04867</ENT> <ENT>.04694</ENT> <ENT>.04530</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.05613</ENT> <ENT>.05410</ENT> <ENT>.05217</ENT> <ENT>.05035</ENT> <ENT>.04862</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.06007</ENT> <ENT>.05793</ENT> <ENT>.05591</ENT> <ENT>.05399</ENT> <ENT>.05217</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.06425</ENT> <ENT>.06200</ENT> <ENT>.05987</ENT> <ENT>.05785</ENT> <ENT>.05593</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.06869</ENT> <ENT>.06633</ENT> <ENT>.06409</ENT> <ENT>.06197</ENT> <ENT>.05995</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.07339</ENT> <ENT>.07092</ENT> <ENT>.06857</ENT> <ENT>.06634</ENT> <ENT>.06421</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.07840</ENT> <ENT>.07581</ENT> <ENT>.07335</ENT> <ENT>.07101</ENT> <ENT>.06878</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.08370</ENT> <ENT>.08099</ENT> <ENT>.07841</ENT> <ENT>.07595</ENT> <ENT>.07361</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.08930</ENT> <ENT>.08646</ENT> <ENT>.08377</ENT> <ENT>.08119</ENT> <ENT>.07874</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.09517</ENT> <ENT>.09222</ENT> <ENT>.08940</ENT> <ENT>.08670</ENT> <ENT>.08413</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.10136</ENT> <ENT>.09828</ENT> <ENT>.09533</ENT> <ENT>.09252</ENT> <ENT>.08983</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.10786</ENT> <ENT>.10464</ENT> <ENT>.10157</ENT> <ENT>.09864</ENT> <ENT>.09582</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.11470</ENT> <ENT>.11136</ENT> <ENT>.10816</ENT> <ENT>.10510</ENT> <ENT>.10216</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.12189</ENT> <ENT>.11842</ENT> <ENT>.11509</ENT> <ENT>.11190</ENT> <ENT>.10884</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.12946</ENT> <ENT>.12585</ENT> <ENT>.12239</ENT> <ENT>.11907</ENT> <ENT>.11588</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.13737</ENT> <ENT>.13363</ENT> <ENT>.13003</ENT> <ENT>.12659</ENT> <ENT>.12327</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.14565</ENT> <ENT>.14177</ENT> <ENT>.13805</ENT> <ENT>.13447</ENT> <ENT>.13103</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.15429</ENT> <ENT>.15028</ENT> <ENT>.14642</ENT> <ENT>.14271</ENT> <ENT>.13914</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.16327</ENT> <ENT>.15912</ENT> <ENT>.15513</ENT> <ENT>.15129</ENT> <ENT>.14759</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.17259</ENT> <ENT>.16831</ENT> <ENT>.16419</ENT> <ENT>.16022</ENT> <ENT>.15639</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.18225</ENT> <ENT>.17784</ENT> <ENT>.17358</ENT> <ENT>.16948</ENT> <ENT>.16553</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.19227</ENT> <ENT>.18773</ENT> <ENT>.18335</ENT> <ENT>.17912</ENT> <ENT>.17503</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.20265</ENT> <ENT>.19798</ENT> <ENT>.19347</ENT> <ENT>.18911</ENT> <ENT>.18490</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.21343</ENT> <ENT>.20863</ENT> <ENT>.20400</ENT> <ENT>.19951</ENT> <ENT>.19518</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.22460</ENT> <ENT>.21968</ENT> <ENT>.21492</ENT> <ENT>.21032</ENT> <ENT>.20586</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.23620</ENT> <ENT>.23117</ENT> <ENT>.22629</ENT> <ENT>.22156</ENT> <ENT>.21698</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.24824</ENT> <ENT>.24309</ENT> <ENT>.23810</ENT> <ENT>.23325</ENT> <ENT>.22856</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.26073</ENT> <ENT>.25546</ENT> <ENT>.25036</ENT> <ENT>.24540</ENT> <ENT>.24060</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.27364</ENT> <ENT>.26827</ENT> <ENT>.26306</ENT> <ENT>.25800</ENT> <ENT>.25308</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.28696</ENT> <ENT>.28150</ENT> <ENT>.27619</ENT> <ENT>.27103</ENT> <ENT>.26601</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.30070</ENT> <ENT>.29515</ENT> <ENT>.28974</ENT> <ENT>.28449</ENT> <ENT>.27937</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.31483</ENT> <ENT>.30919</ENT> <ENT>.30371</ENT> <ENT>.29836</ENT> <ENT>.29316</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.32936</ENT> <ENT>.32365</ENT> <ENT>.31808</ENT> <ENT>.31266</ENT> <ENT>.30737</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.34432</ENT> <ENT>.33854</ENT> <ENT>.33290</ENT> <ENT>.32741</ENT> <ENT>.32204</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.35972</ENT> <ENT>.35389</ENT> <ENT>.34820</ENT> <ENT>.34264</ENT> <ENT>.33721</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.37565</ENT> <ENT>.36977</ENT> <ENT>.36403</ENT> <ENT>.35842</ENT> <ENT>.35294</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.39210</ENT> <ENT>.38619</ENT> <ENT>.38042</ENT> <ENT>.37477</ENT> <ENT>.36924</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.40900</ENT> <ENT>.40308</ENT> <ENT>.39728</ENT> <ENT>.39161</ENT> <ENT>.38605</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.42618</ENT> <ENT>.42025</ENT> <ENT>.41444</ENT> <ENT>.40876</ENT> <ENT>.40318</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.44345</ENT> <ENT>.43753</ENT> <ENT>.43173</ENT> <ENT>.42604</ENT> <ENT>.42046</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.46073</ENT> <ENT>.45483</ENT> <ENT>.44904</ENT> <ENT>.44336</ENT> <ENT>.43779</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.47799</ENT> <ENT>.47212</ENT> <ENT>.46635</ENT> <ENT>.46069</ENT> <ENT>.45513</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.49524</ENT> <ENT>.48941</ENT> <ENT>.48368</ENT> <ENT>.47805</ENT> <ENT>.47252</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.51256</ENT> <ENT>.50678</ENT> <ENT>.50110</ENT> <ENT>.49551</ENT> <ENT>.49001</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.53001</ENT> <ENT>.52429</ENT> <ENT>.51867</ENT> <ENT>.51313</ENT> <ENT>.50769</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.54745</ENT> <ENT>.54181</ENT> <ENT>.53626</ENT> <ENT>.53079</ENT> <ENT>.52541</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.56476</ENT> <ENT>.55921</ENT> <ENT>.55374</ENT> <ENT>.54835</ENT> <ENT>.54303</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.58193</ENT> <ENT>.57648</ENT> <ENT>.57110</ENT> <ENT>.56579</ENT> <ENT>.56056</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.59907</ENT> <ENT>.59373</ENT> <ENT>.58845</ENT> <ENT>.58325</ENT> <ENT>.57811</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.61624</ENT> <ENT>.61102</ENT> <ENT>.60586</ENT> <ENT>.60077</ENT> <ENT>.59574</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.63300</ENT> <ENT>.62791</ENT> <ENT>.62289</ENT> <ENT>.61791</ENT> <ENT>.61300</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.64883</ENT> <ENT>.64387</ENT> <ENT>.63896</ENT> <ENT>.63411</ENT> <ENT>.62932</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.66363</ENT> <ENT>.65880</ENT> <ENT>.65402</ENT> <ENT>.64929</ENT> <ENT>.64461</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.67775</ENT> <ENT>.67304</ENT> <ENT>.66838</ENT> <ENT>.66377</ENT> <ENT>.65921</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.69160</ENT> <ENT>.68703</ENT> <ENT>.68250</ENT> <ENT>.67802</ENT> <ENT>.67357</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.70509</ENT> <ENT>.70066</ENT> <ENT>.69626</ENT> <ENT>.69191</ENT> <ENT>.68760</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.71775</ENT> <ENT>.71345</ENT> <ENT>.70919</ENT> <ENT>.70496</ENT> <ENT>.70078</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.72929</ENT> <ENT>.72512</ENT> <ENT>.72099</ENT> <ENT>.71689</ENT> <ENT>.71282</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.73964</ENT> <ENT>.73559</ENT> <ENT>.73157</ENT> <ENT>.72758</ENT> <ENT>.72362</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.74867</ENT> <ENT>.74472</ENT> <ENT>.74081</ENT> <ENT>.73692</ENT> <ENT>.73306</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.75625</ENT> <ENT>.75239</ENT> <ENT>.74856</ENT> <ENT>.74476</ENT> <ENT>.74099</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.76303</ENT> <ENT>.75925</ENT> <ENT>.75550</ENT> <ENT>.75177</ENT> <ENT>.74807</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.76892</ENT> <ENT>.76521</ENT> <ENT>.76152</ENT> <ENT>.75786</ENT> <ENT>.75422</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.77443</ENT> <ENT>.77078</ENT> <ENT>.76715</ENT> <ENT>.76355</ENT> <ENT>.75998</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.77990</ENT> <ENT>.77631</ENT> <ENT>.77275</ENT> <ENT>.76921</ENT> <ENT>.76569</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.78463</ENT> <ENT>.78109</ENT> <ENT>.77757</ENT> <ENT>.77407</ENT> <ENT>.77060</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.78971</ENT> <ENT>.78622</ENT> <ENT>.78275</ENT> <ENT>.77930</ENT> <ENT>.77587</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.79629</ENT> <ENT>.79287</ENT> <ENT>.78947</ENT> <ENT>.78608</ENT> <ENT>.78272</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.80244</ENT> <ENT>.79907</ENT> <ENT>.79572</ENT> <ENT>.79239</ENT> <ENT>.78907</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.81198</ENT> <ENT>.80871</ENT> <ENT>.80546</ENT> <ENT>.88222</ENT> <ENT>.79900</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.82792</ENT> <ENT>.82485</ENT> <ENT>.82180</ENT> <ENT>.81876</ENT> <ENT>.81572</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.85057</ENT> <ENT>.84783</ENT> <ENT>.84509</ENT> <ENT>.84237</ENT> <ENT>.83964</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.88740</ENT> <ENT>.88526</ENT> <ENT>.88312</ENT> <ENT>.88098</ENT> <ENT>.87885</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94900</ENT> <ENT>.94800</ENT> <ENT>.94700</ENT> <ENT>.94600</ENT> <ENT>.94500</ENT> </ROW> </GPOTABLE> <PRTPAGE P="265"/> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02487</ENT> <ENT>.02466</ENT> <ENT>.02447</ENT> <ENT>.02429</ENT> <ENT>.02412</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00686</ENT> <ENT>.00666</ENT> <ENT>.00648</ENT> <ENT>.00631</ENT> <ENT>.00615</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00641</ENT> <ENT>.00620</ENT> <ENT>.00601</ENT> <ENT>.00583</ENT> <ENT>.00566</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00631</ENT> <ENT>.00609</ENT> <ENT>.00589</ENT> <ENT>.00570</ENT> <ENT>.00552</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00637</ENT> <ENT>.00614</ENT> <ENT>.00593</ENT> <ENT>.00573</ENT> <ENT>.00554</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00657</ENT> <ENT>.00633</ENT> <ENT>.00610</ENT> <ENT>.00588</ENT> <ENT>.00568</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00687</ENT> <ENT>.00661</ENT> <ENT>.00637</ENT> <ENT>.00614</ENT> <ENT>.00593</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00724</ENT> <ENT>.00696</ENT> <ENT>.00670</ENT> <ENT>.00646</ENT> <ENT>.00623</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00770</ENT> <ENT>.00740</ENT> <ENT>.00713</ENT> <ENT>.00687</ENT> <ENT>.00663</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00827</ENT> <ENT>.00795</ENT> <ENT>.00766</ENT> <ENT>.00739</ENT> <ENT>.00713</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00894</ENT> <ENT>.00861</ENT> <ENT>.00830</ENT> <ENT>.00800</ENT> <ENT>.00773</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00974</ENT> <ENT>.00939</ENT> <ENT>.00906</ENT> <ENT>.00875</ENT> <ENT>.00846</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01066</ENT> <ENT>.01029</ENT> <ENT>.00993</ENT> <ENT>.00961</ENT> <ENT>.00929</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01164</ENT> <ENT>.01124</ENT> <ENT>.01087</ENT> <ENT>.01052</ENT> <ENT>.01019</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01262</ENT> <ENT>.01220</ENT> <ENT>.01181</ENT> <ENT>.01144</ENT> <ENT>.01109</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01355</ENT> <ENT>.01311</ENT> <ENT>.01270</ENT> <ENT>.01231</ENT> <ENT>.01194</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01440</ENT> <ENT>.01394</ENT> <ENT>.01350</ENT> <ENT>.01309</ENT> <ENT>.01271</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01516</ENT> <ENT>.01467</ENT> <ENT>.01421</ENT> <ENT>.01378</ENT> <ENT>.01337</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01585</ENT> <ENT>.01534</ENT> <ENT>.01485</ENT> <ENT>.01440</ENT> <ENT>.01397</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01651</ENT> <ENT>.01597</ENT> <ENT>.01546</ENT> <ENT>.01498</ENT> <ENT>.01453</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01719</ENT> <ENT>.01662</ENT> <ENT>.01608</ENT> <ENT>.01557</ENT> <ENT>.01510</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01789</ENT> <ENT>.01728</ENT> <ENT>.01672</ENT> <ENT>.01618</ENT> <ENT>.01568</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01861</ENT> <ENT>.01797</ENT> <ENT>.01737</ENT> <ENT>.01680</ENT> <ENT>.01627</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01938</ENT> <ENT>.01870</ENT> <ENT>.01806</ENT> <ENT>.01746</ENT> <ENT>.01689</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.02023</ENT> <ENT>.01951</ENT> <ENT>.01883</ENT> <ENT>.01819</ENT> <ENT>.01759</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02121</ENT> <ENT>.02045</ENT> <ENT>.01973</ENT> <ENT>.01905</ENT> <ENT>.01841</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02236</ENT> <ENT>.02155</ENT> <ENT>.02078</ENT> <ENT>.02006</ENT> <ENT>.01938</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02368</ENT> <ENT>.02282</ENT> <ENT>.02200</ENT> <ENT>.02124</ENT> 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<ENT>.74245</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.76219</ENT> <ENT>.75872</ENT> <ENT>.75527</ENT> <ENT>.75184</ENT> <ENT>.74844</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.76715</ENT> <ENT>.76372</ENT> <ENT>.76031</ENT> <ENT>.75692</ENT> <ENT>.75356</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.77246</ENT> <ENT>.76908</ENT> <ENT>.76571</ENT> <ENT>.76236</ENT> <ENT>.75904</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.77937</ENT> <ENT>.77605</ENT> <ENT>.77274</ENT> <ENT>.76945</ENT> <ENT>.76618</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.78577</ENT> <ENT>.78249</ENT> <ENT>.77923</ENT> <ENT>.77598</ENT> <ENT>.77275</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.79579</ENT> <ENT>.79259</ENT> <ENT>.78941</ENT> <ENT>.78625</ENT> <ENT>.78310</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.81270</ENT> <ENT>.80969</ENT> <ENT>.80670</ENT> <ENT>.80371</ENT> <ENT>.80073</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.83693</ENT> <ENT>.83422</ENT> <ENT>.83152</ENT> <ENT>.82883</ENT> <ENT>.82614</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.87672</ENT> <ENT>.87459</ENT> <ENT>.87246</ENT> <ENT>.87034</ENT> <ENT>.86822</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94400</ENT> <ENT>.94300</ENT> <ENT>.94200</ENT> <ENT>.94100</ENT> <ENT>.94000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02396</ENT> <ENT>.02380</ENT> <ENT>.02366</ENT> <ENT>.02352</ENT> <ENT>.02338</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00600</ENT> <ENT>.00585</ENT> <ENT>.00572</ENT> <ENT>.00559</ENT> <ENT>.00547</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00550</ENT> <ENT>.00535</ENT> <ENT>.00521</ENT> <ENT>.00508</ENT> <ENT>.00495</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00536</ENT> <ENT>.00520</ENT> <ENT>.00505</ENT> <ENT>.00491</ENT> <ENT>.00478</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00536</ENT> <ENT>.00519</ENT> <ENT>.00504</ENT> <ENT>.00489</ENT> <ENT>.00475</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00549</ENT> <ENT>.00532</ENT> <ENT>.00515</ENT> <ENT>.00499</ENT> <ENT>.00484</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00572</ENT> <ENT>.00554</ENT> <ENT>.00536</ENT> <ENT>.00519</ENT> <ENT>.00503</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00602</ENT> <ENT>.00582</ENT> <ENT>.00563</ENT> <ENT>.00545</ENT> <ENT>.00528</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00640</ENT> <ENT>.00618</ENT> <ENT>.00598</ENT> <ENT>.00579</ENT> <ENT>.00561</ENT> </ROW> <ROW> <PRTPAGE P="266"/> <ENT I="01">9</ENT> <ENT>.00688</ENT> <ENT>.00665</ENT> <ENT>.00644</ENT> <ENT>.00623</ENT> <ENT>.00604</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00747</ENT> <ENT>.00723</ENT> <ENT>.00699</ENT> <ENT>.00678</ENT> <ENT>.00657</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00818</ENT> <ENT>.00792</ENT> <ENT>.00767</ENT> <ENT>.00744</ENT> <ENT>.00722</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00900</ENT> <ENT>.00873</ENT> <ENT>.00846</ENT> <ENT>.00822</ENT> <ENT>.00798</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.00988</ENT> <ENT>.00959</ENT> <ENT>.00931</ENT> <ENT>.00905</ENT> <ENT>.00880</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01077</ENT> <ENT>.01046</ENT> <ENT>.01017</ENT> <ENT>.00989</ENT> <ENT>.00963</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01160</ENT> <ENT>.01127</ENT> <ENT>.01097</ENT> <ENT>.01067</ENT> <ENT>.01040</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01234</ENT> <ENT>.01200</ENT> <ENT>.01167</ENT> <ENT>.01137</ENT> <ENT>.01108</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01299</ENT> <ENT>.01263</ENT> <ENT>.01229</ENT> <ENT>.01197</ENT> <ENT>.01166</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01357</ENT> <ENT>.01319</ENT> <ENT>.01283</ENT> <ENT>.01249</ENT> <ENT>.01217</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01410</ENT> <ENT>.01370</ENT> <ENT>.01332</ENT> <ENT>.01297</ENT> <ENT>.01263</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01465</ENT> <ENT>.01422</ENT> <ENT>.01382</ENT> <ENT>.01345</ENT> <ENT>.01309</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01520</ENT> <ENT>.01475</ENT> <ENT>.01433</ENT> <ENT>.01393</ENT> <ENT>.01355</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01576</ENT> <ENT>.01529</ENT> <ENT>.01484</ENT> <ENT>.01442</ENT> <ENT>.01402</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01636</ENT> <ENT>.01586</ENT> <ENT>.01538</ENT> <ENT>.01493</ENT> <ENT>.01450</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01703</ENT> <ENT>.01649</ENT> <ENT>.01599</ENT> <ENT>.01551</ENT> <ENT>.01505</ENT> </ROW> <ROW> <ENT 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I="01">73</ENT> <ENT>.35506</ENT> <ENT>.35026</ENT> <ENT>.34555</ENT> <ENT>.34094</ENT> <ENT>.33642</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.37201</ENT> <ENT>.36716</ENT> <ENT>.36241</ENT> <ENT>.35776</ENT> <ENT>.35319</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.38916</ENT> <ENT>.38429</ENT> <ENT>.37950</ENT> <ENT>.37481</ENT> <ENT>.37020</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.40644</ENT> <ENT>.40154</ENT> <ENT>.39673</ENT> <ENT>.39200</ENT> <ENT>.38737</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.42378</ENT> <ENT>.41887</ENT> <ENT>.41404</ENT> <ENT>.40930</ENT> <ENT>.40464</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.44123</ENT> <ENT>.43631</ENT> <ENT>.43148</ENT> <ENT>.42673</ENT> <ENT>.42205</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.45885</ENT> <ENT>.45394</ENT> <ENT>.44911</ENT> <ENT>.44436</ENT> <ENT>.43969</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.47673</ENT> <ENT>.47184</ENT> <ENT>.46703</ENT> <ENT>.46229</ENT> <ENT>.45763</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.49473</ENT> <ENT>.48987</ENT> <ENT>.48509</ENT> <ENT>.48037</ENT> <ENT>.47573</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.51269</ENT> <ENT>.50787</ENT> <ENT>.50313</ENT> <ENT>.49845</ENT> <ENT>.49383</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.53062</ENT> <ENT>.52586</ENT> <ENT>.52116</ENT> <ENT>.51653</ENT> <ENT>.51195</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.54864</ENT> <ENT>.54395</ENT> <ENT>.53931</ENT> <ENT>.53473</ENT> <ENT>.53021</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.56683</ENT> <ENT>.56221</ENT> <ENT>.55765</ENT> <ENT>.55314</ENT> <ENT>.54869</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.58470</ENT> <ENT>.58017</ENT> <ENT>.57570</ENT> <ENT>.57127</ENT> <ENT>.56689</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.60164</ENT> <ENT>.59720</ENT> <ENT>.59281</ENT> <ENT>.58847</ENT> <ENT>.58417</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.61754</ENT> <ENT>.61320</ENT> <ENT>.60889</ENT> <ENT>.60464</ENT> <ENT>.60042</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.63277</ENT> <ENT>.62851</ENT> <ENT>.62430</ENT> <ENT>.62013</ENT> <ENT>.61600</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.64780</ENT> <ENT>.64364</ENT> <ENT>.63953</ENT> <ENT>.63545</ENT> <ENT>.63141</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.66252</ENT> <ENT>.65848</ENT> <ENT>.65446</ENT> <ENT>.65049</ENT> <ENT>.64655</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.67640</ENT> <ENT>.67246</ENT> <ENT>.66856</ENT> <ENT>.66468</ENT> <ENT>.66084</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.68912</ENT> <ENT>.68528</ENT> <ENT>.68148</ENT> <ENT>.67770</ENT> <ENT>.67396</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.70055</ENT> <ENT>.69680</ENT> <ENT>.69309</ENT> <ENT>.68941</ENT> <ENT>.68576</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.71054</ENT> <ENT>.70689</ENT> <ENT>.70326</ENT> <ENT>.69966</ENT> <ENT>.69609</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.71893</ENT> <ENT>.71535</ENT> <ENT>.71180</ENT> <ENT>.70827</ENT> <ENT>.70476</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.72643</ENT> <ENT>.72292</ENT> <ENT>.71943</ENT> <ENT>.71596</ENT> <ENT>.71252</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.73294</ENT> <ENT>.72948</ENT> <ENT>.72604</ENT> <ENT>.72263</ENT> <ENT>.71924</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.73902</ENT> <ENT>.73561</ENT> <ENT>.73222</ENT> <ENT>.72886</ENT> <ENT>.72551</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.74506</ENT> <ENT>.74170</ENT> <ENT>.73836</ENT> <ENT>.73504</ENT> <ENT>.73174</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.75021</ENT> <ENT>.74689</ENT> <ENT>.74359</ENT> <ENT>.74030</ENT> <ENT>.73704</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.75573</ENT> <ENT>.75244</ENT> <ENT>.74918</ENT> <ENT>.74593</ENT> <ENT>.74270</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.76293</ENT> <ENT>.75970</ENT> <ENT>.75649</ENT> <ENT>.75329</ENT> <ENT>.75011</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.76954</ENT> <ENT>.76634</ENT> <ENT>.76316</ENT> <ENT>.76000</ENT> <ENT>.75685</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.77996</ENT> <ENT>.77684</ENT> <ENT>.77373</ENT> <ENT>.77064</ENT> <ENT>.76756</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.79777</ENT> <ENT>.79481</ENT> <ENT>.79187</ENT> <ENT>.78894</ENT> <ENT>.78602</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.82346</ENT> <ENT>.82078</ENT> <ENT>.81812</ENT> <ENT>.81546</ENT> <ENT>.81281</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.86610</ENT> <ENT>.86398</ENT> <ENT>.86187</ENT> <ENT>.85976</ENT> <ENT>.85765</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.93900</ENT> <ENT>.93800</ENT> <ENT>.93700</ENT> <ENT>.93600</ENT> <ENT>.93500</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="s10,7,7,7,7,7"> <TTITLE>Table E</TTITLE> <TDESC> <E T="04">Table E—Single Life, Unisex—Table Showing the Present Worth of the Remainder Interest in Property Transferred to a Unitrust Having the Adjusted Payout Rate Shown—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Age</CHED> <CHED H="1">(2) Adjusted payout rate</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02325</ENT> <ENT>.02313</ENT> <ENT>.02301</ENT> <ENT>.02290</ENT> <ENT>.02279</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00536</ENT> <ENT>.00525</ENT> <ENT>.00514</ENT> <ENT>.00505</ENT> <ENT>.00495</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00484</ENT> <ENT>.00472</ENT> <ENT>.00462</ENT> <ENT>.00451</ENT> <ENT>.00442</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00465</ENT> <ENT>.00453</ENT> <ENT>.00442</ENT> <ENT>.00431</ENT> <ENT>.00421</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00461</ENT> <ENT>.00449</ENT> <ENT>.00437</ENT> <ENT>.00426</ENT> <ENT>.00415</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00470</ENT> <ENT>.00457</ENT> <ENT>.00444</ENT> <ENT>.00432</ENT> <ENT>.00421</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00488</ENT> <ENT>.00474</ENT> <ENT>.00460</ENT> <ENT>.00447</ENT> <ENT>.00435</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00512</ENT> <ENT>.00496</ENT> <ENT>.00482</ENT> <ENT>.00468</ENT> <ENT>.00455</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00543</ENT> <ENT>.00527</ENT> <ENT>.00512</ENT> <ENT>.00497</ENT> <ENT>.00483</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00585</ENT> <ENT>.00568</ENT> <ENT>.00551</ENT> <ENT>.00536</ENT> <ENT>.00521</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00637</ENT> <ENT>.00619</ENT> <ENT>.00601</ENT> <ENT>.00584</ENT> <ENT>.00568</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00701</ENT> <ENT>.00681</ENT> <ENT>.00662</ENT> <ENT>.00644</ENT> <ENT>.00627</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00776</ENT> <ENT>.00755</ENT> <ENT>.00735</ENT> <ENT>.00716</ENT> <ENT>.00697</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.00857</ENT> <ENT>.00734</ENT> <ENT>.00813</ENT> <ENT>.00793</ENT> <ENT>.00773</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.00938</ENT> <ENT>.00914</ENT> <ENT>.00892</ENT> <ENT>.00870</ENT> <ENT>.00850</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01014</ENT> <ENT>.00989</ENT> <ENT>.00965</ENT> <ENT>.00942</ENT> <ENT>.00921</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01080</ENT> <ENT>.01054</ENT> <ENT>.01029</ENT> <ENT>.01005</ENT> <ENT>.00983</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01137</ENT> <ENT>.01109</ENT> <ENT>.01083</ENT> <ENT>.01058</ENT> <ENT>.01035</ENT> </ROW> <ROW> <PRTPAGE P="267"/> <ENT I="01">18</ENT> <ENT>.01186</ENT> <ENT>.01157</ENT> <ENT>.01130</ENT> <ENT>.01103</ENT> <ENT>.01078</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01230</ENT> <ENT>.01300</ENT> <ENT>.01171</ENT> <ENT>.01143</ENT> <ENT>.01117</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01275</ENT> <ENT>.01243</ENT> <ENT>.01212</ENT> <ENT>.01183</ENT> <ENT>.01155</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01319</ENT> <ENT>.01285</ENT> <ENT>.01253</ENT> <ENT>.01222</ENT> <ENT>.01193</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01364</ENT> <ENT>.01328</ENT> <ENT>.01293</ENT> <ENT>.01261</ENT> <ENT>.01230</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01410</ENT> <ENT>.01372</ENT> <ENT>.01336</ENT> <ENT>.01301</ENT> <ENT>.01268</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01463</ENT> <ENT>.01422</ENT> <ENT>.01383</ENT> <ENT>.01347</ENT> <ENT>.01312</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.01525</ENT> <ENT>.01482</ENT> <ENT>.01441</ENT> <ENT>.01401</ENT> <ENT>.01364</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.01601</ENT> <ENT>.01555</ENT> <ENT>.01511</ENT> <ENT>.01469</ENT> <ENT>.01430</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.01692</ENT> <ENT>.01643</ENT> <ENT>.01596</ENT> <ENT>.01551</ENT> <ENT>.01509</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.01800</ENT> <ENT>.01748</ENT> <ENT>.01697</ENT> <ENT>.01650</ENT> <ENT>.01604</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.01922</ENT> <ENT>.01865</ENT> <ENT>.01812</ENT> <ENT>.01760</ENT> <ENT>.01712</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02058</ENT> <ENT>.01998</ENT> <ENT>.01940</ENT> <ENT>.01886</ENT> <ENT>.01833</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02206</ENT> <ENT>.02142</ENT> <ENT>.02080</ENT> <ENT>.02022</ENT> <ENT>.01966</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.02370</ENT> <ENT>.02301</ENT> <ENT>.02236</ENT> <ENT>.02173</ENT> <ENT>.02113</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.02550</ENT> <ENT>.02477</ENT> <ENT>.02407</ENT> <ENT>.02340</ENT> <ENT>.02276</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.02746</ENT> <ENT>.02667</ENT> <ENT>.02592</ENT> <ENT>.02521</ENT> <ENT>.02452</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.02960</ENT> <ENT>.02876</ENT> <ENT>.02796</ENT> <ENT>.02719</ENT> <ENT>.02646</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.03193</ENT> <ENT>.03103</ENT> <ENT>.03017</ENT> <ENT>.02936</ENT> <ENT>.02858</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.03444</ENT> <ENT>.03348</ENT> <ENT>.03257</ENT> <ENT>.03170</ENT> <ENT>.03087</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.03714</ENT> <ENT>.03612</ENT> <ENT>.03515</ENT> <ENT>.03422</ENT> <ENT>.03333</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.04002</ENT> <ENT>.03894</ENT> <ENT>.03791</ENT> <ENT>.03692</ENT> <ENT>.03597</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.04312</ENT> <ENT>.04197</ENT> <ENT>.04087</ENT> <ENT>.03891</ENT> <ENT>.03880</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.04643</ENT> <ENT>.04521</ENT> <ENT>.04404</ENT> <ENT>.04292</ENT> <ENT>.04185</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.05001</ENT> <ENT>.04871</ENT> <ENT>.04747</ENT> <ENT>.04628</ENT> <ENT>.04514</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.05382</ENT> <ENT>.05245</ENT> <ENT>.05113</ENT> <ENT>.04987</ENT> <ENT>.04865</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.05789</ENT> <ENT>.05644</ENT> <ENT>.05505</ENT> <ENT>.05371</ENT> <ENT>.05242</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.06220</ENT> <ENT>.06067</ENT> <ENT>.05919</ENT> <ENT>.05777</ENT> <ENT>.05641</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.06678</ENT> <ENT>.06516</ENT> <ENT>.06360</ENT> <ENT>.06210</ENT> <ENT>.06065</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.07162</ENT> <ENT>.06991</ENT> <ENT>.06826</ENT> <ENT>.06668</ENT> <ENT>.06515</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.07678</ENT> <ENT>.07498</ENT> <ENT>.07324</ENT> <ENT>.07157</ENT> <ENT>.06996</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.08225</ENT> <ENT>.08035</ENT> <ENT>.07852</ENT> <ENT>.07676</ENT> <ENT>.07506</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.08807</ENT> <ENT>.08607</ENT> <ENT>.08415</ENT> <ENT>.08229</ENT> <ENT>.08050</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.09421</ENT> <ENT>.09211</ENT> <ENT>.09009</ENT> <ENT>.08814</ENT> <ENT>.08625</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.10070</ENT> <ENT>.09850</ENT> <ENT>.09637</ENT> <ENT>.09432</ENT> <ENT>.09234</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.10753</ENT> <ENT>.10523</ENT> <ENT>.10300</ENT> <ENT>.10085</ENT> <ENT>.09877</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.11468</ENT> 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<ENT>.41293</ENT> <ENT>.40848</ENT> <ENT>.40410</ENT> <ENT>.39980</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.43508</ENT> <ENT>.43055</ENT> <ENT>.42609</ENT> <ENT>.42170</ENT> <ENT>.41737</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.45303</ENT> <ENT>.44850</ENT> <ENT>.44404</ENT> <ENT>.43964</ENT> <ENT>.43531</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.47115</ENT> <ENT>.46663</ENT> <ENT>.46218</ENT> <ENT>.45779</ENT> <ENT>.45347</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.48928</ENT> <ENT>.48479</ENT> <ENT>.48036</ENT> <ENT>.47599</ENT> <ENT>.47168</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.50744</ENT> <ENT>.50298</ENT> <ENT>.49858</ENT> <ENT>.49424</ENT> <ENT>.48995</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.52575</ENT> <ENT>.52134</ENT> <ENT>.51698</ENT> <ENT>.51268</ENT> <ENT>.50843</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.54429</ENT> <ENT>.53994</ENT> <ENT>.53564</ENT> <ENT>.53139</ENT> <ENT>.52720</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.56257</ENT> <ENT>.55829</ENT> <ENT>.55406</ENT> <ENT>.54988</ENT> <ENT>.54574</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.57993</ENT> <ENT>.57572</ENT> <ENT>.57156</ENT> <ENT>.56745</ENT> <ENT>.56338</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.59625</ENT> <ENT>.59212</ENT> <ENT>.58804</ENT> <ENT>.58399</ENT> <ENT>.57999</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.61191</ENT> <ENT>.60786</ENT> <ENT>.60384</ENT> <ENT>.59987</ENT> <ENT>.59594</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.62741</ENT> <ENT>.62344</ENT> <ENT>.61952</ENT> <ENT>.61562</ENT> <ENT>.61177</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.64264</ENT> <ENT>.63877</ENT> <ENT>.63493</ENT> <ENT>.63113</ENT> <ENT>.62736</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.65703</ENT> <ENT>.65326</ENT> <ENT>.64951</ENT> <ENT>.64580</ENT> <ENT>.64212</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.67024</ENT> <ENT>.66656</ENT> <ENT>.66291</ENT> <ENT>.65928</ENT> <ENT>.65568</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.68213</ENT> <ENT>.67854</ENT> <ENT>.67497</ENT> <ENT>.67142</ENT> <ENT>.66791</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.69255</ENT> <ENT>.68903</ENT> <ENT>.68554</ENT> <ENT>.68207</ENT> <ENT>.67863</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.70128</ENT> <ENT>.69783</ENT> <ENT>.69440</ENT> <ENT>.69100</ENT> <ENT>.68762</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.70910</ENT> <ENT>.70570</ENT> <ENT>.70233</ENT> <ENT>.69899</ENT> <ENT>.69566</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.71587</ENT> <ENT>.71252</ENT> <ENT>.70920</ENT> <ENT>.70590</ENT> <ENT>.70263</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.72219</ENT> <ENT>.71889</ENT> <ENT>.71562</ENT> <ENT>.71236</ENT> <ENT>.70913</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.72847</ENT> <ENT>.72522</ENT> <ENT>.72189</ENT> <ENT>.71877</ENT> <ENT>.71558</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.73380</ENT> <ENT>.73058</ENT> <ENT>.72738</ENT> <ENT>.72420</ENT> <ENT>.72104</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.73949</ENT> <ENT>.73630</ENT> <ENT>.73313</ENT> <ENT>.72998</ENT> <ENT>.72685</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.74695</ENT> <ENT>.74381</ENT> <ENT>.74068</ENT> <ENT>.73758</ENT> <ENT>.73449</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.75372</ENT> <ENT>.75060</ENT> <ENT>.74751</ENT> <ENT>.74442</ENT> <ENT>.74136</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.76449</ENT> <ENT>.76144</ENT> <ENT>.75840</ENT> <ENT>.75538</ENT> <ENT>.75237</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.78311</ENT> <ENT>.78021</ENT> <ENT>.77732</ENT> <ENT>.77444</ENT> <ENT>.77157</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.81016</ENT> <ENT>.80752</ENT> <ENT>.80489</ENT> <ENT>.80227</ENT> <ENT>.79965</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.85554</ENT> <ENT>.85344</ENT> <ENT>.85134</ENT> <ENT>.84924</ENT> <ENT>.84715</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.93400</ENT> <ENT>.93300</ENT> <ENT>.93200</ENT> <ENT>.93100</ENT> <ENT>.93000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="6" OPTS="L2" CDEF="7,7,7,7,7,7"> <TTITLE>Table F(1)</TTITLE> <TDESC> <E T="04">Table F(1)—10 Percent—Table Showing Factors for Computations of the Adjusted Payout Rate for Certain Valuations and Payout Sequences—Applicable for Transfers After November 30, 1983, and Before May 1, 1989</E> </TDESC> <BOXHD> <CHED H="1">(1) Number of months by which the valuation date precedes the first payout</CHED> <CHED H="2">At least</CHED> <CHED H="2">But less than</CHED> <CHED H="1">(2) Factors for payout at the end of each</CHED> <CHED H="2">Annual period</CHED> <CHED H="2">Semiannual period</CHED> <CHED H="2">Quarterly period</CHED> <CHED H="2">Monthly period</CHED> </BOXHD> <ROW> <ENT I="01"> </ENT> <ENT>1</ENT> <ENT> </ENT> <ENT>.976731</ENT> <ENT>.965232</ENT> <ENT>.957616</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>2</ENT> <ENT>.992089</ENT> <ENT>.969004</ENT> <ENT>.957596</ENT> <ENT>.950041</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>3</ENT> <ENT>.984240</ENT> <ENT>.961338</ENT> <ENT>.950021</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>4</ENT> <ENT>.976454</ENT> <ENT>.953733</ENT> <ENT>.942505</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>5</ENT> <ENT>.968729</ENT> <ENT>.946188</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>6</ENT> <ENT>.961066</ENT> <ENT>.938703</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>7</ENT> <ENT>.953463</ENT> <ENT>.931277</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>8</ENT> <ENT>.945920</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>9</ENT> <ENT>.938436</ENT> </ROW> <ROW> <PRTPAGE P="268"/> <ENT I="01">9</ENT> <ENT>10</ENT> <ENT>.931012</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>11</ENT> <ENT>.923647</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>12</ENT> <ENT>.916340</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT> </ENT> <ENT>.909091</ENT> </ROW> </GPOTABLE> <P> (e) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is after April 30, 1989, and before May 1, 1999</E> —(1) <E T="03">In general.</E> Except as otherwise provided in paragraph (e)(2) of this section, in the case of transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, the present value of a remainder interest is determined under paragraphs (e)(3) through (e)(6) of this section, provided that the amount of the payout as of any payout date during any taxable year of the trust is not larger than the amount that the trust could distribute on such date under § 1.664-3(a)(1)(v) if the taxable year of the trust were to end on such date. See, however, § 1.7520-3(b) (relating to exceptions to the use of the prescribed tables under certain circumstances). </P> <P> (2) <E T="03">Transitional rules for valuation of charitable remainder unitrusts.</E> (i) If the valuation date of a transfer to a charitable remainder unitrust is after April 30, 1989, and before June 10, 1994, a transferor can rely upon Notice 89-24, 1989-1 C.B. 660, or Notice 89-60, 1989-1 C.B. 700, in valuing the transferred interest. (See § 601.601(d)(2)(ii)( <E T="03">b</E> ) of this chapter.) </P> <P>(ii) For purposes of sections 2055, 2106, or 2624, if on May 1, 1989, the decedent was mentally incompetent so that the disposition of the property could not be changed, and the decedent died after April 30, 1989, without having regained competency to dispose of the decedent's property, or the decedent died within 90 days of the date that the decedent first regained competency after April 30, 1989, the present value of a remainder interest determined under this section is determined as if the valuation date with respect to the decedent's gross estate is either before May 1, 1989, or after April 30, 1989, at the option of the decedent's executor.</P> <P> (3) <E T="03">Adjusted payout rate.</E> For transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, the adjusted payout rate is determined by using the appropriate Table F, contained in § 1.664-4(e)(6), for the section 7520 interest rate applicable to the transfer. If the interest rate is between 4.2 and 14 percent, see § 1.664-4(e)(6). If the interest rate is below 4.2 percent or greater than 14 percent, see § 1.664-4(b). See § 1.664-4(e) for rules applicable in determining the adjusted payout rate. </P> <P> (4) <E T="03">Period is a term of years.</E> If the period described in § 1.664-3(a)(5) is a term of years, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, is the factor under the appropriate adjusted payout rate in Table D in § 1.664-4(e)(6) corresponding to the number of years in the term. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in Table D, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph. Generally, for purposes of this section, the valuation date is, in the case of an inter vivos transfer, the date on which the property is transferred to the trust by the donor, and, in the case of a testamentary transfer under sections 2055, 2106, or 2624, the valuation date is the date of death. See § 1.664-4(e)(4) for additional rules regarding the valuation date. See § 1.664-4(e)(4) for an example that illustrates the application of this paragraph (e)(4). <PRTPAGE P="269"/> </P> <P> (5) <E T="03">Period is the life of one individual.</E> If the period described in § 1.664-3(a)(5) is the life of one individual, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, is the factor in Table U(1) in paragraph (e)(6) of this section under the appropriate adjusted payout. For purposes of the computations described in this paragraph (e)(5), the age of an individual is the age of that individual at the individual's nearest birthday. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in the appropriate table, a linear interpolation must be made. The rules provided in § 1.664-4(e)(5) apply for determining the present value of the remainder interest. See § 1.664-4(e)(5) for an example illustrating the application of this paragraph (e)(5)(using current actuarial tables). </P> <P> (6) <E T="03">Actuarial tables for transfers for which the valuation date is after April 30, 1989, and before May 1, 1999.</E> For transfers for which the valuation date is after April 30, 1989, and before May 1, 1999, the present value of a charitable remainder unitrust interest that is dependent on a term of years or the termination of a life interest is determined by using the section 7520 rate and Table D, Tables F(4.2) through F(14.0) in § 1.664-4(e)(6) and Table U(1) of this paragraph (e)(6), as applicable. See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). Many actuarial factors not contained in the following tables are contained in Internal Revenue Service Publication 1458, “Actuarial Values, Beta Volume,” (8-89). Publication 1458 is no longer available for purchase from the Superintendent of Documents, United States Government Printing Office, Washington, DC 20402. However, pertinent factors in this publication may be obtained by a written request to: CC:DOM:CORP:R (IRS Publication 1458), room 5226, Internal Revenue Service, POB 7604, Ben Franklin Station, Washington, DC 20044. </P> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table U(1)—Unitrust Single Life Remainder Factors—Based on Life Table 80CNSMT</TTITLE> <TDESC>[Applicable for Transfers After April 30, 1989, and Before May 1, 1999]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">5.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.06797</ENT> <ENT>.06181</ENT> <ENT>.05645</ENT> <ENT>.05177</ENT> <ENT>.04768</ENT> <ENT>.04410</ENT> <ENT>.04096</ENT> <ENT>.03820</ENT> <ENT>.03578</ENT> <ENT>.03364</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.05881</ENT> <ENT>.05243</ENT> <ENT>.04686</ENT> <ENT>.04199</ENT> <ENT>.03773</ENT> <ENT>.03400</ENT> <ENT>.03072</ENT> <ENT>.02784</ENT> <ENT>.02531</ENT> <ENT>.02308</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.06049</ENT> <ENT>.05394</ENT> <ENT>.04821</ENT> <ENT>.04319</ENT> <ENT>.03880</ENT> <ENT>.03494</ENT> <ENT>.03155</ENT> <ENT>.02856</ENT> <ENT>.02593</ENT> <ENT>.02361</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.06252</ENT> <ENT>.05579</ENT> <ENT>.04990</ENT> <ENT>.04473</ENT> <ENT>.04020</ENT> <ENT>.03621</ENT> <ENT>.03270</ENT> <ENT>.02961</ENT> <ENT>.02688</ENT> <ENT>.02446</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.06479</ENT> <ENT>.05788</ENT> <ENT>.05182</ENT> <ENT>.04650</ENT> <ENT>.04183</ENT> <ENT>.03771</ENT> <ENT>.03408</ENT> <ENT>.03087</ENT> <ENT>.02804</ENT> <ENT>.02553</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.06724</ENT> <ENT>.06016</ENT> <ENT>.05393</ENT> <ENT>.04845</ENT> <ENT>.04363</ENT> <ENT>.03937</ENT> <ENT>.03562</ENT> <ENT>.03230</ENT> <ENT>.02936</ENT> <ENT>.02675</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.06984</ENT> <ENT>.06257</ENT> <ENT>.05618</ENT> <ENT>.05054</ENT> <ENT>.04557</ENT> <ENT>.04117</ENT> <ENT>.03729</ENT> <ENT>.03385</ENT> <ENT>.03080</ENT> <ENT>.02809</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.07259</ENT> <ENT>.06513</ENT> <ENT>.05856</ENT> <ENT>.05276</ENT> <ENT>.04764</ENT> <ENT>.04310</ENT> <ENT>.03909</ENT> <ENT>.03552</ENT> <ENT>.03236</ENT> <ENT>.02954</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.07548</ENT> <ENT>.06784</ENT> <ENT>.06109</ENT> <ENT>.05513</ENT> <ENT>.04985</ENT> <ENT>.04517</ENT> <ENT>.04102</ENT> <ENT>.03733</ENT> <ENT>.03405</ENT> <ENT>.03113</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.07854</ENT> <ENT>.07071</ENT> <ENT>.06378</ENT> <ENT>.05765</ENT> <ENT>.05221</ENT> <ENT>.04738</ENT> <ENT>.04310</ENT> <ENT>.03928</ENT> <ENT>.03588</ENT> <ENT>.03285</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.08176</ENT> <ENT>.07374</ENT> 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<ENT>.79275</ENT> <ENT>.78606</ENT> <ENT>.77945</ENT> <ENT>.77292</ENT> <ENT>.76647</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.83643</ENT> <ENT>.82963</ENT> <ENT>.82291</ENT> <ENT>.81627</ENT> <ENT>.80971</ENT> <ENT>.80322</ENT> <ENT>.79681</ENT> <ENT>.79047</ENT> <ENT>.78420</ENT> <ENT>.77801</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.84503</ENT> <ENT>.83854</ENT> <ENT>.83212</ENT> <ENT>.82578</ENT> <ENT>.81950</ENT> <ENT>.81330</ENT> <ENT>.80716</ENT> <ENT>.80109</ENT> <ENT>.79509</ENT> <ENT>.78915</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.85308</ENT> <ENT>.84689</ENT> <ENT>.84076</ENT> <ENT>.83470</ENT> <ENT>.82870</ENT> <ENT>.82276</ENT> <ENT>.81689</ENT> <ENT>.81107</ENT> <ENT>.80532</ENT> <ENT>.79963</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.86052</ENT> <ENT>.85460</ENT> <ENT>.84875</ENT> <ENT>.84295</ENT> <ENT>.83721</ENT> <ENT>.83152</ENT> <ENT>.82590</ENT> <ENT>.82033</ENT> <ENT>.81481</ENT> <ENT>.80935</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.86729</ENT> <ENT>.86163</ENT> <ENT>.85602</ENT> <ENT>.85046</ENT> <ENT>.84496</ENT> <ENT>.83951</ENT> <ENT>.83412</ENT> <ENT>.82877</ENT> <ENT>.82348</ENT> <ENT>.81823</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.87338</ENT> <ENT>.86795</ENT> <ENT>.86257</ENT> <ENT>.85723</ENT> <ENT>.85195</ENT> <ENT>.84672</ENT> <ENT>.84153</ENT> <ENT>.83639</ENT> <ENT>.83129</ENT> <ENT>.82624</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.87877</ENT> <ENT>.87354</ENT> <ENT>.86836</ENT> <ENT>.86323</ENT> <ENT>.85814</ENT> <ENT>.85309</ENT> <ENT>.84809</ENT> <ENT>.84313</ENT> <ENT>.83822</ENT> <ENT>.83334</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.88365</ENT> <ENT>.87861</ENT> <ENT>.87362</ENT> <ENT>.86867</ENT> <ENT>.86375</ENT> <ENT>.85888</ENT> <ENT>.85405</ENT> <ENT>.84926</ENT> <ENT>.84450</ENT> <ENT>.83979</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.88805</ENT> <ENT>.88318</ENT> <ENT>.87835</ENT> <ENT>.87356</ENT> <ENT>.86880</ENT> <ENT>.86409</ENT> <ENT>.85941</ENT> <ENT>.85477</ENT> <ENT>.85016</ENT> <ENT>.84559</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.89210</ENT> <ENT>.88739</ENT> <ENT>.88271</ENT> <ENT>.87807</ENT> <ENT>.87347</ENT> <ENT>.86890</ENT> <ENT>.86436</ENT> <ENT>.85986</ENT> <ENT>.85539</ENT> <ENT>.85095</ENT> </ROW> <ROW> <PRTPAGE P="271"/> <ENT I="01">100</ENT> <ENT>.89588</ENT> <ENT>.89131</ENT> <ENT>.88678</ENT> <ENT>.88227</ENT> <ENT>.87780</ENT> <ENT>.87337</ENT> <ENT>.86896</ENT> <ENT>.86459</ENT> <ENT>.86024</ENT> <ENT>.85593</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.89949</ENT> <ENT>.89506</ENT> <ENT>.89066</ENT> <ENT>.88629</ENT> <ENT>.88195</ENT> <ENT>.87764</ENT> <ENT>.87336</ENT> <ENT>.86911</ENT> <ENT>.86488</ENT> <ENT>.86069</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.90325</ENT> <ENT>.89897</ENT> <ENT>.89471</ENT> <ENT>.89047</ENT> <ENT>.88627</ENT> <ENT>.88209</ENT> <ENT>.87794</ENT> <ENT>.87381</ENT> <ENT>.86971</ENT> <ENT>.86564</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.90724</ENT> <ENT>.90311</ENT> <ENT>.89900</ENT> <ENT>.89491</ENT> <ENT>.89085</ENT> <ENT>.88681</ENT> <ENT>.88279</ENT> <ENT>.87880</ENT> <ENT>.87484</ENT> <ENT>.87089</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.91167</ENT> <ENT>.90770</ENT> <ENT>.90376</ENT> <ENT>.89983</ENT> <ENT>.89593</ENT> <ENT>.89205</ENT> <ENT>.88819</ENT> <ENT>.88435</ENT> <ENT>.88053</ENT> <ENT>.87673</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.91708</ENT> <ENT>.91333</ENT> <ENT>.90959</ENT> <ENT>.90587</ENT> <ENT>.90217</ENT> <ENT>.89848</ENT> <ENT>.89481</ENT> <ENT>.89116</ENT> <ENT>.88752</ENT> <ENT>.88391</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.92470</ENT> <ENT>.92126</ENT> <ENT>.91782</ENT> <ENT>.91440</ENT> <ENT>.91100</ENT> <ENT>.90760</ENT> <ENT>.90422</ENT> <ENT>.90085</ENT> <ENT>.89749</ENT> <ENT>.89414</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.93545</ENT> <ENT>.93246</ENT> <ENT>.92948</ENT> <ENT>.92650</ENT> <ENT>.92353</ENT> <ENT>.92057</ENT> <ENT>.91762</ENT> <ENT>.91467</ENT> <ENT>.91173</ENT> <ENT>.90880</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.95239</ENT> <ENT>.95016</ENT> <ENT>.94792</ENT> <ENT>.94569</ENT> <ENT>.94346</ENT> <ENT>.94123</ENT> <ENT>.93900</ENT> <ENT>.93678</ENT> <ENT>.93456</ENT> <ENT>.93234</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.97900</ENT> <ENT>.97800</ENT> <ENT>.97700</ENT> <ENT>.97600</ENT> <ENT>.97500</ENT> <ENT>.97400</ENT> <ENT>.97300</ENT> <ENT>.97200</ENT> <ENT>.97100</ENT> <ENT>.97000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table U(1)—Based on Life Table 80CNSMT Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.03176</ENT> <ENT>.03009</ENT> <ENT>.02861</ENT> <ENT>.02730</ENT> <ENT>.02613</ENT> <ENT>.02509</ENT> <ENT>.02416</ENT> <ENT>.02333</ENT> <ENT>.02258</ENT> <ENT>.02191</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.02110</ENT> <ENT>.01936</ENT> <ENT>.01781</ENT> <ENT>.01644</ENT> <ENT>.01522</ENT> <ENT>.01413</ENT> <ENT>.01316</ENT> <ENT>.01229</ENT> <ENT>.01150</ENT> <ENT>.01080</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.02156</ENT> <ENT>.01974</ENT> <ENT>.01812</ENT> <ENT>.01669</ENT> <ENT>.01541</ENT> <ENT>.01427</ENT> <ENT>.01325</ENT> <ENT>.01234</ENT> <ENT>.01152</ENT> <ENT>.01078</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02233</ENT> <ENT>.02043</ENT> <ENT>.01875</ENT> <ENT>.01725</ENT> <ENT>.01591</ENT> <ENT>.01471</ENT> <ENT>.01364</ENT> <ENT>.01268</ENT> <ENT>.01182</ENT> <ENT>.01105</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.02330</ENT> <ENT>.02132</ENT> <ENT>.01956</ENT> <ENT>.01800</ENT> <ENT>.01660</ENT> <ENT>.01535</ENT> <ENT>.01422</ENT> <ENT>.01322</ENT> <ENT>.01231</ENT> <ENT>.01149</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.02443</ENT> <ENT>.02237</ENT> <ENT>.02054</ENT> <ENT>.01890</ENT> <ENT>.01743</ENT> <ENT>.01612</ENT> <ENT>.01494</ENT> <ENT>.01389</ENT> <ENT>.01293</ENT> <ENT>.01208</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.02568</ENT> <ENT>.02353</ENT> <ENT>.02162</ENT> <ENT>.01990</ENT> <ENT>.01837</ENT> <ENT>.01700</ENT> <ENT>.01576</ENT> <ENT>.01465</ENT> <ENT>.01365</ENT> <ENT>.01275</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.02704</ENT> <ENT>.02480</ENT> <ENT>.02280</ENT> <ENT>.02102</ENT> <ENT>.01941</ENT> <ENT>.01798</ENT> <ENT>.01668</ENT> <ENT>.01552</ENT> <ENT>.01446</ENT> <ENT>.01351</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.02852</ENT> <ENT>.02619</ENT> <ENT>.02411</ENT> <ENT>.02224</ENT> <ENT>.02057</ENT> <ENT>.01906</ENT> <ENT>.01770</ENT> <ENT>.01648</ENT> <ENT>.01537</ENT> <ENT>.01437</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.03014</ENT> <ENT>.02772</ENT> <ENT>.02554</ENT> <ENT>.02360</ENT> <ENT>.02184</ENT> <ENT>.02027</ENT> <ENT>.01885</ENT> <ENT>.01756</ENT> <ENT>.01640</ENT> <ENT>.01535</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.03190</ENT> <ENT>.02938</ENT> <ENT>.02711</ENT> <ENT>.02508</ENT> <ENT>.02325</ENT> <ENT>.02160</ENT> <ENT>.02012</ENT> <ENT>.01877</ENT> <ENT>.01755</ENT> <ENT>.01645</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.03381</ENT> <ENT>.03119</ENT> <ENT>.02883</ENT> <ENT>.02672</ENT> <ENT>.02481</ENT> <ENT>.02308</ENT> <ENT>.02153</ENT> <ENT>.02012</ENT> <ENT>.01884</ENT> <ENT>.01768</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.03585</ENT> <ENT>.03313</ENT> <ENT>.03068</ENT> <ENT>.02847</ENT> <ENT>.02648</ENT> <ENT>.02468</ENT> <ENT>.02305</ENT> <ENT>.02157</ENT> <ENT>.02023</ENT> <ENT>.01902</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.03798</ENT> <ENT>.03515</ENT> <ENT>.03260</ENT> <ENT>.03030</ENT> <ENT>.02822</ENT> <ENT>.02635</ENT> <ENT>.02464</ENT> <ENT>.02310</ENT> <ENT>.02170</ENT> <ENT>.02042</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.04012</ENT> <ENT>.03718</ENT> <ENT>.03453</ENT> <ENT>.03213</ENT> <ENT>.02997</ENT> <ENT>.02801</ENT> <ENT>.02623</ENT> <ENT>.02462</ENT> <ENT>.02315</ENT> <ENT>.02181</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.04225</ENT> <ENT>.03919</ENT> <ENT>.03644</ENT> <ENT>.03395</ENT> <ENT>.03169</ENT> <ENT>.02965</ENT> <ENT>.02779</ENT> <ENT>.02611</ENT> <ENT>.02457</ENT> <ENT>.02317</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.04436</ENT> <ENT>.04120</ENT> <ENT>.03833</ENT> <ENT>.03574</ENT> <ENT>.03339</ENT> <ENT>.03126</ENT> <ENT>.02932</ENT> <ENT>.02756</ENT> <ENT>.02595</ENT> <ENT>.02449</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.04647</ENT> <ENT>.04319</ENT> <ENT>.04021</ENT> <ENT>.03752</ENT> <ENT>.03507</ENT> <ENT>.03285</ENT> <ENT>.03082</ENT> <ENT>.02898</ENT> <ENT>.02730</ENT> <ENT>.02577</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.04860</ENT> <ENT>.04519</ENT> <ENT>.04210</ENT> <ENT>.03930</ENT> <ENT>.03675</ENT> <ENT>.03443</ENT> <ENT>.03232</ENT> <ENT>.03040</ENT> <ENT>.02864</ENT> <ENT>.02703</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.05079</ENT> <ENT>.04725</ENT> <ENT>.04404</ENT> <ENT>.04113</ENT> <ENT>.03847</ENT> <ENT>.03606</ENT> <ENT>.03386</ENT> <ENT>.03185</ENT> <ENT>.03001</ENT> <ENT>.02833</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.05304</ENT> <ENT>.04938</ENT> <ENT>.04604</ENT> <ENT>.04301</ENT> <ENT>.04025</ENT> <ENT>.03773</ENT> <ENT>.03543</ENT> <ENT>.03333</ENT> <ENT>.03141</ENT> <ENT>.02965</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.05537</ENT> <ENT>.05157</ENT> <ENT>.04811</ENT> <ENT>.04495</ENT> <ENT>.04208</ENT> <ENT>.03945</ENT> <ENT>.03705</ENT> <ENT>.03486</ENT> <ENT>.03285</ENT> <ENT>.03101</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.05779</ENT> <ENT>.05385</ENT> <ENT>.05025</ENT> <ENT>.04698</ENT> <ENT>.04398</ENT> <ENT>.04125</ENT> <ENT>.03874</ENT> <ENT>.03645</ENT> <ENT>.03435</ENT> <ENT>.03242</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.06032</ENT> <ENT>.05623</ENT> <ENT>.05250</ENT> <ENT>.04910</ENT> <ENT>.04598</ENT> <ENT>.04313</ENT> <ENT>.04052</ENT> <ENT>.03812</ENT> <ENT>.03592</ENT> <ENT>.03390</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.06302</ENT> <ENT>.05878</ENT> <ENT>.05491</ENT> <ENT>.05136</ENT> <ENT>.04812</ENT> <ENT>.04515</ENT> <ENT>.04242</ENT> <ENT>.03992</ENT> <ENT>.03762</ENT> <ENT>.03550</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.06589</ENT> <ENT>.06150</ENT> <ENT>.05748</ENT> <ENT>.05380</ENT> <ENT>.05042</ENT> <ENT>.04733</ENT> <ENT>.04448</ENT> <ENT>.04187</ENT> <ENT>.03946</ENT> <ENT>.03725</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.06897</ENT> <ENT>.06442</ENT> <ENT>.06025</ENT> <ENT>.05643</ENT> <ENT>.05292</ENT> <ENT>.04969</ENT> <ENT>.04673</ENT> <ENT>.04400</ENT> <ENT>.04148</ENT> <ENT>.03916</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.07228</ENT> <ENT>.06757</ENT> <ENT>.06325</ENT> <ENT>.05928</ENT> <ENT>.05563</ENT> <ENT>.05227</ENT> <ENT>.04917</ENT> <ENT>.04632</ENT> <ENT>.04369</ENT> <ENT>.04126</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.07582</ENT> <ENT>.07094</ENT> <ENT>.06646</ENT> <ENT>.06234</ENT> <ENT>.05854</ENT> <ENT>.05504</ENT> <ENT>.05182</ENT> <ENT>.04884</ENT> <ENT>.04609</ENT> <ENT>.04355</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.07958</ENT> <ENT>.07454</ENT> <ENT>.06990</ENT> <ENT>.06562</ENT> <ENT>.06167</ENT> <ENT>.05804</ENT> <ENT>.05468</ENT> <ENT>.05157</ENT> <ENT>.04870</ENT> <ENT>.04604</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.08360</ENT> <ENT>.07838</ENT> <ENT>.07357</ENT> <ENT>.06913</ENT> <ENT>.06504</ENT> <ENT>.06125</ENT> <ENT>.05775</ENT> <ENT>.05452</ENT> <ENT>.05152</ENT> <ENT>.04874</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.08788</ENT> <ENT>.08249</ENT> <ENT>.07751</ENT> <ENT>.07291</ENT> <ENT>.06866</ENT> <ENT>.06472</ENT> <ENT>.06108</ENT> <ENT>.05771</ENT> <ENT>.05457</ENT> <ENT>.05167</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.09242</ENT> <ENT>.08685</ENT> <ENT>.08170</ENT> <ENT>.07694</ENT> <ENT>.07252</ENT> <ENT>.06844</ENT> <ENT>.06465</ENT> <ENT>.06113</ENT> <ENT>.05786</ENT> <ENT>.05483</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.09724</ENT> <ENT>.09149</ENT> <ENT>.08617</ENT> <ENT>.08124</ENT> <ENT>.07666</ENT> <ENT>.07242</ENT> <ENT>.06848</ENT> <ENT>.06482</ENT> <ENT>.06141</ENT> <ENT>.05824</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.10234</ENT> <ENT>.09641</ENT> <ENT>.09091</ENT> <ENT>.08581</ENT> <ENT>.08107</ENT> <ENT>.07667</ENT> <ENT>.07257</ENT> <ENT>.06876</ENT> <ENT>.06521</ENT> <ENT>.06191</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.10773</ENT> <ENT>.10161</ENT> <ENT>.09594</ENT> <ENT>.09066</ENT> <ENT>.08575</ENT> <ENT>.08119</ENT> <ENT>.07694</ENT> <ENT>.07298</ENT> <ENT>.06928</ENT> <ENT>.06583</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.11338</ENT> <ENT>.10708</ENT> <ENT>.10122</ENT> <ENT>.09577</ENT> <ENT>.09070</ENT> <ENT>.08597</ENT> <ENT>.08156</ENT> <ENT>.07744</ENT> <ENT>.07360</ENT> <ENT>.07001</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.11932</ENT> <ENT>.11283</ENT> <ENT>.10680</ENT> <ENT>.10117</ENT> <ENT>.09592</ENT> <ENT>.09102</ENT> <ENT>.08645</ENT> <ENT>.08217</ENT> <ENT>.07818</ENT> <ENT>.07444</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.12554</ENT> <ENT>.11887</ENT> <ENT>.11265</ENT> <ENT>.10685</ENT> <ENT>.10142</ENT> <ENT>.09636</ENT> <ENT>.09162</ENT> <ENT>.08719</ENT> <ENT>.08304</ENT> <ENT>.07915</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.13206</ENT> <ENT>.12521</ENT> <ENT>.11880</ENT> <ENT>.11282</ENT> <ENT>.10722</ENT> <ENT>.10198</ENT> <ENT>.09708</ENT> <ENT>.09249</ENT> <ENT>.08818</ENT> <ENT>.08414</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.13888</ENT> <ENT>.13184</ENT> <ENT>.12526</ENT> <ENT>.11909</ENT> <ENT>.11332</ENT> <ENT>.10791</ENT> <ENT>.10284</ENT> <ENT>.09808</ENT> <ENT>.09361</ENT> <ENT>.08942</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.14601</ENT> <ENT>.13878</ENT> <ENT>.13201</ENT> <ENT>.12567</ENT> <ENT>.11972</ENT> <ENT>.11414</ENT> <ENT>.10890</ENT> <ENT>.10398</ENT> <ENT>.09935</ENT> <ENT>.09499</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.15342</ENT> <ENT>.14601</ENT> <ENT>.13906</ENT> <ENT>.13254</ENT> <ENT>.12641</ENT> <ENT>.12066</ENT> <ENT>.11525</ENT> <ENT>.11016</ENT> <ENT>.10537</ENT> <ENT>.10086</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.16112</ENT> <ENT>.15353</ENT> <ENT>.14640</ENT> <ENT>.13970</ENT> <ENT>.13340</ENT> <ENT>.12747</ENT> <ENT>.12189</ENT> <ENT>.11663</ENT> <ENT>.11168</ENT> <ENT>.10701</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.16913</ENT> <ENT>.16136</ENT> <ENT>.15406</ENT> <ENT>.14718</ENT> <ENT>.14070</ENT> <ENT>.13460</ENT> <ENT>.12885</ENT> <ENT>.12342</ENT> <ENT>.11830</ENT> <ENT>.11347</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.17745</ENT> <ENT>.16951</ENT> <ENT>.16202</ENT> <ENT>.15497</ENT> <ENT>.14832</ENT> <ENT>.14204</ENT> <ENT>.13612</ENT> <ENT>.13053</ENT> <ENT>.12525</ENT> <ENT>.12025</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.18608</ENT> <ENT>.17796</ENT> <ENT>.17030</ENT> <ENT>.16308</ENT> <ENT>.15625</ENT> <ENT>.14981</ENT> <ENT>.14372</ENT> <ENT>.13796</ENT> 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I="01">84</ENT> <ENT>.69508</ENT> <ENT>.68758</ENT> <ENT>.68020</ENT> <ENT>.67293</ENT> <ENT>.66577</ENT> <ENT>.65872</ENT> <ENT>.65178</ENT> <ENT>.64495</ENT> <ENT>.63821</ENT> <ENT>.63158</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.70915</ENT> <ENT>.70190</ENT> <ENT>.69475</ENT> <ENT>.68770</ENT> <ENT>.68076</ENT> <ENT>.67392</ENT> <ENT>.66718</ENT> <ENT>.66054</ENT> <ENT>.65399</ENT> <ENT>.64754</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.72274</ENT> <ENT>.71573</ENT> <ENT>.70882</ENT> <ENT>.70200</ENT> <ENT>.69528</ENT> <ENT>.68865</ENT> <ENT>.68212</ENT> <ENT>.67567</ENT> <ENT>.66931</ENT> <ENT>.66304</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.73569</ENT> <ENT>.72892</ENT> <ENT>.72224</ENT> <ENT>.71565</ENT> <ENT>.70915</ENT> <ENT>.70273</ENT> <ENT>.69639</ENT> <ENT>.69014</ENT> <ENT>.68397</ENT> <ENT>.67788</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.74807</ENT> <ENT>.74154</ENT> <ENT>.73509</ENT> <ENT>.72872</ENT> <ENT>.72243</ENT> <ENT>.71622</ENT> <ENT>.71009</ENT> <ENT>.70403</ENT> <ENT>.69805</ENT> <ENT>.69214</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.76010</ENT> <ENT>.75381</ENT> <ENT>.74759</ENT> <ENT>.74144</ENT> <ENT>.73537</ENT> <ENT>.72937</ENT> <ENT>.72344</ENT> <ENT>.71758</ENT> <ENT>.71179</ENT> <ENT>.70607</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.77189</ENT> <ENT>.76584</ENT> <ENT>.75985</ENT> <ENT>.75394</ENT> <ENT>.74809</ENT> <ENT>.74230</ENT> <ENT>.73659</ENT> <ENT>.73093</ENT> <ENT>.72534</ENT> <ENT>.71981</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.78327</ENT> <ENT>.77746</ENT> <ENT>.77171</ENT> <ENT>.76603</ENT> <ENT>.76040</ENT> <ENT>.75484</ENT> <ENT>.74933</ENT> <ENT>.74388</ENT> <ENT>.73850</ENT> <ENT>.73316</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.79399</ENT> <ENT>.78841</ENT> <ENT>.78289</ENT> <ENT>.77743</ENT> <ENT>.77202</ENT> <ENT>.76667</ENT> <ENT>.76137</ENT> <ENT>.75613</ENT> <ENT>.75093</ENT> <ENT>.74579</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.80394</ENT> <ENT>.79858</ENT> <ENT>.79328</ENT> <ENT>.78803</ENT> <ENT>.78283</ENT> <ENT>.77768</ENT> <ENT>.77258</ENT> <ENT>.76753</ENT> <ENT>.76252</ENT> <ENT>.75757</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.81303</ENT> <ENT>.80788</ENT> <ENT>.80278</ENT> <ENT>.79773</ENT> <ENT>.79272</ENT> <ENT>.78776</ENT> <ENT>.78284</ENT> <ENT>.77797</ENT> <ENT>.77315</ENT> <ENT>.76837</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.82124</ENT> <ENT>.81628</ENT> <ENT>.81136</ENT> <ENT>.80649</ENT> <ENT>.80166</ENT> <ENT>.79687</ENT> <ENT>.79213</ENT> <ENT>.78742</ENT> <ENT>.78276</ENT> <ENT>.77814</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.82851</ENT> <ENT>.82372</ENT> <ENT>.81897</ENT> <ENT>.81426</ENT> <ENT>.80959</ENT> <ENT>.80496</ENT> <ENT>.80036</ENT> <ENT>.79581</ENT> <ENT>.79129</ENT> <ENT>.78682</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.83512</ENT> <ENT>.83048</ENT> <ENT>.82588</ENT> <ENT>.82132</ENT> <ENT>.81679</ENT> <ENT>.81230</ENT> <ENT>.80785</ENT> <ENT>.80343</ENT> <ENT>.79905</ENT> <ENT>.79471</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.84106</ENT> <ENT>.83656</ENT> <ENT>.83210</ENT> <ENT>.82767</ENT> <ENT>.82328</ENT> <ENT>.81892</ENT> <ENT>.81459</ENT> <ENT>.81030</ENT> <ENT>.80604</ENT> <ENT>.80181</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.84655</ENT> <ENT>.84218</ENT> <ENT>.83785</ENT> <ENT>.83354</ENT> <ENT>.82927</ENT> <ENT>.82503</ENT> <ENT>.82082</ENT> <ENT>.81664</ENT> <ENT>.81249</ENT> <ENT>.80837</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.85165</ENT> <ENT>.84740</ENT> <ENT>.84318</ENT> <ENT>.83899</ENT> <ENT>.83483</ENT> <ENT>.83070</ENT> <ENT>.82660</ENT> <ENT>.82252</ENT> <ENT>.81848</ENT> <ENT>.81446</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.85652</ENT> <ENT>.85238</ENT> <ENT>.84827</ENT> <ENT>.84419</ENT> <ENT>.84013</ENT> <ENT>.83611</ENT> <ENT>.83210</ENT> <ENT>.82813</ENT> <ENT>.82418</ENT> <ENT>.82026</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.86159</ENT> <ENT>.85757</ENT> <ENT>.85358</ENT> <ENT>.84960</ENT> <ENT>.84566</ENT> <ENT>.84174</ENT> <ENT>.83784</ENT> <ENT>.83397</ENT> <ENT>.83012</ENT> <ENT>.82630</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.86697</ENT> <ENT>.86307</ENT> <ENT>.85920</ENT> <ENT>.85535</ENT> <ENT>.85152</ENT> <ENT>.84771</ENT> <ENT>.84392</ENT> <ENT>.84016</ENT> <ENT>.83642</ENT> <ENT>.83270</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.87295</ENT> <ENT>.86919</ENT> <ENT>.86544</ENT> <ENT>.86172</ENT> <ENT>.85802</ENT> <ENT>.85434</ENT> <ENT>.85068</ENT> <ENT>.84704</ENT> <ENT>.84341</ENT> <ENT>.83981</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.88030</ENT> <ENT>.87672</ENT> <ENT>.87315</ENT> <ENT>.86959</ENT> <ENT>.86605</ENT> <ENT>.86253</ENT> <ENT>.85903</ENT> <ENT>.85554</ENT> <ENT>.85207</ENT> <ENT>.84861</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.89081</ENT> <ENT>.88749</ENT> <ENT>.88418</ENT> <ENT>.88088</ENT> <ENT>.87760</ENT> <ENT>.87433</ENT> <ENT>.87106</ENT> <ENT>.86782</ENT> <ENT>.86458</ENT> <ENT>.86135</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.90588</ENT> <ENT>.90296</ENT> <ENT>.90005</ENT> <ENT>.89715</ENT> <ENT>.89425</ENT> <ENT>.89137</ENT> <ENT>.88849</ENT> <ENT>.88561</ENT> <ENT>.88275</ENT> <ENT>.87989</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.93013</ENT> <ENT>.92791</ENT> <ENT>.92570</ENT> <ENT>.92350</ENT> <ENT>.92129</ENT> <ENT>.91909</ENT> <ENT>.91689</ENT> <ENT>.91469</ENT> <ENT>.91250</ENT> <ENT>.91031</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.96900</ENT> <ENT>.96800</ENT> <ENT>.96700</ENT> <ENT>.96600</ENT> <ENT>.96500</ENT> <ENT>.96400</ENT> <ENT>.96300</ENT> <ENT>.96200</ENT> <ENT>.96100</ENT> <ENT>.96000</ENT> </ROW> </GPOTABLE> <PRTPAGE P="273"/> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table U(1)—Based on Life Table 80CNSMT Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable after APRIL 30, 1989]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02130</ENT> <ENT>.02075</ENT> <ENT>.02025</ENT> <ENT>.01980</ENT> <ENT>.01939</ENT> <ENT>.01901</ENT> <ENT>.01867</ENT> <ENT>.01835</ENT> <ENT>.01806</ENT> <ENT>.01779</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01017</ENT> <ENT>.00960</ENT> <ENT>.00908</ENT> <ENT>.00861</ENT> <ENT>.00819</ENT> <ENT>.00780</ENT> <ENT>.00745</ENT> <ENT>.00712</ENT> <ENT>.00683</ENT> <ENT>.00655</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01011</ENT> <ENT>.00951</ENT> <ENT>.00897</ENT> <ENT>.00848</ENT> <ENT>.00803</ENT> <ENT>.00762</ENT> <ENT>.00725</ENT> <ENT>.00690</ENT> <ENT>.00659</ENT> <ENT>.00630</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.01035</ENT> <ENT>.00971</ENT> <ENT>.00914</ENT> <ENT>.00862</ENT> <ENT>.00815</ENT> <ENT>.00771</ENT> <ENT>.00732</ENT> <ENT>.00696</ENT> <ENT>.00663</ENT> <ENT>.00632</ENT> </ROW> 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<ENT>.60204</ENT> <ENT>.59556</ENT> <ENT>.58918</ENT> <ENT>.58289</ENT> <ENT>.57671</ENT> <ENT>.57062</ENT> <ENT>.56462</ENT> <ENT>.55872</ENT> <ENT>.55290</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.62505</ENT> <ENT>.61862</ENT> <ENT>.61228</ENT> <ENT>.60604</ENT> <ENT>.59989</ENT> <ENT>.59383</ENT> <ENT>.58786</ENT> <ENT>.58198</ENT> <ENT>.57618</ENT> <ENT>.57047</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.64118</ENT> <ENT>.63491</ENT> <ENT>.62873</ENT> <ENT>.62263</ENT> <ENT>.61663</ENT> <ENT>.61070</ENT> <ENT>.60486</ENT> <ENT>.59911</ENT> <ENT>.59343</ENT> <ENT>.58783</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.65685</ENT> <ENT>.65075</ENT> <ENT>.64473</ENT> <ENT>.63879</ENT> <ENT>.63294</ENT> <ENT>.62716</ENT> <ENT>.62145</ENT> <ENT>.61583</ENT> <ENT>.61027</ENT> <ENT>.60479</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.67187</ENT> <ENT>.66594</ENT> <ENT>.66008</ENT> <ENT>.65430</ENT> <ENT>.64859</ENT> <ENT>.64296</ENT> <ENT>.63739</ENT> <ENT>.63190</ENT> <ENT>.62647</ENT> <ENT>.62112</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.68631</ENT> <ENT>.68054</ENT> <ENT>.67485</ENT> <ENT>.66923</ENT> <ENT>.66367</ENT> <ENT>.65818</ENT> <ENT>.65276</ENT> <ENT>.64740</ENT> <ENT>.64211</ENT> <ENT>.63688</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.70042</ENT> <ENT>.69483</ENT> <ENT>.68930</ENT> <ENT>.68384</ENT> <ENT>.67845</ENT> <ENT>.67311</ENT> <ENT>.66784</ENT> <ENT>.66262</ENT> <ENT>.65747</ENT> <ENT>.65237</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.71434</ENT> <ENT>.70894</ENT> <ENT>.70359</ENT> <ENT>.69830</ENT> <ENT>.69307</ENT> <ENT>.68790</ENT> <ENT>.68278</ENT> <ENT>.67772</ENT> <ENT>.67271</ENT> <ENT>.66775</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.72789</ENT> <ENT>.72266</ENT> <ENT>.71750</ENT> <ENT>.71239</ENT> <ENT>.70733</ENT> <ENT>.70232</ENT> <ENT>.69736</ENT> <ENT>.69246</ENT> <ENT>.68760</ENT> <ENT>.68280</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.74070</ENT> <ENT>.73567</ENT> <ENT>.73068</ENT> <ENT>.72574</ENT> <ENT>.72085</ENT> <ENT>.71601</ENT> <ENT>.71121</ENT> <ENT>.70647</ENT> <ENT>.70176</ENT> <ENT>.69711</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.75266</ENT> <ENT>.74780</ENT> <ENT>.74298</ENT> <ENT>.73821</ENT> <ENT>.73348</ENT> <ENT>.72880</ENT> <ENT>.72417</ENT> <ENT>.71957</ENT> <ENT>.71502</ENT> <ENT>.71051</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.76363</ENT> <ENT>.75893</ENT> <ENT>.75428</ENT> <ENT>.74967</ENT> <ENT>.74510</ENT> <ENT>.74057</ENT> <ENT>.73608</ENT> <ENT>.73163</ENT> <ENT>.72722</ENT> <ENT>.72285</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.77356</ENT> <ENT>.76901</ENT> <ENT>.76451</ENT> <ENT>.76005</ENT> <ENT>.75562</ENT> <ENT>.75123</ENT> <ENT>.74688</ENT> <ENT>.74257</ENT> <ENT>.73829</ENT> <ENT>.73405</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.78237</ENT> <ENT>.77797</ENT> <ENT>.77360</ENT> <ENT>.76927</ENT> <ENT>.76497</ENT> <ENT>.76071</ENT> <ENT>.75648</ENT> <ENT>.75229</ENT> <ENT>.74813</ENT> <ENT>.74401</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.79039</ENT> <ENT>.78612</ENT> <ENT>.78187</ENT> <ENT>.77766</ENT> <ENT>.77348</ENT> <ENT>.76934</ENT> <ENT>.76523</ENT> <ENT>.76115</ENT> <ENT>.75710</ENT> <ENT>.75308</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.79762</ENT> <ENT>.79345</ENT> <ENT>.78932</ENT> <ENT>.78522</ENT> <ENT>.78115</ENT> <ENT>.77711</ENT> <ENT>.77310</ENT> <ENT>.76913</ENT> <ENT>.76518</ENT> <ENT>.76126</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.80429</ENT> <ENT>.80023</ENT> <ENT>.79620</ENT> <ENT>.79220</ENT> <ENT>.78823</ENT> <ENT>.78429</ENT> <ENT>.78038</ENT> <ENT>.77649</ENT> <ENT>.77264</ENT> <ENT>.76881</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.81047</ENT> <ENT>.80651</ENT> <ENT>.80258</ENT> <ENT>.79867</ENT> <ENT>.79479</ENT> <ENT>.79094</ENT> <ENT>.78712</ENT> <ENT>.78332</ENT> <ENT>.77955</ENT> <ENT>.77580</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.81636</ENT> <ENT>.81249</ENT> <ENT>.80865</ENT> <ENT>.80483</ENT> <ENT>.80104</ENT> <ENT>.79727</ENT> <ENT>.79352</ENT> <ENT>.78981</ENT> <ENT>.78611</ENT> <ENT>.78244</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.82250</ENT> <ENT>.81872</ENT> <ENT>.81497</ENT> <ENT>.81124</ENT> <ENT>.80754</ENT> <ENT>.80386</ENT> <ENT>.80020</ENT> <ENT>.79656</ENT> <ENT>.79295</ENT> <ENT>.78936</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.82900</ENT> <ENT>.82532</ENT> <ENT>.82167</ENT> <ENT>.81804</ENT> <ENT>.81442</ENT> <ENT>.81083</ENT> <ENT>.80726</ENT> <ENT>.80371</ENT> <ENT>.80018</ENT> <ENT>.79667</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.83622</ENT> <ENT>.83266</ENT> <ENT>.82911</ENT> <ENT>.82558</ENT> <ENT>.82207</ENT> <ENT>.81858</ENT> <ENT>.81510</ENT> <ENT>.81165</ENT> <ENT>.80821</ENT> <ENT>.80479</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.84517</ENT> <ENT>.84174</ENT> <ENT>.83833</ENT> <ENT>.83494</ENT> <ENT>.83156</ENT> <ENT>.82819</ENT> <ENT>.82485</ENT> <ENT>.82151</ENT> <ENT>.81820</ENT> <ENT>.81489</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.85814</ENT> <ENT>.85494</ENT> <ENT>.85175</ENT> <ENT>.84857</ENT> <ENT>.84540</ENT> <ENT>.84225</ENT> <ENT>.83911</ENT> <ENT>.83598</ENT> <ENT>.83286</ENT> <ENT>.82975</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.87704</ENT> <ENT>.87420</ENT> <ENT>.87136</ENT> <ENT>.86853</ENT> <ENT>.86571</ENT> <ENT>.86290</ENT> <ENT>.86009</ENT> <ENT>.85729</ENT> <ENT>.85450</ENT> <ENT>.85171</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.90812</ENT> <ENT>.90593</ENT> <ENT>.90375</ENT> <ENT>.90156</ENT> <ENT>.89939</ENT> <ENT>.89721</ENT> <ENT>.89504</ENT> <ENT>.89286</ENT> <ENT>.89070</ENT> <ENT>.88853</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.95900</ENT> <ENT>.95800</ENT> <ENT>.95700</ENT> <ENT>.95600</ENT> <ENT>.95500</ENT> <ENT>.95400</ENT> <ENT>.95300</ENT> <ENT>.95200</ENT> <ENT>.95100</ENT> <ENT>.95000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table U(1)—Based on Life Table 80CNSMT Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable after APRIL 30, 1989]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01754</ENT> <ENT>.01731</ENT> <ENT>.01710</ENT> <ENT>.01690</ENT> <ENT>.01671</ENT> <ENT>.01654</ENT> <ENT>.01638</ENT> <ENT>.01622</ENT> <ENT>.01608</ENT> <ENT>.01594</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00630</ENT> <ENT>.00607</ENT> <ENT>.00585</ENT> <ENT>.00565</ENT> <ENT>.00547</ENT> <ENT>.00530</ENT> <ENT>.00514</ENT> <ENT>.00499</ENT> <ENT>.00485</ENT> <ENT>.00472</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00604</ENT> <ENT>.00579</ENT> <ENT>.00557</ENT> <ENT>.00536</ENT> <ENT>.00516</ENT> <ENT>.00498</ENT> <ENT>.00481</ENT> <ENT>.00465</ENT> <ENT>.00451</ENT> <ENT>.00437</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00604</ENT> <ENT>.00578</ENT> <ENT>.00554</ENT> <ENT>.00532</ENT> <ENT>.00511</ENT> <ENT>.00492</ENT> <ENT>.00474</ENT> <ENT>.00458</ENT> <ENT>.00442</ENT> <ENT>.00427</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00621</ENT> <ENT>.00593</ENT> <ENT>.00568</ENT> <ENT>.00544</ENT> <ENT>.00522</ENT> <ENT>.00502</ENT> <ENT>.00483</ENT> <ENT>.00465</ENT> <ENT>.00448</ENT> <ENT>.00433</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00648</ENT> <ENT>.00619</ENT> <ENT>.00592</ENT> <ENT>.00567</ENT> <ENT>.00544</ENT> <ENT>.00522</ENT> <ENT>.00502</ENT> <ENT>.00483</ENT> <ENT>.00465</ENT> <ENT>.00449</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00684</ENT> <ENT>.00653</ENT> <ENT>.00624</ENT> <ENT>.00597</ENT> <ENT>.00572</ENT> <ENT>.00549</ENT> <ENT>.00528</ENT> <ENT>.00507</ENT> <ENT>.00489</ENT> <ENT>.00471</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00726</ENT> <ENT>.00693</ENT> <ENT>.00663</ENT> <ENT>.00634</ENT> <ENT>.00608</ENT> <ENT>.00583</ENT> <ENT>.00560</ENT> <ENT>.00539</ENT> <ENT>.00518</ENT> <ENT>.00499</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00777</ENT> <ENT>.00742</ENT> <ENT>.00709</ENT> <ENT>.00679</ENT> <ENT>.00651</ENT> <ENT>.00624</ENT> <ENT>.00600</ENT> <ENT>.00577</ENT> <ENT>.00555</ENT> <ENT>.00535</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00837</ENT> <ENT>.00800</ENT> <ENT>.00765</ENT> <ENT>.00733</ENT> <ENT>.00703</ENT> <ENT>.00675</ENT> <ENT>.00649</ENT> <ENT>.00625</ENT> <ENT>.00602</ENT> <ENT>.00580</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00908</ENT> <ENT>.00868</ENT> <ENT>.00832</ENT> <ENT>.00797</ENT> <ENT>.00765</ENT> <ENT>.00736</ENT> <ENT>.00708</ENT> <ENT>.00682</ENT> <ENT>.00657</ENT> <ENT>.00634</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00991</ENT> <ENT>.00949</ENT> <ENT>.00910</ENT> <ENT>.00874</ENT> <ENT>.00840</ENT> <ENT>.00808</ENT> <ENT>.00779</ENT> <ENT>.00751</ENT> <ENT>.00725</ENT> <ENT>.00700</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01083</ENT> <ENT>.01039</ENT> <ENT>.00997</ENT> <ENT>.00959</ENT> <ENT>.00923</ENT> <ENT>.00890</ENT> <ENT>.00858</ENT> <ENT>.00829</ENT> <ENT>.00801</ENT> <ENT>.00775</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01181</ENT> <ENT>.01134</ENT> <ENT>.01090</ENT> <ENT>.01049</ENT> <ENT>.01012</ENT> <ENT>.00976</ENT> <ENT>.00943</ENT> <ENT>.00912</ENT> <ENT>.00883</ENT> <ENT>.00855</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01275</ENT> <ENT>.01226</ENT> <ENT>.01180</ENT> <ENT>.01137</ENT> <ENT>.01097</ENT> <ENT>.01060</ENT> <ENT>.01025</ENT> <ENT>.00992</ENT> <ENT>.00961</ENT> <ENT>.00932</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01365</ENT> <ENT>.01313</ENT> <ENT>.01264</ENT> <ENT>.01219</ENT> <ENT>.01177</ENT> <ENT>.01138</ENT> <ENT>.01101</ENT> <ENT>.01066</ENT> <ENT>.01034</ENT> <ENT>.01003</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01449</ENT> <ENT>.01394</ENT> <ENT>.01343</ENT> <ENT>.01295</ENT> <ENT>.01251</ENT> <ENT>.01209</ENT> <ENT>.01171</ENT> <ENT>.01134</ENT> <ENT>.01100</ENT> <ENT>.01068</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01526</ENT> <ENT>.01469</ENT> <ENT>.01415</ENT> <ENT>.01365</ENT> <ENT>.01318</ENT> <ENT>.01274</ENT> <ENT>.01233</ENT> <ENT>.01195</ENT> <ENT>.01159</ENT> <ENT>.01125</ENT> </ROW> <ROW> <PRTPAGE P="275"/> <ENT I="01">18</ENT> <ENT>.01600</ENT> <ENT>.01539</ENT> <ENT>.01482</ENT> <ENT>.01430</ENT> <ENT>.01380</ENT> <ENT>.01334</ENT> <ENT>.01291</ENT> <ENT>.01251</ENT> <ENT>.01213</ENT> <ENT>.01177</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01673</ENT> <ENT>.01609</ENT> <ENT>.01550</ENT> <ENT>.01494</ENT> <ENT>.01442</ENT> <ENT>.01393</ENT> <ENT>.01348</ENT> <ENT>.01305</ENT> <ENT>.01265</ENT> <ENT>.01227</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01747</ENT> <ENT>.01679</ENT> <ENT>.01616</ENT> <ENT>.01557</ENT> <ENT>.01502</ENT> <ENT>.01451</ENT> <ENT>.01403</ENT> <ENT>.01358</ENT> <ENT>.01316</ENT> <ENT>.01276</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01820</ENT> <ENT>.01748</ENT> <ENT>.01682</ENT> <ENT>.01620</ENT> <ENT>.01562</ENT> <ENT>.01508</ENT> <ENT>.01457</ENT> <ENT>.01409</ENT> <ENT>.01365</ENT> <ENT>.01323</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01895</ENT> <ENT>.01819</ENT> <ENT>.01749</ENT> <ENT>.01683</ENT> <ENT>.01622</ENT> <ENT>.01565</ENT> <ENT>.01511</ENT> <ENT>.01461</ENT> <ENT>.01414</ENT> <ENT>.01369</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01972</ENT> <ENT>.01893</ENT> <ENT>.01818</ENT> <ENT>.01749</ENT> <ENT>.01684</ENT> <ENT>.01624</ENT> <ENT>.01567</ENT> <ENT>.01514</ENT> <ENT>.01464</ENT> <ENT>.01417</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.02058</ENT> <ENT>.01974</ENT> <ENT>.01895</ENT> <ENT>.01822</ENT> <ENT>.01753</ENT> <ENT>.01689</ENT> <ENT>.01629</ENT> <ENT>.01572</ENT> <ENT>.01519</ENT> <ENT>.01469</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02154</ENT> <ENT>.02064</ENT> <ENT>.01981</ENT> <ENT>.01903</ENT> <ENT>.01830</ENT> <ENT>.01762</ENT> <ENT>.01698</ENT> <ENT>.01638</ENT> <ENT>.01582</ENT> <ENT>.01529</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02262</ENT> <ENT>.02167</ENT> <ENT>.02079</ENT> <ENT>.01996</ENT> <ENT>.01919</ENT> <ENT>.01847</ENT> <ENT>.01779</ENT> <ENT>.01715</ENT> <ENT>.01655</ENT> <ENT>.01599</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02385</ENT> <ENT>.02284</ENT> <ENT>.02191</ENT> <ENT>.02103</ENT> <ENT>.02021</ENT> <ENT>.01944</ENT> <ENT>.01872</ENT> <ENT>.01804</ENT> <ENT>.01740</ENT> <ENT>.01680</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02521</ENT> <ENT>.02415</ENT> <ENT>.02316</ENT> <ENT>.02222</ENT> <ENT>.02135</ENT> <ENT>.02053</ENT> <ENT>.01977</ENT> <ENT>.01904</ENT> <ENT>.01836</ENT> <ENT>.01772</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02673</ENT> <ENT>.02561</ENT> <ENT>.02455</ENT> <ENT>.02357</ENT> <ENT>.02264</ENT> <ENT>.02177</ENT> <ENT>.02095</ENT> <ENT>.02018</ENT> <ENT>.01946</ENT> <ENT>.01877</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02842</ENT> <ENT>.02723</ENT> <ENT>.02611</ENT> <ENT>.02506</ENT> <ENT>.02407</ENT> <ENT>.02315</ENT> <ENT>.02227</ENT> <ENT>.02146</ENT> <ENT>.02068</ENT> <ENT>.01996</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.03030</ENT> <ENT>.02903</ENT> <ENT>.02784</ENT> <ENT>.02673</ENT> <ENT>.02568</ENT> <ENT>.02470</ENT> <ENT>.02377</ENT> <ENT>.02290</ENT> <ENT>.02207</ENT> <ENT>.02130</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.03235</ENT> <ENT>.03101</ENT> <ENT>.02976</ENT> <ENT>.02857</ENT> <ENT>.02746</ENT> <ENT>.02641</ENT> <ENT>.02543</ENT> <ENT>.02450</ENT> <ENT>.02362</ENT> <ENT>.02279</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.03463</ENT> <ENT>.03321</ENT> <ENT>.03188</ENT> <ENT>.03062</ENT> <ENT>.02944</ENT> <ENT>.02833</ENT> <ENT>.02728</ENT> <ENT>.02629</ENT> <ENT>.02535</ENT> <ENT>.02447</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.03711</ENT> <ENT>.03561</ENT> <ENT>.03419</ENT> <ENT>.03286</ENT> <ENT>.03161</ENT> <ENT>.03043</ENT> <ENT>.02931</ENT> <ENT>.02826</ENT> <ENT>.02726</ENT> <ENT>.02632</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.03981</ENT> <ENT>.03822</ENT> <ENT>.03672</ENT> <ENT>.03531</ENT> <ENT>.03398</ENT> <ENT>.03273</ENT> <ENT>.03154</ENT> <ENT>.03042</ENT> <ENT>.02936</ENT> <ENT>.02836</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.04271</ENT> <ENT>.04103</ENT> <ENT>.03945</ENT> <ENT>.03796</ENT> <ENT>.03655</ENT> <ENT>.03522</ENT> <ENT>.03396</ENT> <ENT>.03277</ENT> <ENT>.03164</ENT> <ENT>.03057</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.04584</ENT> <ENT>.04407</ENT> <ENT>.04239</ENT> <ENT>.04081</ENT> <ENT>.03932</ENT> <ENT>.03791</ENT> <ENT>.03657</ENT> <ENT>.03531</ENT> <ENT>.03411</ENT> <ENT>.03297</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.04920</ENT> <ENT>.04733</ENT> <ENT>.04556</ENT> <ENT>.04389</ENT> <ENT>.04231</ENT> <ENT>.04082</ENT> <ENT>.03940</ENT> <ENT>.03806</ENT> <ENT>.03679</ENT> <ENT>.03558</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.05280</ENT> <ENT>.05083</ENT> <ENT>.04897</ENT> <ENT>.04721</ENT> <ENT>.04554</ENT> <ENT>.04396</ENT> <ENT>.04246</ENT> <ENT>.04103</ENT> <ENT>.03968</ENT> <ENT>.03840</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.05667</ENT> <ENT>.05459</ENT> <ENT>.05263</ENT> <ENT>.05077</ENT> <ENT>.04901</ENT> <ENT>.04733</ENT> <ENT>.04575</ENT> <ENT>.04424</ENT> <ENT>.04280</ENT> <ENT>.04144</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.06080</ENT> <ENT>.05861</ENT> <ENT>.05655</ENT> <ENT>.05459</ENT> <ENT>.05272</ENT> <ENT>.05096</ENT> <ENT>.04928</ENT> <ENT>.04768</ENT> <ENT>.04617</ENT> <ENT>.04472</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.06518</ENT> <ENT>.06289</ENT> <ENT>.06071</ENT> <ENT>.05864</ENT> <ENT>.05668</ENT> <ENT>.05482</ENT> <ENT>.05305</ENT> <ENT>.05136</ENT> <ENT>.04975</ENT> <ENT>.04822</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.06982</ENT> <ENT>.06742</ENT> <ENT>.06513</ENT> <ENT>.06296</ENT> <ENT>.06089</ENT> <ENT>.05893</ENT> <ENT>.05706</ENT> <ENT>.05528</ENT> <ENT>.05358</ENT> <ENT>.05196</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.07475</ENT> <ENT>.07223</ENT> <ENT>.06983</ENT> <ENT>.06754</ENT> <ENT>.06537</ENT> <ENT>.06330</ENT> <ENT>.06133</ENT> <ENT>.05945</ENT> <ENT>.05766</ENT> <ENT>.05595</ENT> </ROW> <ROW> <ENT 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<ENT>.27949</ENT> <ENT>.27439</ENT> <ENT>.26943</ENT> <ENT>.26461</ENT> <ENT>.25991</ENT> <ENT>.25534</ENT> <ENT>.25089</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.30991</ENT> <ENT>.30429</ENT> <ENT>.29882</ENT> <ENT>.29349</ENT> <ENT>.28830</ENT> <ENT>.28325</ENT> <ENT>.27833</ENT> <ENT>.27354</ENT> <ENT>.26887</ENT> <ENT>.26432</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.32457</ENT> <ENT>.31887</ENT> <ENT>.31332</ENT> <ENT>.30791</ENT> <ENT>.30264</ENT> <ENT>.29750</ENT> <ENT>.29249</ENT> <ENT>.28760</ENT> <ENT>.28284</ENT> <ENT>.27820</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.33955</ENT> <ENT>.33378</ENT> <ENT>.32816</ENT> <ENT>.32267</ENT> <ENT>.31732</ENT> <ENT>.31210</ENT> <ENT>.30701</ENT> <ENT>.30204</ENT> <ENT>.29719</ENT> <ENT>.29246</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.35485</ENT> <ENT>.34902</ENT> <ENT>.34333</ENT> <ENT>.33778</ENT> <ENT>.33236</ENT> <ENT>.32707</ENT> <ENT>.32190</ENT> <ENT>.31686</ENT> <ENT>.31193</ENT> <ENT>.30711</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.37049</ENT> <ENT>.36461</ENT> <ENT>.35887</ENT> <ENT>.35326</ENT> <ENT>.34778</ENT> <ENT>.34242</ENT> <ENT>.33719</ENT> <ENT>.33207</ENT> <ENT>.32707</ENT> <ENT>.32218</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.38656</ENT> <ENT>.38064</ENT> <ENT>.37485</ENT> <ENT>.36920</ENT> <ENT>.36366</ENT> <ENT>.35825</ENT> <ENT>.35296</ENT> <ENT>.34778</ENT> <ENT>.34272</ENT> <ENT>.33776</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.40312</ENT> <ENT>.39717</ENT> <ENT>.39136</ENT> <ENT>.38566</ENT> <ENT>.38009</ENT> <ENT>.37464</ENT> <ENT>.36930</ENT> <ENT>.36407</ENT> <ENT>.35895</ENT> <ENT>.35394</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.42022</ENT> <ENT>.41426</ENT> <ENT>.40842</ENT> <ENT>.40271</ENT> <ENT>.39711</ENT> <ENT>.39163</ENT> <ENT>.38625</ENT> <ENT>.38099</ENT> <ENT>.37583</ENT> <ENT>.37077</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.43782</ENT> <ENT>.43187</ENT> <ENT>.42603</ENT> <ENT>.42031</ENT> <ENT>.41470</ENT> <ENT>.40920</ENT> <ENT>.40380</ENT> <ENT>.39851</ENT> <ENT>.39332</ENT> <ENT>.38823</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.45586</ENT> <ENT>.44992</ENT> <ENT>.44410</ENT> <ENT>.43839</ENT> <ENT>.43278</ENT> <ENT>.42728</ENT> <ENT>.42188</ENT> <ENT>.41658</ENT> <ENT>.41138</ENT> <ENT>.40627</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.47418</ENT> <ENT>.46828</ENT> <ENT>.46248</ENT> <ENT>.45679</ENT> <ENT>.45120</ENT> <ENT>.44572</ENT> <ENT>.44033</ENT> <ENT>.43503</ENT> <ENT>.42983</ENT> <ENT>.42472</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.49264</ENT> <ENT>.48679</ENT> <ENT>.48103</ENT> <ENT>.47538</ENT> <ENT>.46982</ENT> <ENT>.46436</ENT> <ENT>.45900</ENT> <ENT>.45372</ENT> <ENT>.44853</ENT> <ENT>.44343</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.51103</ENT> <ENT>.50524</ENT> <ENT>.49954</ENT> <ENT>.49394</ENT> <ENT>.48843</ENT> <ENT>.48301</ENT> <ENT>.47768</ENT> <ENT>.47243</ENT> <ENT>.46727</ENT> <ENT>.46219</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.52925</ENT> <ENT>.52352</ENT> <ENT>.51789</ENT> <ENT>.51235</ENT> <ENT>.50690</ENT> <ENT>.50153</ENT> <ENT>.49624</ENT> <ENT>.49104</ENT> <ENT>.48591</ENT> <ENT>.48087</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.54718</ENT> <ENT>.54154</ENT> <ENT>.53598</ENT> <ENT>.53051</ENT> <ENT>.52512</ENT> <ENT>.51981</ENT> <ENT>.51459</ENT> <ENT>.50943</ENT> <ENT>.50436</ENT> <ENT>.49936</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.56484</ENT> <ENT>.55930</ENT> <ENT>.55383</ENT> <ENT>.54844</ENT> <ENT>.54313</ENT> <ENT>.53789</ENT> <ENT>.53273</ENT> <ENT>.52764</ENT> <ENT>.52262</ENT> <ENT>.51767</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.58231</ENT> <ENT>.57686</ENT> <ENT>.57149</ENT> <ENT>.56619</ENT> <ENT>.56096</ENT> <ENT>.55581</ENT> <ENT>.55072</ENT> <ENT>.54571</ENT> <ENT>.54076</ENT> <ENT>.53588</ENT> </ROW> <ROW> <PRTPAGE P="276"/> <ENT I="01">86</ENT> <ENT>.59939</ENT> <ENT>.59405</ENT> <ENT>.58878</ENT> <ENT>.58358</ENT> <ENT>.57845</ENT> <ENT>.57339</ENT> <ENT>.56839</ENT> <ENT>.56346</ENT> <ENT>.55858</ENT> <ENT>.55377</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.61583</ENT> <ENT>.61061</ENT> <ENT>.60545</ENT> <ENT>.60035</ENT> <ENT>.59532</ENT> <ENT>.59035</ENT> <ENT>.58545</ENT> <ENT>.58060</ENT> <ENT>.57581</ENT> <ENT>.57108</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.63171</ENT> <ENT>.62661</ENT> <ENT>.62156</ENT> <ENT>.61658</ENT> <ENT>.61165</ENT> <ENT>.60678</ENT> <ENT>.60196</ENT> <ENT>.59721</ENT> <ENT>.59251</ENT> <ENT>.58786</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.64733</ENT> <ENT>.64235</ENT> <ENT>.63742</ENT> <ENT>.63255</ENT> <ENT>.62774</ENT> <ENT>.62298</ENT> <ENT>.61827</ENT> <ENT>.61361</ENT> <ENT>.60900</ENT> <ENT>.60444</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.66285</ENT> <ENT>.65801</ENT> <ENT>.65321</ENT> <ENT>.64847</ENT> <ENT>.64377</ENT> <ENT>.63913</ENT> <ENT>.63453</ENT> <ENT>.62998</ENT> <ENT>.62548</ENT> <ENT>.62103</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.67804</ENT> <ENT>.67334</ENT> <ENT>.66868</ENT> <ENT>.66407</ENT> <ENT>.65950</ENT> <ENT>.65498</ENT> <ENT>.65050</ENT> <ENT>.64607</ENT> <ENT>.64169</ENT> <ENT>.63735</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.69250</ENT> <ENT>.68793</ENT> <ENT>.68341</ENT> <ENT>.67893</ENT> <ENT>.67450</ENT> <ENT>.67011</ENT> <ENT>.66575</ENT> <ENT>.66144</ENT> <ENT>.65718</ENT> <ENT>.65295</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.70604</ENT> <ENT>.70162</ENT> <ENT>.69723</ENT> <ENT>.69288</ENT> <ENT>.68858</ENT> <ENT>.68431</ENT> <ENT>.68008</ENT> <ENT>.67589</ENT> <ENT>.67174</ENT> <ENT>.66762</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.71852</ENT> <ENT>.71422</ENT> <ENT>.70997</ENT> <ENT>.70575</ENT> <ENT>.70156</ENT> <ENT>.69742</ENT> <ENT>.69331</ENT> <ENT>.68923</ENT> <ENT>.68519</ENT> <ENT>.68119</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.72984</ENT> <ENT>.72567</ENT> <ENT>.72154</ENT> <ENT>.71744</ENT> <ENT>.71337</ENT> <ENT>.70934</ENT> <ENT>.70534</ENT> <ENT>.70137</ENT> <ENT>.69744</ENT> <ENT>.69354</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.73992</ENT> <ENT>.73586</ENT> <ENT>.73183</ENT> <ENT>.72784</ENT> <ENT>.72388</ENT> <ENT>.71995</ENT> <ENT>.71605</ENT> <ENT>.71218</ENT> <ENT>.70835</ENT> <ENT>.70454</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.74910</ENT> <ENT>.74514</ENT> <ENT>.74122</ENT> <ENT>.73733</ENT> <ENT>.73346</ENT> <ENT>.72963</ENT> <ENT>.72582</ENT> <ENT>.72205</ENT> <ENT>.71830</ENT> <ENT>.71458</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.75737</ENT> <ENT>.75351</ENT> <ENT>.74967</ENT> <ENT>.74587</ENT> <ENT>.74209</ENT> <ENT>.73835</ENT> <ENT>.73463</ENT> <ENT>.73093</ENT> <ENT>.72727</ENT> <ENT>.72363</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.76501</ENT> <ENT>.76123</ENT> <ENT>.75748</ENT> <ENT>.75376</ENT> <ENT>.75007</ENT> <ENT>.74640</ENT> <ENT>.74276</ENT> <ENT>.73914</ENT> <ENT>.73555</ENT> <ENT>.73198</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.77208</ENT> <ENT>.76838</ENT> <ENT>.76471</ENT> <ENT>.76107</ENT> <ENT>.75745</ENT> <ENT>.75385</ENT> <ENT>.75028</ENT> <ENT>.74673</ENT> <ENT>.74321</ENT> <ENT>.73971</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.77879</ENT> <ENT>.77517</ENT> <ENT>.77157</ENT> <ENT>.76800</ENT> <ENT>.76444</ENT> <ENT>.76092</ENT> <ENT>.75741</ENT> <ENT>.75392</ENT> <ENT>.75046</ENT> <ENT>.74702</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.78579</ENT> <ENT>.78224</ENT> <ENT>.77871</ENT> <ENT>.77521</ENT> <ENT>.77173</ENT> <ENT>.76827</ENT> <ENT>.76483</ENT> <ENT>.76141</ENT> <ENT>.75801</ENT> <ENT>.75463</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.79318</ENT> <ENT>.78971</ENT> <ENT>.78626</ENT> <ENT>.78283</ENT> <ENT>.77942</ENT> <ENT>.77604</ENT> <ENT>.77266</ENT> <ENT>.76931</ENT> <ENT>.76598</ENT> <ENT>.76267</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.80139</ENT> <ENT>.79801</ENT> <ENT>.79464</ENT> <ENT>.79129</ENT> <ENT>.78796</ENT> <ENT>.78465</ENT> <ENT>.78136</ENT> <ENT>.77808</ENT> <ENT>.77482</ENT> <ENT>.77157</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.81161</ENT> <ENT>.80834</ENT> <ENT>.80508</ENT> <ENT>.80184</ENT> <ENT>.79861</ENT> <ENT>.79540</ENT> <ENT>.79220</ENT> <ENT>.78902</ENT> <ENT>.78585</ENT> <ENT>.78270</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.82665</ENT> <ENT>.82357</ENT> <ENT>.82049</ENT> <ENT>.81743</ENT> <ENT>.81438</ENT> <ENT>.81134</ENT> <ENT>.80831</ENT> <ENT>.80530</ENT> <ENT>.80229</ENT> <ENT>.79930</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.84893</ENT> <ENT>.84616</ENT> <ENT>.84340</ENT> <ENT>.84064</ENT> <ENT>.83789</ENT> <ENT>.83515</ENT> <ENT>.83241</ENT> <ENT>.82969</ENT> <ENT>.82696</ENT> <ENT>.82425</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.88637</ENT> <ENT>.88421</ENT> <ENT>.88205</ENT> <ENT>.87989</ENT> <ENT>.87774</ENT> <ENT>.87559</ENT> <ENT>.87344</ENT> <ENT>.87129</ENT> <ENT>.86915</ENT> <ENT>.86701</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.94900</ENT> <ENT>.94800</ENT> <ENT>.94700</ENT> <ENT>.94600</ENT> <ENT>.94500</ENT> <ENT>.94400</ENT> <ENT>.94300</ENT> <ENT>.94200</ENT> <ENT>.94100</ENT> <ENT>.94000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s14,7,7,7,7,7,7,7,7,7,7"> <TTITLE>Table U(1)—Based on Life Table 80CNSMT Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable after April 30, 1989]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Adjusted payout rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01581</ENT> <ENT>.01569</ENT> <ENT>.01557</ENT> <ENT>.01546</ENT> <ENT>.01536</ENT> <ENT>.01526</ENT> <ENT>.01516</ENT> <ENT>.01507</ENT> <ENT>.01499</ENT> <ENT>.01490</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00459</ENT> <ENT>.00448</ENT> <ENT>.00437</ENT> <ENT>.00426</ENT> <ENT>.00417</ENT> <ENT>.00407</ENT> <ENT>.00399</ENT> <ENT>.00390</ENT> <ENT>.00382</ENT> <ENT>.00375</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00424</ENT> <ENT>.00412</ENT> <ENT>.00400</ENT> <ENT>.00389</ENT> <ENT>.00379</ENT> <ENT>.00369</ENT> <ENT>.00360</ENT> <ENT>.00352</ENT> <ENT>.00343</ENT> <ENT>.00335</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00414</ENT> <ENT>.00401</ENT> <ENT>.00389</ENT> <ENT>.00377</ENT> <ENT>.00366</ENT> <ENT>.00356</ENT> <ENT>.00346</ENT> <ENT>.00337</ENT> <ENT>.00328</ENT> <ENT>.00320</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00418</ENT> <ENT>.00404</ENT> <ENT>.00391</ENT> <ENT>.00379</ENT> <ENT>.00368</ENT> <ENT>.00357</ENT> <ENT>.00347</ENT> <ENT>.00337</ENT> <ENT>.00327</ENT> <ENT>.00319</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00433</ENT> <ENT>.00418</ENT> <ENT>.00405</ENT> <ENT>.00391</ENT> <ENT>.00379</ENT> <ENT>.00368</ENT> <ENT>.00357</ENT> <ENT>.00346</ENT> <ENT>.00336</ENT> <ENT>.00327</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00454</ENT> <ENT>.00439</ENT> <ENT>.00424</ENT> <ENT>.00410</ENT> <ENT>.00397</ENT> <ENT>.00384</ENT> <ENT>.00372</ENT> <ENT>.00361</ENT> <ENT>.00351</ENT> <ENT>.00341</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00482</ENT> <ENT>.00465</ENT> <ENT>.00449</ENT> <ENT>.00434</ENT> <ENT>.00420</ENT> <ENT>.00407</ENT> <ENT>.00394</ENT> <ENT>.00382</ENT> <ENT>.00371</ENT> <ENT>.00360</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00516</ENT> <ENT>.00498</ENT> <ENT>.00481</ENT> <ENT>.00465</ENT> <ENT>.00450</ENT> <ENT>.00436</ENT> <ENT>.00422</ENT> <ENT>.00410</ENT> <ENT>.00397</ENT> <ENT>.00386</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00560</ENT> <ENT>.00541</ENT> <ENT>.00523</ENT> <ENT>.00505</ENT> <ENT>.00489</ENT> <ENT>.00474</ENT> <ENT>.00459</ENT> <ENT>.00446</ENT> <ENT>.00433</ENT> <ENT>.00420</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00613</ENT> <ENT>.00592</ENT> <ENT>.00573</ENT> <ENT>.00555</ENT> <ENT>.00537</ENT> <ENT>.00521</ENT> <ENT>.00505</ENT> <ENT>.00491</ENT> <ENT>.00477</ENT> <ENT>.00463</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00677</ENT> <ENT>.00655</ENT> <ENT>.00635</ENT> <ENT>.00615</ENT> <ENT>.00597</ENT> <ENT>.00580</ENT> <ENT>.00563</ENT> <ENT>.00547</ENT> <ENT>.00532</ENT> <ENT>.00518</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.00751</ENT> <ENT>.00728</ENT> <ENT>.00706</ENT> <ENT>.00685</ENT> <ENT>.00666</ENT> <ENT>.00647</ENT> <ENT>.00629</ENT> <ENT>.00613</ENT> <ENT>.00597</ENT> <ENT>.00581</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.00829</ENT> <ENT>.00805</ENT> <ENT>.00782</ENT> <ENT>.00760</ENT> <ENT>.00739</ENT> <ENT>.00719</ENT> <ENT>.00701</ENT> <ENT>.00683</ENT> <ENT>.00666</ENT> <ENT>.00650</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.00905</ENT> <ENT>.00879</ENT> <ENT>.00854</ENT> <ENT>.00831</ENT> <ENT>.00809</ENT> <ENT>.00789</ENT> <ENT>.00769</ENT> <ENT>.00750</ENT> <ENT>.00732</ENT> <ENT>.00715</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.00974</ENT> <ENT>.00947</ENT> <ENT>.00921</ENT> <ENT>.00897</ENT> <ENT>.00874</ENT> <ENT>.00852</ENT> <ENT>.00831</ENT> <ENT>.00811</ENT> <ENT>.00793</ENT> <ENT>.00775</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01037</ENT> <ENT>.01009</ENT> <ENT>.00982</ENT> <ENT>.00956</ENT> <ENT>.00932</ENT> <ENT>.00909</ENT> <ENT>.00887</ENT> <ENT>.00866</ENT> <ENT>.00846</ENT> <ENT>.00827</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01093</ENT> <ENT>.01063</ENT> <ENT>.01034</ENT> <ENT>.01007</ENT> <ENT>.00982</ENT> <ENT>.00958</ENT> <ENT>.00935</ENT> <ENT>.00913</ENT> <ENT>.00892</ENT> <ENT>.00873</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01143</ENT> <ENT>.01112</ENT> <ENT>.01082</ENT> <ENT>.01053</ENT> <ENT>.01027</ENT> <ENT>.01001</ENT> <ENT>.00977</ENT> <ENT>.00954</ENT> <ENT>.00933</ENT> <ENT>.00912</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01192</ENT> <ENT>.01159</ENT> <ENT>.01127</ENT> <ENT>.01097</ENT> <ENT>.01069</ENT> <ENT>.01043</ENT> <ENT>.01017</ENT> <ENT>.00993</ENT> <ENT>.00970</ENT> <ENT>.00949</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01239</ENT> <ENT>.01204</ENT> <ENT>.01170</ENT> <ENT>.01139</ENT> <ENT>.01109</ENT> <ENT>.01081</ENT> <ENT>.01055</ENT> <ENT>.01029</ENT> <ENT>.01005</ENT> <ENT>.00983</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01283</ENT> <ENT>.01246</ENT> <ENT>.01211</ENT> <ENT>.01178</ENT> <ENT>.01147</ENT> <ENT>.01117</ENT> <ENT>.01089</ENT> <ENT>.01063</ENT> <ENT>.01037</ENT> <ENT>.01013</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01328</ENT> <ENT>.01288</ENT> <ENT>.01251</ENT> <ENT>.01216</ENT> <ENT>.01183</ENT> <ENT>.01152</ENT> <ENT>.01122</ENT> <ENT>.01094</ENT> <ENT>.01067</ENT> <ENT>.01042</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01372</ENT> <ENT>.01331</ENT> <ENT>.01292</ENT> <ENT>.01254</ENT> <ENT>.01219</ENT> <ENT>.01186</ENT> <ENT>.01155</ENT> <ENT>.01125</ENT> <ENT>.01097</ENT> <ENT>.01070</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01422</ENT> <ENT>.01378</ENT> <ENT>.01336</ENT> <ENT>.01297</ENT> <ENT>.01260</ENT> <ENT>.01225</ENT> <ENT>.01191</ENT> <ENT>.01160</ENT> <ENT>.01130</ENT> <ENT>.01101</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.01479</ENT> <ENT>.01432</ENT> <ENT>.01388</ENT> <ENT>.01346</ENT> <ENT>.01306</ENT> <ENT>.01269</ENT> <ENT>.01233</ENT> <ENT>.01200</ENT> <ENT>.01168</ENT> <ENT>.01138</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.01545</ENT> <ENT>.01495</ENT> <ENT>.01448</ENT> <ENT>.01404</ENT> <ENT>.01362</ENT> <ENT>.01322</ENT> <ENT>.01284</ENT> <ENT>.01248</ENT> <ENT>.01214</ENT> <ENT>.01182</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.01623</ENT> <ENT>.01570</ENT> <ENT>.01520</ENT> <ENT>.01472</ENT> <ENT>.01427</ENT> <ENT>.01385</ENT> <ENT>.01344</ENT> <ENT>.01306</ENT> <ENT>.01270</ENT> <ENT>.01235</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.01712</ENT> <ENT>.01655</ENT> <ENT>.01601</ENT> <ENT>.01551</ENT> <ENT>.01503</ENT> <ENT>.01457</ENT> <ENT>.01414</ENT> <ENT>.01373</ENT> <ENT>.01334</ENT> <ENT>.01298</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.01813</ENT> <ENT>.01752</ENT> <ENT>.01695</ENT> <ENT>.01641</ENT> <ENT>.01589</ENT> <ENT>.01541</ENT> <ENT>.01494</ENT> <ENT>.01451</ENT> <ENT>.01409</ENT> <ENT>.01370</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.01927</ENT> <ENT>.01862</ENT> <ENT>.01801</ENT> <ENT>.01743</ENT> <ENT>.01688</ENT> <ENT>.01635</ENT> <ENT>.01586</ENT> <ENT>.01539</ENT> <ENT>.01495</ENT> <ENT>.01452</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02056</ENT> <ENT>.01987</ENT> <ENT>.01922</ENT> <ENT>.01859</ENT> <ENT>.01801</ENT> <ENT>.01745</ENT> <ENT>.01692</ENT> <ENT>.01642</ENT> <ENT>.01594</ENT> <ENT>.01548</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.02201</ENT> <ENT>.02127</ENT> <ENT>.02057</ENT> <ENT>.01990</ENT> <ENT>.01927</ENT> <ENT>.01868</ENT> <ENT>.01811</ENT> <ENT>.01757</ENT> <ENT>.01706</ENT> <ENT>.01657</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.02363</ENT> <ENT>.02284</ENT> <ENT>.02209</ENT> <ENT>.02138</ENT> <ENT>.02071</ENT> <ENT>.02007</ENT> <ENT>.01946</ENT> <ENT>.01888</ENT> <ENT>.01833</ENT> <ENT>.01781</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.02543</ENT> <ENT>.02458</ENT> <ENT>.02378</ENT> <ENT>.02302</ENT> <ENT>.02230</ENT> <ENT>.02162</ENT> <ENT>.02096</ENT> <ENT>.02034</ENT> <ENT>.01975</ENT> <ENT>.01919</ENT> </ROW> <ROW> <PRTPAGE P="277"/> <ENT I="01">35</ENT> <ENT>.02741</ENT> <ENT>.02651</ENT> <ENT>.02565</ENT> <ENT>.02484</ENT> <ENT>.02407</ENT> <ENT>.02333</ENT> <ENT>.02264</ENT> <ENT>.02197</ENT> <ENT>.02134</ENT> <ENT>.02073</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.02956</ENT> <ENT>.02859</ENT> <ENT>.02768</ENT> <ENT>.02681</ENT> <ENT>.02599</ENT> <ENT>.02520</ENT> <ENT>.02446</ENT> <ENT>.02374</ENT> <ENT>.02307</ENT> <ENT>.02242</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.03189</ENT> <ENT>.03087</ENT> <ENT>.02990</ENT> <ENT>.02897</ENT> <ENT>.02809</ENT> <ENT>.02725</ENT> <ENT>.02645</ENT> <ENT>.02569</ENT> <ENT>.02496</ENT> <ENT>.02427</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.03443</ENT> <ENT>.03334</ENT> <ENT>.03230</ENT> <ENT>.03131</ENT> <ENT>.03037</ENT> <ENT>.02948</ENT> <ENT>.02862</ENT> <ENT>.02781</ENT> <ENT>.02703</ENT> <ENT>.02628</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.03718</ENT> <ENT>.03602</ENT> <ENT>.03491</ENT> <ENT>.03386</ENT> <ENT>.03285</ENT> <ENT>.03190</ENT> <ENT>.03099</ENT> <ENT>.03011</ENT> <ENT>.02928</ENT> <ENT>.02849</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.04015</ENT> <ENT>.03891</ENT> <ENT>.03774</ENT> <ENT>.03662</ENT> <ENT>.03555</ENT> <ENT>.03453</ENT> <ENT>.03355</ENT> <ENT>.03262</ENT> <ENT>.03173</ENT> <ENT>.03088</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.04335</ENT> <ENT>.04204</ENT> <ENT>.04079</ENT> <ENT>.03959</ENT> <ENT>.03846</ENT> <ENT>.03737</ENT> <ENT>.03633</ENT> <ENT>.03534</ENT> <ENT>.03439</ENT> <ENT>.03348</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.04677</ENT> <ENT>.04538</ENT> <ENT>.04405</ENT> <ENT>.04278</ENT> <ENT>.04157</ENT> <ENT>.04042</ENT> <ENT>.03931</ENT> <ENT>.03825</ENT> <ENT>.03724</ENT> <ENT>.03627</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.05042</ENT> <ENT>.04894</ENT> <ENT>.04754</ENT> <ENT>.04619</ENT> <ENT>.04491</ENT> <ENT>.04368</ENT> <ENT>.04250</ENT> <ENT>.04138</ENT> <ENT>.04030</ENT> <ENT>.03926</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.05432</ENT> <ENT>.05276</ENT> <ENT>.05127</ENT> <ENT>.04984</ENT> <ENT>.04848</ENT> <ENT>.04718</ENT> <ENT>.04593</ENT> <ENT>.04473</ENT> <ENT>.04358</ENT> <ENT>.04248</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.05849</ENT> <ENT>.05684</ENT> <ENT>.05526</ENT> <ENT>.05375</ENT> <ENT>.05231</ENT> <ENT>.05092</ENT> <ENT>.04960</ENT> <ENT>.04832</ENT> <ENT>.04710</ENT> <ENT>.04593</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.06292</ENT> <ENT>.06118</ENT> <ENT>.05952</ENT> <ENT>.05792</ENT> <ENT>.05639</ENT> <ENT>.05492</ENT> <ENT>.05352</ENT> <ENT>.05217</ENT> <ENT>.05087</ENT> <ENT>.04963</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.06765</ENT> <ENT>.06581</ENT> <ENT>.06405</ENT> <ENT>.06237</ENT> <ENT>.06075</ENT> <ENT>.05920</ENT> <ENT>.05771</ENT> <ENT>.05628</ENT> <ENT>.05491</ENT> <ENT>.05359</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.07265</ENT> <ENT>.07071</ENT> <ENT>.06886</ENT> <ENT>.06708</ENT> <ENT>.06537</ENT> <ENT>.06373</ENT> <ENT>.06216</ENT> <ENT>.06064</ENT> <ENT>.05919</ENT> <ENT>.05779</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.07791</ENT> <ENT>.07587</ENT> <ENT>.07392</ENT> <ENT>.07204</ENT> <ENT>.07024</ENT> <ENT>.06851</ENT> <ENT>.06685</ENT> <ENT>.06525</ENT> <ENT>.06371</ENT> <ENT>.06223</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.08343</ENT> <ENT>.08129</ENT> <ENT>.07923</ENT> <ENT>.07726</ENT> <ENT>.07536</ENT> <ENT>.07354</ENT> <ENT>.07178</ENT> <ENT>.07009</ENT> <ENT>.06847</ENT> <ENT>.06690</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.08924</ENT> <ENT>.08699</ENT> <ENT>.08483</ENT> <ENT>.08276</ENT> <ENT>.08076</ENT> <ENT>.07884</ENT> <ENT>.07699</ENT> <ENT>.07520</ENT> <ENT>.07349</ENT> <ENT>.07183</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.09539</ENT> <ENT>.09303</ENT> <ENT>.09076</ENT> <ENT>.08858</ENT> <ENT>.08648</ENT> <ENT>.08446</ENT> <ENT>.08251</ENT> <ENT>.08064</ENT> <ENT>.07883</ENT> <ENT>.07708</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.10189</ENT> <ENT>.09942</ENT> <ENT>.09704</ENT> <ENT>.09475</ENT> <ENT>.09255</ENT> <ENT>.09043</ENT> <ENT>.08838</ENT> <ENT>.08640</ENT> <ENT>.08450</ENT> <ENT>.08266</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.10872</ENT> <ENT>.10614</ENT> <ENT>.10365</ENT> <ENT>.10126</ENT> <ENT>.09894</ENT> <ENT>.09672</ENT> <ENT>.09456</ENT> <ENT>.09249</ENT> <ENT>.09049</ENT> <ENT>.08855</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.11592</ENT> <ENT>.11322</ENT> <ENT>.11062</ENT> <ENT>.10811</ENT> <ENT>.10569</ENT> <ENT>.10335</ENT> <ENT>.10110</ENT> <ENT>.09892</ENT> <ENT>.09682</ENT> <ENT>.09478</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.12350</ENT> <ENT>.12068</ENT> <ENT>.11796</ENT> <ENT>.11534</ENT> <ENT>.11281</ENT> <ENT>.11036</ENT> <ENT>.10800</ENT> <ENT>.10571</ENT> <ENT>.10350</ENT> <ENT>.10137</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.13148</ENT> <ENT>.12855</ENT> <ENT>.12572</ENT> <ENT>.12298</ENT> <ENT>.12033</ENT> <ENT>.11777</ENT> <ENT>.11530</ENT> <ENT>.11291</ENT> <ENT>.11060</ENT> <ENT>.10836</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.13990</ENT> <ENT>.13685</ENT> <ENT>.13389</ENT> <ENT>.13104</ENT> <ENT>.12828</ENT> <ENT>.12561</ENT> <ENT>.12303</ENT> <ENT>.12053</ENT> <ENT>.11811</ENT> <ENT>.11576</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.14875</ENT> <ENT>.14557</ENT> <ENT>.14250</ENT> <ENT>.13953</ENT> <ENT>.13665</ENT> <ENT>.13387</ENT> <ENT>.13118</ENT> <ENT>.12856</ENT> <ENT>.12604</ENT> <ENT>.12359</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.15799</ENT> <ENT>.15469</ENT> <ENT>.15150</ENT> <ENT>.14841</ENT> <ENT>.14542</ENT> <ENT>.14253</ENT> <ENT>.13972</ENT> <ENT>.13700</ENT> <ENT>.13436</ENT> <ENT>.13180</ENT> </ROW> <ROW> <ENT I="01">61</ENT> <ENT>.16761</ENT> <ENT>.16419</ENT> <ENT>.16088</ENT> <ENT>.15768</ENT> <ENT>.15457</ENT> <ENT>.15156</ENT> <ENT>.14864</ENT> <ENT>.14580</ENT> <ENT>.14305</ENT> <ENT>.14039</ENT> </ROW> <ROW> <ENT I="01">62</ENT> <ENT>.17758</ENT> <ENT>.17404</ENT> <ENT>.17062</ENT> <ENT>.16729</ENT> <ENT>.16407</ENT> <ENT>.16094</ENT> <ENT>.15791</ENT> <ENT>.15496</ENT> <ENT>.15210</ENT> <ENT>.14932</ENT> </ROW> <ROW> <ENT I="01">63</ENT> <ENT>.18791</ENT> <ENT>.18425</ENT> <ENT>.18071</ENT> <ENT>.17726</ENT> <ENT>.17392</ENT> <ENT>.17068</ENT> <ENT>.16753</ENT> <ENT>.16447</ENT> <ENT>.16150</ENT> <ENT>.15861</ENT> </ROW> <ROW> <ENT I="01">64</ENT> <ENT>.19862</ENT> <ENT>.19484</ENT> <ENT>.19118</ENT> <ENT>.18762</ENT> <ENT>.18417</ENT> <ENT>.18081</ENT> <ENT>.17754</ENT> <ENT>.17437</ENT> <ENT>.17129</ENT> <ENT>.16829</ENT> </ROW> <ROW> <ENT I="01">65</ENT> <ENT>.20979</ENT> <ENT>.20590</ENT> <ENT>.20212</ENT> <ENT>.19845</ENT> <ENT>.19487</ENT> <ENT>.19140</ENT> <ENT>.18802</ENT> <ENT>.18474</ENT> <ENT>.18154</ENT> <ENT>.17843</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.22149</ENT> <ENT>.21748</ENT> <ENT>.21359</ENT> <ENT>.20980</ENT> <ENT>.20612</ENT> <ENT>.20253</ENT> <ENT>.19904</ENT> <ENT>.19564</ENT> <ENT>.19233</ENT> <ENT>.18911</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.23374</ENT> <ENT>.22962</ENT> <ENT>.22562</ENT> <ENT>.22172</ENT> <ENT>.21792</ENT> <ENT>.21423</ENT> <ENT>.21062</ENT> <ENT>.20712</ENT> <ENT>.20370</ENT> <ENT>.20037</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.24656</ENT> <ENT>.24234</ENT> <ENT>.23822</ENT> <ENT>.23422</ENT> <ENT>.23031</ENT> <ENT>.22651</ENT> <ENT>.22280</ENT> <ENT>.21919</ENT> <ENT>.21566</ENT> <ENT>.21222</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.25988</ENT> <ENT>.25556</ENT> <ENT>.25134</ENT> <ENT>.24724</ENT> <ENT>.24323</ENT> <ENT>.23932</ENT> <ENT>.23551</ENT> <ENT>.23179</ENT> <ENT>.22816</ENT> <ENT>.22461</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.27367</ENT> <ENT>.26925</ENT> <ENT>.26493</ENT> <ENT>.26073</ENT> <ENT>.25662</ENT> <ENT>.25261</ENT> <ENT>.24870</ENT> <ENT>.24488</ENT> <ENT>.24115</ENT> <ENT>.23750</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.28784</ENT> <ENT>.28333</ENT> <ENT>.27892</ENT> <ENT>.27462</ENT> <ENT>.27042</ENT> <ENT>.26631</ENT> <ENT>.26230</ENT> <ENT>.25839</ENT> <ENT>.25456</ENT> <ENT>.25082</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.30241</ENT> <ENT>.29781</ENT> <ENT>.29332</ENT> <ENT>.28893</ENT> <ENT>.28464</ENT> <ENT>.28044</ENT> <ENT>.27634</ENT> <ENT>.27233</ENT> <ENT>.26841</ENT> <ENT>.26457</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.31740</ENT> <ENT>.31272</ENT> <ENT>.30815</ENT> <ENT>.30368</ENT> <ENT>.29930</ENT> <ENT>.29502</ENT> <ENT>.29084</ENT> <ENT>.28674</ENT> <ENT>.28273</ENT> <ENT>.27880</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.33291</ENT> <ENT>.32817</ENT> <ENT>.32352</ENT> <ENT>.31897</ENT> <ENT>.31452</ENT> <ENT>.31016</ENT> <ENT>.30589</ENT> <ENT>.30171</ENT> <ENT>.29762</ENT> <ENT>.29361</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.34903</ENT> <ENT>.34422</ENT> <ENT>.33951</ENT> <ENT>.33490</ENT> <ENT>.33038</ENT> <ENT>.32595</ENT> <ENT>.32161</ENT> <ENT>.31735</ENT> <ENT>.31318</ENT> <ENT>.30909</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.36581</ENT> <ENT>.36095</ENT> <ENT>.35619</ENT> <ENT>.35152</ENT> <ENT>.34694</ENT> <ENT>.34245</ENT> <ENT>.33805</ENT> <ENT>.33373</ENT> <ENT>.32949</ENT> <ENT>.32533</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.38324</ENT> <ENT>.37835</ENT> <ENT>.37354</ENT> <ENT>.36883</ENT> <ENT>.36420</ENT> <ENT>.35966</ENT> <ENT>.35520</ENT> <ENT>.35083</ENT> <ENT>.34654</ENT> <ENT>.34232</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.40126</ENT> <ENT>.39634</ENT> <ENT>.39150</ENT> <ENT>.38676</ENT> <ENT>.38210</ENT> <ENT>.37752</ENT> <ENT>.37302</ENT> <ENT>.36861</ENT> <ENT>.36427</ENT> <ENT>.36001</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.41970</ENT> <ENT>.41476</ENT> <ENT>.40992</ENT> <ENT>.40515</ENT> <ENT>.40047</ENT> <ENT>.39587</ENT> <ENT>.39135</ENT> <ENT>.38690</ENT> <ENT>.38253</ENT> <ENT>.37823</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.43842</ENT> <ENT>.43348</ENT> <ENT>.42864</ENT> <ENT>.42387</ENT> <ENT>.41918</ENT> <ENT>.41456</ENT> <ENT>.41002</ENT> <ENT>.40556</ENT> <ENT>.40117</ENT> <ENT>.39685</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.45719</ENT> <ENT>.45228</ENT> <ENT>.44744</ENT> <ENT>.44267</ENT> <ENT>.43799</ENT> <ENT>.43337</ENT> <ENT>.42883</ENT> <ENT>.42436</ENT> <ENT>.41996</ENT> <ENT>.41562</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.47590</ENT> <ENT>.47101</ENT> <ENT>.46619</ENT> <ENT>.46145</ENT> <ENT>.45677</ENT> <ENT>.45217</ENT> <ENT>.44764</ENT> <ENT>.44317</ENT> <ENT>.43877</ENT> <ENT>.43443</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.49443</ENT> <ENT>.48957</ENT> <ENT>.48478</ENT> <ENT>.48007</ENT> <ENT>.47542</ENT> <ENT>.47084</ENT> <ENT>.46632</ENT> <ENT>.46187</ENT> <ENT>.45748</ENT> <ENT>.45315</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.51279</ENT> <ENT>.50798</ENT> <ENT>.50324</ENT> <ENT>.49856</ENT> <ENT>.49394</ENT> <ENT>.48939</ENT> <ENT>.48490</ENT> <ENT>.48048</ENT> <ENT>.47611</ENT> <ENT>.47180</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.53106</ENT> <ENT>.52630</ENT> <ENT>.52161</ENT> <ENT>.51698</ENT> <ENT>.51241</ENT> <ENT>.50790</ENT> <ENT>.50345</ENT> <ENT>.49906</ENT> <ENT>.49473</ENT> <ENT>.49045</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.54902</ENT> <ENT>.54434</ENT> <ENT>.53971</ENT> <ENT>.53514</ENT> <ENT>.53062</ENT> <ENT>.52616</ENT> <ENT>.52176</ENT> <ENT>.51741</ENT> <ENT>.51312</ENT> <ENT>.50888</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.56640</ENT> <ENT>.56178</ENT> <ENT>.55722</ENT> <ENT>.55271</ENT> <ENT>.54826</ENT> <ENT>.54386</ENT> <ENT>.53951</ENT> <ENT>.53521</ENT> <ENT>.53097</ENT> <ENT>.52677</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.58326</ENT> <ENT>.57872</ENT> <ENT>.57423</ENT> <ENT>.56979</ENT> <ENT>.56541</ENT> <ENT>.56107</ENT> <ENT>.55678</ENT> <ENT>.55254</ENT> <ENT>.54834</ENT> <ENT>.54420</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.59994</ENT> <ENT>.59548</ENT> <ENT>.59107</ENT> <ENT>.58671</ENT> <ENT>.58240</ENT> <ENT>.57813</ENT> <ENT>.57391</ENT> <ENT>.56973</ENT> <ENT>.56560</ENT> <ENT>.56152</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.61662</ENT> <ENT>.61226</ENT> <ENT>.60794</ENT> <ENT>.60367</ENT> <ENT>.59944</ENT> <ENT>.59526</ENT> <ENT>.59112</ENT> <ENT>.58702</ENT> <ENT>.58296</ENT> <ENT>.57894</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.63305</ENT> <ENT>.62879</ENT> <ENT>.62457</ENT> <ENT>.62040</ENT> <ENT>.61627</ENT> <ENT>.61217</ENT> <ENT>.60812</ENT> <ENT>.60411</ENT> <ENT>.60013</ENT> <ENT>.59619</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.64876</ENT> <ENT>.64461</ENT> <ENT>.64050</ENT> <ENT>.63643</ENT> <ENT>.63239</ENT> <ENT>.62839</ENT> <ENT>.62443</ENT> <ENT>.62051</ENT> <ENT>.61662</ENT> <ENT>.61277</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.66355</ENT> <ENT>.65950</ENT> <ENT>.65550</ENT> <ENT>.65153</ENT> <ENT>.64759</ENT> <ENT>.64369</ENT> <ENT>.63983</ENT> <ENT>.63600</ENT> <ENT>.63220</ENT> <ENT>.62843</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.67722</ENT> <ENT>.67328</ENT> <ENT>.66938</ENT> <ENT>.66551</ENT> <ENT>.66167</ENT> <ENT>.65786</ENT> <ENT>.65409</ENT> <ENT>.65035</ENT> <ENT>.64664</ENT> <ENT>.64296</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.68967</ENT> <ENT>.68583</ENT> <ENT>.68203</ENT> <ENT>.67825</ENT> <ENT>.67451</ENT> <ENT>.67079</ENT> <ENT>.66711</ENT> <ENT>.66345</ENT> <ENT>.65983</ENT> <ENT>.65623</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.70076</ENT> <ENT>.69701</ENT> <ENT>.69330</ENT> <ENT>.68961</ENT> <ENT>.68595</ENT> <ENT>.68231</ENT> <ENT>.67871</ENT> <ENT>.67513</ENT> <ENT>.67158</ENT> <ENT>.66806</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.71089</ENT> <ENT>.70722</ENT> <ENT>.70359</ENT> <ENT>.69998</ENT> <ENT>.69640</ENT> <ENT>.69284</ENT> <ENT>.68931</ENT> <ENT>.68581</ENT> <ENT>.68234</ENT> <ENT>.67888</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.72001</ENT> <ENT>.71642</ENT> <ENT>.71286</ENT> <ENT>.70933</ENT> <ENT>.70582</ENT> <ENT>.70233</ENT> <ENT>.69887</ENT> <ENT>.69544</ENT> <ENT>.69203</ENT> <ENT>.68864</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.72844</ENT> <ENT>.72492</ENT> <ENT>.72143</ENT> <ENT>.71796</ENT> <ENT>.71452</ENT> <ENT>.71110</ENT> <ENT>.70770</ENT> <ENT>.70433</ENT> <ENT>.70098</ENT> <ENT>.69765</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.73623</ENT> <ENT>.73278</ENT> <ENT>.72935</ENT> <ENT>.72594</ENT> <ENT>.72256</ENT> <ENT>.71920</ENT> <ENT>.71586</ENT> <ENT>.71254</ENT> <ENT>.70924</ENT> <ENT>.70597</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.74361</ENT> <ENT>.74021</ENT> <ENT>.73684</ENT> <ENT>.73349</ENT> <ENT>.73016</ENT> <ENT>.72685</ENT> <ENT>.72356</ENT> <ENT>.72029</ENT> <ENT>.71704</ENT> <ENT>.71382</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.75128</ENT> <ENT>.74794</ENT> <ENT>.74463</ENT> <ENT>.74133</ENT> <ENT>.73806</ENT> <ENT>.73480</ENT> <ENT>.73157</ENT> <ENT>.72835</ENT> <ENT>.72515</ENT> <ENT>.72198</ENT> </ROW> <ROW> <PRTPAGE P="278"/> <ENT I="01">103</ENT> <ENT>.75938</ENT> <ENT>.75610</ENT> <ENT>.75284</ENT> <ENT>.74961</ENT> <ENT>.74639</ENT> <ENT>.74319</ENT> <ENT>.74000</ENT> <ENT>.73684</ENT> <ENT>.73369</ENT> <ENT>.73056</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.76835</ENT> <ENT>.76514</ENT> <ENT>.76194</ENT> <ENT>.75877</ENT> <ENT>.75561</ENT> <ENT>.75246</ENT> <ENT>.74934</ENT> <ENT>.74623</ENT> <ENT>.74313</ENT> <ENT>.74005</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.77956</ENT> <ENT>.77643</ENT> <ENT>.77332</ENT> <ENT>.77023</ENT> <ENT>.76714</ENT> <ENT>.76408</ENT> <ENT>.76102</ENT> <ENT>.75798</ENT> <ENT>.75496</ENT> <ENT>.75195</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.79632</ENT> <ENT>.79334</ENT> <ENT>.79038</ENT> <ENT>.78743</ENT> <ENT>.78449</ENT> <ENT>.78157</ENT> <ENT>.77865</ENT> <ENT>.77575</ENT> <ENT>.77285</ENT> <ENT>.76997</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.82154</ENT> <ENT>.81884</ENT> <ENT>.81615</ENT> <ENT>.81346</ENT> <ENT>.81079</ENT> <ENT>.80811</ENT> <ENT>.80545</ENT> <ENT>.80279</ENT> <ENT>.80014</ENT> <ENT>.79750</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.86487</ENT> <ENT>.86274</ENT> <ENT>.86061</ENT> <ENT>.85848</ENT> <ENT>.85635</ENT> <ENT>.85423</ENT> <ENT>.85210</ENT> <ENT>.84998</ENT> <ENT>.84787</ENT> <ENT>.84575</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.93900</ENT> <ENT>.93800</ENT> <ENT>.93700</ENT> <ENT>.93600</ENT> <ENT>.93500</ENT> <ENT>.93400</ENT> <ENT>.93300</ENT> <ENT>.93200</ENT> <ENT>.93100</ENT> <ENT>.93000</ENT> </ROW> </GPOTABLE> <P> (f) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is after April 30, 1999, and before May 1, 2009</E> —(1) <E T="03">In general.</E> Except as otherwise provided in paragraph (f)(2) of this section, in the case of transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, the present value of a remainder interest is determined under paragraphs (f)(3) through (f)(6) of this section, provided that the amount of the payout as of any payout date during any taxable year of the trust is not larger than the amount that the trust could distribute on such date under § 1.664-3(a)(1)(v) if the taxable year of the trust were to end on such date. See, however, § 1.7520-3(b) (relating to exceptions to the use of the prescribed tables under certain circumstances). </P> <P> (2) <E T="03">Transitional rules for valuation of charitable remainder unitrusts.</E> (i) For purposes of sections 2055, 2106, or 2624, if on May 1, 1999, the decedent was mentally incompetent so that the disposition of the property could not be changed, and the decedent died after April 30, 1999, without having regained competency to dispose of the decedent's property, or the decedent died within 90 days of the date that the decedent first regained competency after April 30, 1999, the present value of a remainder interest under this section is determined as if the valuation date with respect to the decedent's gross estate is either before May 1, 1999, or after April 30, 1999, at the option of the decedent's executor. </P> <P>(ii) For purposes of sections 170, 2055, 2106, 2522, or 2624, in the case of transfers to a charitable remainder unitrust for which the valuation date is after April 30, 1999, and before July 1, 1999, the present value of a remainder interest based on one or more measuring lives is determined under this section by use of the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial tables under either paragraph (e)(6) or (f)(6) of this section, at the option of the donor or the decedent's executor, as the case may be.</P> <P>(iii) For purposes of paragraphs (f)(2)(i) and (f)(2)(ii) of this section, where the donor or decedent's executor is given the option to use the appropriate actuarial tables under either paragraph (e)(6) or (f)(6) of this section, the donor or decedent's executor must use the same actuarial table with respect to each individual transaction and with respect to all transfers occurring on the valuation date (for example, gift and income tax charitable deductions with respect to the same transfer must be determined based on the same tables, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on the same tables).</P> <P> (3) <E T="03">Adjusted payout rate.</E> For transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, the adjusted payout rate is determined by using the appropriate Table F, contained in § 1.664-4(e)(6), for the section 7520 interest rate applicable to the transfer. If the interest rate is between 4.2 and 14 percent, see § 1.664-4(e)(6). If the interest rate is below 4.2 percent or greater than 14 percent, see § 1.664-4(b). See § 1.664-4(e) for rules applicable in determining the adjusted payout rate. </P> <P> (4) <E T="03">Period is a term of years.</E> If the period described in § 1.664-3(a)(5) is a term <PRTPAGE P="279"/> of years, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, is the factor under the appropriate adjusted payout rate in Table D in § 1.664-4(e)(6) corresponding to the number of years in the term. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in Table D, a linear interpolation must be made. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph. Generally, for purposes of this section, the valuation date is, in the case of an inter vivos transfer, the date on which the property is transferred to the trust by the donor, and, in the case of a testamentary transfer under sections 2055, 2106, or 2624, the valuation date is the date of death. See § 1.664-4(e)(4) for additional rules regarding the valuation date. See § 1.664-4(e)(4) for an example that illustrates the application of this paragraph (f)(4). </P> <P> (5) <E T="03">Period is the life of one individual.</E> If the period described in § 1.664-3(a)(5) is the life of one individual, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, is the factor in Table U(1) in paragraph (f)(6) of this section under the appropriate adjusted payout. For purposes of the computations described in this paragraph (f)(5), the age of an individual is the age of that individual at the individual's nearest birthday. If the adjusted payout rate is an amount that is between adjusted payout rates for which factors are provided in the appropriate table, a linear interpolation must be made. The rules provided in § 1.664-4(e)(5) apply for determining the present value of the remainder interest. See § 1.664-4(e)(5) for an example illustrating the application of this paragraph (f)(5) (using current actuarial tables). </P> <P> (6) <E T="03">Actuarial Table U(1) for transfers for which the valuation date is after April 30, 1999, and before May 1, 2009.</E> For transfers for which the valuation date is after April 30, 1999, and before May 1, 2009, the present value of a charitable remainder unitrust interest that is dependent on the termination of a life interest is determined by using the section 7520 rate, Table U(1) in this paragraph (f)(6), and Tables F(4.2) through F(14.0) in § 1.664-4(e)(6). See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). Many actuarial factors not contained in the following tables are contained in Internal Revenue Service Publication 1458, “Actuarial Values, Book Beth,” (7-1999). Publication 1458 is no longer available for purchase from the Superintendent of Documents, United States Government Printing Office. However, pertinent factors in this publication may be obtained by a written request to: CC:PA:LPD:PR (IRS Publication 1458), Room 5205, Internal Revenue Service, P.O.Box 7604, Ben Franklin Station, Washington, DC 20044. </P> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table U(1)—Based on Life Table 90CM Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">4.2%</CHED> <CHED H="2">4.4%</CHED> <CHED H="2">4.6%</CHED> <CHED H="2">4.8%</CHED> <CHED H="2">5.0%</CHED> <CHED H="2">5.2%</CHED> <CHED H="2">5.4%</CHED> <CHED H="2">5.6%</CHED> <CHED H="2">.8%</CHED> <CHED H="2">6.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.06177</ENT> <ENT>.05580</ENT> <ENT>.05061</ENT> <ENT>.04609</ENT> <ENT>.04215</ENT> <ENT>.03871</ENT> <ENT>.03570</ENT> <ENT>.03307</ENT> <ENT>.03075</ENT> <ENT>.02872</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.05543</ENT> <ENT>.04925</ENT> <ENT>.04388</ENT> <ENT>.03919</ENT> <ENT>.03509</ENT> <ENT>.03151</ENT> <ENT>.02838</ENT> <ENT>.02563</ENT> <ENT>.02321</ENT> <ENT>.02109</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.05716</ENT> <ENT>.05081</ENT> <ENT>.04528</ENT> <ENT>.04045</ENT> <ENT>.03622</ENT> <ENT>.03252</ENT> <ENT>.02927</ENT> <ENT>.02642</ENT> <ENT>.02391</ENT> <ENT>.02170</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.05920</ENT> <ENT>.05268</ENT> <ENT>.04699</ENT> <ENT>.04201</ENT> <ENT>.03765</ENT> <ENT>.03382</ENT> <ENT>.03046</ENT> <ENT>.02750</ENT> <ENT>.02490</ENT> <ENT>.02260</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.06143</ENT> <ENT>.05475</ENT> <ENT>.04889</ENT> <ENT>.04376</ENT> <ENT>.03926</ENT> <ENT>.03530</ENT> <ENT>.03182</ENT> <ENT>.02876</ENT> <ENT>.02605</ENT> <ENT>.02366</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.06384</ENT> <ENT>.05697</ENT> <ENT>.05095</ENT> <ENT>.04567</ENT> <ENT>.04103</ENT> <ENT>.03694</ENT> <ENT>.03334</ENT> <ENT>.03016</ENT> <ENT>.02735</ENT> <ENT>.02487</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.06637</ENT> <ENT>.05933</ENT> <ENT>.05315</ENT> <ENT>.04771</ENT> <ENT>.04292</ENT> <ENT>.03870</ENT> <ENT>.03497</ENT> <ENT>.03168</ENT> <ENT>.02876</ENT> <ENT>.02618</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.06905</ENT> <ENT>.06183</ENT> <ENT>.05547</ENT> <ENT>.04987</ENT> <ENT>.04494</ENT> <ENT>.04058</ENT> <ENT>.03673</ENT> <ENT>.03332</ENT> <ENT>.03029</ENT> <ENT>.02761</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.07186</ENT> <ENT>.06445</ENT> <ENT>.05792</ENT> <ENT>.05216</ENT> <ENT>.04708</ENT> <ENT>.04258</ENT> <ENT>.03859</ENT> <ENT>.03506</ENT> <ENT>.03192</ENT> <ENT>.02914</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.07482</ENT> <ENT>.06722</ENT> <ENT>.06052</ENT> <ENT>.05460</ENT> <ENT>.04936</ENT> <ENT>.04471</ENT> <ENT>.04060</ENT> <ENT>.03694</ENT> <ENT>.03369</ENT> <ENT>.03079</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.07793</ENT> <ENT>.07015</ENT> <ENT>.06327</ENT> <ENT>.05718</ENT> <ENT>.05179</ENT> <ENT>.04700</ENT> <ENT>.04274</ENT> <ENT>.03896</ENT> <ENT>.03559</ENT> <ENT>.03259</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.08120</ENT> <ENT>.07323</ENT> <ENT>.06617</ENT> <ENT>.05991</ENT> <ENT>.05435</ENT> <ENT>.04942</ENT> <ENT>.04502</ENT> <ENT>.04111</ENT> <ENT>.03762</ENT> <ENT>.03450</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.08461</ENT> <ENT>.07645</ENT> <ENT>.06920</ENT> <ENT>.06277</ENT> <ENT>.05706</ENT> <ENT>.05197</ENT> <ENT>.04744</ENT> <ENT>.04339</ENT> <ENT>.03978</ENT> <ENT>.03655</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.08812</ENT> <ENT>.07976</ENT> <ENT>.07234</ENT> <ENT>.06574</ENT> <ENT>.05985</ENT> <ENT>.05461</ENT> <ENT>.04993</ENT> <ENT>.04576</ENT> <ENT>.04202</ENT> <ENT>.03867</ENT> </ROW> <ROW> <PRTPAGE P="280"/> <ENT I="01">14</ENT> <ENT>.09168</ENT> <ENT>.08313</ENT> <ENT>.07552</ENT> <ENT>.06874</ENT> <ENT>.06269</ENT> <ENT>.05729</ENT> <ENT>.05247</ENT> <ENT>.04815</ENT> <ENT>.04428</ENT> <ENT>.04081</ENT> 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<ENT>.85171</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.89836</ENT> <ENT>.89388</ENT> <ENT>.88943</ENT> <ENT>.88501</ENT> <ENT>.88062</ENT> <ENT>.87626</ENT> <ENT>.87193</ENT> <ENT>.86763</ENT> <ENT>.86336</ENT> <ENT>.85911</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.90375</ENT> <ENT>.89948</ENT> <ENT>.89525</ENT> <ENT>.89103</ENT> <ENT>.88685</ENT> <ENT>.88269</ENT> <ENT>.87856</ENT> <ENT>.87445</ENT> <ENT>.87037</ENT> <ENT>.86632</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.90905</ENT> <ENT>.90500</ENT> <ENT>.90097</ENT> <ENT>.89696</ENT> <ENT>.89298</ENT> <ENT>.88902</ENT> <ENT>.88509</ENT> <ENT>.88118</ENT> <ENT>.87729</ENT> <ENT>.87342</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.91424</ENT> <ENT>.91040</ENT> <ENT>.90658</ENT> <ENT>.90278</ENT> <ENT>.89900</ENT> <ENT>.89524</ENT> <ENT>.89150</ENT> <ENT>.88778</ENT> <ENT>.88408</ENT> <ENT>.88040</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.91939</ENT> <ENT>.91575</ENT> <ENT>.91214</ENT> <ENT>.90854</ENT> <ENT>.90496</ENT> <ENT>.90139</ENT> <ENT>.89785</ENT> <ENT>.89432</ENT> <ENT>.89081</ENT> <ENT>.88732</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.92485</ENT> <ENT>.92144</ENT> <ENT>.91805</ENT> <ENT>.91467</ENT> <ENT>.91131</ENT> <ENT>.90796</ENT> <ENT>.90463</ENT> <ENT>.90131</ENT> <ENT>.89800</ENT> <ENT>.89471</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.93020</ENT> <ENT>.92701</ENT> <ENT>.92383</ENT> <ENT>.92067</ENT> <ENT>.91751</ENT> <ENT>.91437</ENT> <ENT>.91125</ENT> <ENT>.90813</ENT> <ENT>.90502</ENT> <ENT>.90193</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.93701</ENT> <ENT>.93411</ENT> <ENT>.93122</ENT> <ENT>.92834</ENT> <ENT>.92546</ENT> <ENT>.92260</ENT> <ENT>.91974</ENT> <ENT>.91689</ENT> <ENT>.91405</ENT> <ENT>.91122</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.94522</ENT> <ENT>.94268</ENT> <ENT>.94013</ENT> <ENT>.93760</ENT> <ENT>.93507</ENT> <ENT>.93254</ENT> <ENT>.93002</ENT> <ENT>.92750</ENT> <ENT>.92499</ENT> <ENT>.92249</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.95782</ENT> <ENT>.95583</ENT> <ENT>.95385</ENT> <ENT>.95187</ENT> <ENT>.94989</ENT> <ENT>.94791</ENT> <ENT>.94593</ENT> <ENT>.94396</ENT> <ENT>.94199</ENT> <ENT>.94002</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.97900</ENT> <ENT>.97800</ENT> <ENT>.97700</ENT> <ENT>.97600</ENT> <ENT>.97500</ENT> <ENT>.97400</ENT> <ENT>.97300</ENT> <ENT>.97200</ENT> <ENT>.97100</ENT> <ENT>.97000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table U(1)—Based on Life Table 90CM Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">6.2%</CHED> <CHED H="2">6.4%</CHED> <CHED H="2">6.6%</CHED> <CHED H="2">6.8%</CHED> <CHED H="2">7.0%</CHED> <CHED H="2">7.2%</CHED> <CHED H="2">7.4%</CHED> <CHED H="2">7.6%</CHED> <CHED H="2">7.8%</CHED> <CHED H="2">8.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.02693</ENT> <ENT>.02534</ENT> <ENT>.02395</ENT> <ENT>.02271</ENT> <ENT>.02161</ENT> <ENT>.02063</ENT> <ENT>.01976</ENT> <ENT>.01898</ENT> <ENT>.01828</ENT> <ENT>.01765</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.01922</ENT> <ENT>.01756</ENT> <ENT>.01610</ENT> <ENT>.01480</ENT> <ENT>.01365</ENT> <ENT>.01263</ENT> <ENT>.01171</ENT> <ENT>.01090</ENT> <ENT>.01017</ENT> <ENT>.00951</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.01975</ENT> <ENT>.01802</ENT> <ENT>.01650</ENT> <ENT>.01514</ENT> <ENT>.01393</ENT> <ENT>.01286</ENT> <ENT>.01190</ENT> <ENT>.01104</ENT> <ENT>.01028</ENT> <ENT>.00959</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.02056</ENT> <ENT>.01876</ENT> <ENT>.01717</ENT> <ENT>.01575</ENT> <ENT>.01449</ENT> <ENT>.01336</ENT> <ENT>.01235</ENT> <ENT>.01145</ENT> <ENT>.01064</ENT> <ENT>.00992</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.02155</ENT> <ENT>.01967</ENT> <ENT>.01800</ENT> <ENT>.01652</ENT> <ENT>.01520</ENT> <ENT>.01401</ENT> <ENT>.01296</ENT> <ENT>.01201</ENT> <ENT>.01116</ENT> <ENT>.01039</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.02266</ENT> <ENT>.02071</ENT> <ENT>.01896</ENT> <ENT>.01741</ENT> <ENT>.01603</ENT> <ENT>.01479</ENT> <ENT>.01368</ENT> <ENT>.01269</ENT> <ENT>.01179</ENT> <ENT>.01098</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.02389</ENT> <ENT>.02184</ENT> <ENT>.02003</ENT> <ENT>.01841</ENT> <ENT>.01696</ENT> <ENT>.01566</ENT> <ENT>.01450</ENT> <ENT>.01345</ENT> <ENT>.01251</ENT> <ENT>.01166</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.02522</ENT> <ENT>.02309</ENT> <ENT>.02120</ENT> <ENT>.01950</ENT> <ENT>.01799</ENT> <ENT>.01663</ENT> <ENT>.01540</ENT> <ENT>.01431</ENT> <ENT>.01332</ENT> <ENT>.01242</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.02665</ENT> <ENT>.02444</ENT> <ENT>.02246</ENT> <ENT>.02069</ENT> <ENT>.01910</ENT> <ENT>.01768</ENT> <ENT>.01640</ENT> <ENT>.01524</ENT> <ENT>.01420</ENT> <ENT>.01326</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.02821</ENT> <ENT>.02590</ENT> <ENT>.02384</ENT> <ENT>.02199</ENT> <ENT>.02033</ENT> <ENT>.01884</ENT> <ENT>.01750</ENT> <ENT>.01629</ENT> <ENT>.01520</ENT> <ENT>.01421</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.02990</ENT> <ENT>.02750</ENT> <ENT>.02535</ENT> <ENT>.02342</ENT> <ENT>.02169</ENT> <ENT>.02013</ENT> <ENT>.01872</ENT> <ENT>.01745</ENT> <ENT>.01631</ENT> <ENT>.01526</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.03172</ENT> <ENT>.02922</ENT> <ENT>.02698</ENT> <ENT>.02497</ENT> <ENT>.02316</ENT> <ENT>.02153</ENT> <ENT>.02006</ENT> <ENT>.01872</ENT> <ENT>.01752</ENT> <ENT>.01643</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.03365</ENT> <ENT>.03106</ENT> <ENT>.02872</ENT> <ENT>.02663</ENT> <ENT>.02474</ENT> <ENT>.02303</ENT> <ENT>.02149</ENT> <ENT>.02010</ENT> <ENT>.01884</ENT> <ENT>.01769</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.03566</ENT> <ENT>.03297</ENT> <ENT>.03054</ENT> <ENT>.02835</ENT> <ENT>.02638</ENT> <ENT>.02460</ENT> <ENT>.02299</ENT> <ENT>.02154</ENT> <ENT>.02021</ENT> <ENT>.01901</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.03770</ENT> <ENT>.03490</ENT> <ENT>.03237</ENT> <ENT>.03010</ENT> <ENT>.02804</ENT> <ENT>.02619</ENT> <ENT>.02450</ENT> <ENT>.02298</ENT> <ENT>.02159</ENT> <ENT>.02033</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.03973</ENT> <ENT>.03682</ENT> <ENT>.03419</ENT> <ENT>.03182</ENT> <ENT>.02968</ENT> <ENT>.02775</ENT> <ENT>.02599</ENT> <ENT>.02439</ENT> <ENT>.02294</ENT> <ENT>.02162</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.04173</ENT> <ENT>.03871</ENT> <ENT>.03598</ENT> <ENT>.03352</ENT> <ENT>.03129</ENT> <ENT>.02926</ENT> <ENT>.02743</ENT> <ENT>.02576</ENT> <ENT>.02424</ENT> <ENT>.02286</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.04372</ENT> <ENT>.04059</ENT> <ENT>.03775</ENT> <ENT>.03519</ENT> <ENT>.03287</ENT> <ENT>.03076</ENT> <ENT>.02884</ENT> <ENT>.02710</ENT> <ENT>.02551</ENT> <ENT>.02406</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.04573</ENT> <ENT>.04248</ENT> <ENT>.03953</ENT> <ENT>.03686</ENT> <ENT>.03444</ENT> <ENT>.03224</ENT> <ENT>.03024</ENT> <ENT>.02842</ENT> <ENT>.02676</ENT> <ENT>.02524</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.04780</ENT> <ENT>.04443</ENT> <ENT>.04137</ENT> <ENT>.03859</ENT> <ENT>.03607</ENT> <ENT>.03378</ENT> <ENT>.03169</ENT> <ENT>.02978</ENT> <ENT>.02804</ENT> <ENT>.02646</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.04997</ENT> <ENT>.04647</ENT> <ENT>.04329</ENT> <ENT>.04040</ENT> <ENT>.03778</ENT> <ENT>.03539</ENT> <ENT>.03321</ENT> <ENT>.03122</ENT> <ENT>.02940</ENT> <ENT>.02773</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.05226</ENT> <ENT>.04862</ENT> <ENT>.04532</ENT> <ENT>.04232</ENT> <ENT>.03958</ENT> <ENT>.03709</ENT> <ENT>.03481</ENT> <ENT>.03274</ENT> <ENT>.03083</ENT> <ENT>.02909</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.05465</ENT> <ENT>.05088</ENT> <ENT>.04745</ENT> <ENT>.04432</ENT> <ENT>.04148</ENT> <ENT>.03888</ENT> <ENT>.03650</ENT> <ENT>.03433</ENT> <ENT>.03234</ENT> <ENT>.03052</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.05716</ENT> <ENT>.05325</ENT> <ENT>.04969</ENT> <ENT>.04645</ENT> <ENT>.04348</ENT> <ENT>.04077</ENT> <ENT>.03830</ENT> <ENT>.03603</ENT> <ENT>.03394</ENT> <ENT>.03203</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.05983</ENT> <ENT>.05578</ENT> <ENT>.05208</ENT> <ENT>.04871</ENT> <ENT>.04562</ENT> <ENT>.04280</ENT> <ENT>.04021</ENT> <ENT>.03784</ENT> <ENT>.03566</ENT> <ENT>.03367</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.06266</ENT> <ENT>.05846</ENT> <ENT>.05463</ENT> <ENT>.05112</ENT> <ENT>.04791</ENT> <ENT>.04497</ENT> <ENT>.04227</ENT> <ENT>.03980</ENT> <ENT>.03752</ENT> <ENT>.03543</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.06566</ENT> <ENT>.06131</ENT> <ENT>.05734</ENT> <ENT>.05369</ENT> <ENT>.05035</ENT> <ENT>.04729</ENT> <ENT>.04448</ENT> <ENT>.04189</ENT> <ENT>.03951</ENT> <ENT>.03732</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.06887</ENT> <ENT>.06436</ENT> <ENT>.06024</ENT> <ENT>.05646</ENT> <ENT>.05298</ENT> <ENT>.04979</ENT> <ENT>.04686</ENT> <ENT>.04416</ENT> <ENT>.04168</ENT> <ENT>.03939</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.07225</ENT> <ENT>.06758</ENT> <ENT>.06331</ENT> <ENT>.05938</ENT> <ENT>.05577</ENT> <ENT>.05245</ENT> <ENT>.04940</ENT> <ENT>.04658</ENT> <ENT>.04398</ENT> <ENT>.04159</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.07581</ENT> <ENT>.07099</ENT> <ENT>.06656</ENT> <ENT>.06248</ENT> <ENT>.05873</ENT> <ENT>.05528</ENT> <ENT>.05210</ENT> <ENT>.04916</ENT> <ENT>.04645</ENT> <ENT>.04394</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.07956</ENT> <ENT>.07457</ENT> <ENT>.06998</ENT> <ENT>.06575</ENT> <ENT>.06186</ENT> <ENT>.05827</ENT> <ENT>.05495</ENT> <ENT>.05189</ENT> <ENT>.04906</ENT> <ENT>.04644</ENT> </ROW> <ROW> <PRTPAGE P="282"/> <ENT I="01">31</ENT> <ENT>.08348</ENT> <ENT>.07833</ENT> <ENT>.07358</ENT> <ENT>.06920</ENT> <ENT>.06515</ENT> <ENT>.06142</ENT> <ENT>.05797</ENT> <ENT>.05478</ENT> <ENT>.05182</ENT> <ENT>.04908</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.08761</ENT> <ENT>.08228</ENT> <ENT>.07736</ENT> <ENT>.07282</ENT> <ENT>.06863</ENT> <ENT>.06475</ENT> <ENT>.06116</ENT> <ENT>.05783</ENT> <ENT>.05475</ENT> <ENT>.05189</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.09195</ENT> <ENT>.08645</ENT> <ENT>.08136</ENT> <ENT>.07666</ENT> <ENT>.07231</ENT> <ENT>.06828</ENT> <ENT>.06454</ENT> <ENT>.06108</ENT> <ENT>.05786</ENT> <ENT>.05488</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.09651</ENT> <ENT>.09082</ENT> <ENT>.08557</ENT> <ENT>.08070</ENT> <ENT>.07619</ENT> <ENT>.07200</ENT> <ENT>.06812</ENT> <ENT>.06452</ENT> <ENT>.06117</ENT> <ENT>.05805</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.10131</ENT> <ENT>.09545</ENT> <ENT>.09002</ENT> <ENT>.08498</ENT> <ENT>.08030</ENT> <ENT>.07596</ENT> <ENT>.07193</ENT> <ENT>.06818</ENT> <ENT>.06469</ENT> <ENT>.06144</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.10635</ENT> <ENT>.10031</ENT> <ENT>.09470</ENT> <ENT>.08949</ENT> <ENT>.08465</ENT> <ENT>.08015</ENT> <ENT>.07596</ENT> <ENT>.07206</ENT> <ENT>.06842</ENT> <ENT>.06503</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.11165</ENT> <ENT>.10542</ENT> <ENT>.09963</ENT> <ENT>.09424</ENT> <ENT>.08923</ENT> <ENT>.08457</ENT> <ENT>.08022</ENT> <ENT>.07617</ENT> <ENT>.07238</ENT> <ENT>.06885</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.11722</ENT> <ENT>.11081</ENT> <ENT>.10484</ENT> <ENT>.09927</ENT> <ENT>.09409</ENT> <ENT>.08926</ENT> <ENT>.08475</ENT> <ENT>.08054</ENT> <ENT>.07661</ENT> <ENT>.07293</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.12308</ENT> <ENT>.11648</ENT> <ENT>.11032</ENT> <ENT>.10458</ENT> <ENT>.09922</ENT> <ENT>.09422</ENT> <ENT>.08955</ENT> <ENT>.08518</ENT> <ENT>.08109</ENT> <ENT>.07726</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.12925</ENT> <ENT>.12246</ENT> <ENT>.11612</ENT> <ENT>.11020</ENT> <ENT>.10466</ENT> <ENT>.09949</ENT> <ENT>.09465</ENT> <ENT>.09011</ENT> <ENT>.08587</ENT> <ENT>.08189</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.13575</ENT> <ENT>.12877</ENT> <ENT>.12225</ENT> <ENT>.11614</ENT> <ENT>.11043</ENT> <ENT>.10508</ENT> <ENT>.10007</ENT> <ENT>.09537</ENT> <ENT>.09097</ENT> <ENT>.08683</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.14259</ENT> <ENT>.13542</ENT> <ENT>.12871</ENT> <ENT>.12243</ENT> <ENT>.11654</ENT> <ENT>.11101</ENT> <ENT>.10583</ENT> <ENT>.10097</ENT> <ENT>.09640</ENT> <ENT>.09210</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.14977</ENT> <ENT>.14242</ENT> <ENT>.13552</ENT> <ENT>.12905</ENT> <ENT>.12298</ENT> <ENT>.11729</ENT> <ENT>.11193</ENT> <ENT>.10690</ENT> <ENT>.10217</ENT> <ENT>.09771</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.15731</ENT> <ENT>.14976</ENT> <ENT>.14269</ENT> <ENT>.13604</ENT> <ENT>.12979</ENT> <ENT>.12391</ENT> <ENT>.11838</ENT> <ENT>.11318</ENT> <ENT>.10828</ENT> <ENT>.10367</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.16516</ENT> <ENT>.15743</ENT> <ENT>.15017</ENT> <ENT>.14334</ENT> <ENT>.13691</ENT> <ENT>.13086</ENT> <ENT>.12516</ENT> <ENT>.11979</ENT> <ENT>.11472</ENT> <ENT>.10994</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.17334</ENT> <ENT>.16544</ENT> <ENT>.15800</ENT> <ENT>.15099</ENT> <ENT>.14438</ENT> <ENT>.13816</ENT> <ENT>.13228</ENT> <ENT>.12674</ENT> <ENT>.12150</ENT> <ENT>.11656</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.18184</ENT> <ENT>.17375</ENT> <ENT>.16613</ENT> <ENT>.15895</ENT> <ENT>.15217</ENT> <ENT>.14576</ENT> <ENT>.13972</ENT> <ENT>.13400</ENT> <ENT>.12860</ENT> <ENT>.12349</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.19066</ENT> <ENT>.18240</ENT> <ENT>.17461</ENT> <ENT>.16724</ENT> <ENT>.16029</ENT> <ENT>.15371</ENT> <ENT>.14749</ENT> <ENT>.14161</ENT> <ENT>.13604</ENT> <ENT>.13077</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.19981</ENT> <ENT>.19138</ENT> <ENT>.18342</ENT> <ENT>.17588</ENT> <ENT>.16875</ENT> <ENT>.16201</ENT> <ENT>.15562</ENT> <ENT>.14956</ENT> <ENT>.14383</ENT> <ENT>.13839</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.20931</ENT> <ENT>.20072</ENT> <ENT>.19259</ENT> <ENT>.18489</ENT> <ENT>.17759</ENT> <ENT>.17067</ENT> <ENT>.16412</ENT> <ENT>.15790</ENT> <ENT>.15199</ENT> <ENT>.14639</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.21917</ENT> <ENT>.21042</ENT> <ENT>.20212</ENT> <ENT>.19426</ENT> <ENT>.18679</ENT> <ENT>.17971</ENT> <ENT>.17299</ENT> <ENT>.16660</ENT> <ENT>.16054</ENT> <ENT>.15477</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.22933</ENT> <ENT>.22043</ENT> <ENT>.21198</ENT> <ENT>.20395</ENT> <ENT>.19633</ENT> <ENT>.18909</ENT> <ENT>.18220</ENT> <ENT>.17566</ENT> <ENT>.16943</ENT> <ENT>.16350</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.23981</ENT> <ENT>.23076</ENT> <ENT>.22216</ENT> <ENT>.21399</ENT> <ENT>.20621</ENT> <ENT>.19881</ENT> <ENT>.19176</ENT> <ENT>.18506</ENT> <ENT>.17867</ENT> <ENT>.17258</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.25060</ENT> <ENT>.24141</ENT> <ENT>.23267</ENT> <ENT>.22434</ENT> <ENT>.21642</ENT> <ENT>.20886</ENT> <ENT>.20166</ENT> <ENT>.19480</ENT> <ENT>.18826</ENT> <ENT>.18201</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.26171</ENT> <ENT>.25239</ENT> <ENT>.24351</ENT> <ENT>.23504</ENT> <ENT>.22697</ENT> <ENT>.21927</ENT> <ENT>.21192</ENT> <ENT>.20491</ENT> <ENT>.19821</ENT> <ENT>.19182</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.27313</ENT> <ENT>.26369</ENT> <ENT>.25468</ENT> <ENT>.24608</ENT> <ENT>.23787</ENT> <ENT>.23003</ENT> <ENT>.22254</ENT> <ENT>.21538</ENT> <ENT>.20854</ENT> <ENT>.20199</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.28487</ENT> <ENT>.27531</ENT> <ENT>.26618</ENT> <ENT>.25746</ENT> <ENT>.24912</ENT> <ENT>.24114</ENT> <ENT>.23351</ENT> <ENT>.22621</ENT> <ENT>.21923</ENT> <ENT>.21254</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.29688</ENT> <ENT>.28722</ENT> <ENT>.27798</ENT> <ENT>.26914</ENT> <ENT>.26067</ENT> <ENT>.25257</ENT> <ENT>.24481</ENT> <ENT>.23738</ENT> <ENT>.23025</ENT> <ENT>.22343</ENT> </ROW> <ROW> <ENT I="01">59</ENT> <ENT>.30913</ENT> <ENT>.29937</ENT> <ENT>.29002</ENT> <ENT>.28107</ENT> <ENT>.27249</ENT> <ENT>.26427</ENT> <ENT>.25639</ENT> <ENT>.24882</ENT> <ENT>.24157</ENT> <ENT>.23461</ENT> </ROW> <ROW> <ENT I="01">60</ENT> <ENT>.32159</ENT> <ENT>.31175</ENT> <ENT>.30231</ENT> <ENT>.29325</ENT> <ENT>.28457</ENT> <ENT>.27623</ENT> 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<ENT>.36809</ENT> <ENT>.35868</ENT> <ENT>.34961</ENT> <ENT>.34085</ENT> <ENT>.33239</ENT> <ENT>.32422</ENT> <ENT>.31633</ENT> <ENT>.30871</ENT> </ROW> <ROW> <ENT I="01">66</ENT> <ENT>.40205</ENT> <ENT>.39193</ENT> <ENT>.38216</ENT> <ENT>.37272</ENT> <ENT>.36361</ENT> <ENT>.35479</ENT> <ENT>.34628</ENT> <ENT>.33804</ENT> <ENT>.33008</ENT> <ENT>.32238</ENT> </ROW> <ROW> <ENT I="01">67</ENT> <ENT>.41650</ENT> <ENT>.40639</ENT> <ENT>.39661</ENT> <ENT>.38715</ENT> <ENT>.37800</ENT> <ENT>.36915</ENT> <ENT>.36059</ENT> <ENT>.35230</ENT> <ENT>.34428</ENT> <ENT>.33651</ENT> </ROW> <ROW> <ENT I="01">68</ENT> <ENT>.43126</ENT> <ENT>.42117</ENT> <ENT>.41139</ENT> <ENT>.40193</ENT> <ENT>.39277</ENT> <ENT>.38390</ENT> <ENT>.37530</ENT> <ENT>.36697</ENT> <ENT>.35890</ENT> <ENT>.35108</ENT> </ROW> <ROW> <ENT I="01">69</ENT> <ENT>.44628</ENT> <ENT>.43622</ENT> <ENT>.42648</ENT> <ENT>.41703</ENT> <ENT>.40787</ENT> <ENT>.39898</ENT> <ENT>.39037</ENT> <ENT>.38201</ENT> <ENT>.37391</ENT> <ENT>.36604</ENT> </ROW> <ROW> <ENT I="01">70</ENT> <ENT>.46150</ENT> <ENT>.45149</ENT> <ENT>.44178</ENT> <ENT>.43236</ENT> <ENT>.42321</ENT> <ENT>.41433</ENT> <ENT>.40571</ENT> <ENT>.39735</ENT> <ENT>.38922</ENT> <ENT>.38132</ENT> </ROW> <ROW> <ENT I="01">71</ENT> <ENT>.47683</ENT> <ENT>.46689</ENT> <ENT>.45723</ENT> <ENT>.44785</ENT> <ENT>.43873</ENT> <ENT>.42987</ENT> <ENT>.42126</ENT> <ENT>.41290</ENT> <ENT>.40476</ENT> <ENT>.39685</ENT> </ROW> <ROW> <ENT I="01">72</ENT> <ENT>.49225</ENT> <ENT>.48238</ENT> <ENT>.47279</ENT> <ENT>.46346</ENT> <ENT>.45439</ENT> <ENT>.44556</ENT> <ENT>.43697</ENT> <ENT>.42862</ENT> <ENT>.42048</ENT> <ENT>.41257</ENT> </ROW> <ROW> <ENT I="01">73</ENT> <ENT>.50770</ENT> <ENT>.49793</ENT> <ENT>.48841</ENT> <ENT>.47915</ENT> <ENT>.47013</ENT> <ENT>.46135</ENT> <ENT>.45280</ENT> <ENT>.44447</ENT> <ENT>.43635</ENT> <ENT>.42844</ENT> </ROW> <ROW> <ENT I="01">74</ENT> <ENT>.52324</ENT> <ENT>.51358</ENT> <ENT>.50416</ENT> <ENT>.49498</ENT> <ENT>.48603</ENT> <ENT>.47731</ENT> <ENT>.46880</ENT> <ENT>.46051</ENT> <ENT>.45242</ENT> <ENT>.44454</ENT> </ROW> <ROW> <ENT I="01">75</ENT> <ENT>.53894</ENT> <ENT>.52939</ENT> <ENT>.52008</ENT> <ENT>.51100</ENT> <ENT>.50214</ENT> <ENT>.49349</ENT> <ENT>.48505</ENT> <ENT>.47681</ENT> <ENT>.46877</ENT> <ENT>.46092</ENT> </ROW> <ROW> <ENT I="01">76</ENT> <ENT>.55483</ENT> <ENT>.54543</ENT> <ENT>.53624</ENT> <ENT>.52728</ENT> <ENT>.51852</ENT> <ENT>.50996</ENT> <ENT>.50160</ENT> <ENT>.49344</ENT> <ENT>.48546</ENT> <ENT>.47766</ENT> </ROW> <ROW> <ENT I="01">77</ENT> <ENT>.57091</ENT> <ENT>.56167</ENT> <ENT>.55263</ENT> <ENT>.54380</ENT> <ENT>.53516</ENT> <ENT>.52671</ENT> <ENT>.51845</ENT> <ENT>.51038</ENT> <ENT>.50247</ENT> <ENT>.49475</ENT> </ROW> <ROW> <ENT I="01">78</ENT> <ENT>.58716</ENT> <ENT>.57809</ENT> <ENT>.56922</ENT> <ENT>.56053</ENT> <ENT>.55203</ENT> <ENT>.54372</ENT> <ENT>.53557</ENT> <ENT>.52760</ENT> <ENT>.51980</ENT> <ENT>.51216</ENT> </ROW> <ROW> <ENT I="01">79</ENT> <ENT>.60346</ENT> <ENT>.59459</ENT> <ENT>.58590</ENT> <ENT>.57738</ENT> <ENT>.56904</ENT> <ENT>.56086</ENT> <ENT>.55286</ENT> <ENT>.54501</ENT> <ENT>.53732</ENT> <ENT>.52978</ENT> </ROW> <ROW> <ENT I="01">80</ENT> <ENT>.61969</ENT> <ENT>.61102</ENT> <ENT>.60252</ENT> <ENT>.59419</ENT> <ENT>.58601</ENT> <ENT>.57800</ENT> <ENT>.57014</ENT> <ENT>.56243</ENT> <ENT>.55487</ENT> <ENT>.54745</ENT> </ROW> <ROW> <ENT I="01">81</ENT> <ENT>.63571</ENT> <ENT>.62726</ENT> <ENT>.61897</ENT> <ENT>.61082</ENT> <ENT>.60283</ENT> <ENT>.59499</ENT> <ENT>.58729</ENT> <ENT>.57974</ENT> <ENT>.57232</ENT> <ENT>.56503</ENT> </ROW> <ROW> <ENT I="01">82</ENT> <ENT>.65146</ENT> <ENT>.64324</ENT> <ENT>.63515</ENT> <ENT>.62722</ENT> <ENT>.61942</ENT> <ENT>.61176</ENT> <ENT>.60423</ENT> <ENT>.59683</ENT> <ENT>.58957</ENT> <ENT>.58242</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.66693</ENT> <ENT>.65893</ENT> <ENT>.65108</ENT> <ENT>.64335</ENT> <ENT>.63575</ENT> <ENT>.62828</ENT> <ENT>.62093</ENT> <ENT>.61371</ENT> <ENT>.60660</ENT> <ENT>.59962</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.68222</ENT> <ENT>.67447</ENT> <ENT>.66684</ENT> <ENT>.65934</ENT> <ENT>.65195</ENT> <ENT>.64468</ENT> <ENT>.63753</ENT> <ENT>.63049</ENT> <ENT>.62356</ENT> <ENT>.61674</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.69742</ENT> <ENT>.68993</ENT> <ENT>.68255</ENT> <ENT>.67528</ENT> <ENT>.66812</ENT> <ENT>.66106</ENT> <ENT>.65411</ENT> <ENT>.64727</ENT> <ENT>.64053</ENT> <ENT>.63389</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.71241</ENT> <ENT>.70517</ENT> <ENT>.69805</ENT> <ENT>.69102</ENT> <ENT>.68410</ENT> <ENT>.67727</ENT> <ENT>.67054</ENT> <ENT>.66390</ENT> <ENT>.65736</ENT> <ENT>.65091</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.72696</ENT> <ENT>.72000</ENT> <ENT>.71313</ENT> <ENT>.70635</ENT> <ENT>.69967</ENT> <ENT>.69307</ENT> <ENT>.68656</ENT> <ENT>.68014</ENT> <ENT>.67381</ENT> <ENT>.66756</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.74108</ENT> <ENT>.73438</ENT> <ENT>.72777</ENT> <ENT>.72125</ENT> <ENT>.71480</ENT> <ENT>.70845</ENT> <ENT>.70217</ENT> <ENT>.69597</ENT> <ENT>.68985</ENT> <ENT>.68380</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.75475</ENT> <ENT>.74832</ENT> <ENT>.74198</ENT> <ENT>.73571</ENT> <ENT>.72951</ENT> <ENT>.72339</ENT> <ENT>.71734</ENT> <ENT>.71137</ENT> <ENT>.70547</ENT> <ENT>.69963</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.76796</ENT> <ENT>.76180</ENT> <ENT>.75572</ENT> <ENT>.74971</ENT> <ENT>.74376</ENT> <ENT>.73788</ENT> <ENT>.73207</ENT> <ENT>.72633</ENT> <ENT>.72065</ENT> <ENT>.71503</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.78049</ENT> <ENT>.77460</ENT> <ENT>.76878</ENT> <ENT>.76302</ENT> <ENT>.75732</ENT> <ENT>.75168</ENT> <ENT>.74610</ENT> <ENT>.74058</ENT> <ENT>.73512</ENT> <ENT>.72972</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.79211</ENT> <ENT>.78647</ENT> <ENT>.78089</ENT> <ENT>.77537</ENT> <ENT>.76990</ENT> <ENT>.76449</ENT> <ENT>.75913</ENT> <ENT>.75383</ENT> <ENT>.74858</ENT> <ENT>.74338</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.80283</ENT> <ENT>.79743</ENT> <ENT>.79208</ENT> <ENT>.78679</ENT> <ENT>.78154</ENT> <ENT>.77634</ENT> <ENT>.77119</ENT> <ENT>.76610</ENT> <ENT>.76105</ENT> <ENT>.75604</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.81283</ENT> <ENT>.80765</ENT> <ENT>.80253</ENT> <ENT>.79744</ENT> <ENT>.79240</ENT> <ENT>.78741</ENT> <ENT>.78247</ENT> <ENT>.77756</ENT> <ENT>.77270</ENT> <ENT>.76789</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.82233</ENT> <ENT>.81737</ENT> <ENT>.81245</ENT> <ENT>.80757</ENT> <ENT>.80274</ENT> <ENT>.79795</ENT> <ENT>.79320</ENT> <ENT>.78849</ENT> <ENT>.78382</ENT> <ENT>.77918</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.83126</ENT> <ENT>.82651</ENT> <ENT>.82180</ENT> <ENT>.81712</ENT> <ENT>.81248</ENT> <ENT>.80788</ENT> <ENT>.80332</ENT> <ENT>.79880</ENT> <ENT>.79431</ENT> <ENT>.78985</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.83953</ENT> <ENT>.83498</ENT> <ENT>.83046</ENT> <ENT>.82597</ENT> <ENT>.82152</ENT> <ENT>.81710</ENT> <ENT>.81271</ENT> <ENT>.80836</ENT> <ENT>.80404</ENT> <ENT>.79976</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.84731</ENT> <ENT>.84294</ENT> <ENT>.83860</ENT> <ENT>.83429</ENT> <ENT>.83002</ENT> <ENT>.82577</ENT> <ENT>.82155</ENT> <ENT>.81737</ENT> <ENT>.81321</ENT> <ENT>.80908</ENT> </ROW> <ROW> <PRTPAGE P="283"/> <ENT I="01">99</ENT> <ENT>.85490</ENT> <ENT>.85071</ENT> <ENT>.84656</ENT> <ENT>.84243</ENT> <ENT>.83832</ENT> <ENT>.83425</ENT> <ENT>.83020</ENT> <ENT>.82618</ENT> <ENT>.82219</ENT> <ENT>.81822</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.86229</ENT> <ENT>.85828</ENT> <ENT>.85431</ENT> <ENT>.85035</ENT> <ENT>.84642</ENT> <ENT>.84252</ENT> <ENT>.83864</ENT> <ENT>.83478</ENT> <ENT>.83095</ENT> <ENT>.82714</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.86958</ENT> <ENT>.86575</ENT> <ENT>.86195</ENT> <ENT>.85818</ENT> <ENT>.85442</ENT> <ENT>.85069</ENT> <ENT>.84698</ENT> <ENT>.84329</ENT> <ENT>.83962</ENT> <ENT>.83597</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.87674</ENT> <ENT>.87310</ENT> <ENT>.86947</ENT> <ENT>.86587</ENT> <ENT>.86229</ENT> <ENT>.85873</ENT> <ENT>.85518</ENT> <ENT>.85166</ENT> <ENT>.84815</ENT> <ENT>.84466</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.88384</ENT> <ENT>.88038</ENT> <ENT>.87694</ENT> <ENT>.87351</ENT> <ENT>.87010</ENT> <ENT>.86671</ENT> <ENT>.86334</ENT> <ENT>.85998</ENT> <ENT>.85663</ENT> <ENT>.85331</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.89143</ENT> <ENT>.88817</ENT> <ENT>.88492</ENT> <ENT>.88169</ENT> <ENT>.87847</ENT> <ENT>.87526</ENT> <ENT>.87207</ENT> <ENT>.86889</ENT> <ENT>.86573</ENT> <ENT>.86258</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.89885</ENT> <ENT>.89578</ENT> <ENT>.89272</ENT> <ENT>.88967</ENT> <ENT>.88664</ENT> <ENT>.88361</ENT> <ENT>.88060</ENT> <ENT>.87760</ENT> <ENT>.87461</ENT> <ENT>.87163</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.90840</ENT> <ENT>.90559</ENT> <ENT>.90278</ENT> <ENT>.89999</ENT> <ENT>.89720</ENT> <ENT>.89442</ENT> <ENT>.89165</ENT> <ENT>.88888</ENT> <ENT>.88613</ENT> <ENT>.88338</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.91999</ENT> <ENT>.91750</ENT> <ENT>.91501</ENT> <ENT>.91253</ENT> <ENT>.91005</ENT> <ENT>.90758</ENT> <ENT>.90511</ENT> <ENT>.90265</ENT> <ENT>.90019</ENT> <ENT>.89774</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.93805</ENT> <ENT>.93609</ENT> <ENT>.93412</ENT> <ENT>.93216</ENT> <ENT>.93020</ENT> <ENT>.92824</ENT> <ENT>.92629</ENT> <ENT>.92434</ENT> <ENT>.92239</ENT> <ENT>.92044</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.96900</ENT> <ENT>.96800</ENT> <ENT>.96700</ENT> <ENT>.96600</ENT> <ENT>.96500</ENT> <ENT>.96400</ENT> <ENT>.96300</ENT> <ENT>.96200</ENT> <ENT>.96100</ENT> <ENT>.96000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2(,,0)" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table U(1)—Based on Life Table 90CM Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">8.2%</CHED> <CHED H="2">8.4%</CHED> <CHED H="2">8.6%</CHED> <CHED H="2">8.8%</CHED> <CHED H="2">9.0%</CHED> <CHED H="2">9.2%</CHED> <CHED H="2">9.4%</CHED> <CHED H="2">9.6%</CHED> <CHED H="2">9.8%</CHED> <CHED H="2">10.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01709</ENT> <ENT>.01658</ENT> <ENT>.01612</ENT> <ENT>.01570</ENT> <ENT>.01532</ENT> <ENT>.01497</ENT> <ENT>.01466</ENT> <ENT>.01437</ENT> <ENT>.01410</ENT> <ENT>.01386</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00892</ENT> <ENT>.00839</ENT> <ENT>.00791</ENT> <ENT>.00747</ENT> <ENT>.00708</ENT> <ENT>.00672</ENT> <ENT>.00639</ENT> <ENT>.00609</ENT> <ENT>.00582</ENT> <ENT>.00557</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00896</ENT> <ENT>.00840</ENT> <ENT>.00790</ENT> <ENT>.00744</ENT> <ENT>.00702</ENT> <ENT>.00664</ENT> <ENT>.00629</ENT> <ENT>.00598</ENT> <ENT>.00569</ENT> <ENT>.00542</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00926</ENT> <ENT>.00867</ENT> <ENT>.00814</ENT> <ENT>.00765</ENT> <ENT>.00721</ENT> <ENT>.00681</ENT> <ENT>.00644</ENT> <ENT>.00611</ENT> <ENT>.00580</ENT> <ENT>.00552</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00970</ENT> <ENT>.00908</ENT> <ENT>.00851</ENT> <ENT>.00800</ENT> <ENT>.00753</ENT> <ENT>.00711</ENT> <ENT>.00672</ENT> <ENT>.00636</ENT> <ENT>.00604</ENT> <ENT>.00574</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.01026</ENT> <ENT>.00960</ENT> <ENT>.00900</ENT> <ENT>.00846</ENT> <ENT>.00796</ENT> <ENT>.00751</ENT> <ENT>.00710</ENT> <ENT>.00672</ENT> <ENT>.00637</ENT> <ENT>.00606</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.01089</ENT> <ENT>.01019</ENT> <ENT>.00956</ENT> <ENT>.00899</ENT> <ENT>.00846</ENT> <ENT>.00799</ENT> <ENT>.00755</ENT> <ENT>.00715</ENT> <ENT>.00678</ENT> <ENT>.00644</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.01161</ENT> <ENT>.01088</ENT> <ENT>.01021</ENT> <ENT>.00960</ENT> <ENT>.00905</ENT> <ENT>.00854</ENT> <ENT>.00808</ENT> <ENT>.00765</ENT> <ENT>.00726</ENT> <ENT>.00690</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.01241</ENT> <ENT>.01163</ENT> <ENT>.01093</ENT> <ENT>.01029</ENT> <ENT>.00970</ENT> <ENT>.00917</ENT> <ENT>.00867</ENT> <ENT>.00822</ENT> <ENT>.00781</ENT> <ENT>.00743</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.01331</ENT> <ENT>.01249</ENT> <ENT>.01175</ENT> <ENT>.01107</ENT> <ENT>.01045</ENT> <ENT>.00988</ENT> <ENT>.00936</ENT> <ENT>.00889</ENT> <ENT>.00845</ENT> <ENT>.00804</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.01432</ENT> <ENT>.01346</ENT> <ENT>.01268</ENT> <ENT>.01196</ENT> <ENT>.01131</ENT> <ENT>.01071</ENT> <ENT>.01016</ENT> <ENT>.00965</ENT> <ENT>.00918</ENT> <ENT>.00875</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.01543</ENT> <ENT>.01453</ENT> <ENT>.01370</ENT> <ENT>.01295</ENT> <ENT>.01226</ENT> <ENT>.01162</ENT> <ENT>.01104</ENT> <ENT>.01051</ENT> <ENT>.01001</ENT> <ENT>.00956</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01664</ENT> <ENT>.01569</ENT> <ENT>.01482</ENT> <ENT>.01403</ENT> <ENT>.01330</ENT> <ENT>.01263</ENT> <ENT>.01202</ENT> <ENT>.01145</ENT> <ENT>.01093</ENT> <ENT>.01045</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01791</ENT> <ENT>.01691</ENT> <ENT>.01600</ENT> <ENT>.01516</ENT> <ENT>.01440</ENT> <ENT>.01369</ENT> <ENT>.01304</ENT> <ENT>.01245</ENT> <ENT>.01190</ENT> <ENT>.01139</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01918</ENT> <ENT>.01813</ENT> <ENT>.01717</ENT> <ENT>.01629</ENT> <ENT>.01548</ENT> <ENT>.01474</ENT> <ENT>.01406</ENT> <ENT>.01343</ENT> <ENT>.01285</ENT> <ENT>.01231</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.02041</ENT> <ENT>.01931</ENT> <ENT>.01831</ENT> <ENT>.01738</ENT> <ENT>.01653</ENT> <ENT>.01576</ENT> <ENT>.01504</ENT> <ENT>.01437</ENT> <ENT>.01376</ENT> <ENT>.01320</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.02160</ENT> <ENT>.02044</ENT> <ENT>.01938</ENT> <ENT>.01841</ENT> <ENT>.01752</ENT> <ENT>.01670</ENT> <ENT>.01595</ENT> <ENT>.01525</ENT> <ENT>.01460</ENT> <ENT>.01401</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.02274</ENT> <ENT>.02152</ENT> <ENT>.02041</ENT> <ENT>.01940</ENT> <ENT>.01846</ENT> <ENT>.01760</ENT> <ENT>.01680</ENT> 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</ROW> <ROW> <ENT I="01">97</ENT> <ENT>.79550</ENT> <ENT>.79128</ENT> <ENT>.78709</ENT> <ENT>.78293</ENT> <ENT>.77880</ENT> <ENT>.77470</ENT> <ENT>.77063</ENT> <ENT>.76659</ENT> <ENT>.76258</ENT> <ENT>.75860</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.80498</ENT> <ENT>.80091</ENT> <ENT>.79687</ENT> <ENT>.79286</ENT> <ENT>.78888</ENT> <ENT>.78492</ENT> <ENT>.78099</ENT> <ENT>.77709</ENT> <ENT>.77322</ENT> <ENT>.76937</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.81428</ENT> <ENT>.81036</ENT> <ENT>.80647</ENT> <ENT>.80261</ENT> <ENT>.79877</ENT> <ENT>.79496</ENT> <ENT>.79117</ENT> <ENT>.78741</ENT> <ENT>.78367</ENT> <ENT>.77995</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.82336</ENT> <ENT>.81959</ENT> <ENT>.81586</ENT> <ENT>.81214</ENT> <ENT>.80845</ENT> <ENT>.80478</ENT> <ENT>.80113</ENT> <ENT>.79751</ENT> <ENT>.79390</ENT> <ENT>.79032</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.83234</ENT> <ENT>.82873</ENT> <ENT>.82515</ENT> <ENT>.82158</ENT> <ENT>.81804</ENT> <ENT>.81451</ENT> <ENT>.81101</ENT> <ENT>.80753</ENT> <ENT>.80406</ENT> <ENT>.80062</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.84119</ENT> <ENT>.83774</ENT> <ENT>.83431</ENT> <ENT>.83089</ENT> <ENT>.82750</ENT> <ENT>.82412</ENT> <ENT>.82076</ENT> <ENT>.81742</ENT> <ENT>.81409</ENT> <ENT>.81078</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.84999</ENT> <ENT>.84670</ENT> <ENT>.84342</ENT> <ENT>.84016</ENT> <ENT>.83691</ENT> <ENT>.83368</ENT> <ENT>.83046</ENT> <ENT>.82726</ENT> <ENT>.82408</ENT> <ENT>.82091</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.85944</ENT> <ENT>.85632</ENT> <ENT>.85321</ENT> <ENT>.85011</ENT> <ENT>.84703</ENT> <ENT>.84396</ENT> <ENT>.84090</ENT> <ENT>.83786</ENT> <ENT>.83483</ENT> <ENT>.83182</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.86866</ENT> <ENT>.86570</ENT> <ENT>.86276</ENT> <ENT>.85982</ENT> <ENT>.85690</ENT> <ENT>.85399</ENT> <ENT>.85109</ENT> <ENT>.84820</ENT> <ENT>.84532</ENT> <ENT>.84245</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.88065</ENT> <ENT>.87792</ENT> <ENT>.87520</ENT> <ENT>.87248</ENT> <ENT>.86978</ENT> <ENT>.86708</ENT> <ENT>.86440</ENT> <ENT>.86172</ENT> <ENT>.85905</ENT> <ENT>.85638</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.89530</ENT> <ENT>.89286</ENT> <ENT>.89042</ENT> <ENT>.88799</ENT> <ENT>.88557</ENT> <ENT>.88315</ENT> <ENT>.88073</ENT> <ENT>.87833</ENT> <ENT>.87592</ENT> <ENT>.87352</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.91849</ENT> <ENT>.91654</ENT> <ENT>.91460</ENT> <ENT>.91266</ENT> <ENT>.91072</ENT> <ENT>.90879</ENT> <ENT>.90685</ENT> <ENT>.90492</ENT> <ENT>.90299</ENT> <ENT>.90106</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.95900</ENT> <ENT>.95800</ENT> <ENT>.95700</ENT> <ENT>.95600</ENT> <ENT>.95500</ENT> <ENT>.95400</ENT> <ENT>.95300</ENT> <ENT>.95200</ENT> <ENT>.95100</ENT> <ENT>.95000</ENT> </ROW> </GPOTABLE> <PRTPAGE P="285"/> <GPOTABLE COLS="11" OPTS="L2" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table U(1)—Based on Life Table 90CM Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">10.2%</CHED> <CHED H="2">10.4%</CHED> <CHED H="2">10.6%</CHED> <CHED H="2">10.8%</CHED> <CHED H="2">11.0%</CHED> <CHED H="2">11.2%</CHED> <CHED H="2">11.4%</CHED> <CHED H="2">11.6%</CHED> <CHED H="2">11.8%</CHED> <CHED H="2">12.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01363</ENT> <ENT>.01342</ENT> <ENT>.01323</ENT> <ENT>.01305</ENT> <ENT>.01288</ENT> <ENT>.01272</ENT> <ENT>.01258</ENT> <ENT>.01244</ENT> <ENT>.01231</ENT> <ENT>.01219</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00534</ENT> <ENT>.00512</ENT> <ENT>.00493</ENT> <ENT>.00474</ENT> <ENT>.00458</ENT> <ENT>.00442</ENT> <ENT>.00427</ENT> <ENT>.00414</ENT> <ENT>.00401</ENT> <ENT>.00389</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00518</ENT> <ENT>.00495</ENT> <ENT>.00474</ENT> <ENT>.00455</ENT> <ENT>.00437</ENT> <ENT>.00421</ENT> <ENT>.00405</ENT> <ENT>.00391</ENT> <ENT>.00377</ENT> <ENT>.00365</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00526</ENT> <ENT>.00502</ENT> <ENT>.00480</ENT> <ENT>.00459</ENT> <ENT>.00440</ENT> <ENT>.00422</ENT> <ENT>.00406</ENT> <ENT>.00391</ENT> <ENT>.00376</ENT> <ENT>.00363</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00546</ENT> <ENT>.00521</ENT> <ENT>.00497</ENT> <ENT>.00475</ENT> <ENT>.00455</ENT> <ENT>.00436</ENT> <ENT>.00419</ENT> <ENT>.00402</ENT> <ENT>.00387</ENT> <ENT>.00373</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00576</ENT> <ENT>.00549</ENT> <ENT>.00524</ENT> <ENT>.00501</ENT> <ENT>.00479</ENT> <ENT>.00459</ENT> <ENT>.00440</ENT> <ENT>.00423</ENT> <ENT>.00406</ENT> <ENT>.00391</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00613</ENT> <ENT>.00584</ENT> <ENT>.00557</ENT> <ENT>.00532</ENT> <ENT>.00509</ENT> <ENT>.00488</ENT> <ENT>.00468</ENT> <ENT>.00449</ENT> <ENT>.00432</ENT> <ENT>.00415</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00657</ENT> <ENT>.00626</ENT> <ENT>.00598</ENT> <ENT>.00571</ENT> <ENT>.00547</ENT> <ENT>.00524</ENT> <ENT>.00502</ENT> <ENT>.00482</ENT> <ENT>.00464</ENT> <ENT>.00446</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00707</ENT> <ENT>.00675</ENT> <ENT>.00644</ENT> <ENT>.00616</ENT> <ENT>.00590</ENT> <ENT>.00565</ENT> <ENT>.00542</ENT> <ENT>.00521</ENT> <ENT>.00501</ENT> <ENT>.00482</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00766</ENT> <ENT>.00732</ENT> <ENT>.00699</ENT> <ENT>.00669</ENT> <ENT>.00641</ENT> <ENT>.00615</ENT> <ENT>.00591</ENT> <ENT>.00568</ENT> <ENT>.00547</ENT> <ENT>.00527</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00835</ENT> <ENT>.00798</ENT> <ENT>.00764</ENT> <ENT>.00732</ENT> <ENT>.00702</ENT> <ENT>.00675</ENT> <ENT>.00649</ENT> <ENT>.00624</ENT> <ENT>.00602</ENT> <ENT>.00580</ENT> </ROW> <ROW> <ENT I="01">11</ENT> <ENT>.00913</ENT> <ENT>.00874</ENT> <ENT>.00838</ENT> <ENT>.00804</ENT> <ENT>.00772</ENT> <ENT>.00743</ENT> <ENT>.00715</ENT> <ENT>.00689</ENT> <ENT>.00665</ENT> <ENT>.00642</ENT> </ROW> <ROW> <ENT I="01">12</ENT> <ENT>.01000</ENT> <ENT>.00959</ENT> <ENT>.00920</ENT> <ENT>.00884</ENT> <ENT>.00851</ENT> <ENT>.00819</ENT> <ENT>.00790</ENT> <ENT>.00762</ENT> <ENT>.00737</ENT> <ENT>.00712</ENT> </ROW> <ROW> <ENT I="01">13</ENT> <ENT>.01091</ENT> <ENT>.01048</ENT> <ENT>.01007</ENT> <ENT>.00969</ENT> <ENT>.00933</ENT> <ENT>.00900</ENT> <ENT>.00869</ENT> <ENT>.00840</ENT> <ENT>.00813</ENT> <ENT>.00787</ENT> </ROW> <ROW> <ENT I="01">14</ENT> <ENT>.01181</ENT> <ENT>.01135</ENT> <ENT>.01092</ENT> <ENT>.01052</ENT> <ENT>.01014</ENT> <ENT>.00979</ENT> <ENT>.00947</ENT> <ENT>.00916</ENT> <ENT>.00887</ENT> <ENT>.00860</ENT> </ROW> <ROW> <ENT I="01">15</ENT> <ENT>.01267</ENT> <ENT>.01218</ENT> <ENT>.01173</ENT> <ENT>.01130</ENT> <ENT>.01091</ENT> <ENT>.01054</ENT> <ENT>.01019</ENT> <ENT>.00987</ENT> <ENT>.00956</ENT> <ENT>.00928</ENT> </ROW> <ROW> <ENT I="01">16</ENT> <ENT>.01345</ENT> <ENT>.01294</ENT> <ENT>.01246</ENT> <ENT>.01201</ENT> <ENT>.01160</ENT> <ENT>.01121</ENT> <ENT>.01084</ENT> <ENT>.01050</ENT> <ENT>.01018</ENT> <ENT>.00988</ENT> </ROW> <ROW> <ENT I="01">17</ENT> <ENT>.01418</ENT> <ENT>.01364</ENT> <ENT>.01313</ENT> <ENT>.01266</ENT> <ENT>.01222</ENT> <ENT>.01181</ENT> <ENT>.01143</ENT> <ENT>.01107</ENT> <ENT>.01073</ENT> <ENT>.01041</ENT> </ROW> <ROW> <ENT I="01">18</ENT> <ENT>.01486</ENT> <ENT>.01429</ENT> <ENT>.01375</ENT> <ENT>.01326</ENT> <ENT>.01279</ENT> <ENT>.01236</ENT> <ENT>.01196</ENT> <ENT>.01158</ENT> <ENT>.01122</ENT> <ENT>.01088</ENT> </ROW> <ROW> <ENT I="01">19</ENT> <ENT>.01554</ENT> <ENT>.01494</ENT> <ENT>.01438</ENT> <ENT>.01385</ENT> <ENT>.01336</ENT> <ENT>.01291</ENT> <ENT>.01248</ENT> <ENT>.01208</ENT> <ENT>.01170</ENT> <ENT>.01135</ENT> </ROW> <ROW> <ENT I="01">20</ENT> <ENT>.01626</ENT> <ENT>.01562</ENT> <ENT>.01503</ENT> <ENT>.01448</ENT> <ENT>.01396</ENT> <ENT>.01348</ENT> <ENT>.01303</ENT> <ENT>.01260</ENT> <ENT>.01220</ENT> <ENT>.01183</ENT> </ROW> <ROW> <ENT I="01">21</ENT> <ENT>.01702</ENT> <ENT>.01635</ENT> <ENT>.01573</ENT> <ENT>.01514</ENT> <ENT>.01460</ENT> <ENT>.01409</ENT> <ENT>.01361</ENT> <ENT>.01316</ENT> <ENT>.01274</ENT> <ENT>.01235</ENT> </ROW> <ROW> <ENT I="01">22</ENT> <ENT>.01782</ENT> <ENT>.01711</ENT> <ENT>.01645</ENT> <ENT>.01584</ENT> <ENT>.01526</ENT> <ENT>.01472</ENT> <ENT>.01422</ENT> <ENT>.01374</ENT> <ENT>.01330</ENT> <ENT>.01288</ENT> </ROW> <ROW> <ENT I="01">23</ENT> <ENT>.01868</ENT> <ENT>.01793</ENT> <ENT>.01724</ENT> <ENT>.01658</ENT> <ENT>.01597</ENT> <ENT>.01540</ENT> <ENT>.01487</ENT> <ENT>.01437</ENT> <ENT>.01390</ENT> <ENT>.01345</ENT> </ROW> <ROW> <ENT I="01">24</ENT> <ENT>.01962</ENT> <ENT>.01883</ENT> <ENT>.01809</ENT> <ENT>.01740</ENT> <ENT>.01675</ENT> <ENT>.01615</ENT> <ENT>.01558</ENT> <ENT>.01505</ENT> <ENT>.01455</ENT> <ENT>.01408</ENT> </ROW> <ROW> <ENT I="01">25</ENT> <ENT>.02065</ENT> <ENT>.01981</ENT> <ENT>.01903</ENT> <ENT>.01830</ENT> <ENT>.01762</ENT> <ENT>.01698</ENT> <ENT>.01638</ENT> <ENT>.01581</ENT> <ENT>.01528</ENT> <ENT>.01478</ENT> </ROW> <ROW> <ENT I="01">26</ENT> <ENT>.02178</ENT> <ENT>.02089</ENT> <ENT>.02006</ENT> <ENT>.01929</ENT> <ENT>.01856</ENT> <ENT>.01789</ENT> <ENT>.01725</ENT> <ENT>.01665</ENT> <ENT>.01609</ENT> <ENT>.01556</ENT> </ROW> <ROW> <ENT I="01">27</ENT> <ENT>.02303</ENT> <ENT>.02209</ENT> <ENT>.02122</ENT> <ENT>.02040</ENT> <ENT>.01963</ENT> <ENT>.01891</ENT> <ENT>.01824</ENT> <ENT>.01760</ENT> <ENT>.01700</ENT> <ENT>.01644</ENT> </ROW> <ROW> <ENT I="01">28</ENT> <ENT>.02439</ENT> <ENT>.02339</ENT> <ENT>.02247</ENT> <ENT>.02160</ENT> <ENT>.02079</ENT> <ENT>.02002</ENT> <ENT>.01931</ENT> <ENT>.01863</ENT> <ENT>.01800</ENT> <ENT>.01740</ENT> </ROW> <ROW> <ENT I="01">29</ENT> <ENT>.02585</ENT> <ENT>.02480</ENT> <ENT>.02382</ENT> <ENT>.02290</ENT> <ENT>.02204</ENT> <ENT>.02123</ENT> <ENT>.02047</ENT> <ENT>.01976</ENT> <ENT>.01908</ENT> <ENT>.01845</ENT> </ROW> <ROW> <ENT I="01">30</ENT> <ENT>.02742</ENT> <ENT>.02631</ENT> <ENT>.02527</ENT> <ENT>.02430</ENT> <ENT>.02339</ENT> <ENT>.02253</ENT> <ENT>.02172</ENT> <ENT>.02096</ENT> <ENT>.02025</ENT> <ENT>.01957</ENT> </ROW> <ROW> <ENT I="01">31</ENT> <ENT>.02910</ENT> <ENT>.02793</ENT> <ENT>.02683</ENT> <ENT>.02579</ENT> <ENT>.02482</ENT> <ENT>.02391</ENT> <ENT>.02306</ENT> <ENT>.02225</ENT> <ENT>.02149</ENT> <ENT>.02077</ENT> </ROW> <ROW> <ENT I="01">32</ENT> <ENT>.03089</ENT> <ENT>.02965</ENT> <ENT>.02849</ENT> <ENT>.02739</ENT> <ENT>.02636</ENT> <ENT>.02540</ENT> <ENT>.02449</ENT> <ENT>.02363</ENT> <ENT>.02282</ENT> <ENT>.02206</ENT> </ROW> <ROW> <ENT I="01">33</ENT> <ENT>.03282</ENT> <ENT>.03151</ENT> <ENT>.03028</ENT> <ENT>.02912</ENT> <ENT>.02803</ENT> <ENT>.02701</ENT> <ENT>.02604</ENT> <ENT>.02513</ENT> <ENT>.02427</ENT> <ENT>.02346</ENT> </ROW> <ROW> <ENT I="01">34</ENT> <ENT>.03489</ENT> <ENT>.03350</ENT> <ENT>.03220</ENT> <ENT>.03097</ENT> <ENT>.02982</ENT> <ENT>.02873</ENT> <ENT>.02771</ENT> <ENT>.02674</ENT> <ENT>.02583</ENT> <ENT>.02497</ENT> </ROW> <ROW> <ENT I="01">35</ENT> <ENT>.03713</ENT> <ENT>.03567</ENT> <ENT>.03429</ENT> <ENT>.03299</ENT> <ENT>.03177</ENT> <ENT>.03061</ENT> <ENT>.02953</ENT> <ENT>.02850</ENT> <ENT>.02753</ENT> <ENT>.02661</ENT> </ROW> <ROW> <ENT I="01">36</ENT> <ENT>.03953</ENT> <ENT>.03798</ENT> <ENT>.03653</ENT> <ENT>.03515</ENT> <ENT>.03386</ENT> <ENT>.03263</ENT> <ENT>.03148</ENT> <ENT>.03039</ENT> <ENT>.02936</ENT> <ENT>.02838</ENT> </ROW> <ROW> <ENT I="01">37</ENT> <ENT>.04211</ENT> <ENT>.04048</ENT> <ENT>.03894</ENT> <ENT>.03748</ENT> <ENT>.03611</ENT> <ENT>.03481</ENT> <ENT>.03359</ENT> <ENT>.03243</ENT> <ENT>.03134</ENT> <ENT>.03030</ENT> </ROW> <ROW> <ENT I="01">38</ENT> <ENT>.04490</ENT> <ENT>.04318</ENT> <ENT>.04155</ENT> <ENT>.04001</ENT> <ENT>.03856</ENT> <ENT>.03719</ENT> <ENT>.03589</ENT> <ENT>.03466</ENT> <ENT>.03350</ENT> <ENT>.03239</ENT> </ROW> <ROW> <ENT I="01">39</ENT> <ENT>.04791</ENT> <ENT>.04609</ENT> <ENT>.04437</ENT> <ENT>.04274</ENT> <ENT>.04120</ENT> <ENT>.03975</ENT> <ENT>.03837</ENT> <ENT>.03707</ENT> <ENT>.03583</ENT> <ENT>.03466</ENT> </ROW> <ROW> <ENT I="01">40</ENT> <ENT>.05116</ENT> <ENT>.04924</ENT> <ENT>.04742</ENT> <ENT>.04571</ENT> <ENT>.04408</ENT> <ENT>.04254</ENT> <ENT>.04108</ENT> <ENT>.03970</ENT> <ENT>.03839</ENT> <ENT>.03714</ENT> </ROW> <ROW> <ENT I="01">41</ENT> <ENT>.05469</ENT> <ENT>.05267</ENT> <ENT>.05075</ENT> <ENT>.04894</ENT> <ENT>.04722</ENT> <ENT>.04559</ENT> <ENT>.04405</ENT> <ENT>.04258</ENT> <ENT>.04119</ENT> <ENT>.03987</ENT> </ROW> <ROW> <ENT I="01">42</ENT> <ENT>.05851</ENT> <ENT>.05638</ENT> <ENT>.05436</ENT> <ENT>.05245</ENT> <ENT>.05063</ENT> <ENT>.04891</ENT> <ENT>.04728</ENT> <ENT>.04573</ENT> <ENT>.04425</ENT> <ENT>.04285</ENT> </ROW> <ROW> <ENT I="01">43</ENT> <ENT>.06263</ENT> <ENT>.06039</ENT> <ENT>.05827</ENT> <ENT>.05625</ENT> <ENT>.05433</ENT> <ENT>.05252</ENT> <ENT>.05079</ENT> <ENT>.04915</ENT> <ENT>.04759</ENT> <ENT>.04610</ENT> </ROW> <ROW> <ENT I="01">44</ENT> <ENT>.06707</ENT> <ENT>.06472</ENT> <ENT>.06248</ENT> <ENT>.06035</ENT> <ENT>.05834</ENT> <ENT>.05642</ENT> <ENT>.05459</ENT> <ENT>.05286</ENT> <ENT>.05121</ENT> <ENT>.04963</ENT> </ROW> <ROW> <ENT I="01">45</ENT> <ENT>.07180</ENT> <ENT>.06933</ENT> <ENT>.06698</ENT> <ENT>.06474</ENT> <ENT>.06262</ENT> <ENT>.06059</ENT> <ENT>.05867</ENT> <ENT>.05684</ENT> <ENT>.05509</ENT> <ENT>.05342</ENT> </ROW> <ROW> <ENT I="01">46</ENT> <ENT>.07685</ENT> <ENT>.07425</ENT> <ENT>.07178</ENT> <ENT>.06943</ENT> <ENT>.06720</ENT> <ENT>.06507</ENT> <ENT>.06304</ENT> <ENT>.06110</ENT> <ENT>.05926</ENT> <ENT>.05750</ENT> </ROW> <ROW> <ENT I="01">47</ENT> <ENT>.08218</ENT> <ENT>.07946</ENT> <ENT>.07687</ENT> <ENT>.07440</ENT> <ENT>.07205</ENT> <ENT>.06981</ENT> <ENT>.06768</ENT> <ENT>.06564</ENT> <ENT>.06369</ENT> <ENT>.06183</ENT> </ROW> <ROW> <ENT I="01">48</ENT> <ENT>.08784</ENT> <ENT>.08499</ENT> <ENT>.08228</ENT> <ENT>.07969</ENT> <ENT>.07722</ENT> <ENT>.07487</ENT> <ENT>.07262</ENT> <ENT>.07047</ENT> <ENT>.06842</ENT> <ENT>.06646</ENT> </ROW> <ROW> <ENT I="01">49</ENT> <ENT>.09382</ENT> <ENT>.09085</ENT> <ENT>.08801</ENT> <ENT>.08530</ENT> <ENT>.08271</ENT> <ENT>.08024</ENT> <ENT>.07788</ENT> <ENT>.07562</ENT> <ENT>.07346</ENT> <ENT>.07140</ENT> </ROW> <ROW> <ENT I="01">50</ENT> <ENT>.10018</ENT> <ENT>.09707</ENT> <ENT>.09410</ENT> <ENT>.09127</ENT> <ENT>.08856</ENT> <ENT>.08597</ENT> <ENT>.08349</ENT> <ENT>.08112</ENT> <ENT>.07885</ENT> <ENT>.07667</ENT> </ROW> <ROW> <ENT I="01">51</ENT> <ENT>.10691</ENT> <ENT>.10367</ENT> <ENT>.10057</ENT> <ENT>.09761</ENT> <ENT>.09477</ENT> <ENT>.09206</ENT> <ENT>.08946</ENT> <ENT>.08697</ENT> <ENT>.08459</ENT> <ENT>.08231</ENT> </ROW> <ROW> <ENT I="01">52</ENT> <ENT>.11399</ENT> <ENT>.11061</ENT> <ENT>.10738</ENT> <ENT>.10429</ENT> <ENT>.10132</ENT> <ENT>.09849</ENT> <ENT>.09577</ENT> <ENT>.09316</ENT> <ENT>.09066</ENT> <ENT>.08826</ENT> </ROW> <ROW> <ENT I="01">53</ENT> <ENT>.12142</ENT> <ENT>.11791</ENT> <ENT>.11454</ENT> <ENT>.11132</ENT> <ENT>.10823</ENT> <ENT>.10526</ENT> <ENT>.10242</ENT> <ENT>.09969</ENT> <ENT>.09707</ENT> <ENT>.09456</ENT> </ROW> <ROW> <ENT I="01">54</ENT> <ENT>.12921</ENT> <ENT>.12556</ENT> <ENT>.12206</ENT> <ENT>.11870</ENT> <ENT>.11548</ENT> <ENT>.11239</ENT> <ENT>.10942</ENT> <ENT>.10657</ENT> <ENT>.10383</ENT> <ENT>.10120</ENT> </ROW> <ROW> <ENT I="01">55</ENT> <ENT>.13738</ENT> <ENT>.13359</ENT> <ENT>.12995</ENT> <ENT>.12646</ENT> <ENT>.12311</ENT> <ENT>.11989</ENT> <ENT>.11679</ENT> <ENT>.11382</ENT> <ENT>.11096</ENT> <ENT>.10820</ENT> </ROW> <ROW> <ENT I="01">56</ENT> <ENT>.14595</ENT> <ENT>.14202</ENT> <ENT>.13824</ENT> <ENT>.13462</ENT> <ENT>.13113</ENT> <ENT>.12778</ENT> <ENT>.12456</ENT> <ENT>.12146</ENT> <ENT>.11847</ENT> <ENT>.11560</ENT> </ROW> <ROW> <ENT I="01">57</ENT> <ENT>.15491</ENT> <ENT>.15084</ENT> <ENT>.14693</ENT> <ENT>.14317</ENT> <ENT>.13955</ENT> <ENT>.13607</ENT> <ENT>.13272</ENT> <ENT>.12949</ENT> <ENT>.12638</ENT> <ENT>.12338</ENT> </ROW> <ROW> <ENT I="01">58</ENT> <ENT>.16424</ENT> <ENT>.16004</ENT> <ENT>.15599</ENT> <ENT>.15209</ENT> <ENT>.14834</ENT> <ENT>.14473</ENT> <ENT>.14125</ENT> 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</ROW> <ROW> <ENT I="01">82</ENT> <ENT>.51145</ENT> <ENT>.50563</ENT> <ENT>.49990</ENT> <ENT>.49427</ENT> <ENT>.48873</ENT> <ENT>.48328</ENT> <ENT>.47792</ENT> <ENT>.47265</ENT> <ENT>.46746</ENT> <ENT>.46235</ENT> </ROW> <ROW> <ENT I="01">83</ENT> <ENT>.52983</ENT> <ENT>.52407</ENT> <ENT>.51841</ENT> <ENT>.51284</ENT> <ENT>.50735</ENT> <ENT>.50195</ENT> <ENT>.49663</ENT> <ENT>.49139</ENT> <ENT>.48624</ENT> <ENT>.48116</ENT> </ROW> <ROW> <ENT I="01">84</ENT> <ENT>.54828</ENT> <ENT>.54261</ENT> <ENT>.53702</ENT> <ENT>.53151</ENT> <ENT>.52609</ENT> <ENT>.52075</ENT> <ENT>.51549</ENT> <ENT>.51030</ENT> <ENT>.50519</ENT> <ENT>.50015</ENT> </ROW> <ROW> <ENT I="01">85</ENT> <ENT>.56693</ENT> <ENT>.56135</ENT> <ENT>.55586</ENT> <ENT>.55044</ENT> <ENT>.54510</ENT> <ENT>.53983</ENT> <ENT>.53464</ENT> <ENT>.52952</ENT> <ENT>.52447</ENT> <ENT>.51949</ENT> </ROW> <ROW> <ENT I="01">86</ENT> <ENT>.58560</ENT> <ENT>.58013</ENT> <ENT>.57474</ENT> <ENT>.56943</ENT> <ENT>.56418</ENT> <ENT>.55901</ENT> <ENT>.55390</ENT> <ENT>.54886</ENT> <ENT>.54389</ENT> <ENT>.53898</ENT> </ROW> <ROW> <ENT I="01">87</ENT> <ENT>.60398</ENT> <ENT>.59864</ENT> <ENT>.59337</ENT> <ENT>.58817</ENT> <ENT>.58303</ENT> <ENT>.57795</ENT> <ENT>.57294</ENT> <ENT>.56799</ENT> <ENT>.56310</ENT> <ENT>.55828</ENT> </ROW> <ROW> <ENT I="01">88</ENT> <ENT>.62206</ENT> <ENT>.61685</ENT> <ENT>.61170</ENT> <ENT>.60662</ENT> <ENT>.60159</ENT> <ENT>.59663</ENT> <ENT>.59173</ENT> <ENT>.58688</ENT> <ENT>.58209</ENT> <ENT>.57736</ENT> </ROW> <ROW> <ENT I="01">89</ENT> <ENT>.63980</ENT> <ENT>.63474</ENT> <ENT>.62972</ENT> <ENT>.62477</ENT> <ENT>.61987</ENT> <ENT>.61503</ENT> <ENT>.61024</ENT> <ENT>.60551</ENT> <ENT>.60083</ENT> <ENT>.59620</ENT> </ROW> <ROW> <ENT I="01">90</ENT> <ENT>.65719</ENT> <ENT>.65227</ENT> <ENT>.64741</ENT> <ENT>.64259</ENT> <ENT>.63783</ENT> <ENT>.63312</ENT> <ENT>.62846</ENT> <ENT>.62385</ENT> <ENT>.61928</ENT> <ENT>.61477</ENT> </ROW> <ROW> <ENT I="01">91</ENT> <ENT>.67388</ENT> <ENT>.66912</ENT> <ENT>.66440</ENT> <ENT>.65973</ENT> <ENT>.65511</ENT> <ENT>.65053</ENT> <ENT>.64600</ENT> <ENT>.64152</ENT> <ENT>.63708</ENT> <ENT>.63269</ENT> </ROW> <ROW> <ENT I="01">92</ENT> <ENT>.68949</ENT> <ENT>.68487</ENT> <ENT>.68030</ENT> <ENT>.67577</ENT> <ENT>.67129</ENT> <ENT>.66685</ENT> <ENT>.66245</ENT> <ENT>.65809</ENT> <ENT>.65378</ENT> <ENT>.64950</ENT> </ROW> <ROW> <ENT I="01">93</ENT> <ENT>.70401</ENT> <ENT>.69954</ENT> <ENT>.69511</ENT> <ENT>.69072</ENT> <ENT>.68637</ENT> <ENT>.68205</ENT> <ENT>.67778</ENT> <ENT>.67355</ENT> <ENT>.66935</ENT> <ENT>.66519</ENT> </ROW> <ROW> <ENT I="01">94</ENT> <ENT>.71765</ENT> <ENT>.71332</ENT> <ENT>.70902</ENT> <ENT>.70477</ENT> <ENT>.70055</ENT> <ENT>.69636</ENT> <ENT>.69222</ENT> <ENT>.68810</ENT> <ENT>.68403</ENT> <ENT>.67998</ENT> </ROW> <ROW> <ENT I="01">95</ENT> <ENT>.73072</ENT> <ENT>.72653</ENT> <ENT>.72237</ENT> <ENT>.71825</ENT> <ENT>.71416</ENT> <ENT>.71010</ENT> <ENT>.70608</ENT> <ENT>.70209</ENT> <ENT>.69813</ENT> <ENT>.69421</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.74311</ENT> <ENT>.73906</ENT> <ENT>.73504</ENT> <ENT>.73105</ENT> <ENT>.72709</ENT> <ENT>.72316</ENT> <ENT>.71926</ENT> <ENT>.71539</ENT> <ENT>.71155</ENT> <ENT>.70774</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.75465</ENT> <ENT>.75073</ENT> <ENT>.74684</ENT> <ENT>.74297</ENT> <ENT>.73914</ENT> <ENT>.73533</ENT> <ENT>.73155</ENT> <ENT>.72780</ENT> <ENT>.72407</ENT> <ENT>.72037</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.76555</ENT> <ENT>.76175</ENT> <ENT>.75798</ENT> <ENT>.75424</ENT> <ENT>.75052</ENT> <ENT>.74683</ENT> <ENT>.74317</ENT> <ENT>.73953</ENT> <ENT>.73591</ENT> <ENT>.73232</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.77626</ENT> <ENT>.77260</ENT> <ENT>.76895</ENT> <ENT>.76534</ENT> <ENT>.76174</ENT> <ENT>.75817</ENT> <ENT>.75462</ENT> <ENT>.75109</ENT> <ENT>.74759</ENT> <ENT>.74411</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.78676</ENT> <ENT>.78323</ENT> <ENT>.77971</ENT> <ENT>.77622</ENT> <ENT>.77274</ENT> <ENT>.76929</ENT> <ENT>.76586</ENT> <ENT>.76245</ENT> <ENT>.75906</ENT> <ENT>.75569</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.79719</ENT> <ENT>.79379</ENT> <ENT>.79040</ENT> <ENT>.78703</ENT> <ENT>.78368</ENT> <ENT>.78035</ENT> <ENT>.77704</ENT> <ENT>.77375</ENT> <ENT>.77048</ENT> <ENT>.76722</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.80749</ENT> <ENT>.80422</ENT> <ENT>.80096</ENT> <ENT>.79772</ENT> <ENT>.79450</ENT> <ENT>.79130</ENT> <ENT>.78811</ENT> <ENT>.78494</ENT> <ENT>.78178</ENT> <ENT>.77864</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.81775</ENT> <ENT>.81461</ENT> <ENT>.81149</ENT> <ENT>.80838</ENT> <ENT>.80529</ENT> <ENT>.80221</ENT> <ENT>.79914</ENT> <ENT>.79609</ENT> <ENT>.79306</ENT> <ENT>.79003</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.82881</ENT> <ENT>.82582</ENT> <ENT>.82284</ENT> <ENT>.81988</ENT> <ENT>.81693</ENT> <ENT>.81399</ENT> <ENT>.81106</ENT> <ENT>.80815</ENT> <ENT>.80525</ENT> <ENT>.80236</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.83959</ENT> <ENT>.83674</ENT> <ENT>.83391</ENT> <ENT>.83108</ENT> <ENT>.82826</ENT> <ENT>.82546</ENT> <ENT>.82267</ENT> <ENT>.81988</ENT> <ENT>.81711</ENT> <ENT>.81435</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.85373</ENT> <ENT>.85108</ENT> <ENT>.84844</ENT> <ENT>.84581</ENT> <ENT>.84319</ENT> <ENT>.84058</ENT> <ENT>.83797</ENT> <ENT>.83537</ENT> <ENT>.83278</ENT> <ENT>.83020</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.87113</ENT> <ENT>.86875</ENT> <ENT>.86636</ENT> <ENT>.86399</ENT> <ENT>.86161</ENT> <ENT>.85925</ENT> <ENT>.85689</ENT> <ENT>.85453</ENT> <ENT>.85218</ENT> <ENT>.84984</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.89913</ENT> <ENT>.89721</ENT> <ENT>.89529</ENT> <ENT>.89337</ENT> <ENT>.89145</ENT> <ENT>.88953</ENT> <ENT>.88762</ENT> <ENT>.88571</ENT> <ENT>.88380</ENT> <ENT>.88189</ENT> </ROW> <ROW RUL="s"> <ENT I="01">109</ENT> <ENT>.94900</ENT> <ENT>.94800</ENT> <ENT>.94700</ENT> <ENT>.94600</ENT> <ENT>.94500</ENT> <ENT>.94400</ENT> <ENT>.94300</ENT> <ENT>.94200</ENT> <ENT>.94100</ENT> <ENT>.94000</ENT> </ROW> </GPOTABLE> <GPOTABLE COLS="11" OPTS="L2" CDEF="s25,6,6,6,6,6,6,6,6,6,6"> <TTITLE>Table U(1)—Based on Life Table 90CM Unitrust Single Life Remainder Factors</TTITLE> <TDESC>[Applicable After April 30, 1999, and Before May 1, 2009]</TDESC> <BOXHD> <CHED H="1">Age</CHED> <CHED H="1">Interest rate</CHED> <CHED H="2">12.2%</CHED> <CHED H="2">12.4%</CHED> <CHED H="2">12.6%</CHED> <CHED H="2">12.8%</CHED> <CHED H="2">13.0%</CHED> <CHED H="2">13.2%</CHED> <CHED H="2">13.4%</CHED> <CHED H="2">13.6%</CHED> <CHED H="2">13.8%</CHED> <CHED H="2">14.0%</CHED> </BOXHD> <ROW> <ENT I="01">0</ENT> <ENT>.01208</ENT> <ENT>.01197</ENT> <ENT>.01187</ENT> <ENT>.01177</ENT> <ENT>.01168</ENT> <ENT>.01159</ENT> <ENT>.01151</ENT> <ENT>.01143</ENT> <ENT>.01135</ENT> <ENT>.01128</ENT> </ROW> <ROW> <ENT I="01">1</ENT> <ENT>.00378</ENT> <ENT>.00367</ENT> <ENT>.00358</ENT> <ENT>.00348</ENT> <ENT>.00340</ENT> <ENT>.00331</ENT> <ENT>.00323</ENT> <ENT>.00316</ENT> <ENT>.00309</ENT> <ENT>.00302</ENT> </ROW> <ROW> <ENT I="01">2</ENT> <ENT>.00353</ENT> <ENT>.00342</ENT> <ENT>.00331</ENT> <ENT>.00322</ENT> <ENT>.00312</ENT> <ENT>.00304</ENT> <ENT>.00295</ENT> <ENT>.00288</ENT> <ENT>.00280</ENT> <ENT>.00273</ENT> </ROW> <ROW> <ENT I="01">3</ENT> <ENT>.00350</ENT> <ENT>.00339</ENT> <ENT>.00327</ENT> <ENT>.00317</ENT> <ENT>.00307</ENT> <ENT>.00298</ENT> <ENT>.00289</ENT> <ENT>.00281</ENT> <ENT>.00273</ENT> <ENT>.00265</ENT> </ROW> <ROW> <ENT I="01">4</ENT> <ENT>.00359</ENT> <ENT>.00347</ENT> <ENT>.00335</ENT> <ENT>.00324</ENT> <ENT>.00313</ENT> <ENT>.00303</ENT> <ENT>.00294</ENT> <ENT>.00285</ENT> <ENT>.00276</ENT> <ENT>.00268</ENT> </ROW> <ROW> <ENT I="01">5</ENT> <ENT>.00377</ENT> <ENT>.00363</ENT> <ENT>.00351</ENT> <ENT>.00339</ENT> <ENT>.00327</ENT> <ENT>.00317</ENT> <ENT>.00306</ENT> <ENT>.00297</ENT> <ENT>.00288</ENT> <ENT>.00279</ENT> </ROW> <ROW> <ENT I="01">6</ENT> <ENT>.00400</ENT> <ENT>.00386</ENT> <ENT>.00372</ENT> <ENT>.00359</ENT> <ENT>.00347</ENT> <ENT>.00335</ENT> <ENT>.00325</ENT> <ENT>.00314</ENT> <ENT>.00305</ENT> <ENT>.00295</ENT> </ROW> <ROW> <ENT I="01">7</ENT> <ENT>.00430</ENT> <ENT>.00414</ENT> <ENT>.00400</ENT> <ENT>.00386</ENT> <ENT>.00373</ENT> <ENT>.00360</ENT> <ENT>.00349</ENT> <ENT>.00338</ENT> <ENT>.00327</ENT> <ENT>.00317</ENT> </ROW> <ROW> <ENT I="01">8</ENT> <ENT>.00465</ENT> <ENT>.00448</ENT> <ENT>.00432</ENT> <ENT>.00417</ENT> <ENT>.00403</ENT> <ENT>.00390</ENT> <ENT>.00378</ENT> <ENT>.00366</ENT> <ENT>.00354</ENT> <ENT>.00344</ENT> </ROW> <ROW> <ENT I="01">9</ENT> <ENT>.00508</ENT> <ENT>.00490</ENT> <ENT>.00473</ENT> <ENT>.00457</ENT> <ENT>.00442</ENT> <ENT>.00428</ENT> <ENT>.00414</ENT> <ENT>.00402</ENT> <ENT>.00389</ENT> <ENT>.00378</ENT> </ROW> <ROW> <ENT I="01">10</ENT> <ENT>.00560</ENT> <ENT>.00541</ENT> <ENT>.00523</ENT> <ENT>.00506</ENT> <ENT>.00490</ENT> <ENT>.00475</ENT> <ENT>.00460</ENT> <ENT>.00446</ENT> <ENT>.00433</ENT> <ENT>.00421</ENT> </ROW> <ROW> <ENT I="01">11</ENT> 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</ROW> <ROW> <ENT I="01">95</ENT> <ENT>.69031</ENT> <ENT>.68645</ENT> <ENT>.68262</ENT> <ENT>.67881</ENT> <ENT>.67504</ENT> <ENT>.67130</ENT> <ENT>.66759</ENT> <ENT>.66390</ENT> <ENT>.66025</ENT> <ENT>.65662</ENT> </ROW> <ROW> <ENT I="01">96</ENT> <ENT>.70396</ENT> <ENT>.70021</ENT> <ENT>.69648</ENT> <ENT>.69279</ENT> <ENT>.68912</ENT> <ENT>.68548</ENT> <ENT>.68186</ENT> <ENT>.67828</ENT> <ENT>.67471</ENT> <ENT>.67118</ENT> </ROW> <ROW> <ENT I="01">97</ENT> <ENT>.71670</ENT> <ENT>.71305</ENT> <ENT>.70943</ENT> <ENT>.70584</ENT> <ENT>.70227</ENT> <ENT>.69872</ENT> <ENT>.69520</ENT> <ENT>.69171</ENT> <ENT>.68824</ENT> <ENT>.68480</ENT> </ROW> <ROW> <ENT I="01">98</ENT> <ENT>.72875</ENT> <ENT>.72521</ENT> <ENT>.72169</ENT> <ENT>.71819</ENT> <ENT>.71472</ENT> <ENT>.71127</ENT> <ENT>.70784</ENT> <ENT>.70444</ENT> <ENT>.70106</ENT> <ENT>.69770</ENT> </ROW> <ROW> <ENT I="01">99</ENT> <ENT>.74065</ENT> <ENT>.73721</ENT> <ENT>.73379</ENT> <ENT>.73040</ENT> <ENT>.72703</ENT> <ENT>.72368</ENT> <ENT>.72035</ENT> <ENT>.71704</ENT> <ENT>.71375</ENT> <ENT>.71048</ENT> </ROW> <ROW> <ENT I="01">100</ENT> <ENT>.75234</ENT> <ENT>.74901</ENT> <ENT>.74570</ENT> <ENT>.74241</ENT> <ENT>.73914</ENT> <ENT>.73589</ENT> <ENT>.73265</ENT> <ENT>.72944</ENT> <ENT>.72625</ENT> <ENT>.72307</ENT> </ROW> <ROW> <ENT I="01">101</ENT> <ENT>.76399</ENT> <ENT>.76077</ENT> <ENT>.75757</ENT> <ENT>.75438</ENT> <ENT>.75122</ENT> <ENT>.74807</ENT> <ENT>.74494</ENT> <ENT>.74183</ENT> <ENT>.73873</ENT> <ENT>.73565</ENT> </ROW> <ROW> <ENT I="01">102</ENT> <ENT>.77552</ENT> <ENT>.77241</ENT> <ENT>.76932</ENT> <ENT>.76625</ENT> <ENT>.76319</ENT> <ENT>.76015</ENT> <ENT>.75712</ENT> <ENT>.75411</ENT> <ENT>.75111</ENT> <ENT>.74813</ENT> </ROW> <ROW> <ENT I="01">103</ENT> <ENT>.78703</ENT> <ENT>.78404</ENT> <ENT>.78106</ENT> <ENT>.77809</ENT> <ENT>.77514</ENT> <ENT>.77221</ENT> <ENT>.76929</ENT> <ENT>.76638</ENT> <ENT>.76348</ENT> <ENT>.76060</ENT> </ROW> <ROW> <ENT I="01">104</ENT> <ENT>.79948</ENT> <ENT>.79662</ENT> <ENT>.79377</ENT> <ENT>.79093</ENT> <ENT>.78810</ENT> <ENT>.78528</ENT> <ENT>.78248</ENT> <ENT>.77969</ENT> <ENT>.77691</ENT> <ENT>.77414</ENT> </ROW> <ROW> <ENT I="01">105</ENT> <ENT>.81159</ENT> <ENT>.80885</ENT> <ENT>.80612</ENT> <ENT>.80340</ENT> <ENT>.80069</ENT> <ENT>.79799</ENT> <ENT>.79530</ENT> <ENT>.79262</ENT> <ENT>.78995</ENT> <ENT>.78729</ENT> </ROW> <ROW> <ENT I="01">106</ENT> <ENT>.82763</ENT> <ENT>.82506</ENT> <ENT>.82250</ENT> <ENT>.81995</ENT> <ENT>.81741</ENT> <ENT>.81488</ENT> <ENT>.81235</ENT> <ENT>.80983</ENT> <ENT>.80732</ENT> <ENT>.80482</ENT> </ROW> <ROW> <ENT I="01">107</ENT> <ENT>.84749</ENT> <ENT>.84516</ENT> <ENT>.84283</ENT> <ENT>.84051</ENT> <ENT>.83819</ENT> <ENT>.83587</ENT> <ENT>.83356</ENT> <ENT>.83126</ENT> <ENT>.82896</ENT> <ENT>.82666</ENT> </ROW> <ROW> <ENT I="01">108</ENT> <ENT>.87999</ENT> <ENT>.87808</ENT> <ENT>.87618</ENT> <ENT>.87428</ENT> <ENT>.87238</ENT> <ENT>.87049</ENT> <ENT>.86859</ENT> <ENT>.86670</ENT> <ENT>.86481</ENT> <ENT>.86293</ENT> </ROW> <ROW> <ENT I="01">109</ENT> <ENT>.93900</ENT> <ENT>.93800</ENT> <ENT>.93700</ENT> <ENT>.93600</ENT> <ENT>.93500</ENT> <ENT>.93400</ENT> <ENT>.93300</ENT> <ENT>.93200</ENT> <ENT>.93100</ENT> <ENT>.93000</ENT> </ROW> </GPOTABLE> <P> (7) <E T="03">Effective/applicability dates.</E> Paragraphs (f)(1) through (f)(6) apply after April 30, 1999, and before May 1, 2009. </P> <P> (g) <E T="03">Valuation of charitable remainder unitrusts having certain payout sequences for transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023</E> —(1) <E T="03">In general.</E> Except as otherwise provided in paragraph (g)(2) of this section, in the case of transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023, the present value of a remainder interest is determined under paragraphs (g)(3) through (6) of this section, provided that the amount of the payout as of any payout date during any taxable year of the trust is not larger than the amount that the trust could distribute on such date under § 1.664-3(a)(1)(v) if the taxable year of the trust were to end on such date. See, however, § 1.7520-3(b) (relating to exceptions to the use of the prescribed tables under certain circumstances). </P> <P> (2) <E T="03">Transitional rules for valuation of charitable remainder unitrusts.</E> (i) For purposes of section 2055, 2106, or 2624, if on May 1, 2009, the decedent was under a mental disability so that the disposition of the property could not be changed, and the decedent died on or after May 1, 2009, but before June 2, 2023, without having regained the ability to dispose of the decedent's property, or if the decedent died within 90 days of the date that the decedent first regained that ability on or after May 1, 2009, but before June 2, 2023, the present value of a remainder interest under this section is determined as if the valuation date with respect to the decedent's gross estate is either before May 1, 2009, or after April 30, 2009, at the option of the decedent's executor. </P> <P> (ii) For purposes of section 170, 2055, 2106, 2522, or 2624, in the case of transfers to a charitable remainder unitrust for which the valuation date is on or after May 1, 2009, and before July 1, 2009, the present value of a remainder interest based on one or more measuring lives is determined under this section by using the section 7520 interest rate for the month in which the valuation date occurs (see §§ 1.7520-1(b) and 1.7520-2(a)(2)) and the appropriate actuarial tables under either paragraph <PRTPAGE P="289"/> (f)(6) or (g)(6) of this section, at the option of the donor or the decedent's executor, as the case may be. </P> <P>(iii) For purposes of paragraphs (g)(2)(i) and (ii) of this section, where the donor or decedent's executor is given the option to use the appropriate actuarial tables under either paragraph (f)(6) or (g)(6) of this section, the donor or decedent's executor must consistently use the same mortality basis with respect to each interest (income, remainder, partial, etc.) in the same property, and with respect to all transfers occurring on the same valuation date. For example, gift and income tax charitable deductions with respect to the same transfer must be determined based on factors with the same mortality basis, and all assets includible in the gross estate and/or estate tax deductions claimed must be valued based on factors with the same mortality basis.</P> <P>(iv) In the case of transfers to a charitable remainder unitrust for which the valuation date is after April 30, 2019, and before June 1, 2023, the present value of the remainder interest under this section is determined under § 1.664(c)-4(e)(2).</P> <P> (3) <E T="03">Adjusted payout rate.</E> The adjusted payout rate is determined by applying the formula in § 1.664-4(e)(6)(ii) for the section 7520 interest rate applicable to the transfer to derive a factor and calculating the final result to at least six decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS, for interest rates from 0.2 to 20 percent, inclusive, and appear in Tables F(0.2) through F(20.0). Tables F(0.2) through F(20.0) can be found on the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Tables F(0.2) through F(20.0) are referenced and explained in IRS Publication 1458, <E T="03">Actuarial Valuations Version 3B.</E> The payout adjustment factors from Table F can also be found in § 1.664-4(e)(6)(iii), but only for interest rates from 4.2 to 14 percent, inclusive. Alternatively, the Commissioner may supply a factor upon a request for a ruling. See § 1.664-4(b). See § 1.664-4(e) for rules applicable in determining the adjusted payout rate. </P> <P> (4) <E T="03">Period is a term of years.</E> If the period described in § 1.664-3(a)(5) is a term of years, the factor that is used in determining the present value of the remainder interest is determined by applying the formula in § 1.664-4(e)(6)(i) under the appropriate adjusted payout rate corresponding to the number of years in the term and calculating the final result to at least six decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table D. Table D can be found on the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Table D is referenced and explained in IRS Publication 1458, <E T="03">Actuarial Valuations Version 3B.</E> The remainder factors from Table D also can be found in § 1.664-4(e)(6)(iii), but only for adjusted payout rates from 4.2 to 14 percent, inclusive. If the adjusted payout rate is a percentage that is between the adjusted payout rate for which factors are provided by Table D, an exact method of obtaining the applicable remainder factors (such as through software using the actual rate of return and the actuarial formula provided in § 1.664-4(e)(6)(i)) or a linear interpolation must be used, provided whichever method used is applied consistently in valuing all interests in the same property. The applicable remainder factors derived by an exact method or by interpolation must be expressed to at least six decimal places. The present value of the remainder interest is determined by multiplying the net fair market value (as of the appropriate valuation date) of the property placed in trust by the factor determined under this paragraph (g)(4). Generally, for purposes of this section, the valuation date is, in the case of an inter vivos transfer, the date on which the property is transferred to the trust by the donor, and, in the case of a testamentary transfer under section 2055, 2106, or 2624, the valuation date is the date of death. See § 1.664-4(e)(4) for additional rules regarding the valuation date, and for an example that illustrates the application of this paragraph (g)(4). </P> <P> (5) <E T="03">Period is the life of one individual.</E> If the period described in § 1.664-3(a)(5) is <PRTPAGE P="290"/> the life of one individual, the factor that is used in determining the present value of the remainder interest for transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023, may be computed directly by using the formula in § 1.664-4(e)(5)(i) to derive a remainder factor from the appropriate mortality table and calculating the final result to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table U(1). Table U(1) can be found on the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). Table U(1) is referenced and explained in IRS Publication 1458, <E T="03">Actuarial Valuations Version 3B.</E> The remainder factors from Table U(1) also can be found in paragraph (g)(6) of this section, but only for adjusted payout rates from 4.2 to 14 percent, inclusive. For purposes of the computations described in this paragraph (g)(5), the age of an individual is the age of that individual at the individual's nearest birthday. If the adjusted payout rate is a percentage that is between the adjusted payout rate for which factors are provided by Table U(1), an exact method of obtaining the applicable factors (such as through software using the actual rate of return and the actuarial formula provided in § 1.664-4(e)(5)(i)) or a linear interpolation must be used, provided whichever method used is applied consistently in valuing all interests in the same property. The applicable remainder factors derived by an exact method or by interpolation must be expressed to at least five decimal places. The rules provided in § 1.664-4(e)(5) apply for determining the present value of the remainder interest. See § 1.664-4(e)(5) for an example illustrating the application of this paragraph (g)(5) (using current actuarial tables). </P> <P> (6) <E T="03">Actuarial Table U(1) for transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023.</E> For transfers for which the valuation date is on or after May 1, 2009, and before June 1, 2023, and without regard to the headings in the tables in this paragraph (g)(6) that do not contain this termination date for the applicability of the tables, the present value of a charitable remainder unitrust interest that is dependent on the termination of a life interest is determined by using the section 7520 rate, Table U(1) in this paragraph (g)(6), and Tables F(4.2) through F(14.0) in § 1.664-4(e)(6)(iii). See, however, § 1.7520-3(b) (relating to exceptions to the use of prescribed tables under certain circumstances). Actuarial factors that do not appear in the following tables may be computed directly by using the formula in § 1.664-4(e)(5)(i) to derive remainder factors from the appropriate mortality table and calculating the result to at least five decimal places. For the convenience of taxpayers, actuarial factors have been computed by the IRS and appear in Table U(1) that is referenced and explained by IRS Publication 1458, <E T="03">Actuarial Valuations Version 3B</E> (2009). The table is available at no charge, electronically via the IRS website at <E T="03">https://www.irs.gov/retirement-plans/actuarial-tables</E> (or a corresponding URL as may be updated from time to time). </P> <GPH SPAN="2" DEEP="397"> <PRTPAGE P="291"/> <GID>ER10AU11.024</GID> </GPH> <GPH SPAN="2" DEEP="400"> <PRTPAGE P="292"/> <GID>ER10AU11.025</GID> </GPH> <GPH SPAN="2" DEEP="437"> <PRTPAGE P="293"/> <GID>ER10AU11.026</GID> </GPH> <GPH SPAN="2" DEEP="397"> <PRTPAGE P="294"/> <GID>ER10AU11.027</GID> </GPH> <GPH SPAN="2" DEEP="400"> <PRTPAGE P="295"/> <GID>ER10AU11.028</GID> </GPH> <GPH SPAN="2" DEEP="437"> <PRTPAGE P="296"/> <GID>ER10AU11.029</GID> </GPH> <GPH SPAN="2" DEEP="397"> <PRTPAGE P="297"/> <GID>ER10AU11.030</GID> </GPH> <GPH SPAN="2" DEEP="400"> <PRTPAGE P="298"/> <GID>ER10AU11.031</GID> </GPH> <GPH SPAN="2" DEEP="437"> <PRTPAGE P="299"/> <GID>ER10AU11.032</GID> </GPH> <GPH SPAN="2" DEEP="397"> <PRTPAGE P="300"/> <GID>ER10AU11.033</GID> </GPH> <GPH SPAN="2" DEEP="400"> <PRTPAGE P="301"/> <GID>ER10AU11.034</GID> </GPH> <GPH SPAN="2" DEEP="437"> <PRTPAGE P="302"/> <GID>ER10AU11.035</GID> </GPH> <GPH SPAN="2" DEEP="397"> <PRTPAGE P="303"/> <GID>ER10AU11.036</GID> </GPH> <GPH SPAN="2" DEEP="400"> <PRTPAGE P="304"/> <GID>ER10AU11.037</GID> </GPH> <GPH SPAN="2" DEEP="437"> <PRTPAGE P="305"/> <GID>ER10AU11.038</GID> </GPH> <PRTPAGE P="306"/> <P> (7) <E T="03">Applicability dates.</E> Paragraphs (g)(1) through (6) of this section apply on and after May 1, 2009, and before June 1, 2023. </P> <CITA>[T.D. 8540, 59 FR 30102, 30116, 30117, 30148, June 10, 1994, as amended by T.D. 8819, 64 FR 23199, 23209, Apr. 30, 1999; T.D. 8886, 65 FR 36943, June 12, 2000; T.D. 9448, 74 FR 21465, 21482, May 7, 2009; T.D. 9540, 76 FR 49612, Aug. 10, 2011; T.D. 9974, 88 FR 37433, June 7, 2023; 88 FR 37436, June 7, 2023]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">treatment of excess distributions of trusts applicable to taxable years beginning on or after january 1, 1969</HD> <SECTION> <SECTNO>§ 1.665(a)-0A</SECTNO> <SUBJECT>Excess distributions by trusts; scope of subpart D.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) Subpart D (section 665 and following), part I, subchapter J, chapter 1 of the Code as amended by the Tax Reform Act of 1969, is designed to tax the beneficiary of a trust that accumulates, rather than distributes, all or part of its income currently ( <E T="03">i.e.</E> , an accumulation trust), in most cases, as if the income had been currently distributed to the beneficiary instead of accumulated by the trusts. Accordingly, subpart D provides special rules for the treatment of amounts paid, credited, or required to be distributed by a complex trust (one that is subject to subpart C (section 661 and following) of such part I) in any year in excess of “distributable net income” (as defined in section 643 (a)) for that year. Such an excess distribution is an “accumulation distribution” (as defined in section 665(b)). The special rules of subpart D are generally inapplicable to amounts paid, credited, or required to be distributed by a trust in a taxable year in which it qualifies as a simple trust (one that is subject to subpart B (section 651 and following) of such part I). However, see § 1.665(e)-1A(b) for rules relating to the treatment of a simple trust as a complex trust. </P> <P>(2) An accumulation distribution is deemed to consist of, first, “undistributed net income” (as defined in section 665(a)) of the trust from preceding taxable years, and, after all the undistributed net income for all preceding taxable years has been deemed distributed, “undistributed capital gain” (as defined in section 665(f)) of the trust for all preceding taxable years commencing with the first year such amounts were accumulated. An accumulation distribution of undistributed capital gain is a “capital gain distribution” (as defined in section 665(g)). To the extent an accumulation distribution exceeds the “undistributed net income” and “undistributed capital gain” so determined, it is deemed to consist of corpus.</P> <P>(3) The accumulation distribution is “thrown back” to the earliest “preceding taxable year” of the trust, which, in the case of distributions made for a taxable year beginning after December 31, 1973, from a trust (other than a foreign trust created by a U.S. person), is any taxable year beginning after December 31, 1968. Special transitional rules apply for distributions made in taxable years beginning before January 1, 1974. In the case of a foreign trust created by a U.S. person, a “preceding taxable year” is any year of the trust to which the Code applies.</P> <P>(4) A distribution of undistributed net income (included in an accumulation distribution) and a capital gain distribution will be included in the income of the beneficiary in the year they are actually paid, credited, or required to be distributed to him. The tax on the distribution will be approximately the amount of tax the beneficiary would have paid with respect to the distribution had the income and capital gain been distributed to the beneficiary in the year earned by the trust. An additional amount equal to the “taxes imposed on the trust” for the preceding year is also deemed distributed. To prevent double taxation, however, the beneficiary receives a credit for such taxes.</P> <P> (b) <E T="03">Effective dates.</E> All regulations sections under subpart D (sections 665 through 669) which have an “A” suffix (such as § 1.665(a)A and § 1.666(b)-1A) are applicable to taxable years beginning on or after January 1, 1969, and all references therein to sections 665 through 669 are references to such sections as amended by the Tax Reform Act of 1969. Sections without the “A” suffix (such as § 1.666(b)-1) are applicable only to taxable years beginning before January 1, 1969, and all references therein to sections 665 through 669 are references <PRTPAGE P="307"/> to such sections before amendment by the Tax Reform Act of 1969. </P> <P> (c) <E T="03">Examples.</E> Where examples contained in the regulations under subpart D refer to tax rates for years after 1968, such tax rates are not necessarily the actual rates for such years, but are only used for example purposes. </P> <P> (d) <E T="03">Applicability to estates.</E> Subpart D does not apply to any estate. </P> <CITA>[T.D. 7204, 37 FR 17135, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(a)-1A</SECTNO> <SUBJECT>Undistributed net income.</SUBJECT> <P> (a) <E T="03">Domestic trusts.</E> The term <E T="03">undistributed net income,</E> in the case of a trust (other than a foreign trust created by a U.S. person) means, for any taxable year beginning after December 31, 1968, the distributable net income of the trust for that year (as determined under section 643(a)), less: </P> <P>(1) The amount of income required to be distributed currently and any other amounts properly paid or credited or required to be distributed to beneficiaries in the taxable year as specified in section 661(a), and</P> <P>(2) The amount of taxes imposed on the trust attributable to such distributable net income, as defined in § 1.665 (d)-1A. The application of the rule in this paragraph to a taxable year of a trust in which income is accumulated may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>Under the terms of the trust, $10,000 of income is required to be distributed currently to A and the trustee has discretion to make additional distributions to A. During the taxable year 1971 the trust had distributable net income of $30,100 derived from royalties and the trustee made distributions of $20,000 to A. The taxable income of the trust is $10,000 on which a tax of $2,190 is paid. The undistributed net income of the trust for the taxable year 1971 is $7,910, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>$30,100</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="02">Income currently distributable to A</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to A</ENT> <ENT>10,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">Taxes imposed on the trust attributable to the undistributed net income (see § 1.665(d)-1A)</ENT> <ENT>2,190</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Total</ENT> <ENT>22,190</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>7,910</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (b) <E T="03">Foreign trusts.</E> The undistributed net income of a foreign trust created by a U.S. person for any taxable year is the distributable net income of such trust (see § 1.643(a)-6 and the examples set forth in paragraph (b) thereof), less: </P> <P>(1) The amount of income required to be distributed currently and any other amounts properly paid or credited or required to be distributed to beneficiaries in the taxable year as specified in section 661(a), and</P> <P>(2) The amount of taxes imposed on such trust by chapter 1 of the Internal Revenue Code, which are attributable to items of income which are required to be included in such distributable net income.</P> <FP>For purposes of subparagraph (2) of this paragraph, the amount of taxes imposed on the trust for any taxable year by chapter 1 of the Internal Revenue Code is the amount of taxes imposed pursuant to section 871 (relating to tax on non-resident alien individuals) which is properly allocable to the undistributed portion of the distributable net income. See § 1.665(d)-1A. The amount of taxes imposed pursuant to section 871 is the difference between the total tax imposed pursuant to that section on the foreign trust created by a U.S. person for the year and the amount which would have been imposed on such trust had all the distributable net income, as determined under section 643(a), been distributed. The application of the rule in this paragraph may be illustrated by the following examples:</FP> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> A trust was created in 1952 under the laws of Country X by the transfer to a trustee in Country X of property by a U.S. person. The entire trust constitutes a foreign trust created by a U.S. person. The governing instrument of the trust provides that $7,000 of income is required to be distributed currently to a U.S. beneficiary and gives the trustee discretion to make additional distributions to the beneficiary. During the taxable year 1973 the trust had income of $10,000 from dividends of a U.S. corporation (on which Federal income taxes of $3,000 were imposed pursuant to section 871 and withheld under section 1441, resulting in the receipt by the trust of cash in the amount of $7,000), $20,000 in capital gains from the sale of stock of a Country Y corporation and $30,000 from dividends of a Country X corporation, none of the gross income of which was derived from sources <PRTPAGE P="308"/> within the United States. No income taxes were required to be paid to Country X or Country Y in 1973. The trustee did not file a U.S. income tax return for the taxable year 1973. The distributable net income of the trust before distributions to the beneficiary for 1973 is $60,000 ($57,000 of which is cash). During 1973 the trustee made distributions to the U.S. beneficiary equaling one-half of the trust's distributable net income. Thus, the U.S. beneficiary is treated as having had distributed to him $5,000 (composed of $3,500 as a cash distribution and $1,500 as the tax imposed pursuant to section 871 and withheld under section 1441), representing one-half of the income from U.S. sources; $10,000 in cash, representing one-half of the capital gains from the sale of stock of the Country Y corporation; and $15,000 in cash, representing one-half of the income from Country X sources for a total of $30,000. The undistributed net income of the trust at the close of taxable year 1973 is $28,500 computed as follows: </P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>$60,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="12">(1) Amounts distributed to the beneficiary:</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary</ENT> <ENT>$7,000</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary</ENT> <ENT>21,500</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary</ENT> <ENT>1,500</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>80,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">(2) Amount of taxes imposed on the trust under chapter 1 of the Code attributable to the undistributed net income (See § 1.665 (d)-1A) $3,000 less $1,500)</ENT> <ENT>$1,500</ENT> </ROW> <ROW RUL="n,s"> <ENT I="03">Total</ENT> <ENT>$31,500</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>28,500</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The facts are the same as in example 1 except that property has been transferred to the trust by a person other than a U.S. person, and during 1973 the foreign trust created by a U.S. person was 60 percent of the entire foreign trust. The trustee paid no income taxes to Country X or Country Y in 1973.</P> <P>(1) The undistributed net income of the portion of the entire trust which is a foreign trust created by a U.S. person for 1973 is $17,100, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="11">Distributable net income (60% of each item of gross income of entire trust):</ENT> </ROW> <ROW> <ENT I="02">60% of $10,000 U.S. dividends</ENT> <ENT>$6,000</ENT> </ROW> <ROW> <ENT I="02">60% of $20,000 Country X capital gains</ENT> <ENT>12,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">60% of $30,000 Country X dividends</ENT> <ENT>18,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>36,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Less:</ENT> </ROW> <ROW> <ENT I="12">(i) Amounts distributed to the beneficiary—</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary (60% of $7,000)</ENT> <ENT>$4,200</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary (60% of $21,500)</ENT> <ENT>12,900</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary (60% of $1,500)</ENT> <ENT>900</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>18,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">(ii) Amount of taxes imposed on the trust under chapter 1 of the Code attributable to the undistributed net income (see § 1.665 (d)-1A) (60% of $1,500)</ENT> <ENT>900</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="03">Total</ENT> <ENT>18,900</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>17,100</ENT> </ROW> </GPOTABLE> <P>(2) The undistributed net income of the portion of the entire trust which is not a foreign trust created by a U.S. person for 1973 is $11,400, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="11">Distributable net income (40% of each item of gross income of entire trust)</ENT> </ROW> <ROW> <ENT I="02">40% of $10,000 U.S. dividends</ENT> <ENT>$4,000</ENT> </ROW> <ROW> <ENT I="02">40% of $20,000 Country X capital gains</ENT> <ENT>8,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="02">40% of $30,000 Country X dividends</ENT> <ENT>12,000</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>24,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="12">(i) Amounts distributed to the beneficiary—</ENT> </ROW> <ROW> <ENT I="02">Income currently distributed to the beneficiary (40% of $7,000)</ENT> <ENT>$2,800</ENT> </ROW> <ROW> <ENT I="02">Other amounts distributed to the beneficiary (40% of $21,500)</ENT> <ENT>8,600</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Taxes under sec. 871 deemed distributed to the beneficiary (40% of $1,500)</ENT> <ENT>600</ENT> </ROW> <ROW> <ENT I="03">Total amounts distributed to the beneficiary</ENT> <ENT>12,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">(ii) Amount of taxes imposed on the trust under chapter 1 of the Code attributable to the undistributed net income (See § 1.665 (d)-1A) (40% of $1,500)</ENT> <ENT>600</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="03">Total</ENT> <ENT>12,600</ENT> </ROW> <ROW> <ENT I="03">Undistributed net income</ENT> <ENT>11,400</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (c) <E T="03">Effect of prior distributions.</E> The undistributed net income for any year to which an accumulation distribution for a later year may be thrown back will be reduced by accumulation distributions in intervening years that are required to be thrown back to such year. For example, if a trust has undistributed net income for 1975, and an accumulation distribution is made in 1980, there must be taken into account the effect on undistributed net income for <PRTPAGE P="309"/> 1975 of any accumulation distribution made in 1976, 1977, 1978, or 1979. However, undistributed net income for any year will not be reduced by any distributions in any intervening years that are excluded under section 663(a)(1), relating to gifts, bequests, etc. See paragraph (d) of § 1.666(a)-1A for an illustration of the reduction of undistributed net income for any year by a subsequent accumulation distribution. </P> <P> (d) <E T="03">Distributions made in taxable years beginning before January 1, 1974.</E> For special rules relating to accumulation distributions of undistributed net income made in taxable years of the trust beginning before January 1, 1974, see § 1.665(b)-2A. </P> <CITA>[T.D. 7204, 37 FR 17136, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(b)-1A</SECTNO> <SUBJECT>Accumulation distributions.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) For any taxable year of a trust the term <E T="03">accumulation distribution</E> means an amount by which the amounts properly paid, credited, or required to be distributed within the meaning of section 661(a)(2) ( <E T="03">i.e.,</E> all amounts properly paid, credited, or required to be distributed to the beneficiary other than income required to be distributed currently within the meaning of section 661(a)(1)) for that year exceed the distributable net income (determined under section 643(a)) of the trust, reduced (but not below zero) by the amount of income required to be distributed currently. To the extent provided in section 663(b) and the regulations thereunder, distributions made within the first 65 days following a taxable year may be treated as having been distributed on the last day of such taxable year. </P> <P>(2) An accumulation distribution also includes, for a taxable year of the trust, any amount to which section 661(a)(2) and the preceding paragraph are inapplicable and which is paid, credited, or required to be distributed during the taxable year of the trust by reason of the exercise of a power to appoint, distribute, consume, or withdraw corpus of the trust or income of the trust accumulated in a preceding taxable year. No accumulation distribution is deemed to be made solely because the grantor or any other person is treated as owner of a portion of the trust by reason of an unexercised power to appoint, distribute, consume, or withdraw corpus or accumulated income of the trust. Nor will an accumulation distribution be deemed to have been made by reason of the exercise of a power that may affect only taxable income previously attributed to the holders of such power under subpart E (section 671 and following). See example 4 of paragraph (d) of this section for an example of an accumulation distribution occurring as a result of the exercise of a power of withdrawal.</P> <P>(3) Although amounts properly paid or credited under section 661(a) do not exceed the income of the trust during the taxable year, an accumulation distribution may result if the amounts properly paid or credited under section 661(a)(2) exceed distributable net income reduced (but not below zero) by the amount required to be distributed currently under section 661(a)(1). This may occur, for example, when expenses, interest, taxes, or other items allocable to corpus are taken into account in determining taxable income and hence causing distributable net income to be less than the trust's income.</P> <P> (b) <E T="03">Payments that are accumulation distributions.</E> The following are some instances in which an accumulation distribution may arise: </P> <P> (1) <E T="03">One trust to another.</E> A distribution from one trust to another trust is generally an accumulation distribution. See § 1.643(c)-1. This general rule will apply regardless of whether the distribution is to an existing trust or to a newly created trust and regardless of whether the trust to which the distribution is made was created by the same person who created the trust from which the distribution is made or a different person. However, a distribution made from one trust to a second trust will be deemed an accumulation distribution by the first trust to an ultimate beneficiary of the second trust if the primary purpose of the distribution to the second trust is to avoid the capital gain distribution provisions (see section 669 and the regulations thereunder). An amount passing from one separate share of a trust to another separate share of the same trust is not <PRTPAGE P="310"/> an accumulation distribution. See § 1.665(g)-2A. For rules relating to the computation of the beneficiary's tax under section 668 by reason of an accumulation distribution from the second trust, see paragraphs (b)(1) and (c)(1)(i) of § 1.668(b)-1A and paragraphs (b)(1) and (c)(1)(i) of § 1.669(b)-1A. </P> <P> (2) <E T="03">Income accumulated during minority.</E> A distribution of income accumulated during the minority of the beneficiary is generally an accumulation distribution. For example, if a trust accumulates income until the beneficiary's 21st birthday, and then distributes the income to the beneficiary, such a distribution is an accumulation distribution. However, see § 1.665(b)-2A for rules governing income accumulated in taxable years beginning before January 1, 1969. </P> <P> (3) <E T="03">Amounts paid for support.</E> To the extent that amounts forming all or part of an accumulation distribution are applied or distributed for the support of a dependent under the circumstances specified in section 677(b) or section 678(c) or are used to discharge or satisfy any person's legal obligation as that term is used in § 1.662(a)-4, such amounts will be considered as having been distributed directly to the person whose obligation is being satisfied. </P> <P> (c) <E T="03">Payments that are not accumulation distributions</E> —(1) <E T="03">Gifts, bequests, etc., described in section 663(a)(1).</E> A gift or bequest of a specific sum of money or of specific property described in section 663(a)(1) is not an accumulation distribution. </P> <P> (2) <E T="03">Charitable payments.</E> Any amount paid, permanently set aside, or used for the purposes specified in section 642(c) is not an accumulation distribution, even though no charitable deduction is allowed under such section with respect to such payment. </P> <P> (3) <E T="03">Income required to be distributed currently.</E> No accumulation distribution will arise by reason of a payment of income required to be distributed currently even though such income exceeds the distributable net income of the trust because the payment is an amount specified in section 661(a)(1). </P> <P> (d) <E T="03">Examples.</E> The provisions of this section may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A trustee properly makes a distribution to a beneficiary of $20,000 during the taxable year 1976, of which $10,000 is income required to be distributed currently to the beneficiary. The distributable net income of the trust is $15,000. There is an accumulation distribution of $5,000 computed as follows.</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income required to be distributed currently (section 661(a)(1))</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>10,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Distributable net income</ENT> <ENT>$15,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Income required to be distributed currently</ENT> <ENT>10,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Balance of distributable net income</ENT> <ENT>5,000</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Under the terms of the trust instrument, an annuity of $15,000 is required to be paid to A out of income each year and the trustee may in his discretion make distributions out of income or corpus to B. During the taxable year the trust had income of $18,000, as defined in section 643(b), and expenses allocable to corpus of $5,000. Distributable net income amounted to $13,000. The trustee distributed $15,000 of income to A and, in the exercise of his discretion, paid $5,000 to B. There is an accumulation distribution of $5,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income required to be distributed currently to A (section 661(a)(1))</ENT> <ENT>15,000</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>5,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Distributable net income</ENT> <ENT>$13,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Income required to be distributed currently to A</ENT> <ENT>15,000</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Balance of distributable net income</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="03">Accumulation distribution to B</ENT> <ENT>5,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>Under the terms of a trust instrument, the trustee may either accumulate the trust income or make distributions to A and B. The trustee may also invade corpus for the benefit of A and B. During the taxable year, the trust had income as defined in section 643(b) of $22,000 and expenses of $5,000 allocable to corpus. Distributable net income amounts to $17,000. The trustee distributed $10,000 each to A and B during the taxable year. There is an accumulation distribution of $3,000 computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Total distribution</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Income required to be distributed currently</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="03">Other amounts distributed (section 661(a)(2))</ENT> <ENT>20,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="01">Distributable net income</ENT> <ENT>$17,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="01">Less: Income required to be distributed currently</ENT> <ENT>0</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="01">Balance of distributable net income</ENT> <ENT>17,000</ENT> </ROW> <ROW> <PRTPAGE P="311"/> <ENT I="03">Accumulation distribution</ENT> <ENT>3,000</ENT> </ROW> </GPOTABLE> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>A dies in 1974 and bequeaths one-half the residue of his estate in trust. His widow, W, is given a power, exercisable solely by her, to require the trustee to pay her each year of the trust $5,000 from corpus. W's right to exercise such power was exercisable at any time during the year but was not cumulative, so that, upon her failure to exercise it before the end of any taxable year of the trust, her right as to that year lapsed. The trust's taxable year is the calendar year. During the calendar years 1975 and 1976, W did not exercise her right and it lapsed as to those years. In the calendar years 1977 and 1978, in which years the trust had not distributable net income, she exercised her right and withdrew $4,000 in 1977 and $5,000 in 1978. No accumulation distribution was made by the trust in the calendar years 1975 and 1976. An accumulation distribution of $4,000 was made in 1977 and an accumulation distribution of $5,000 was made in 1978. The accumulation distribution for the years 1977 and 1978 is not reduced by any amount of income of the trust attributable to her under section 678 by reason of her power of withdrawal.</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17137, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(b)-2A</SECTNO> <SUBJECT>Special rules for accumulation distributions made in taxable years beginning before January 1, 1974.</SUBJECT> <P> (a) <E T="03">General rule.</E> Section 331(d)(2)(A) of the Tax Reform Act of 1969 excludes certain accumulated income from the tax imposed by section 668(a)(2) by providing certain exceptions from the definition of an “accumulation distribution.” Any amount paid, credited, or required to be distributed by a trust (other than a foreign trust created by a U.S. person) during a taxable year of the trust beginning after December 31, 1968, and before January 1, 1974, shall not be subject to the tax imposed by section 668(a)(2) to the extent of the portion of such amount that (1) would be allocated under section 666(a) to a preceding taxable year of the trust beginning before January 1, 1969, and (2) would not have been deemed an accumulation distribution because of the provisions of paragraphs (1), (2), (3), or (4) of section 665(b) as in effect on December 31, 1968, had the trust distributed such amounts on the last day of its last taxable year beginning before January 1, 1969. However, the $2,000 <E T="03">de minimis</E> exception formerly in section 665(b) does not apply in the case of any distribution made in a taxable year of a trust beginning after December 31, 1968. Amounts to which this exclusion applies shall reduce the undistributed net income of the trust for the preceding taxable year or years to which such amounts would be allocated under section 666(a). However, since section 668(a)(2) does not apply to such amounts, no amount of taxes imposed on the trust allocable to such undistributed net income is deemed distributed under section 666 (b) and (c). </P> <P> (b) <E T="03">Application of general rule.</E> The rule expressed in paragraph (a) of this section is applied to the exceptions formerly in section 665(b) as follows: </P> <P> (1) <E T="03">Distributions from amounts accumulated while beneficiary is under 21.</E> (i) Paragraph (1) of section 665(b) as in effect on December 31, 1968, provided that amounts paid, credited, or required to be distributed to a beneficiary as income accumulated before the birth of such beneficiary or before such beneficiary attains the age of 21 were not to be considered to be accumulation distributions. If an accumulation distribution is made in a taxable year of the trust beginning after December 31, 1968, and before January 1, 1974, and under section 666(a) such accumulation distribution would be allocated to a preceding taxable year beginning before January 1, 1969, no tax shall be imposed under section 668(a)(2) to the extent the income earned by the trust for such preceding taxable year would be deemed under § 1.665(b)-2(b)(1) to have been accumulated before the beneficiary's birth or before his 21st birthday. The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust on the calendar year basis was established on January 1, 1965, to accumulate the income during the minority of B, and to pay the accumulated income over to B upon his attaining the age of 21. B's 21st birthday is January 1, 1973. On January 2, 1973, the trustee pays over to B all the accumulated income of the trust. The distribution is an accumulation distribution that may be allocated under section 666(a) to 1968, 1969, 1970, 1971, and 1972 (the 5 preceding taxable years as defined in § 1.665(e)-1A). To the extent the distribution is allocated to 1968, no tax is imposed under section 668(a)(2).</P> </EXAMPLE> <P> (ii) As indicated in paragraph (a) of this section, a distribution of an <PRTPAGE P="312"/> amount excepted from the tax otherwise imposed under section 668(a)(2) will reduce undistributed net income for the purpose of determining the effect of a future distribution. Thus, under the facts of the example in subdivision (i) of this subparagraph, the undistributed net income for the trust's taxable year 1968 would be reduced by the amount of the distribution allocated to that year under section 666(a). </P> <P> (2) <E T="03">Emergency distributions.</E> Paragraph (2) of section 665(b) as in effect on December 31, 1968, provided an exclusion from the definition of an accumulation distribution for amounts properly paid or credited to a beneficiary to meet his emergency needs. Therefore, if an accumulation distribution is made from a trust in a taxable year beginning before January 1, 1974, and under section 666(a) such accumulation distribution would be allocated to a preceding taxable year of the trust beginning before January 1, 1969, no tax shall be imposed under section 668(a)(2) if such distribution would have been considered an emergency distribution under § 1.665(b)-2(b)(2) had it been made in a taxable year of the trust beginning before January 1, 1969. For example, assume a trust on a calendar year basis in 1972 makes an accumulation distribution which under § 1.665(b)-2(b) (2) would be considered an emergency distribution and under section 666(a) the distribution would be allocated to the years 1967, 1968, and 1969. To the extent such amount is allocated to 1967 and 1968, no tax would be imposed under section 668(a)(2). </P> <P> (3) <E T="03">Certain distributions at specified ages.</E> Paragraph (3) of section 665(b) as in effect on December 31, 1968, provided an exclusion (in the case of certain trusts created before January 1, 1954) from the definition of an accumulation distribution for amounts properly paid or credited to a beneficiary upon his attaining a specified age or ages, subject to certain restrictions (see § 1.665(b)-2(b)(3)). Therefore, a distribution from a trust in a taxable year beginning after December 31, 1968, will not be subject to the tax imposed under section 668(a)(2) to the extent such distribution would be allocated to a preceding taxable year of the trust beginning before January 1, 1969, if such distribution would have qualified under the provisions of § 1.665(b)-2(b)(3) had it been made in a taxable year of the trust to which such section was applicable. </P> <P> (4) <E T="03">Certain final distributions.</E> Paragraph (4) of section 665(b) as in effect on December 31, 1968, provided an exclusion from the definition of an accumulation distribution for amounts properly paid or credited to a beneficiary as a final distribution of the trust if such final distribution was made more than 9 years after the date of the last transfer to such trust. Therefore, amounts properly paid or credited to a beneficiary as a final distribution of a trust in a taxable year of a trust beginning after December 31, 1968, and before January 1, 1974, will not be subject to the tax imposed under section 668(a)(2) to the extent such distribution would be allocated to a preceding taxable year of the trust beginning before January 1, 1969, if such final distribution was made more than 9 years after the date of the last transfer to such trust. The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust on a calendar year basis was established on January 1, 1958, and no additional transfers were made to it. On January 1, 1973, the trustee terminates the trust and on the same day he makes a final distribution to the beneficiary, B. The distribution is an accumulation distribution that may be allocated under section 666(a) to 1968, 1969, 1970, 1971, and 1972 (the 5 preceding taxable years as defined in § 1.665(e)-1A). Because more than 9 years elapsed between the date of the last transfer to the trust and the date of final distribution, the distribution is not taxed under section 668 (a) (2) to the extent it would be allocated to 1968 under section 666(a).</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17138, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(c)-1A</SECTNO> <SUBJECT>Special rule applicable to distributions by certain foreign trusts.</SUBJECT> <P> (a) <E T="03">In general.</E> Except as provided in paragraph (b) of this section, for purposes of section 665 any amount paid to a U.S. person which is from a payor who is not a U.S. person and which is derived directly or indirectly from a foreign trust created by a U.S. person shall be deemed in the year of payment <PRTPAGE P="313"/> to the U.S. person to have been directly paid to the U.S. person by the trust. For example, if a nonresident alien receives a distribution from a foreign trust created by a U.S. person and then pays the amount of the distribution over to a U.S. person, the payment of such amount to the U.S. person represents an accumulation distribution to the U.S. person from the trust to the extent that the amount received would have been an accumulation distribution had the trust paid the amount directly to the U.S. person in the year in which the payment was received by the U.S. person. This section also applies in a case where a nonresident alien receives indirectly an accumulation distribution from a foreign trust created by a U.S. person and then pays it over to a U.S. person. An example of such a transaction is one where the foreign trust created by a U.S. person makes the distribution to an intervening foreign trust created by either a U.S. person or a person other than a U.S. person and the intervening trust distributes the amount received to a nonresident alien who in turn pays it over to a U.S. person. Under these circumstances, it is deemed that the payment received by the U.S. person was received directly from a foreign trust created by a U.S. person. </P> <P> (b) <E T="03">Limitation.</E> In the case of a distribution to a beneficiary who is a U.S. person, paragraph (a) of this section does not apply if the distribution is received by such beneficiary under circumstances indicating lack of intent on the part of the parties to circumvent the purposes for which section 7 of the Revenue Act of 1962 (76 Stat. 985) was enacted. </P> <CITA>[T.D. 7204, 37 FR 17139 Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(d)-1A</SECTNO> <SUBJECT>Taxes imposed on the trust.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) For purposes of subpart D, the term <E T="03">taxes imposed on the trust</E> means the amount of Federal income taxes properly imposed for any taxable year on the trust that are attributable to the undistributed portions of distributable net income and gains in excess of losses from the sales or exchanges of capital assets. Except as provided in paragraph (c)(2) of this section, the minimum tax for tax preferences imposed by section 56 is not a tax attributable to the undistributed portions of distributable net income and gains in excess of losses from the sales or exchanges of capital assets. See section 56 and the regulations thereunder. </P> <P> (2) In the case of a trust that has received an accumulation distribution from another trust, the term <E T="03">taxes imposed on the trust</E> also includes the amount of taxes deemed distributed under §§ 1.666(b)-1A, 1.666(c)-1A, 1.669(d)-1A, and 1.669(e)-1A (whichever are applicable) as a result of such accumulation distribution, to the extent that they were taken into account under paragraphs (b)(2) or (c)(1)(vi) of § 1.668 (b)-1A and (b)(2) or (c)(1)(vi) of § 1.669(b)-1A in computing the partial tax on such accumulation distribution. For example, assume that trust A, a calendar year trust, makes an accumulation distribution in 1975 to trust B, also on the calendar year basis, in connection with which $500 of taxes are deemed under § 1.666(b)-1A to be distributed to trust B. The partial tax on the accumulation distribution is computed under paragraph (b) of § 1.668(b)-1A (the exact method) to be $600 and all of the $500 is used under paragraph (b)(2) of § 1.668(b)-1A to reduce the partial tax to $100. The taxes imposed on trust B for 1975 will, in addition to the $100 partial tax, also include the $500 used to reduce the partial tax. </P> <P> (b) <E T="03">Taxes imposed on the trust attributable to undistributed net income.</E> (1) For the purpose of subpart D, the term <E T="03">taxes imposed on the trust attributable to the undistributed net income</E> means the amount of Federal income taxes for the taxable year properly allocable to the undistributed portion of the distributable net income for such taxable year. This amount is (i) an amount that bears the same relationship to the total taxes of the trust for the year (other than the minimum tax for tax preferences imposed by section 56), computed after the allowance of credits under section 642(a), as ( <E T="03">a</E> ) the taxable income of the trust, other than the capital gains not included in distributable net income less their share of section 1202 deduction, bears to ( <E T="03">b</E> ) the total taxable income of the trust for such year or, (ii) if the alternative <PRTPAGE P="314"/> tax computation under section 1201(b) is used and there are no net short-term gains, an amount equal to such total taxes less the amount of the alternative tax imposed on the trust and attributable to the capital gain. Thus, for the purposes of subpart D, in determining the amount of taxes imposed on the trust attributable to the undistributed net income, that portion of the taxes paid by the trust attributable to capital gain allocable to corpus is excluded. The rule stated in this subparagraph may be illustrated by the following example, which assumes that the alternative tax computation is not used: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(1) Under the terms of a trust, which reports on the calendar year basis, the income may be accumulated or distributed to A in the discretion of the trustee and capital gains are allocable to corpus. During the taxable year 1974, the trust had income of $20,000 from royalties, long-term capital gains of $10,000, and expenses of $2,000. The trustee in his discretion made a distribution of $10,000 to A. The taxes imposed on the trust for such year attributable to the undistributed net income are $2,319, determined as shown below.</P> <P>(2) The distributable net income of the trust computed under section 643(a) is $18,000 (royalties of $20,000 less expenses of $2,000). The total taxes paid by the trust are $3,787, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Royalties</ENT> <ENT>$20,000</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Capital gain allocable to corpus</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="03">Gross income</ENT> <ENT>30,000</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="11">Deductions:</ENT> </ROW> <ROW> <ENT I="02">Expenses</ENT> <ENT>$2,000</ENT> </ROW> <ROW> <ENT I="02">Distributions to A</ENT> <ENT>10,000</ENT> </ROW> <ROW> <ENT I="02">Capital gain deduction</ENT> <ENT>5,000</ENT> </ROW> <ROW RUL="n,s,n"> <ENT I="02">Personal exemption</ENT> <ENT>100</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>17,100</ENT> </ROW> <ROW> <ENT I="01">Taxable income</ENT> <ENT>12,900</ENT> </ROW> <ROW> <ENT I="03">Total income taxes</ENT> <ENT>3,787</ENT> </ROW> </GPOTABLE> <P>(3) Taxable income other than capital gains less the section 1202 deduction is $7,900 ($12,900−($10,000−$5,000)). Therefore, the amount of taxes imposed on the trust attributable to the undistributed net income is $2,319, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">$3,787 (total taxes) × $7,900 (taxable income other than capital gains not included in d.n.i. less the 1202 deduction) divided by $12,900 (taxable income)</ENT> <ENT>$2,319</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P>(2) If in any taxable year an accumulation distribution of undistributed net income is made by the trust which results in a throwback to a prior year, the taxes of the prior year imposed on the trust attributable to any remaining undistributed net income of such prior year are the taxes prescribed in subparagraph (1) of this paragraph reduced by the taxes of the prior year deemed distributed under section 666 (b) or (c). The provisions of this subparagraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>Assume the same facts as in the example in subparagraph (1) of this paragraph. In 1975 the trust makes an accumulation distribution, of which an amount of undistributed net income is deemed distributed in 1974. Taxes imposed on the trust (in the amount of $1,000) attributable to the undistributed net income are therefore deemed distributed in such year. Consequently, the taxes imposed on the trust subsequent to the 1975 distribution attributable to the remaining undistributed net income are $1,319 ($2,319 less $1,000).</P> </EXAMPLE> <P> (c) <E T="03">Taxes imposed on the trust attributable to undistributed capital gain</E> —(1) <E T="03">Regular tax.</E> For the purpose of subpart D the term <E T="03">taxes imposed on the trust attributable to undistributed capital gain</E> means the amount of Federal income taxes for the taxable year properly attributable to that portion of the excess of capital gains over capital losses of the trust that is allocable to corpus for such taxable year. Such amount is the total of: </P> <P>(i) The amount computed under subparagraph (2) of this paragraph (the minimum tax), plus</P> <P> (ii) The amount that bears the same relationship to the total taxes of the trust for the year (other than the minimum tax), computed after the allowance of credits under section 642(a), as ( <E T="03">a</E> ) the excess of capital gains over capital losses for such year that are not included in distributable net income, computed after its share of the deduction under section 1202 (relating to the deduction for capital gains) has been taken into account, bears to the greater of ( <E T="03">b</E> ) the total taxable income of the trust for such year, or ( <E T="03">c</E> ) the amount of capital gains computed under ( <E T="03">a</E> ) of this subdivision. </P> <FP> However, if the alternative tax computation under section 1201(b) is used and there are no net short-term gains, <PRTPAGE P="315"/> the amount is the amount of the alternative tax imposed on the trust and attributable to the capital gain. The application of this subparagraph may be illustrated by the following example, which assumes that the alternative tax computation is not used: </FP> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>Assume the same facts as in the example in paragraph (b)(1). The capital gains not included in d.n.i. are $10,000, and the deduction under section 1202 is $5,000. The amount of taxes imposed on the trust attributable to undistributed capital gain is $1,468, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">$3,787 (total taxes) × $5,000 (capital gains not included in d.n.i. less section 1202 deductions) divided by $12,900 (taxable income)</ENT> <ENT>$1,468</ENT> </ROW> </GPOTABLE> </EXAMPLE> <P> (2) <E T="03">Minimum tax.</E> The term <E T="03">taxes imposed on the trust attributable to the undistributed capital gain</E> also includes the minimum tax for tax preferences imposed on the trust by section 56 with respect to the undistributed capital gain. The amount of such minimum tax so included bears the same relation to the total amount of minimum tax imposed on the trust by section 56 for the taxable year as one-half the net capital gain (net section 1201 gain for taxable years beginning before January 1, 1977) (as defined in section 1222(11)) from such taxable year bears to the sum of the items of tax preference of the trust for such taxable year which are apportioned to the trust in accordance with § 1.58-3(a) (1). </P> <P> (3) <E T="03">Reduction for prior distribution.</E> If in any taxable year a capital gain distribution is made by the trust which results in a throwback to a prior year, the taxes of the prior year imposed on the trust attributable to any remaining undistributed capital gain of the prior year are the taxes prescribed in subparagraph (1) of this paragraph reduced by the taxes of the prior year deemed distributed under section 669 (d) or (e). The provisions of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>Assume the same facts as in the example in subparagraph (1) of this paragraph. In 1976, the trust makes a capital gain distribution, of which an amount of undistributed capital gain is deemed distributed in 1974. Taxes imposed on the trust (in the amount of $500) attributable to the undistributed capital gain are therefore deemed distributed in such year. Consequently, the taxes imposed on the trust attributable to the remaining undistributed capital gain are $968 ($1,468 less $500).</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17139, Aug. 25, 1972, as amended by T.D. 7728, 45 FR 72650, Nov. 3, 1980]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(e)-1A</SECTNO> <SUBJECT>Preceding taxable year.</SUBJECT> <P> (a) <E T="03">Definition</E> —(1) <E T="03">Domestic trusts</E> —(i) <E T="03">In general.</E> For purposes of subpart D, in the case of a trust other than a foreign trust created by a U.S. person, the term <E T="03">preceding taxable year</E> serves to identify and limit the taxable years of a trust to which an accumulation distribution consisting of undistributed net income or undistributed capital gain may be allocated (or “thrown back”) under section 666(a) and 669(a). An accumulation distribution consisting of undistributed net income or undistributed capital gain may not be allocated or “thrown back” to a taxable year of a trust if such year is not a “preceding taxable year.” </P> <P> (ii) <E T="03">Accumulation distributions.</E> In the case of an accumulation distribution consisting of undistributed net income made in a taxable year beginning before January 1, 1974, any taxable year of the trust that precedes by more than 5 years the taxable year of the trust in which such accumulation distribution was made is not a “preceding taxable year.” Thus, for a domestic trust on a calendar year basis, calendar year 1967 is not a “preceding taxable year” with respect to an accumulation distribution made in calendar year 1973, whereas calendar year 1968 is a “preceding taxable year.” In the case of an accumulation distribution made during a taxable year beginning after December 31, 1973, any taxable year of the trust that begins before January 1, 1969, is not a “preceding taxable year.” Thus, for a domestic trust on a calendar year basis, calendar year 1968 is not a “preceding taxable year” with respect to an accumulation distribution made in calendar year 1975, whereas calendar year 1969 is a “preceding taxable year.” </P> <P> (iii) <E T="03">Capital gain distributions.</E> In the case of an accumulation distribution that is a capital gain distribution, any taxable year of the trust that ( <E T="03">a</E> ) begins before January 1, 1969, or ( <E T="03">b</E> ) is prior to the first year in which income is accumulated, whichever occurs later, is not a “preceding taxable year.” <PRTPAGE P="316"/> Thus, for the purpose of capital gain distributions and section 669, only taxable years beginning after December 31, 1968, can be “preceding taxable years.” See § 1.688(a)-1A(c). </P> <P> (2) <E T="03">Foreign trusts created by U.S. persons.</E> For purposes of subpart D, in the case of a foreign trust created by a U.S. person, the term “preceding taxable year” does not include any taxable year to which part I of subchapter J does not apply. See section 683 and regulations thereunder. Accordingly, the provisions of subpart D may not, in the case of a foreign trust created by a U.S. person, be applied to any taxable year which begins before 1954 or ends before August 17, 1954. For example, if a foreign trust created by a U.S. person (reporting on the calendar year basis) makes a distribution during the calendar year 1970 of income accumulated during prior years, the earliest year of the trust to which the accumulation distribution may be allocated under such subpart D is 1954, but it may not be allocated to 1953 and prior years, since the Internal Revenue Code of 1939 applies to those years. </P> <P> (b) <E T="03">Simple trusts.</E> A taxable year of a trust during which the trust was a simple trust (that is, was subject to subpart B) for the entire year shall not be considered a “preceding taxable year” unless during such year the trust received “outside income” or unless the trustee did not distribute all of the income of the trust that was required to be distributed currently for such year. In such event, undistributed net income for such year shall not exceed the greater of the “outside income” or income not distributed during such year. For purposes of this paragraph, the term <E T="03">outside income</E> means amounts that are included in distributable net income of the trust for the year but that are not “income” of the trust as that term is defined in § 1.643(b)-1. Some examples of “outside income” are: </P> <P>(1) Income taxable to the trust under section 691;</P> <P>(2) Unrealized accounts receivable that were assigned to the trust; and</P> <P>(3) Distributions from another trust that include distributable net income or undistributed net income of such other trust.</P> <FP> The term <E T="03">outside income,</E> however, does not include amounts received as distributions from an estate, other than income specified in (1) and (2), for which the estate was allowed a deduction under section 661(a). The application of this paragraph may be illustrated by the following examples: </FP> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> By his will D creates a trust for his widow W. The terms of the trust require that the income be distributed currently ( <E T="03">i.e.</E> , it is a simple trust), and authorize the trustee to make discretionary payments of corpus to W. Upon W's death the trust corpus is to be distributed to D's then living issue. The executor of D's will makes a $10,000 distribution of corpus to the trust that carries out estate income consisting of dividends and interest to the trust under section 662(a)(2). The trust reports this income as its only income on its income tax return for its taxable year in which ends the taxable year of the estate in which the $10,000 distribution was made, and pays a tax thereon of $2,106. Thus, the trust has undistributed net income of $7,894 ($10,000 −$2,106). Several years later the trustee makes a discretionary corpus payment of $15,000 to W. This payment is an accumulation distribution under section 665(b). However, since the trust had no “outside income” in the year of the estate distribution, such year is not a preceding taxable year. Thus, W is not treated as receiving undistributed net income of $7,894 and taxes thereon of $2,106 for the purpose of including the same in her gross income under section 668. The result would be the same if the invasion power were not exercised and the accumulation distribution occurred as a result of the distribution of the corpus to D's issue upon the death of W. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P> Trust A, a simple trust on the calendar year basis, received in 1972 extraordinary dividends or taxable stock dividends that the trustee in good faith allocated to corpus, but that are determined in 1974 to have been currently distributable to the beneficiary. See section 643(a)(4) and § 1.643(a)-4. Trust A would qualify for treatment under subpart C for 1974, the year of distribution of the extraordinary dividends or taxable stock dividends, because the distribution is not out of income of the current taxable year and is treated as another amount properly paid or credited or required to be distributed for such taxable year within the meaning of section 661(a) (2). Also, the distribution in 1974 qualifies as an accumulation distribution for the purposes of subpart D. For purposes only of such subpart D, trust A would be treated as subject to the provisions of such subpart C for 1972, the preceding taxable year in which the extraordinary or taxable stock dividends were received, and, in computing <PRTPAGE P="317"/> undistributed net income for 1972, the extraordinary or taxable stock dividends would be included in distributable net income under section 643(a). The rule stated in the preceding sentence would also apply if the distribution in 1974 was made out of corpus without regard to a determination that the extraordinary dividends or taxable stock dividends in question were currently distributable to the beneficiary. </P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17141, Aug. 25, 1972]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.665(f)-1A</SECTNO> <RESERVED>[Reserved]</RESERVED> </SECTION> <SECTION> <SECTNO>§ 1.665(g)-1A</SECTNO> <RESERVED>[Reserved]</RESERVED> </SECTION> <SECTION> <SECTNO>§ 1.665(g)-2A</SECTNO> <SUBJECT>Application of separate share rule.</SUBJECT> <P> (a) <E T="03">In general.</E> If the separate share rule of section 663(c) is applicable for any taxable year of a trust, subpart D is applied as if each share were a separate trust except as provided in paragraph (c) of this section and in § 1.668(a)-1A(c). Thus, the amounts of an “accumulation distribution”, “undistributed net income”, “undistributed capital gain”, and “capital gain distribution” are computed separately for each share. </P> <P> (b) <E T="03">Allocation of taxes—undistributed net income.</E> The “taxes imposed on the trust attributable to the undistributed net income” are allocated as follows: </P> <P>(1) There is first allocated to each separate share that portion of the “taxes imposed on the trust attributable to the undistributed net income” (as defined in § 1.665(d)-1A(b)), computed before the allowance of any credits under section 642(a), that bears the same relation to the total of such taxes that the distributable net income of the separate share bears to the distributable net income of the trust, adjusted for this purpose as follows:</P> <P>(i) There is excluded from distributable net income of the trust and of each separate share any tax-exempt interest, foreign income of a foreign trust, and excluded dividends, to the extent such amounts are included in distributable net income pursuant to section 643(a) (5), (6), and (7); and</P> <P>(ii) The distributable net income of the trust is reduced by any deductions allowable under section 661 for amounts paid, credited, or required to be distributed during the taxable year, and the distributable net income of each separate share is reduced by any such deduction allocable to that share.</P> <P>(2) The taxes so determined for each separate share are then reduced by that portion of the credits against tax allowable to the trust under section 642(a) in computing the “taxes imposed on the trust” that bears the same relation to the total of such credits that the items of distributable net income allocable to the separate share with respect to which the credit is allowed bear to the total of such items of the trust.</P> <P> (c) <E T="03">Allocation of taxes—undistributed capital gain.</E> The “taxes imposed on the trust attributable to undistributed capital gain” are allocated as follows: </P> <P>(1) There is first allocated to each separate share that portion of the “taxes imposed on the trust attributable to undistributed capital gain” (as defined in § 1.665(d)-1A(c)), computed before the allowance of any credits under section 642(a), that bears the same relation to the total of such taxes that the undistributed capital gain (prior to the deduction of taxes under section 665(c)(2)) of the separate share bears to the total such undistributed capital gain of the trust.</P> <P>(2) The taxes so determined for each separate share are then reduced by that portion of the credits against tax allowable to the trust under section 642(a) in computing the “taxes imposed on the trust” that bears the same relation to the total of such credits that the capital gain allocable to the separate share with respect to which the credit is allowed bear to the total of such capital gain of the trust.</P> <P> (d) <E T="03">Termination of a separate share.</E> (1) If upon termination of a separate share, an amount is properly paid, credited, or required to be distributed by the trust under section 661(a)(2) to a beneficiary from such share, an accumulation distribution will be deemed to have been made to the extent of such amount. In determining the distributable net income of such share, only those items of income and deduction for the taxable year of the trust in which such share terminates, properly allocable to such share, shall be taken into consideration. </P> <P> (2) No accumulation distribution will be deemed to have been made upon the <PRTPAGE P="318"/> termination of a separate share to the extent that the property constituting such share, or a portion thereof, continues to be held as a part of the same trust. The undistributed net income, undistributed capital gain, and the taxes imposed on the trust attributable to such items, if any, for all preceding taxable years (reduced by any amounts deemed distributed under sections 666(a) and 669(a) by reason of any accumulation distribution of undistributed net income or undistributed capital gain in prior years or the current taxable year), which were allocable to the terminating share, shall be treated as being applicable to the trust itself. However, no adjustment will be made to the amounts deemed distributed under sections 666 and 669 by reason of an accumulation distribution of undistributed net income or undistributed capital gain from the surviving share or shares made in years prior to the year in which the terminating share was added to such surviving share or shares. </P> <P>(3) The provisions of this paragraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A trust was established under the will of X for the benefit of his wife and upon her death the property was to continue in the same trust for his two sons, Y and Z. The separate share rule is applicable to this trust. The trustee had discretion to pay or accumulate the income to the wife, and after her death was to pay each son's share to him after he attained the age of 25. When the wife died, Y was 23 and Z was 28.</P> <P>(1) Upon the death of X's widow, there is no accumulation distribution. The entire trust is split into two equal shares, and therefore the undistributed net income and the undistributed capital gain of the trust are split into two shares.</P> <P>(2) The distribution to Z of his share after his mother's death is an accumulation distribution of his separate share of one-half of the undistributed net income and undistributed capital gain.</P> </EXAMPLE> <CITA>[T.D. 7204, 37 FR 17142, Aug. 25, 1972]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">grantors and others treated as substantial owners</HD> <SECTION> <SECTNO>§ 1.671-1</SECTNO> <SUBJECT>Grantors and others treated as substantial owners; scope.</SUBJECT> <P>(a) Subpart E (section 671 and following), part I, subchapter J, chapter 1 of the Code, contains provisions taxing income of a trust to the grantor or another person under certain circumstances even though he is not treated as a beneficiary under subparts A through D (section 641 and following) of such part I. Sections 671 and 672 contain general provisions relating to the entire subpart. Sections 673 through 677 define the circumstances under which income of a trust is taxed to a grantor. These circumstances are in general as follows:</P> <P>(1) If the grantor has retained a reversionary interest in the trust, within specified time limits (section 673);</P> <P>(2) If the grantor or a nonadverse party has certain powers over the beneficial interests under the trust (section 674);</P> <P>(3) If certain administrative powers over the trust exist under which the grantor can or does benefit (section 675).</P> <P>(4) If the grantor or a nonadverse party has a power to revoke the trust or return the corpus to the grantor (section 676); or</P> <P>(5) If the grantor or a nonadverse party has the power to distribute income to or for the benefit of the grantor or the grantor's spouse (section 677).</P> <FP>Under section 678, income of a trust is taxed to a person other than the grantor to the extent that he has the sole power to vest corpus or income in himself.</FP> <P>(b) Sections 671 through 677 do not apply if the income of a trust is taxable to a grantor's spouse under section 71 or 682 (relating respectively to alimony and separate maintenance payments, and the income of an estate or trust in the case of divorce, etc.).</P> <P> (c) Except as provided in such subpart E, income of a trust is not included in computing the taxable income and credits of a grantor or another person solely on the grounds of his dominion and control over the trust. However, the provisions of subpart E do not apply in situations involving an assignment of future income, whether or not the assignment is to a trust. Thus, for example, a person who assigns his right to future income under an employment contract may be taxed on that income even though the assignment is to a trust over which the <PRTPAGE P="319"/> assignor has retained none of the controls specified in sections 671 through 677. Similarly, a bondholder who assigns his right to interest may be taxed on interest payments even though the assignment is to an uncontrolled trust. Nor are the rules as to family partnerships affected by the provisions of subpart E, even though a partnership interest is held in trust. Likewise, these sections have no application in determining the right of a grantor to deductions for payments to a trust under a transfer and leaseback arrangement. In addition, the limitation of the last sentence of section 671 does not prevent any person from being taxed on the income of a trust when it is used to discharge his legal obligation. See § 1.662 (a)-4. He is then treated as a beneficiary under subparts A through D or treated as an owner under section 677 because the income is distributed for his benefit, and not because of his dominion or control over the trust. </P> <P>(d) The provisions of subpart E are not applicable with respect to a pooled income fund as defined in paragraph (5) of section 642(c) and the regulations thereunder, a charitable remainder annuity trust as defined in paragraph (1) of section 664(d) and the regulations thereunder, or a charitable remainder unitrust as defined in paragraph (2) of section 664(d) and the regulations thereunder.</P> <P>(e) For the effective date of subpart E see section 683 and the regulations thereunder.</P> <P>(f) For rules relating to the treatment of liabilities resulting on the sale or other disposition of encumbered trust property due to a renunciation of powers by the grantor or other owner, see § 1.1001-2.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7148, 36 FR 20749, Oct. 29, 1971; T.D. 7741, 45 FR 81745, Dec. 12, 1980]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.671-2</SECTNO> <SUBJECT>Applicable principles.</SUBJECT> <P>(a) Under section 671 a grantor or another person includes in computing his taxable income and credits those items of income, deduction, and credit against tax which are attributable to or included in any portion of a trust of which he is treated as the owner. Sections 673 through 678 set forth the rules for determining when the grantor or another person is treated as the owner of any portion of a trust. The rules for determining the items of income, deduction, and credit against tax that are attributable to or included in a portion of the trust are set forth in § 1.671-3.</P> <P>(b) Since the principle underlying subpart E (section 671 and following), part I, subchapter J, chapter 1 of the Code, is in general that income of a trust over which the grantor or another person has retained substantial dominion or control should be taxed to the grantor or other person rather than to the trust which receives the income or to the beneficiary to whom the income may be distributed, it is ordinarily immaterial whether the income involved constitutes income or corpus for trust accounting purposes. Accordingly, when it is stated in the regulations under subpart E that “income” is attributed to the grantor or another person, the reference, unless specifically limited, is to income determined for tax purposes and not to income for trust accounting purposes. When it is intended to emphasize that income for trust accounting purposes (determined in accordance with the provisions set forth in § 1.643(b)-1 is meant, the phrase “ordinary income” is used.</P> <P>(c) An item of income, deduction, or credit included in computing the taxable income and credits of a grantor or another person under section 671 is treated as if it had been received or paid directly by the grantor or other person (whether or not an individual). For example, a charitable contribution made by a trust which is attributed to the grantor (an individual) under sections 671 through 677 will be aggregated with his other charitable contributions to determine their deductibility under the limitations of section 170(b)(1). Likewise, dividends received by a trust from sources in a particular foreign country which are attributed to a grantor or another person under subpart E will be aggregated with his other income from sources within that country to determine whether the taxpayer is subject to the limitations of section 904 with respect to credit for the tax paid to that country.</P> <P> (d) Items of income, deduction, and credit not attributed to or included in any portion of a trust of which the <PRTPAGE P="320"/> grantor or another person is treated as the owner under subpart E are subject to the provisions of subparts A through D (section 641 and following), of such part I. </P> <P> (e)(1) For purposes of part I of subchapter J, chapter 1 of the Internal Revenue Code, a grantor includes any person to the extent such person either creates a trust, or directly or indirectly makes a gratuitous transfer (within the meaning of paragraph (e)(2) of this section) of property to a trust. For purposes of this section, the term <E T="03">property</E> includes cash. If a person creates or funds a trust on behalf of another person, both persons are treated as grantors of the trust. (See section 6048 for reporting requirements that apply to grantors of foreign trusts.) However, a person who creates a trust but makes no gratuitous transfers to the trust is not treated as an owner of any portion of the trust under sections 671 through 677 or 679. Also, a person who funds a trust with an amount that is directly reimbursed to such person within a reasonable period of time and who makes no other transfers to the trust that constitute gratuitous transfers is not treated as an owner of any portion of the trust under sections 671 through 677 or 679. See also § 1.672(f)-5(a). </P> <P>(2)(i) A gratuitous transfer is any transfer other than a transfer for fair market value. A transfer of property to a trust may be considered a gratuitous transfer without regard to whether the transfer is treated as a gift for gift tax purposes.</P> <P>(ii) For purposes of this paragraph (e), a transfer is for fair market value only to the extent of the value of property received from the trust, services rendered by the trust, or the right to use property of the trust. For example, rents, royalties, interest, and compensation paid to a trust are transfers for fair market value only to the extent that the payments reflect an arm's length price for the use of the property of, or for the services rendered by, the trust. For purposes of this determination, an interest in the trust is not property received from the trust. In addition, a person will not be treated as making a transfer for fair market value merely because the transferor recognizes gain on the transaction. See, for example, section 684 regarding the recognition of gain on certain transfers to foreign trusts.</P> <P>(iii) For purposes of this paragraph (e), a gratuitous transfer does not include a distribution to a trust with respect to an interest held by such trust in either a trust described in paragraph (e)(3) of this section or an entity other than a trust.</P> <P>For example, a distribution to a trust by a corporation with respect to its stock described in section 301 is not a gratuitous transfer.</P> <P>(3) A grantor includes any person who acquires an interest in a trust from a grantor of the trust if the interest acquired is an interest in certain investment trusts described in § 301.7701-4(c) of this chapter, liquidating trusts described in § 301.7701-4(d) of this chapter, or environmental remediation trusts described in § 301.7701-4(e) of this chapter.</P> <P>(4) If a gratuitous transfer is made by a partnership or corporation to a trust and is for a business purpose of the partnership or corporation, the partnership or corporation will generally be treated as the grantor of the trust. For example, if a partnership makes a gratuitous transfer to a trust in order to secure a legal obligation of the partnership to a third party unrelated to the partnership, the partnership will be treated as the grantor of the trust. However, if a partnership or a corporation makes a gratuitous transfer to a trust that is not for a business purpose of the partnership or corporation but is for the personal purposes of one or more of the partners or shareholders, the gratuitous transfer will be treated as a constructive distribution to such partners or shareholders under federal tax principles and the partners or the shareholders will be treated as the grantors of the trust. For example, if a partnership makes a gratuitous transfer to a trust that is for the benefit of a child of a partner, the gratuitous transfer will be treated as a distribution to the partner under section 731 and a subsequent gratuitous transfer by the partner to the trust.</P> <P> (5) If a trust makes a gratuitous transfer of property to another trust, <PRTPAGE P="321"/> the grantor of the transferor trust generally will be treated as the grantor of the transferee trust. However, if a person with a general power of appointment over the transferor trust exercises that power in favor of another trust, then such person will be treated as the grantor of the transferee trust, even if the grantor of the transferor trust is treated as the owner of the transferor trust under subpart E of part I, subchapter J, chapter 1 of the Internal Revenue Code. </P> <P>(6) The following examples illustrate the rules of this paragraph (e). Unless otherwise indicated, all trusts are domestic trusts, and all other persons are United States persons. The examples are as follows:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A creates and funds a trust, T, for the benefit of her children. B subsequently makes a gratuitous transfer to T. Under paragraph (e)(1) of this section, both A and B are grantors of T.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>A makes an investment in a fixed investment trust, T, that is classified as a trust under § 301.7701-4(c)(1) of this chapter. A is a grantor of T. B subsequently acquires A's entire interest in T. Under paragraph (e)(3) of this section, B is a grantor of T with respect to such interest.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>A, an attorney, creates a foreign trust, FT, on behalf of A's client, B, and transfers $100 to FT out of A's funds. A is reimbursed by B for the $100 transferred to FT. The trust instrument states that the trustee has discretion to distribute the income or corpus of FT to B and B's children. Both A and B are treated as grantors of FT under paragraph (e)(1) of this section. In addition, B is treated as the owner of the entire trust under section 677. Because A is reimbursed for the $100 transferred to FT on behalf of B, A is not treated as transferring any property to FT. Therefore, A is not an owner of any portion of FT under sections 671 through 677 regardless of whether A retained any power over or interest in FT described in sections 673 through 677. Furthermore, A is not treated as an owner of any portion of FT under section 679. Both A and B are responsible parties for purposes of the requirements in section 6048.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>A creates and funds a trust, T. A does not retain any power or interest in T that would cause A to be treated as an owner of any portion of the trust under sections 671 through 677. B holds an unrestricted power, exercisable solely by B, to withdraw certain amounts contributed to the trust before the end of the calendar year and to vest those amounts in B. B is treated as an owner of the portion of T that is subject to the withdrawal power under section 678(a)(1). However, B is not a grantor of T under paragraph (e)(1) of this section because B neither created T nor made a gratuitous transfer to T.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P>A transfers cash to a trust, T, through a broker, in exchange for units in T. The units in T are not property for purposes of determining whether A has received fair market value under paragraph (e)(2)(ii) of this section. Therefore, A has made a gratuitous transfer to T, and, under paragraph (e)(1) of this section, A is a grantor of T.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6.</HD> <P>A borrows cash from T, a trust. A has not made any gratuitous transfers to T. Arm's length interest payments by A to T will not be treated as gratuitous transfers under paragraph (e)(2)(ii) of this section. Therefore, under paragraph (e)(1) of this section, A is not a grantor of T with respect to the interest payments.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7.</HD> <P>A, B's brother, creates a trust, T, for B's benefit and transfers $50,000 to T. The trustee invests the $50,000 in stock of Company X. C, B's uncle, purportedly sells property with a fair market value of $1,000,000 to T in exchange for the stock when it has appreciated to a fair market value of $100,000. Under paragraph (e)(2)(ii) of this section, the $900,000 excess value is a gratuitous transfer by C. Therefore, under paragraph (e)(1) of this section, A is a grantor with respect to the portion of the trust valued at $100,000, and C is a grantor of T with respect to the portion of the trust valued at $900,000. In addition, A or C or both will be treated as the owners of the respective portions of the trust of which each person is a grantor if A or C or both retain powers over or interests in such portions under sections 673 through 677.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8.</HD> <P>G creates and funds a trust, T1, for the benefit of G's children and grandchildren. After G's death, under authority granted to the trustees in the trust instrument, the trustees of T1 transfer a portion of the assets of T1 to another trust, T2, and retain a power to revoke T2 and revest the assets of T2 in T1. Under paragraphs (e)(1) and (5) of this section, G is the grantor of T1 and T2. In addition, because the trustees of T1 have retained a power to revest the assets of T2 in T1, T1 is treated as the owner of T2 under section 678(a).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9.</HD> <P>G creates and funds a trust, T1, for the benefit of B. G retains a power to revest the assets of T1 in G within the meaning of section 676. Under the trust agreement, B is given a general power of appointment over the assets of T1. B exercises the general power of appointment with respect to one-half of the corpus of T1 in favor of a trust, T2, that is for the benefit of C, B's child. Under paragraph (e)(1) of this section, G is the grantor of T1, and under paragraphs (e)(1) and (5) of this section, B is the grantor of T2.</P> </EXAMPLE> <PRTPAGE P="322"/> <P>(7) The rules of this section are applicable to any transfer to a trust, or transfer of an interest in a trust, on or after August 10, 1999.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, as amended by T.D. 8831, 64 FR 43274, Aug. 10, 1999; T.D. 8890, 65 FR 41333, July 5, 2000]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.671-3</SECTNO> <SUBJECT>Attribution or inclusion of income, deductions, and credits against tax.</SUBJECT> <P>(a) When a grantor or another person is treated under subpart E (section 671 and following) as the owner of any portion of a trust, there are included in computing his tax liability those items of income, deduction, and credit against tax attributable to or included in that portion. For example:</P> <P>(1) If a grantor or another person is treated as the owner of an entire trust (corpus as well as ordinary income), he takes into account in computing his income tax liability all items of income, deduction, and credit (including capital gains and losses) to which he would have been entitled had the trust not been in existence during the period he is treated as owner.</P> <P>(2) If the portion treated as owned consists of specific trust property and its income, all items directly related to that property are attributable to the portion. Items directly related to trust property not included in the portion treated as owned by the grantor or other person are governed by the provisions of subparts A through D (section 641 and following), part I, subchapter J, chapter 1 of the Code. Items that relate both to the portion treated as owned by the grantor and to the balance of the trust must be apportioned in a manner that is reasonable in the light of all the circumstances of each case, including the terms of the governing instrument, local law, and the practice of the trustee if it is reasonable and consistent.</P> <P>(3) If the portion of a trust treated as owned by a grantor or another person consists of an undivided fractional interest in the trust, or of an interest represented by a dollar amount, a pro rata share of each item of income, deduction, and credit is normally allocated to the portion. Thus, where the portion owned consists of an interest in or a right to an amount of corpus only, a fraction of each item (including items allocated to corpus, such as capital gains) is attributed to the portion. The numerator of this fraction is the amount which is subject to the control of the grantor or other person and the denominator is normally the fair market value of the trust corpus at the beginning of the taxable year in question. The share not treated as owned by the grantor or other person is governed by the provisions of subparts A through D. See the last three sentences of paragraph (c) of this section for the principles applicable if the portion treated as owned consists of an interest in part of the ordinary income in contrast to an interest in corpus alone.</P> <P>(b) If a grantor or another person is treated as the owner of a portion of a trust, that portion may or may not include both ordinary income and other income allocable to corpus. For example:</P> <P>(1) Only ordinary income is included by reason of an interest in or a power over ordinary income alone. Thus, if a grantor is treated under section 673 as an owner by reason of a reversionary interest in ordinary income only, items of income allocable to corpus will not be included in the portion he is treated as owning. Similarly, if a grantor or another person is treated under sections 674-678 as an owner of a portion by reason of a power over ordinary income only, items of income allocable to corpus are not included in that portion. (See paragraph (c) of this section to determine the treatment of deductions and credits when only ordinary income is included in the portion.)</P> <P> (2) Only income allocable to corpus is included by reason of an interest in or a power over corpus alone, if satisfaction of the interest or an exercise of the power will not result in an interest in or the exercise of a power over ordinary income which would itself cause that income to be included. For example, if a grantor has a reversionary interest in a trust which is not such as to require that he be treated as an owner under section 673, he may nevertheless be treated as an owner under section 677(a)(2) since any income allocable to corpus is accumulated for future distribution to him, but items of income <PRTPAGE P="323"/> included in determining ordinary income are not included in the portion he is treated as owning. Similarly, he may have a power over corpus which is such that he is treated as an owner under section 674 or 676 (a), but ordinary income will not be included in the portion he owns, if his power can only affect income received after a period of time such that he would not be treated as an owner of the income if the power were a reversionary interest. (See paragraph (c) of this section to determine the treatment of deductions and credits when only income allocated to corpus is included in the portion.) </P> <P>(3) Both ordinary income and other income allocable to corpus are included by reason of an interest in or a power over both ordinary income and corpus, or an interest in or a power over corpus alone which does not come within the provisions of subparagraph (2) of this paragraph. For example, if a grantor is treated under section 673 as the owner of a portion of a trust by reason of a reversionary interest in corpus, both ordinary income and other income allocable to corpus are included in the portion. Further, a grantor includes both ordinary income and other income allocable to corpus in the portion he is treated as owning if he is treated under section 674 or 676 as an owner because of a power over corpus which can affect income received within a period such that he would be treated as an owner under section 673 if the power were a reversionary interest. Similarly, a grantor or another person includes both ordinary income and other income allocable to corpus in the portion he is treated as owning if he is treated as an owner under section 675 or 678 because of a power over corpus.</P> <P>(c) If only income allocable to corpus is included in computing a grantor's tax liability, he will take into account in that computation only those items of income, deductions, and credit which would not be included under subparts A through D in the computation of the tax liability of the current income beneficiaries if all distributable net income had actually been distributed to those beneficiaries. On the other hand, if the grantor or another person is treated as an owner solely because of his interest in or power over ordinary income alone, he will take into account in computing his tax liability those items which would be included in computing the tax liability of a current income beneficiary, including expenses allocable to corpus which enter into the computation of distributable net income. If the grantor or other person is treated as an owner because of his power over or right to a dollar amount of ordinary income, he will first take into account a portion of those items of income and expense entering into the computation of ordinary income under the trust instrument or local law sufficient to produce income of the dollar amount required. There will then be attributable to him a pro rata portion of other items entering into the computation of distributable net income under subparts A through D, such as expenses allocable to corpus, and a pro rata portion of credits of the trust. For examples of computations under this paragraph, see paragraph (g) of § 1.677(a)-1.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6989, 34 FR 742, Jan. 17, 1969]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.671-4</SECTNO> <SUBJECT>Method of reporting.</SUBJECT> <P> (a) <E T="03">Portion of trust treated as owned by the grantor or another person.</E> Except as otherwise provided in paragraph (b) of this section and § 1.671-5, items of income, deduction, and credit attributable to any portion of a trust that, under the provisions of subpart E (section 671 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code, is treated as owned by the grantor or another person, are not reported by the trust on Form 1041, “U.S. Income Tax Return for Estates and Trusts,” but are shown on a separate statement to be attached to that form. Section 1.671-5 provides special reporting rules for widely held fixed investment trusts. Section 301.7701-4(e)(2) of this chapter provides guidance regarding the application of the reporting rules in this paragraph (a) to an environmental remediation trust. </P> <P> (b) <E T="03">A trust all of which is treated as owned by one or more grantors or other persons</E> —(1) <E T="03">In general.</E> In the case of a trust all of which is treated as owned by one or more grantors or other persons, and which is not described in paragraph (b)(6) or (7) of this section, <PRTPAGE P="324"/> the trustee may, but is not required to, report by one of the methods described in this paragraph (b) rather than by the method described in paragraph (a) of this section. A trustee may not report, however, pursuant to paragraph (b)(2)(i)(A) of this section unless the grantor or other person treated as the owner of the trust provides to the trustee a complete Form W-9 or acceptable substitute Form W-9 signed under penalties of perjury. See section 3406 and the regulations thereunder for the information to include on, and the manner of executing, the Form W-9, depending upon the type of reportable payments made. </P> <P> (2) <E T="03">A trust all of which is treated as owned by one grantor or by one other person</E> —(i) <E T="03">In general.</E> In the case of a trust all of which is treated as owned by one grantor or one other person, the trustee reporting under this paragraph (b) must either— </P> <P>(A) Furnish the name and taxpayer identification number (TIN) of the grantor or other person treated as the owner of the trust, and the address of the trust, to all payors during the taxable year, and comply with the additional requirements described in paragraph (b)(2)(ii) of this section; or</P> <P>(B) Furnish the name, TIN, and address of the trust to all payors during the taxable year, and comply with the additional requirements described in paragraph (b)(2)(iii) of this section.</P> <P> (ii) <E T="03">Additional obligations of the trustee when name and TIN of the grantor or other person treated as the owner of the trust and the address of the trust are furnished to payors.</E> (A) Unless the grantor or other person treated as the owner of the trust is the trustee or a co-trustee of the trust, the trustee must furnish the grantor or other person treated as the owner of the trust with a statement that— </P> <P> ( <E T="03">1</E> ) Shows all items of income, deduction, and credit of the trust for the taxable year; </P> <P> ( <E T="03">2</E> ) Identifies the payor of each item of income; </P> <P> ( <E T="03">3</E> ) Provides the grantor or other person treated as the owner of the trust with the information necessary to take the items into account in computing the grantor's or other person's taxable income; and </P> <P> ( <E T="03">4</E> ) Informs the grantor or other person treated as the owner of the trust that the items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person. </P> <P>(B) The trustee is not required to file any type of return with the Internal Revenue Service.</P> <P> (iii) <E T="03">Additional obligations of the trustee when name, TIN, and address of the trust are furnished to payors</E> —(A) <E T="03">Obligation to file Forms 1099.</E> The trustee must file with the Internal Revenue Service the appropriate Forms 1099, reporting the income or gross proceeds paid to the trust during the taxable year, and showing the trust as the payor and the grantor or other person treated as the owner of the trust as the payee. The trustee has the same obligations for filing the appropriate Forms 1099 as would a payor making reportable payments, except that the trustee must report each type of income in the aggregate, and each item of gross proceeds separately. See paragraph (b)(5) of this section regarding the amounts required to be included on any Forms 1099 filed by the trustee. </P> <P> (B) <E T="03">Obligation to furnish statement.</E> ( <E T="03">1</E> ) Unless the grantor or other person treated as the owner of the trust is the trustee or a co-trustee of the trust, the trustee must also furnish to the grantor or other person treated as the owner of the trust a statement that— </P> <P> ( <E T="03">i</E> ) Shows all items of income, deduction, and credit of the trust for the taxable year; </P> <P> ( <E T="03">ii</E> ) Provides the grantor or other person treated as the owner of the trust with the information necessary to take the items into account in computing the grantor's or other person's taxable income; and </P> <P> ( <E T="03">iii</E> ) Informs the grantor or other person treated as the owner of the trust that the items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person. <PRTPAGE P="325"/> </P> <P> ( <E T="03">2</E> ) By furnishing the statement, the trustee satisfies the obligation to furnish statements to recipients with respect to the Forms 1099 filed by the trustee. </P> <P> (iv) <E T="03">Examples.</E> The following examples illustrate the provisions of this paragraph (b)(2): </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>G, a United States citizen, creates an irrevocable trust which provides that the ordinary income is to be payable to him for life and that on his death the corpus shall be distributed to B, an unrelated person. Except for the right to receive income, G retains no right or power which would cause him to be treated as an owner under sections 671 through 679. Under the applicable local law, capital gains must be added to corpus. Since G has a right to receive income, he is treated as an owner of a portion of the trust under section 677. The tax consequences of any items of capital gain of the trust are governed by the provisions of subparts A, B, C, and D (section 641 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code. Because not all of the trust is treated as owned by the grantor or another person, the trustee may not report by the methods described in paragraph (b)(2) of this section.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(i)(A) On January 2, 1996, G, a United States citizen, creates a trust all of which is treated as owned by G. The trustee of the trust is T. During the 1996 taxable year the trust has the following items of income and gross proceeds:</P> <LDRWK> <FL-2>Interest</FL-2> <LDRFIG>$2,500</LDRFIG> <FL-2>Dividends</FL-2> <LDRFIG>3,205</LDRFIG> <FL-2>Proceeds from sale of B stock</FL-2> <LDRFIG>2,000</LDRFIG> </LDRWK> <P>(B) The trust has no items of deduction or credit.</P> <P>(ii)(A) The payors of the interest paid to the trust are X ($2,000), Y ($300), and Z ($200). The payors of the dividends paid to the trust are A ($3,200), and D ($5). The payor of the gross proceeds paid to the trust is D, a brokerage firm, which held the B stock as the nominee for the trust. The B stock was purchased by T for $1,500 on January 3, 1996, and sold by T on November 29, 1996. T chooses to report pursuant to paragraph (b)(2)(i)(B) of this section, and therefore furnishes the name, TIN, and address of the trust to X, Y, Z, A, and D. X, Y, and Z each furnish T with a Form 1099-INT showing the trust as the payee. A furnishes T with a Form 1099-DIV showing the trust as the payee. D does not furnish T with a Form 1099-DIV because D paid a dividend of less than $10 to T. D furnishes T with a Form 1099-B showing the trust as the payee.</P> <P>(B) On or before February 28, 1997, T files a Form 1099-INT with the Internal Revenue Service on which T reports interest attributable to G, as the owner of the trust, of $2,500; a Form 1099-DIV on which T reports dividends attributable to G, as the owner of the trust, of $3,205; and a Form 1099-B on which T reports gross proceeds from the sale of B stock attributable to G, as the owner of the trust, of $2,000. On or before April 15, 1997, T furnishes a statement to G which lists the following items of income and information necessary for G to take the items into account in computing G's taxable income:</P> <LDRWK> <FL-2>Interest</FL-2> <LDRFIG>$2,500</LDRFIG> <FL-2>Dividends</FL-2> <LDRFIG>3,205</LDRFIG> <FL-2>Gain from sale of B stock</FL-2> <LDRFIG>500</LDRFIG> </LDRWK> <P>Information regarding sale of B stock:</P> <LDRWK> <FL-2>Proceeds</FL-2> <LDRFIG>$2,000</LDRFIG> <FL-2>Basis</FL-2> <LDRFIG>1,500</LDRFIG> <FL-2>Date acquired</FL-2> <LDRFIG>1/03/96</LDRFIG> <FL-2>Date sold</FL-2> <LDRFIG>11/29/96</LDRFIG> </LDRWK> <P>(C) T informs G that any items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person.</P> <P>(D) T has complied with T's obligations under this section.</P> <P> (iii)(A) Same facts as paragraphs (i) and (ii) of this <E T="03">Example 2,</E> except that G contributed the B stock to the trust on January 2, 1996. On or before April 15, 1997, T furnishes a statement to G which lists the following items of income and information necessary for G to take the items into account in computing G's taxable income: </P> <LDRWK> <FL-2>Interest</FL-2> <LDRFIG>$2,500</LDRFIG> <FL-2>Dividends</FL-2> <LDRFIG>3,205</LDRFIG> </LDRWK> <P>Information regarding sale of B stock:</P> <LDRWK> <FL-2>Proceeds</FL-2> <LDRFIG>$2,000</LDRFIG> <FL-2>Date sold</FL-2> <LDRFIG>11/29/96</LDRFIG> </LDRWK> <P>(B) T informs G that any items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person.</P> <P>(C) T has complied with T's obligations under this section.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P> On January 2, 1996, G, a United States citizen, creates a trust all of which is treated as owned by G. The trustee of the trust is T. The only asset of the trust is an interest in C, a common trust fund under section 584(a). T chooses to report pursuant to paragraph (b)(2)(i)(B) of this section and therefore furnishes the name, TIN, and address of the trust to C. C files a Form 1065 and a Schedule K-1 (Partner's Share of Income, Credits, Deductions, etc.) showing the name, TIN, and address of the trust with the Internal Revenue Service and furnishes a copy to T. Because the trust did not receive any amounts described in paragraph (b)(5) of this section, T does not file any type of return with the Internal Revenue Service. On or before April 15, 1997, T furnishes G with a <PRTPAGE P="326"/> statement that shows all items of income, deduction, and credit of the trust for the 1996 taxable year. In addition, T informs G that any items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person. T has complied with T's obligations under this section. </P> </EXAMPLE> <P> (3) <E T="03">A trust all of which is treated as owned by two or more grantors or other persons</E> —(i) <E T="03">In general.</E> In the case of a trust all of which is treated as owned by two or more grantors or other persons, the trustee must furnish the name, TIN, and address of the trust to all payors for the taxable year, and comply with the additional requirements described in paragraph (b)(3)(ii) of this section. </P> <P> (ii) <E T="03">Additional obligations of trustee</E> —(A) <E T="03">Obligation to file Forms 1099.</E> The trustee must file with the Internal Revenue Service the appropriate Forms 1099, reporting the items of income paid to the trust by all payors during the taxable year attributable to the portion of the trust treated as owned by each grantor or other person, and showing the trust as the payor and each grantor or other person treated as an owner of the trust as the payee. The trustee has the same obligations for filing the appropriate Forms 1099 as would a payor making reportable payments, except that the trustee must report each type of income in the aggregate, and each item of gross proceeds separately. See paragraph (b)(5) of this section regarding the amounts required to be included on any Forms 1099 filed by the trustee. </P> <P> (B) <E T="03">Obligation to furnish statement.</E> ( <E T="03">1</E> ) The trustee must also furnish to each grantor or other person treated as an owner of the trust a statement that— </P> <P> ( <E T="03">i</E> ) Shows all items of income, deduction, and credit of the trust for the taxable year attributable to the portion of the trust treated as owned by the grantor or other person; </P> <P> ( <E T="03">ii</E> ) Provides the grantor or other person treated as an owner of the trust with the information necessary to take the items into account in computing the grantor's or other person's taxable income; and </P> <P> ( <E T="03">iii</E> ) Informs the grantor or other person treated as the owner of the trust that the items of income, deduction and credit and other information shown on the statement must be included in computing the taxable income and credits of the grantor or other person on the income tax return of the grantor or other person. </P> <P> ( <E T="03">2</E> ) Except for the requirements pursuant to section 3406 and the regulations thereunder, by furnishing the statement, the trustee satisfies the obligation to furnish statements to recipients with respect to the Forms 1099 filed by the trustee. </P> <P> (4) <E T="03">Persons treated as payors</E> —(i) <E T="03">In general.</E> For purposes of this section, the term payor means any person who is required by any provision of the Internal Revenue Code and the regulations thereunder to make any type of information return (including Form 1099 or Schedule K-1) with respect to the trust for the taxable year, including persons who make payments to the trust or who collect (or otherwise act as middlemen with respect to) payments on behalf of the trust. </P> <P> (ii) <E T="03">Application to brokers and customers.</E> For purposes of this section, a broker, within the meaning of section 6045, is considered a payor. A customer, within the meaning of section 6045, is considered a payee. </P> <P> (5) <E T="03">Amounts required to be included on Forms 1099 filed by the trustee</E> —(i) <E T="03">In general.</E> The amounts that must be included on any Forms 1099 required to be filed by the trustee pursuant to this section do not include any amounts that are reportable by the payor on an information return other than Form 1099. For example, in the case of a trust which owns an interest in a partnership, the trust's distributive share of the income and gain of the partnership is not includible on any Forms 1099 filed by the trustee pursuant to this section because the distributive share is reportable by the partnership on Schedule K-1. </P> <P> (ii) <E T="03">Example.</E> The following example illustrates the provisions of this paragraph (b)(5): </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> (i)(A) On January 2, 1996, G, a United States citizen, creates a trust all of which is treated as owned by G. The trustee of the trust is T. The assets of the trust during the 1996 taxable year are shares of stock in X, an S corporation, a limited partnership <PRTPAGE P="327"/> interest in P, shares of stock in M, and shares of stock in N. T chooses to report pursuant to paragraph (b)(2)(i)(B) of this section and therefore furnishes the name, TIN, and address of the trust to X, P, M, and N. M furnishes T with a Form 1099-DIV showing the trust as the payee. N does not furnish T with a Form 1099-DIV because N paid a dividend of less than $10 to T. X and P furnish T with Schedule K-1 (Shareholder's Share of Income, Credits, Deductions, etc.) and Schedule K-1 (Partner's Share of Income, Credits, Deductions, etc.), respectively, showing the trust's name, TIN, and address. </P> <P>(B) For the 1996 taxable year the trust has the following items of income and deduction:</P> <LDRWK> <FL-2>Dividends paid by M</FL-2> <LDRFIG>$12</LDRFIG> <FL-2>Dividends paid by N</FL-2> <LDRFIG>6</LDRFIG> <FL-2>Administrative expense</FL-2> <LDRFIG>$20</LDRFIG> </LDRWK> <P>Items reported by X on Schedule K-1 attributable to trust's shares of stock in X:</P> <LDRWK> <FL-2>Interest</FL-2> <LDRFIG>$20</LDRFIG> <FL-2>Dividends</FL-2> <LDRFIG>35</LDRFIG> </LDRWK> <P>Items reported by P on Schedule K-1 attributable to trust's limited partnership interest in P:</P> <LDRWK> <FL-2>Ordinary income</FL-2> <LDRFIG>$300</LDRFIG> </LDRWK> <P>(ii)(A) On or before February 28, 1997, T files with the Internal Revenue Service a Form 1099-DIV on which T reports dividends attributable to G as the owner of the trust in the amount of $18. T does not file any other returns.</P> <P> ( <E T="03">B</E> ) T has complied with T's obligation under paragraph (b)(2)(iii)(A) of this section to file the appropriate Forms 1099. </P> </EXAMPLE> <P> (6) <E T="03">Trusts that cannot report under this paragraph (b).</E> The following trusts cannot use the methods of reporting described in this paragraph (b)— </P> <P>(i) A common trust fund as defined in section 584(a);</P> <P>(ii) A trust that has its situs or any of its assets located outside the United States;</P> <P>(iii) A trust that is a qualified subchapter S trust as defined in section 1361(d)(3);</P> <P>(iv) A trust all of which is treated as owned by one grantor or one other person whose taxable year is a fiscal year;</P> <P>(v) A trust all of which is treated as owned by one grantor or one other person who is not a United States person; or</P> <P>(vi) A trust all of which is treated as owned by two or more grantors or other persons, one of whom is not a United States person.</P> <P> (7) <E T="03">Grantors or other persons who are treated as owners of the trust and are exempt recipients for information reporting purposes</E> —(i) <E T="03">Trust treated as owned by one grantor or one other person.</E> The trustee of a trust all of which is treated as owned by one grantor or one other person may not report pursuant to this paragraph (b) if the grantor or other person is an exempt recipient for information reporting purposes. </P> <P> (ii) <E T="03">Trust treated as owned by two or more grantors or other persons.</E> The trustee of a trust, all of which is treated as owned by two or more grantors or other persons, may not report pursuant to this paragraph (b) if one or more grantors or other persons treated as owners are exempt recipients for information reporting purposes unless— </P> <P>(A) At least one grantor or one other person who is treated as an owner of the trust is a person who is not an exempt recipient for information reporting purposes; and</P> <P>(B) The trustee reports without regard to whether any of the grantors or other persons treated as owners of the trust are exempt recipients for information reporting purposes.</P> <P> (8) <E T="03">Husband and wife who make a single return jointly.</E> A trust all of which is treated as owned by a husband and wife who make a single return jointly of income taxes for the taxable year under section 6013 is considered to be owned by one grantor for purposes of this paragraph (b). </P> <P> (c) <E T="03">Due date for Forms 1099 required to be filed by trustee.</E> The due date for any Forms 1099 required to be filed with the Internal Revenue Service by a trustee pursuant to this section is the due date otherwise in effect for filing Forms 1099. </P> <P> (d) <E T="03">Due date and other requirements with respect to statement required to be furnished by trustee</E> —(1) <E T="03">In general.</E> The due date for the statement required to be furnished by a trustee to the grantor or other person treated as an owner of the trust pursuant to this section is the date specified by section 6034A(a). The trustee must maintain in its records a copy of the statement furnished to the grantor or other person treated as an owner of the trust for a period of three years from the due date for furnishing such statement specified in this paragraph (d). </P> <P> (2) <E T="03"> Statement for the taxable year ending with the death of the grantor or other <PRTPAGE P="328"/> person treated as the owner of the trust. </E> If a trust ceases to be treated as owned by the grantor, or other person, by reason of the death of that grantor or other person (decedent), the due date for the statement required to be furnished for the taxable year ending with the death of the decedent shall be the date specified by section 6034A(a) as though the decedent had lived throughout the decedent's last taxable year. See paragraph (h) of this section for special reporting rules for a trust or portion of the trust that ceases to be treated as owned by the grantor or other person by reason of the death of the grantor or other person. </P> <P> (e) <E T="03">Backup withholding requirements</E> —(1) <E T="03">Trustee reporting under paragraph (b)(2)(i)(A) of this section.</E> In order for the trustee to be able to report pursuant to paragraph (b)(2)(i)(A) of this section and to furnish to all payors the name and TIN of the grantor or other person treated as the owner of the trust, the grantor or other person must provide a complete Form W-9 to the trustee in the manner provided in paragraph (b)(1) of this section, and the trustee must give the name and TIN shown on that Form W-9 to all payors. In addition, if the Form W-9 indicates that the grantor or other person is subject to backup withholding, the trustee must notify all payors of reportable interest and dividend payments of the requirement to backup withhold. If the Form W-9 indicates that the grantor or other person is not subject to backup withholding, the trustee does not have to notify the payors that backup withholding is not required. The trustee should not give the Form W-9, or a copy thereof, to a payor because the Form W-9 contains the address of the grantor or other person and paragraph (b)(2)(i)(A) of this section requires the trustee to furnish the address of the trust to all payors and not the address of the grantor or other person. The trustee acts as the agent of the grantor or other person for purposes of furnishing to the payors the information required by this paragraph (e)(1). Thus, a payor may rely on the name and TIN provided to the payor by the trustee, and, if given, on the trustee's statement that the grantor is subject to backup withholding. </P> <P> (2) <E T="03">Other backup withholding requirements.</E> Whether a trustee is treated as a payor for purposes of backup withholding is determined pursuant to section 3406 and the regulations thereunder. </P> <P> (f) <E T="03">Penalties for failure to file a correct Form 1099 or furnish a correct statement.</E> A trustee who fails to file a correct Form 1099 or to furnish a correct statement to a grantor or other person treated as an owner of the trust as required by paragraph (b) of this section is subject to the penalties provided by sections 6721 and 6722 and the regulations thereunder. </P> <P> (g) <E T="03">Changing reporting methods</E> —(1) <E T="03">Changing from reporting by filing Form 1041 to a method described in paragraph (b) of this section.</E> If the trustee has filed a Form 1041 for any taxable year ending before January 1, 1996 (and has not filed a final Form 1041 pursuant to § 1.671-4(b)(3) (as contained in the 26 CFR part 1 edition revised as of April 1, 1995)), or files a Form 1041 for any taxable year thereafter, the trustee must file a final Form 1041 for the taxable year which ends after January 1, 1995, and which immediately precedes the first taxable year for which the trustee reports pursuant to paragraph (b) of this section, on the front of which form the trustee must write: “Pursuant to § 1.671-4(g), this is the final Form 1041 for this grantor trust.”. </P> <P> (2) <E T="03">Changing from reporting by a method described in paragraph (b) of this section to the filing of a Form 1041.</E> The trustee of a trust who reported pursuant to paragraph (b) of this section for a taxable year may report pursuant to paragraph (a) of this section for subsequent taxable years. If the trustee reported pursuant to paragraph (b)(2)(i)(A) of this section, and therefore furnished the name and TIN of the grantor to all payors, the trustee must furnish the name, TIN, and address of the trust to all payors for such subsequent taxable years. If the trustee reported pursuant to paragraph (b)(2)(i)(B) or (b)(3)(i) of this section, and therefore furnished the name and TIN of the trust to all payors, the trustee must indicate on each Form 1096 (Annual Summary and Transmittal of U.S. Information Returns) <PRTPAGE P="329"/> that it files (or appropriately on magnetic media) for the final taxable year for which the trustee so reports that it is the final return of the trust. </P> <P> (3) <E T="03">Changing between methods described in paragraph (b) of this section</E> —(i) <E T="03">Changing from furnishing the TIN of the grantor to furnishing the TIN of the trust.</E> The trustee of a trust who reported pursuant to paragraph (b)(2)(i)(A) of this section for a taxable year, and therefore furnished the name and TIN of the grantor to all payors, may report pursuant to paragraph (b)(2)(i)(B) of this section, and furnish the name and TIN of the trust to all payors, for subsequent taxable years. </P> <P> (ii) <E T="03">Changing from furnishing the TIN of the trust to furnishing the TIN of the grantor.</E> The trustee of a trust who reported pursuant to paragraph (b)(2)(i)(B) of this section for a taxable year, and therefore furnished the name and TIN of the trust to all payors, may report pursuant to paragraph (b)(2)(i)(A) of this section, and furnish the name and TIN of the grantor to all payors, for subsequent taxable years. The trustee, however, must indicate on each Form 1096 (Annual Summary and Transmittal of U.S. Information Returns) that it files (or appropriately on magnetic media) for the final taxable year for which the trustee reports pursuant to paragraph (b)(2)(i)(B) of this section that it is the final return of the trust. </P> <P> (4) <E T="03">Example.</E> The following example illustrates the provisions of paragraph (g) of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(i) On January 3, 1994, G, a United States citizen, creates a trust all of which is treated as owned by G. The trustee of the trust is T. On or before April 17, 1995, T files with the Internal Revenue Service a Form 1041 with an attached statement for the 1994 taxable year showing the items of income, deduction, and credit of the trust. On or before April 15, 1996, T files with the Internal Revenue Service a Form 1041 with an attached statement for the 1995 taxable year showing the items of income, deduction, and credit of the trust. On the Form 1041, T states that “pursuant to § 1.671-4(g), this is the final Form 1041 for this grantor trust.” T may report pursuant to paragraph (b) of this section for the 1996 taxable year.</P> <P>(ii) T reports pursuant to paragraph (b)(2)(i)(B) of this section, and therefore furnishes the name, TIN, and address of the trust to all payors, for the 1996 and 1997 taxable years. T chooses to report pursuant to paragraph (a) of this section for the 1998 taxable year. On each Form 1096 (Annual Summary and Transmittal of U.S. Information Returns) which T files for the 1997 taxable year (or appropriately on magnetic media), T indicates that it is the trust's final return. On or before April 15, 1999, T files with the Internal Revenue Service a Form 1041 with an attached statement showing the items of income, deduction, and credit of the trust. On the Form 1041, T uses the same TIN which T used on the Forms 1041 and Forms 1099 it filed for previous taxable years. T has complied with T's obligations under paragraph (g)(2) of this section.</P> </EXAMPLE> <P> (h) <E T="03">Reporting rules for a trust, or portion of a trust, that ceases to be treated as owned by a grantor or other person by reason of the death of the grantor or other person</E> —(1) <E T="03">Definition of decedent.</E> For purposes of this paragraph (h), the <E T="03">decedent</E> is the grantor or other person treated as the owner of the trust, or portion of the trust, under subpart E, part I, subchapter J, chapter 1 of the Internal Revenue Code on the date of death of that person. </P> <P> (2) <E T="03">In general.</E> The provisions of this section apply to a trust, or portion of a trust, treated as owned by a decedent for the taxable year that ends with the decedent's death. Following the death of the decedent, the trust or portion of a trust that ceases to be treated as owned by the decedent, by reason of the death of the decedent, may no longer report under this section. A trust, all of which was treated as owned by the decedent, must obtain a new TIN upon the death of the decedent, if the trust will continue after the death of the decedent. See § 301.6109-1(a)(3)(i) of this chapter for rules regarding obtaining a TIN upon the death of the decedent. </P> <P> (3) <E T="03">Special rules</E> —(i) <E T="03">Trusts reporting pursuant to paragraph (a) of this section for the taxable year ending with the decedent's death.</E> The due date for the filing of a return pursuant to paragraph (a) of this section for the taxable year ending with the decedent's death shall be the due date provided for under § 1.6072-1(a)(2). The return filed under this paragraph for a trust all of which was treated as owned by the decedent must indicate that it is a final return. </P> <P> (ii) <E T="03">Trust reporting pursuant to paragraph (b)(2)(B) of this section for the taxable year of the decedent's death.</E> A trust <PRTPAGE P="330"/> that reports pursuant to paragraph (b)(2)(B) of this section for the taxable year ending with the decedent's death must indicate on each Form 1096 “Annual Summary and Transmittal of the U.S. Information Returns” that it files (or appropriately on magnetic media) for the taxable year ending with the death of the decedent that it is the final return of the trust. </P> <P> (iii) <E T="03">Trust reporting under paragraph (b)(3) of this section.</E> If a trust has been reporting under paragraph (b)(3) of this section, the trustee may not report under that paragraph if any portion of the trust has a short taxable year by reason of the death of the decedent and the portion treated as owned by the decedent does not terminate on the death of the decedent. </P> <P> (i) <E T="03">Effective date and transition rule</E> —(1) <E T="03">Effective date.</E> The trustee of a trust any portion of which is treated as owned by one or more grantors or other persons must report pursuant to paragraphs (a), (b), (c), (d)(1), (e), (f), and (g) of this section for taxable years beginning on or after January 1, 1996. </P> <P> (2) <E T="03">Transition rule.</E> For taxable years beginning prior to January 1, 1996, the Internal Revenue Service will not challenge the manner of reporting of— </P> <P>(i) A trustee of a trust all of which is treated as owned by one or more grantors or other persons who did not report in accordance with § 1.671-4(a) (as contained in the 26 CFR part 1 edition revised as of April 1, 1995) as in effect for taxable years beginning prior to January 1, 1996, but did report in a manner substantially similar to one of the reporting methods described in paragraph (b) of this section; or</P> <P>(ii) A trustee of two or more trusts all of which are treated as owned by one or more grantors or other persons who filed a single Form 1041 for all of the trusts, rather than a separate Form 1041 for each trust, provided that the items of income, deduction, and credit of each trust were shown on a statement attached to the single Form 1041.</P> <P> (3) <E T="03">Effective date for paragraphs (d)(2) and (h) of this section.</E> Paragraphs (d)(2) and (h) of this section apply for taxable years ending on or after December 24, 2002. </P> <P> (j) <E T="03">Cross-reference.</E> For rules relating to employer identification numbers, and to the obligation of a payor of income or proceeds to the trust to furnish to the payee a statement to recipient, see § 301.6109-1(a)(2) of this chapter. </P> <CITA>[T.D. 8633, 60 FR 66087, Dec. 21, 1995, as amended by T.D. 8668, 61 FR 19191, May 1, 1996; T.D. 9032, 67 FR 78381, Dec. 24, 2002; T.D. 9241, 71 FR 4009, Jan. 24, 2006]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.671-5</SECTNO> <SUBJECT>Reporting for widely held fixed investment trusts.</SUBJECT> <P> (a) <E T="03">Table of contents.</E> This table of contents lists the major paragraph headings for this section. </P> <EXTRACT> <FP SOURCE="FP-2">(a) Table of contents.</FP> <FP SOURCE="FP-2">(b) Definitions.</FP> <FP SOURCE="FP-2">(c) Trustee's obligation to report information.</FP> <FP SOURCE="FP-2">(1) In general.</FP> <FP SOURCE="FP-2">(i) Calculation.</FP> <FP SOURCE="FP-2">(ii) Calculation period.</FP> <FP SOURCE="FP-2">(iii) Accounting method.</FP> <FP SOURCE="FP-2">(iv) Gross income requirement.</FP> <FP SOURCE="FP-2">(2) Information to be reported by all WHFITs.</FP> <FP SOURCE="FP-2">(i) Trust identification and calculation period chosen.</FP> <FP SOURCE="FP-2">(ii) Items of income, expense, and credit.</FP> <FP SOURCE="FP-2">(iii) Non pro-rata partial principal payments.</FP> <FP SOURCE="FP-2">(iv) Asset sales and dispositions.</FP> <FP SOURCE="FP-2">(v) Redemptions and sales of WHFIT interests.</FP> <FP SOURCE="FP-2">(vi) Information regarding bond premium.</FP> <FP SOURCE="FP-2">(vii) Information regarding market discount.</FP> <FP SOURCE="FP-2">(viii) Other information.</FP> <FP SOURCE="FP-2">(3) Identifying the representative who will provide trust information.</FP> <FP SOURCE="FP-2">(4) Time and manner of providing information.</FP> <FP SOURCE="FP-2">(i) Time.</FP> <FP SOURCE="FP-2">(ii) Manner.</FP> <FP SOURCE="FP-2">(iii) Inclusion of information with respect to all calculation periods.</FP> <FP SOURCE="FP-2">(5) Requesting information from a WHFIT.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Manner of requesting information.</FP> <FP SOURCE="FP-2">(iii) Period of time during which a requesting person may request WHFIT information.</FP> <FP SOURCE="FP-2">(6) Trustee's requirement to retain records.</FP> <FP SOURCE="FP-2">(d) Form 1099 requirement for trustees and middlemen.</FP> <FP SOURCE="FP-2">(1) Obligation to file Form 1099 with the IRS.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Forms 1099 not required for exempt recipients.</FP> <FP SOURCE="FP-2">(iii) Reporting and withholding with respect to foreign persons.</FP> <FP SOURCE="FP-2">(2) Information to be reported.</FP> <FP SOURCE="FP-2">(i) Determining amounts to be provided on Forms 1099.</FP> <FP SOURCE="FP-2">(ii) Information to be provided on Forms 1099.</FP> <FP SOURCE="FP-2"> (3) Time and manner of filing Forms 1099. <PRTPAGE P="331"/> </FP> <FP SOURCE="FP-2">(i) Time and place.</FP> <FP SOURCE="FP-2">(ii) Reporting trust sales proceeds, redemption asset proceeds, redemption proceeds, sales asset proceeds, sales proceeds, and non pro-rata partial principal payments.</FP> <FP SOURCE="FP-2">(e) Requirement to furnish a written tax information statement to the TIH.</FP> <FP SOURCE="FP-2">(1) In general.</FP> <FP SOURCE="FP-2">(2) Information required.</FP> <FP SOURCE="FP-2">(i) WHFIT information.</FP> <FP SOURCE="FP-2">(ii) Identification of the person furnishing the statement.</FP> <FP SOURCE="FP-2">(iii) Items of income, expense, and credit.</FP> <FP SOURCE="FP-2">(iv) Non pro-rata partial principal payments.</FP> <FP SOURCE="FP-2">(v) Asset sales and dispositions.</FP> <FP SOURCE="FP-2">(vi) Redemption or sale of a trust interest.</FP> <FP SOURCE="FP-2">(vii) Information regarding market discount and bond premium.</FP> <FP SOURCE="FP-2">(viii) Other information.</FP> <FP SOURCE="FP-2">(ix) Required statement.</FP> <FP SOURCE="FP-2">(3) Due date and other requirements.</FP> <FP SOURCE="FP-2">(4) Requirement to retain records.</FP> <FP SOURCE="FP-2">(f) Safe harbor for providing information for certain NMWHFITs.</FP> <FP SOURCE="FP-2">(1) Safe harbor for trustee reporting of NMWHFIT information.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Reporting NMWHFIT income and expenses.</FP> <FP SOURCE="FP-2">(iii) Reporting non pro-rata partial principal payments under the safe harbor.</FP> <FP SOURCE="FP-2">(iv) Reporting sales and dispositions of NMWHFIT assets under the safe harbor.</FP> <FP SOURCE="FP-2">(v) Reporting redemptions under the safe harbor.</FP> <FP SOURCE="FP-2">(vi) Reporting the sale of a trust interest under the safe harbor.</FP> <FP SOURCE="FP-2">(vii) Reporting OID information under the safe harbor.</FP> <FP SOURCE="FP-2">(viii) Reporting market discount information under the safe harbor.</FP> <FP SOURCE="FP-2">(ix) Reporting bond premium information under the safe harbor.</FP> <FP SOURCE="FP-2">(x) Reporting additional information.</FP> <FP SOURCE="FP-2">(2) Use of information provided by trustees under the safe harbor for NMWHFITs.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Determining NMWHFIT income and expenses under the safe harbor.</FP> <FP SOURCE="FP-2">(iii) Reporting non pro-rata partial principal payments under the safe harbor.</FP> <FP SOURCE="FP-2">(iv) Reporting sales and dispositions of NMWHFIT assets under the safe harbor.</FP> <FP SOURCE="FP-2">(v) Reporting redemptions under the safe harbor.</FP> <FP SOURCE="FP-2">(vi) Reporting sales of trust interests under the safe harbor.</FP> <FP SOURCE="FP-2">(vii) Reporting OID information under the safe harbor.</FP> <FP SOURCE="FP-2">(viii) Reporting market discount information under the safe harbor.</FP> <FP SOURCE="FP-2">(ix) Reporting bond premium information under the safe harbor.</FP> <FP SOURCE="FP-2">(3) Example of the use of the safe harbor for NMWHFITs.</FP> <FP SOURCE="FP-2">(i) Facts.</FP> <FP SOURCE="FP-2">(ii) Trustee reporting.</FP> <FP SOURCE="FP-2">(iii) Brokers' use of information provided by Trustee.</FP> <FP SOURCE="FP-2">(g) Safe Harbor for certain WHMTs.</FP> <FP SOURCE="FP-2">(1) Safe harbor for trustees of certain WHMTs for reporting information.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Requirements.</FP> <FP SOURCE="FP-2">(iii) Reporting WHMT income, expenses, non pro-rata partial principal payments, and sales and dispositions under the safe harbor.</FP> <FP SOURCE="FP-2">(iv) Reporting OID information under the safe harbor.</FP> <FP SOURCE="FP-2">(v) Reporting market discount information under the safe harbor.</FP> <FP SOURCE="FP-2">(vi) Reporting bond premium information under the safe harbor.</FP> <FP SOURCE="FP-2">(2) Use of information provided by a trustee under the safe harbor.</FP> <FP SOURCE="FP-2">(i) In general.</FP> <FP SOURCE="FP-2">(ii) Reporting WHMT income, expenses, non pro-rata partial principal payments, and sales and dispositions under the safe harbor.</FP> <FP SOURCE="FP-2">(iii) Reporting OID information under the safe harbor.</FP> <FP SOURCE="FP-2">(iv) Requirement to provide market discount information under the safe harbor.</FP> <FP SOURCE="FP-2">(v) Requirement to provide bond premium information under the safe harbor.</FP> <FP SOURCE="FP-2">(3) Example of safe harbor in paragraph (g)(1) of this section.</FP> <FP SOURCE="FP-2">(i) Facts.</FP> <FP SOURCE="FP-2">(ii) Trustee reporting.</FP> <FP SOURCE="FP-2">(iii) Broker's use of the information provided by Trustee.</FP> <FP SOURCE="FP-2">(h) Additional safe harbors.</FP> <FP SOURCE="FP-2">(1) Temporary safe harbors.</FP> <FP SOURCE="FP-2">(2) Additional safe harbors provided by other published guidance.</FP> <FP SOURCE="FP-2">(i) Reserved.</FP> <FP SOURCE="FP-2">(j) Requirement that middlemen furnish information to beneficial owners that are exempt recipients and non calendar year beneficial owners.</FP> <FP SOURCE="FP-2">(1) In general.</FP> <FP SOURCE="FP-2">(2) Time for providing information.</FP> <FP SOURCE="FP-2">(3) Manner of providing information.</FP> <FP SOURCE="FP-2">(4) Clearing organization.</FP> <FP SOURCE="FP-2">(k) Coordination with other information reporting rules.</FP> <FP SOURCE="FP-2">(l) Backup withholding requirements.</FP> <FP SOURCE="FP-2">(m) Penalties for failure to comply.</FP> <FP SOURCE="FP-2">(n) Effective date.</FP> </EXTRACT> <P> (b) <E T="03">Definitions.</E> Solely for purposes of this section: </P> <P> (1) An <E T="03">asset</E> includes any real or personal, tangible or intangible property held by the trust, including an interest in a contract. </P> <P> (2) An <E T="03">affected expense</E> is an expense described in § 1.67-2T(i)(1). </P> <P> (3) A <E T="03">beneficial owner</E> is a trust interest holder (TIH) (as defined in paragraph (b)(20) of this section) that holds <PRTPAGE P="332"/> a beneficial interest in a widely held fixed investment trust (WHFIT) (as defined in paragraph (b)(22) of this section.) </P> <P> (4) The <E T="03">calculation period</E> is the period the trustee chooses under paragraph (c)(1)(ii) of this section for calculating the trust information required to be provided under paragraph (c) of this section. </P> <P> (5) The <E T="03">cash held for distribution</E> is the amount of cash held by the WHFIT (other than trust sales proceeds and proceeds from sales described in paragraphs (c)(2)(iv)(D)( <E T="03">4</E> ), (G), and (H) of this section) less reasonably required reserve funds as of the date that the amount of a distribution is required to be determined under the WHFIT's governing document. </P> <P> (6) A <E T="03">clean-up call</E> is the redemption of all trust interests in termination of the WHFIT when the administrative costs of the WHFIT outweigh the benefits of maintaining the WHFIT. </P> <P> (7) An <E T="03">exempt recipient</E> is— </P> <P>(i) Any person described in § 1.6049-4(c)(1)(ii);</P> <P>(ii) A middleman (as defined in paragraph (b)(10) of this section);</P> <P>(iii) A real estate mortgage investment conduit (as defined in section 860(D)(a)) (REMIC);</P> <P>(iv) A WHFIT; or</P> <P>(v) A trust or an estate for which the trustee or middleman of the WHFIT is also required to file a Form 1041, “U.S. Income Tax Return for Estates and Trusts,” in its capacity as a fiduciary of that trust or estate.</P> <P> (8) An <E T="03">in-kind redemption</E> is a redemption in which a beneficial owner receives a pro-rata share of each of the assets of the WHFIT that the beneficial owner is deemed to own under section 671. For example, for purposes of this paragraph (b)(8), if beneficial owner A owns a one percent interest in a WHFIT that holds 100 shares of X corporation stock, so that A is considered to own a one percent interest in each of the 100 shares, A's pro-rata share of the X corporation stock for this purpose is one share of X corporation stock. </P> <P> (9) An <E T="03">item</E> refers to an item of income, expense, or credit as well as any trust event (for example, the sale of an asset) or any characteristic or attribute of the trust that affects the income, deductions, and credits reported by a beneficial owner in any taxable year that the beneficial owner holds an interest in the trust. An item may refer to an individual item or a group of items depending on whether the item must be reported separately under paragraphs (c)(1)(i) and (e)(1) of this section. </P> <P> (10) A <E T="03">middleman</E> is any TIH, other than a qualified intermediary as defined in § 1.1031(k)-1(g), who, at any time during the calendar year, holds an interest in a WHFIT on behalf of, or for the account of, another TIH, or who otherwise acts in a capacity as an intermediary for the account of another person. A middleman includes, but is not limited to— </P> <P>(i) A custodian of a person's account, such as a bank, financial institution, or brokerage firm acting as custodian of an account;</P> <P>(ii) A nominee;</P> <P>(iii) A joint owner of an account or instrument other than—</P> <P>(A) A joint owner who is the spouse of the other owner; and</P> <P>(B) A joint owner who is the beneficial owner and whose name appears on the Form 1099 filed with respect to the trust interest under paragraph (d) of this section; and</P> <P>(iv) A broker (as defined in section 6045(c)(1) and § 1.6045-1(a)(1)), holding an interest for a customer in street name.</P> <P> (11) A <E T="03">mortgage</E> is an obligation that is principally secured by an interest in real property within the meaning of § 1.860G-2(a)(5), except that a mortgage does not include an interest in another WHFIT or mortgages held by another WHFIT. </P> <P> (12) A <E T="03">non-mortgage widely held fixed investment trust</E> (NMWHFIT) is a WHFIT other than a widely held mortgage trust (as defined in paragraph (b)(23) of this section). </P> <P> (13) A <E T="03">non pro-rata partial principal payment</E> is any partial payment of principal received on a debt instrument which does not retire the debt instrument and which is not a pro-rata prepayment described in § 1.1275-2(f)(2). </P> <P> (14) The <E T="03">redemption asset proceeds</E> equal the redemption proceeds (as defined in paragraph (b)(15) of this section) less the cash held for distribution <PRTPAGE P="333"/> with respect to the redeemed trust interest. </P> <P> (15) The <E T="03">redemption proceeds</E> equal the total amount paid to a redeeming TIH as the result of a redemption of a trust interest. </P> <P> (16) A <E T="03">requesting person</E> is— </P> <P>(i) A middleman;</P> <P>(ii) A beneficial owner who is a broker;</P> <P>(iii) A beneficial owner who is an exempt recipient who holds a trust interest directly and not through a middleman;</P> <P>(iv) A noncalendar-year beneficial owner who holds a trust interest directly and not through a middleman; or</P> <P>(v) A representative or agent of a person specified in this paragraph (b)(16).</P> <P> (17) The <E T="03">sales asset proceeds</E> equal the sales proceeds (as defined in paragraph (b)(18) of this section) less the cash held for distribution with respect to the sold trust interest at the time of the sale. </P> <P> (18) The <E T="03">sales proceeds</E> equal the total amount paid to a selling TIH in consideration for the sale of a trust interest. </P> <P> (19) The <E T="03">start-up date</E> is the date on which substantially all of the assets have been deposited with the trustee of the WHFIT. </P> <P> (20) A <E T="03">trust interest holder</E> (TIH) is any person who holds a direct or indirect interest, including a beneficial interest, in a WHFIT at any time during the calendar year. </P> <P> (21) <E T="03">Trust sales proceeds</E> equal the amount paid to a WHFIT for the sale or disposition of an asset held by the WHFIT, including principal payments received by the WHFIT that completely retire a debt instrument (other than a final scheduled principal payment) and pro-rata partial principal prepayments described under § 1.1275-2(f)(2). Trust sales proceeds do not include amounts paid for any interest income that would be required to be reported under § 1.6045-1(d)(3). Trust sales proceeds also do not include amounts paid to a NMWHFIT as the result of pro-rata sales of trust assets to effect a redemption described in paragraph (c)(2)(iv)(G) of this section or the value of assets received as a result of a tax-free corporate reorganization as described in paragraph (c)(2)(iv)(H) of this section. </P> <P> (22) A <E T="03">widely held fixed investment trust</E> (WHFIT) is an arrangement classified as a trust under § 301.7701-4(c) of this chapter, provided that— </P> <P>(i) The trust is a United States person under section 7701(a)(30)(E);</P> <P>(ii) The beneficial owners of the trust are treated as owners under subpart E, part I, subchapter J, chapter 1 of the Internal Revenue Code; and</P> <P>(iii) At least one interest in the trust is held by a middleman.</P> <P> (23) A <E T="03">widely held mortgage trust</E> (WHMT) is a WHFIT, the assets of which consist only of one or more of the following— </P> <P>(i) Mortgages;</P> <P>(ii) Regular interests in a REMIC;</P> <P>(iii) Interests in another WHMT;</P> <P>(iv) Reasonably required reserve funds;</P> <P>(v) Amounts received on the assets described in paragraphs (b)(23)(i), (ii), (iii), and (iv) of this section pending distribution to TIHs; and</P> <P>(vi) During a brief initial funding period, cash and short-term contracts for the purchase of the assets described in paragraphs (b)(23)(i), (ii), and (iii).</P> <P> (c) <E T="03">Trustee's obligation to report information</E> —(1) <E T="03">In general.</E> Upon the request of a requesting person (as defined in paragraph (b)(16) of this section), a trustee of a WHFIT must report the information described in paragraph (c)(2) of this section to the requesting person. The trustee must determine such information in accordance with the following rules— </P> <P> (i) <E T="03">Calculation.</E> WHFIT information may be calculated in any manner that enables a requesting person to determine with reasonable accuracy the WHFIT items described in paragraph (c)(2) of this section that are attributable (or, if permitted under paragraphs (c)(2)(iv)(B) or (f)(2)(iii) of this section, distributed) to a beneficial owner for the taxable year of that owner. The manner of calculation must generally conform with industry practice for calculating the WHFIT items described in paragraph (c)(2) of this section for the type of asset or assets held by the WHFIT, and must enable a requesting person to separately state <PRTPAGE P="334"/> any WHFIT item that, if taken into account separately by a beneficial owner, would result in an income tax liability different from that which would result if the owner did not take the item into account separately. </P> <P> (ii) <E T="03">Calculation period</E> —WHFIT information may be calculated on the basis of a calendar month, calendar quarter, or half or full calendar year, provided that a trustee uses the same calculation period for the life of the WHFIT and the information provided by the trustee meets the requirements of paragraph (c)(1)(i) of this section. Regardless of the calculation period chosen by the trustee, the trustee must provide information requested by a requesting person under paragraph (c)(5) on a calendar year basis. The trustee may provide additional information to requesting persons throughout the calendar year at the trustee's discretion. </P> <P> (iii) <E T="03">Accounting method</E> —(A) <E T="03">General rule.</E> WHFIT information must be calculated and reported using the cash receipts and disbursements method of accounting unless another method is required by the Internal Revenue Code or regulations with respect to a specific trust item. Accordingly, a trustee must provide information necessary for TIHs to comply with the rules of subtitle A, chapter 1, subchapter P, part V, subpart A of the Internal Revenue Code, which require the inclusion of accrued amounts with respect to OID, and section 860B(b), which requires the inclusion of accrued amounts with respect to a REMIC regular interest. </P> <P> (B) <E T="03">Exception for WHFITs marketed predominantly to taxpayers on the accrual method.</E> If the trustee or the trust's sponsor knows or reasonably should know that a WHFIT is marketed primarily to accrual method TIHs and the WHFIT holds assets for which the timing of the recognition of income is materially affected by the use of the accrual method of accounting, the trustee must calculate and report trust information using the accrual method of accounting. </P> <P> (iv) <E T="03">Gross income requirement.</E> The amount of income required to be reported by the trustee is the gross income (as defined in section 61) generated by the WHFIT's assets. Thus, in the case of a WHFIT that receives a payment of income from which an expense (or expenses) has been deducted, the trustee, in calculating the income to be reported under paragraph (c)(2)(ii) of this section, must report the income earned on the trusts assets unreduced by the deducted expense or expenses and separately report the deducted expense or expenses. See paragraph (c)(2)(iv) of this section regarding reporting with respect to sales and dispositions. </P> <P> (2) <E T="03">Information to be reported by all WHFITs.</E> With respect to all WHFITs— </P> <P> (i) <E T="03">Trust identification and calculation period chosen.</E> The trustee must report information identifying the WHFIT, including— </P> <P>(A) The name of the WHFIT;</P> <P>(B) The employer identification number of the WHFIT;</P> <P>(C) The name and address of the trustee;</P> <P>(D) The Committee on Uniform Security Identification Procedure (CUSIP) number, account number, serial number, or other identifying number of the WHFIT;</P> <P>(E) The classification of the WHFIT as either a WHMT or NMWHFIT; and</P> <P>(F) The calculation period used by the trustee.</P> <P> (ii) <E T="03">Items of income, expense, and credit.</E> The trustee must report information detailing— </P> <P>(A) All items of gross income (including OID, except that OID is not required to be included for a WHMT that has a start-up date (as defined in paragraph (b)(19) of this section) prior to August 13, 1998).</P> <P>(B) All items of expense (including affected expenses); and</P> <P>(C) All items of credit.</P> <P> (iii) <E T="03">Non pro-rata partial principal payments.</E> The trustee must report information detailing non pro-rata partial principal payments (as defined in paragraph (b)(13) of this section) received by the WHFIT. </P> <P> (iv) <E T="03">Asset sales and dispositions.</E> The trustee must report information regarding sales and dispositions of WHFIT assets as required in this paragraph (c)(2)(iv). For purposes of this paragraph (c)(2)(iv), a payment (other than a final scheduled payment) that completely retires a debt instrument (including a mortgage held by a <PRTPAGE P="335"/> WHMT) or a pro-rata prepayment on a debt instrument (see § 1.1275-2(f)(2)) held by a WHFIT must be reported as a full or partial sale or disposition of the debt instrument. Pro-rata sales of trust assets to effect redemptions, as defined in paragraph (c)(2)(iv)(G) of this section, or exchanges of trust assets as the result of a corporate reorganization under paragraph (c)(2)(iv)(H) of this section, are not reported as sales or dispositions under this paragraph (c)(2)(iv). </P> <P> (A) <E T="03">General rule.</E> Except as provided in paragraph (c)(2)(iv)(B) (regarding the exception for certain NMWHFITs) or paragraph (c)(2)(iv)(C) (regarding the exception for certain WHMTs) of this section, the trustee must report with respect to each sale or disposition of a WHFIT asset— </P> <P> ( <E T="03">1</E> ) The date of each sale or disposition; </P> <P> ( <E T="03">2</E> ) Information that enables a requesting person to determine the amount of trust sales proceeds (as defined in paragraph (b)(21) of this section) attributable to a beneficial owner as a result of each sale or disposition; and </P> <P> ( <E T="03">3</E> ) Information that enables a beneficial owner to allocate, with reasonable accuracy, a portion of the owner's basis in its trust interest to each sale or disposition. </P> <P> (B) <E T="03">Exception for certain NMWHFITs.</E> If a NMWHFIT meets paragraph (c)(2)(iv)(D)( <E T="03">1</E> )(regarding the general de minimis test), paragraph (c)(2)(iv)(E) (regarding the qualified NMWHFIT exception), or paragraph (c)(2)(iv)(F) (regarding the NMWHFIT final calendar year exception) of this section, the trustee is not required to report under paragraph (c)(2)(iv)(A) of this section. Instead, the trustee must report sufficient information to enable a requesting person to determine the amount of trust sales proceeds distributed to a beneficial owner during the calendar year with respect to each sale or disposition of a trust asset. The trustee also must provide requesting persons with a statement that the NMWHFIT is permitted to report under this paragraph (c)(2)(iv)(B). </P> <P> (C) <E T="03">Exception for certain WHMTs.</E> If a WHMT meets either the general or the special de minimis test of paragraph (c)(2)(iv)(D) of this section for the calendar year, the trustee is not required to report under paragraph (c)(2)(iv)(A) of this section. Instead, the trustee must report information to enable a requesting person to determine the amount of trust sales proceeds attributable to a beneficial owner as a result of the sale or disposition. The trustee also must provide requesting persons with a statement that the WHMT is permitted to report under this paragraph (c)(2)(iv)(C). </P> <P> (D) <E T="03">De minimis tests</E> —( <E T="03">1</E> ) <E T="03">General WHFIT de minimis test.</E> The general WHFIT de minimis test is satisfied if trust sales proceeds for the calendar year are not more than five percent of the net asset value of the trust (aggregate fair market value of the trust's assets less the trust's liabilities) as of the later of January 1 and the start-up date (as defined paragraph (b)(19) of this section); or, if the trustee chooses, the later of January 1 and the measuring date. The measuring date is the date of the last deposit of assets into the WHFIT (not including any deposit of assets into the WHFIT pursuant to a distribution reinvestment program), not to exceed 90 days after the date the registration statement of the WHFIT becomes effective under the Securities Act of 1933. </P> <P> ( <E T="03">2</E> ) <E T="03">Special WHMT de minimis test.</E> A WHMT that meets the asset requirement of paragraph (g)(1)(ii)(E) of this section satisfies the special WHMT de minimis test in this paragraph (c)(2)(iv)(D)( <E T="03">2</E> ) if trust sales proceeds for the calendar year are not more than five percent of the aggregate outstanding principal balance of the WHMT (as defined in paragraph (g)(1)(iii)(D) of this section) as of the later of January 1 of that year or the trust's start-up date. For purposes of applying the special WHMT de minimis test in this paragraph (c)(2)(iv)(D)( <E T="03">2</E> ), amounts that result from the complete or partial payment of the outstanding principal balance of the mortgages held by the trust are not included in the amount of trust sales proceeds. The IRS and the Treasury Department may provide by revenue ruling, or by other published guidance, that the special de minimis test of this paragraph (c)(2)(iv)(D)( <E T="03">2</E> ) may be applied to <PRTPAGE P="336"/> WHFITs holding debt instruments other than those described in paragraph (g)(1)(ii)(E) of this section. </P> <P> ( <E T="03">3</E> ) <E T="03">Effect of clean-up call.</E> If a WHFIT fails to meet either de minimis test described in this paragraph (c)(2)(iv)(D) solely as the result of a clean-up call, as defined in paragraph (b)(6) of this section, the WHFIT will be treated as having met the de minimis test. </P> <P> ( <E T="03">4</E> ) <E T="03">Exception for certain fully reported sales</E> —( <E T="03">i</E> ) <E T="03">Rule.</E> If a trustee of a NMWHFIT reports the sales described in paragraph (c)(2)(iv)(D)( <E T="03">4</E> )( <E T="03">ii</E> ) of this section as provided under paragraph (c)(2)(iv)(A) of this section (regardless of whether the general minimis test in paragraph (c)(2)(iv)(D)( <E T="03">1</E> ) of this section is satisfied for a particular calendar year) consistently throughout the life of the WHFIT, a trustee may exclude the trust sales proceeds received by the WHFIT as a result of those sales from the trust sales proceeds used to determine whether a WHFIT has satisfied the general de minimis test in paragraph (c)(2)(iv)(D)( <E T="03">1</E> ) of this section. </P> <P> ( <E T="03">ii</E> ) <E T="03">Applicable sales and dispositions.</E> This paragraph (c)(2)(iv)(D)( <E T="03">4</E> ) applies to sales and dispositions resulting from corporate reorganizations and restructurings for which the trust receives cash, the sale of assets received by the trust in corporate reorganizations and restructurings (including conversions of closed-end investment companies to open-end investment companies), principal prepayments, bond calls, bond maturities, and the sale of securities by the trustee as required by the governing document or applicable law governing fiduciaries in order to maintain the sound investment character of the trust, and any other nonvolitional dispositions of trust assets. </P> <P> ( <E T="03">iii</E> ) <E T="03">Certain small sales and dispositions.</E> If the amount of trust sales proceeds from a sale or disposition described in paragraph (c)(2)(iv)(D)( <E T="03">4</E> )( <E T="03">ii</E> ) of this section is less than .01 percent of the net fair market value of the WHFIT as determined for applying the de minimis test for the calendar year, the trustee is not required to report the sale or disposition under paragraph (c)(2)(iv)(A) of this section provided the trustee includes the trust sales proceeds, received for purposes of determining whether the trust has met the general de minimis test of paragraph (c)(2)(iv)(D)( <E T="03">1</E> ) of this section. </P> <P> (E) <E T="03">Qualified NMWHFIT exception.</E> The qualified NMWHFIT exception is satisfied if— </P> <P> ( <E T="03">1</E> ) The NMWHFIT has a start-up date (as defined in paragraph (b)(19) of this section) before February 23, 2006; </P> <P> ( <E T="03">2</E> ) The registration statement of the NMWHFIT becomes effective under the Securities Act of 1933, as amended (15 U.S.C. 77a, <E T="03">et seq.</E> ) and trust interests are offered for sale to the public before February 23, 2006; or </P> <P> ( <E T="03">3</E> ) The registration statement of the NMWHFIT becomes effective under the Securities Act of 1933 and trust interests are offered for sale to the public on or after February 23, 2006, and before July 31, 2006, and the NMWHFIT is fully funded before October 1, 2006. For purposes of determining whether a NMWHFIT is fully funded under this paragraph (c)(2)(iv)(E), deposits to the NMWHFIT after October 1, 2006, that are made pursuant to a distribution reinvestment program that is consistent with the requirements of § 301.7701-4(c) of this chapter are disregarded. </P> <P> (F) <E T="03">NMWHFIT final calendar year exception.</E> The NMWHFIT final calendar year exception is satisfied if— </P> <P> ( <E T="03">1</E> ) The NMWHFIT terminates on or before December 31 of the year for which the trustee is reporting; </P> <P> ( <E T="03">2</E> ) Beneficial owners exchange their interests for cash or are treated as having exchanged their interests for cash upon termination of the trust; and </P> <P> ( <E T="03">3</E> ) The trustee makes reasonable efforts to engage in pro-rata sales of trust assets to effect redemptions. </P> <P> (G) <E T="03">Pro-rata sales of trust assets to effect a redemption</E> —(1) <E T="03">Rule.</E> Pro-rata sales of trust assets to effect redemptions are not required to be reported under this paragraph (c)(2)(iv). </P> <P> (2) <E T="03">Definition.</E> Pro-rata sales of trust assets to effect redemptions occur when— </P> <P> ( <E T="03">i</E> ) One or more trust interests are tendered for redemption; </P> <P> ( <E T="03">ii</E> ) The trustee identifies the pro-rata shares of the trust assets that are deemed to be owned by the trust interest or interests tendered for redemption (See paragraph (b)(8) of this section for a description of how pro-rata is <PRTPAGE P="337"/> to be applied for purposes of this paragraph (c)(2)(iv)(G)) and sells those assets as soon as practicable; </P> <P> ( <E T="03">iii</E> ) Proceeds from the sales of the assets identified in paragraph (c)(2)(iv)(G)( <E T="03">2</E> )( <E T="03">ii</E> ) of this section are used solely to effect redemptions; and </P> <P> ( <E T="03">iv</E> ) The redemptions are reported as required under paragraph (c)(2)(v) of this section by the trustee. </P> <P> ( <E T="03">3</E> ) <E T="03">Additional rules</E> —( <E T="03">i</E> ) <E T="03">Calendar month aggregation.</E> The trustee may compare the aggregate pro-rata share of the assets deemed to be owned by the trust interests tendered for redemption during the calendar month with the aggregate sales of assets to effect redemptions for the calendar month to determine the pro-rata sales of trust assets to effect redemptions for the calendar month. If the aggregate pro-rata share of an asset deemed to be owned by the trust interests tendered for redemption for the month is a fractional amount, the trustee may round that number up to the next whole number for the purpose of determining the pro-rata sales to effect redemptions for the calendar month; </P> <P> ( <E T="03">ii</E> ) <E T="03">Sales of assets to effect redemptions may be combined with sales of assets for other purposes.</E> Sales of assets to effect redemptions may be combined with the sales of assets to obtain cash for other purposes but the proceeds from the sales of assets to effect redemptions must be used solely to provide cash for redemptions and the sales of assets to obtain cash for other purposes must be reported as otherwise provided in this paragraph (c)(2)(iv). For example, if a trustee sells assets and the proceeds are used by the trustee to pay trust expenses, these amounts are to be included in the amounts reported under paragraph (c)(2)(iv)(A) or (B), as appropriate. </P> <P> ( <E T="03">4</E> ) <E T="03">Example</E> —( <E T="03">i</E> ) <E T="03">January 1, 2008.</E> Trust has one million trust interests and all interests have equal value and equal rights. The number of shares of stock in corporations A through J and the pro-rata share of each stock that a trust interest is deemed to own as of January 1, 2008, is as follows: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s30,10,10"> <BOXHD> <CHED H="1">Stock</CHED> <CHED H="1">Total shares</CHED> <CHED H="1">Per trust interest</CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>24,845</ENT> <ENT>.024845</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>28,273</ENT> <ENT>.028273</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>35,575</ENT> <ENT>.035575</ENT> </ROW> <ROW> <ENT I="01">D</ENT> <ENT>13,866</ENT> <ENT>.013866</ENT> </ROW> <ROW> <ENT I="01">E</ENT> <ENT>25,082</ENT> <ENT>.025082</ENT> </ROW> <ROW> <ENT I="01">F</ENT> <ENT>39,154</ENT> <ENT>.039154</ENT> </ROW> <ROW> <ENT I="01">G</ENT> <ENT>16,137</ENT> <ENT>.016137</ENT> </ROW> <ROW> <ENT I="01">H</ENT> <ENT>14,704</ENT> <ENT>.014704</ENT> </ROW> <ROW> <ENT I="01">I</ENT> <ENT>17,436</ENT> <ENT>.017436</ENT> </ROW> <ROW> <ENT I="01">J</ENT> <ENT>31,133</ENT> <ENT>.031133</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">ii</E> ) <E T="03">Transactions of January 2, 2008.</E> On January 2, 2008, 50,000 trust interests are tendered for redemption. The deemed pro-rata ownership of stocks A through J represented by the 50,000 redeemed trust interests and the stocks sold to provide cash for the redemptions are set out in the following table: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s30,10,10"> <BOXHD> <CHED H="1">Stock</CHED> <CHED H="1">Deemed pro-rata ownership</CHED> <CHED H="1">Shares sold</CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>1,242.25</ENT> <ENT>1,242</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>1,413.65</ENT> <ENT>1,413</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>1,778.75</ENT> <ENT>1,779</ENT> </ROW> <ROW> <ENT I="01">D</ENT> <ENT>693.30</ENT> <ENT>694</ENT> </ROW> <ROW> <ENT I="01">E</ENT> <ENT>1,254.10</ENT> <ENT>1,254</ENT> </ROW> <ROW> <ENT I="01">F</ENT> <ENT>1,957.70</ENT> <ENT>1,957</ENT> </ROW> <ROW> <ENT I="01">G</ENT> <ENT>806.85</ENT> <ENT>807</ENT> </ROW> <ROW> <ENT I="01">H</ENT> <ENT>735.20</ENT> <ENT>735</ENT> </ROW> <ROW> <ENT I="01">I</ENT> <ENT>871.80</ENT> <ENT>872</ENT> </ROW> <ROW> <ENT I="01">J</ENT> <ENT>1,556.65</ENT> <ENT>1,557</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">iii</E> ) <E T="03">Transactions on January 15 through 17, 2008.</E> On January 15, 2008, 10,000 trust interests are tendered for redemption. Trustee lends money to Trust for redemptions. On January 16, B merges into C at a rate of .55 per share. On January 17, Trustee sells stock to obtain cash to be reimbursed the cash loaned to Trust to effect the redemptions. The pro-rata share of the stock deemed to be owned by the 10,000 redeemed trust interests and the stock sold by the trustee to effect the redemptions are set out in the following table: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s30,8.2,10"> <BOXHD> <CHED H="1">Stock</CHED> <CHED H="1">Deemed pro-rata ownership</CHED> <CHED H="1">Shares sold</CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>248.45</ENT> <ENT>249</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>00</ENT> <ENT>00</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>511.25</ENT> <ENT>512</ENT> </ROW> <ROW> <ENT I="01">D</ENT> <ENT>138.66</ENT> <ENT>138</ENT> </ROW> <ROW> <ENT I="01">E</ENT> <ENT>250.82</ENT> <ENT>251</ENT> </ROW> <ROW> <ENT I="01">F</ENT> <ENT>391.54</ENT> <ENT>392</ENT> </ROW> <ROW> <ENT I="01">G</ENT> <ENT>161.37</ENT> <ENT>162</ENT> </ROW> <ROW> <ENT I="01">H</ENT> <ENT>147.04</ENT> <ENT>148</ENT> </ROW> <ROW> <ENT I="01">I</ENT> <ENT>174.36</ENT> <ENT>174</ENT> </ROW> <ROW> <ENT I="01">J</ENT> <ENT>311.33</ENT> <ENT>311</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">iv</E> ) <E T="03">Transactions on January 28 and 29, 2008.</E> On January 28, 2008, the value of <PRTPAGE P="338"/> the H stock is $30.00 per share and Trustee, pursuant to Trust's governing document, sells the H stock to preserve the financial integrity of Trust and receives $414,630. Trustee intends to report this sale under paragraph (c)(2)(iv)(A) of this section and to distribute the proceeds of the sale pro-rata to trust interest holders on Trust's next scheduled distribution date. On January 29, 2008, while trustee still holds the proceeds from the January 28 sale, 10,000 trust interests are tendered for redemption. The pro-rata share of the stock deemed to be owned by the 10,000 redeemed trust interests and the stock sold by the trustee to effect the redemptions are set out in the following table: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s30,8.2,10"> <BOXHD> <CHED H="1">Stock</CHED> <CHED H="1">Deemed pro-rata ownership</CHED> <CHED H="1">Shares sold</CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>248.45</ENT> <ENT>248</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>0</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>511.25</ENT> <ENT>511</ENT> </ROW> <ROW> <ENT I="01">D</ENT> <ENT>138.66</ENT> <ENT>139</ENT> </ROW> <ROW> <ENT I="01">E</ENT> <ENT>250.82</ENT> <ENT>251</ENT> </ROW> <ROW> <ENT I="01">F</ENT> <ENT>391.54</ENT> <ENT>391</ENT> </ROW> <ROW> <ENT I="01">G</ENT> <ENT>161.37</ENT> <ENT>161</ENT> </ROW> <ROW> <ENT I="01">H</ENT> <ENT> <SU>1</SU>  0 </ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">I</ENT> <ENT>174.36</ENT> <ENT>175</ENT> </ROW> <ROW> <ENT I="01">J</ENT> <ENT>311.33</ENT> <ENT>312</ENT> </ROW> <TNOTE> <SU>1</SU> Share of cash proceeds: $4,458.39. </TNOTE> </GPOTABLE> <P> ( <E T="03">v</E> ) <E T="03">Monthly amounts.</E> To determine the pro-rata sales to effect redemptions for January, trustee compares the aggregate pro-rata share of stocks A through J (rounded to the next whole number) deemed to be owned by the trust interests tendered for redemption during the month of January with the sales of stocks A through J to effect redemptions: </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s30,10,10"> <BOXHD> <CHED H="1">Stock</CHED> <CHED H="1">Deemed pro-rata ownership</CHED> <CHED H="1">Shares sold</CHED> </BOXHD> <ROW> <ENT I="01">A</ENT> <ENT>1740</ENT> <ENT>1739</ENT> </ROW> <ROW> <ENT I="01">B</ENT> <ENT>0</ENT> <ENT>0</ENT> </ROW> <ROW> <ENT I="01">C</ENT> <ENT>3579</ENT> <ENT>3579</ENT> </ROW> <ROW> <ENT I="01">D</ENT> <ENT>971</ENT> <ENT>971</ENT> </ROW> <ROW> <ENT I="01">E</ENT> <ENT>1756</ENT> <ENT>1756</ENT> </ROW> <ROW> <ENT I="01">F</ENT> <ENT>2741</ENT> <ENT>2741</ENT> </ROW> <ROW> <ENT I="01">G</ENT> <ENT>1130</ENT> <ENT>1130</ENT> </ROW> <ROW> <ENT I="01">H</ENT> <ENT>883</ENT> <ENT>883</ENT> </ROW> <ROW> <ENT I="01">I</ENT> <ENT>1221</ENT> <ENT>1221</ENT> </ROW> <ROW> <ENT I="01">J</ENT> <ENT>2180</ENT> <ENT>2180</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">vi</E> ) <E T="03">Pro-rata sales to effect redemptions for the month of January.</E> For the month of January, the deemed pro-rata ownership of shares of stocks A through J equal or exceed the sales of stock to effect redemptions for the month. Accordingly, all of the sales to effect redemptions during the month of January are considered to be pro-rata and are not required to be reported under this paragraph (c)(2)(iv). </P> <P> (H) <E T="03">Corporate Reorganizations.</E> The exchange of trust assets for other assets of equivalent value pursuant to a tax free corporate reorganization is not required to be reported as a sale or disposition under this paragraph (c)(2)(iv). </P> <P> (v) <E T="03">Redemptions and sales of WHFIT interests</E> —(A) <E T="03">Redemptions</E> —( <E T="03">1</E> ) <E T="03">In general.</E> Unless paragraph (c)(2)(v)(C) of this section applies, for each date on which the amount of a redemption proceeds for the redemption of a trust interest is determined, the trustee must provide information to enable a requesting person to determine— </P> <P> ( <E T="03">i</E> ) The redemption proceeds (as defined in paragraph (b)(15) of this section) per trust interest on that date; </P> <P> ( <E T="03">ii</E> ) The redemption asset proceeds (as defined in paragraph (b)(14) of this section) per trust interest on that date; and </P> <P> ( <E T="03">iii</E> ) The gross income that is attributable to the redeeming beneficial owner for the portion of the calendar year that the redeeming beneficial owner held its interest (including income earned by the WHFIT after the date of the last income distribution. </P> <P> ( <E T="03">2</E> ) <E T="03">In kind redemptions.</E> The value of the assets received with respect to an in-kind redemption (as defined in paragraph (b)(8) of this section) is not required to be reported under this paragraph (c)(2)(v)(A). Information regarding the income attributable to a redeeming beneficial owner must, however, be reported under paragraph (c)(2)(v)(A)( <E T="03">1</E> )( <E T="03">iii</E> ) of this section. </P> <P> (B) <E T="03">Sale of a trust interest.</E> Under paragraph (c)(2)(v)(C) of this section applies, if a secondary market for interests in the WHFIT is established, the trustee must provide, for each day of the calendar year, information to enable requesting persons to determine— </P> <P> ( <E T="03">1</E> ) The sale assets proceeds (as defined in paragraph (b)(17) of this section) per trust interest on that date; and </P> <P> ( <E T="03">2</E> ) The gross income that is attributable to a selling beneficial owner and to a purchasing beneficial owner for <PRTPAGE P="339"/> the portion of the calendar year that each held the trust interest. </P> <P> (C) <E T="03">Simplified Reporting for Certain NMWHFITs</E> —( <E T="03">1</E> ) <E T="03">In general.</E> The trustee of an NMWHFIT described in paragraph (c)(2)(v)(C)( <E T="03">2</E> ) of this section is not required to report the information described in paragraph (c)(2)(v)(A) of this section (regarding redemptions) or (c)(2)(v)(B) of this section (regarding sales). However, the trustee must report to requesting persons, for each date on which the amount of redemption proceeds to be paid for the redemption of a trust interest is determined, information that will enable requesting persons to determine the redemption proceeds per trust interest on that date. The trustee also must provide requesting persons with a statement that this paragraph applies to the NMWHFIT. </P> <P> ( <E T="03">2</E> ) <E T="03">NMWHFITs that qualify for the exception.</E> This paragraph (c)(2)(v)(C) applies to a NMWHFIT if— </P> <P> ( <E T="03">i</E> ) Substantially all the assets of the NMWHFIT produce income that is treated as interest income (but only if these assets trade on a recognized exchange or securities market without a price component attributable to accrued interest) or produce dividend income (as defined in section 6042(b) and the regulations under that section). (Trust sales proceeds and gross proceeds from sales described in paragraphs (c)(2)(iv)(G) and (H) of this section are ignored for the purpose of determining if substantially all of a NMWHFIT's assets produce dividend or the interest income described in this paragraph); and </P> <P> ( <E T="03">ii</E> ) The qualified NMWHFIT exception of paragraph (c)(2)(iv)(E) of this section is satisfied, or the trustee is required by the governing document of the NMWHFIT to determine and distribute all cash held for distribution (as defined in paragraph (b)(5) of this section) no less frequently than monthly. A NMWHFIT will be considered to have satisfied this paragraph (c)(2)(v)(C)( <E T="03">2</E> )( <E T="03">i</E> ) notwithstanding that the governing document of the NMWHFIT permits the trustee to forego making a required monthly or more frequent distribution, if the cash held for distribution is less than 0.1 percent of the aggregate net asset value of the trust as of the date specified in the governing document for calculating the amount of the monthly distribution. </P> <P> (vi) <E T="03">Information regarding bond premium.</E> The trustee generally must report information that enables a beneficial owner to determine, in any manner that is reasonably consistent with section 171, the amount of the beneficial owner's amortizable bond premium, if any, for each calendar year. However, if a NMWHFIT meets the general <E T="03">de minimis</E> test in paragraph (c)(2)(iv)(D)( <E T="03">1</E> ) of this section, the qualified NMWHFIT exception of paragraph (c)(2)(iv)(E) of this section, or the NMWHFIT final calendar year exception of paragraph (c)(2)(iv)(F) of this section, the trustee of the NMWHFIT is not required to report information regarding bond premium. </P> <P> (vii) <E T="03">Information regarding market discount.</E> The trustee generally must report information that enables a beneficial owner to determine, in any manner reasonably consistent with section 1276 (including section 1276(a)(3)), the amount of market discount that has accrued during the calendar year. However, if a NMWHFIT meets the general <E T="03">de minimis</E> test in paragraph (c)(2)(iv)(D) of this section, the qualified NMWHFIT exception of paragraph (c)(2)(iv)(E) of this section, or the NMWHFIT final calendar year exception of paragraph (c)(2)(iv)(F) of this section, the trustee of such NMWHFIT is not required to provide information regarding market discount. </P> <P> (viii) <E T="03">Other information.</E> The trustee must provide any other information necessary for a beneficial owner of a trust interest to report, with reasonable accuracy, the items (as defined in paragraph (b)(9) of this section) attributable to the portion of the trust treated as owned by the beneficial owner under section 671. </P> <P> (3) <E T="03">Identifying the representative who will provide trust information.</E> The trustee must identify a representative of the WHFIT who will provide the information specified in this paragraph (c). The trustee also may identify an Internet website at which the trustee will provide the information specified in this paragraph (c). This information must be— <PRTPAGE P="340"/> </P> <P>(i) Printed in a publication generally read by, and available to, requesting persons;</P> <P>(ii) Stated in the trust's prospectus; or</P> <P>(iii) Posted at the trustee's Internet website.</P> <P> (4) <E T="03">Time and manner of providing information</E> —(i) <E T="03">Time</E> —(A) <E T="03">In general.</E> Except as provided in paragraph (c)(4)(i)(B) of this section, a trustee must provide the information specified in this paragraph (c) to requesting persons on or before the later of— </P> <P> ( <E T="03">1</E> ) The 30th day after the close of the calendar year to which the request relates; or </P> <P> ( <E T="03">2</E> ) The day that is 14 days after the receipt of the request. </P> <P> (B) <E T="03">Trusts holding interests in other WHFITs or in REMICs.</E> If the WHFIT holds an interest in one or more other WHFITs or holds one or more REMIC regular interests, or holds both, a trustee must provide the information specified in this paragraph (c) to requesting persons on or before the later of— </P> <P> ( <E T="03">1</E> ) The 44th day after the close of the calendar year to which the request relates; or </P> <P> ( <E T="03">2</E> ) The day that is 28 days after the receipt of the request. </P> <P> (ii) <E T="03">Manner.</E> The information specified in this paragraph (c) must be provided— </P> <P>(A) By written statement sent by first class mail to the address provided by the requesting person;</P> <P>(B) By causing it to be printed in a publication generally read by and available to requesting persons and by notifying requesting persons in writing of the publication in which it will appear, the date on which it will appear, and, if possible, the page on which it will appear;</P> <P>(C) By causing it to be posted at an Internet website, provided the trustee identifies the website under paragraph (c)(3) of this section;</P> <P>(D) By electronic mail provided that the requesting person requests that the trustee furnish the information by electronic mail and the person furnishes an electronic address; or</P> <P>(E) By any other method agreed to by the trustee and the requesting person.</P> <P> (iii) <E T="03">Inclusion of information with respect to all calculation periods.</E> If a trustee calculates WHFIT information using a calculation period other than a calendar year, the trustee must provide information for each calculation period that falls within the calendar year requested. </P> <P> (5) <E T="03">Requesting information from a WHFIT</E> —(i) <E T="03">In general.</E> Requesting persons may request the information specified in this paragraph (c) from a WHFIT. </P> <P> (ii) <E T="03">Manner of requesting information.</E> In requesting WHFIT information, a requesting person must specify the WHFIT and the calendar year for which information is requested. </P> <P> (iii) <E T="03">Period of time during which a requesting person may request WHFIT information.</E> For the life of the WHFIT and for five years following the date of the WHFIT's termination, a requesting person may request the information specified in this paragraph (c) for any calendar year of the WHFIT's existence beginning with the 2007 calendar year. </P> <P> (6) <E T="03">Trustee's requirement to retain records.</E> For the life of the WHFIT and for five years following the date of termination of the WHFIT, the trustee must maintain in its records a copy of the information required to be provided to requesting persons this paragraph (c) for each calendar year beginning with the 2007 calendar year. For a period of five years following the close of the calendar year to which the data pertains, the trustee also must maintain in its records such supplemental data as may be necessary to establish that the information provided to requesting persons is correct and meets the requirements of this paragraph (c). </P> <P> (d) <E T="03">Form 1099 requirement for trustees and middlemen</E> —(1) <E T="03">Obligation to file Form 1099 with the IRS</E> —(i) <E T="03">In general.</E> Except as provided in paragraphs (d)(1)(ii) and (iii) of this section— </P> <P>(A) The trustee must file with the IRS the appropriate Forms 1099, reporting the information specified in paragraph (d)(2) of this section with respect to any TIH who holds an interest in the WHFIT directly and not through a middleman; and</P> <P> (B) Every middleman must file with the IRS the appropriate Forms 1099, reporting the information specified in <PRTPAGE P="341"/> paragraph (d)(2) of this section with respect to any TIH on whose behalf or account the middleman holds an interest in the WHFIT or acts as an intermediary. </P> <P> (ii) <E T="03">Forms 1099 not required for exempt recipients</E> —(A) <E T="03">In general.</E> A Form 1099 is not required with respect to a TIH who is an exempt recipient (as defined in paragraph (b)(7) of this section), unless the trustee or middleman backup withholds under section 3406 on payments made to an exempt recipient (because, for example, the exempt recipient has failed to furnish a Form W-9 on request). If the trustee or middleman backup withholds, then the trustee or middleman is required to file a Form 1099 under this paragraph (d) unless the trustee or middleman refunds the amount withheld in accordance with § 31.6413(a)-3 of this chapter. </P> <P> (B) <E T="03">Exempt recipients must include WHFIT information in computing taxable income.</E> A beneficial owner who is an exempt recipient must obtain WHFIT information and must include the items (as defined in paragraph (b)(9) of this section) of the WHFIT in computing its taxable income on its federal income tax return. Paragraphs (c)(3) and (h) of this section provide rules for exempt recipients to obtain information from a WHFIT. </P> <P> (iii) <E T="03">Reporting and withholding with respect to foreign persons.</E> The items of the WHFIT attributable to a TIH who is not a United States person must be reported, and amounts must be withheld, as provided under subtitle A, chapter 3 of the Internal Revenue Code (sections 1441 through 1464) and the regulations thereunder and not reported under this paragraph (d). </P> <P> (2) <E T="03">Information to be reported</E> —(i) <E T="03">Determining amounts to be provided on Forms 1099.</E> The amounts reported to the IRS for a calendar year by a trustee or middleman on the appropriate Form 1099 must be consistent with the information provided by the trustee under paragraph (c) of this section and must reflect with reasonable accuracy the amount of each item required to be reported on a Form 1099 that is attributable (or if permitted under paragraphs (d)(2)(ii)(D) and (E) of this section, distributed) to the TIH. If the trustee, in providing WHFIT information, uses the safe harbors in paragraph (f)(1) or (g)(1) of this section, then the trustee or middleman must calculate the information to be provided to the IRS on the Forms 1099 in accordance with paragraph (f)(2) or (g)(2) of this section, as appropriate. </P> <P> (ii) <E T="03">Information to be provided on Forms 1099.</E> The trustee or middleman must include on the appropriate Forms 1099: </P> <P> (A) <E T="03">Taxpayer information.</E> The name, address, and taxpayer identification number of the TIH; </P> <P> (B) <E T="03">Information regarding the person filing the Form 1099.</E> The name, address, taxpayer identification number, and telephone number of the person required to file the Form 1099; </P> <P> (C) <E T="03">Gross income.</E> All items of gross income of the WHFIT attributable to the TIH for the calendar year (including OID (unless the exception for certain WHMTs applies (see paragraph (c)(2)(ii)(A) of this section)) and all amounts of income attributable to a selling, purchasing, or redeeming TIH for the portion of the calendar year that the TIH held its interest (unless paragraph (c)(2)(v)(C) of this section (regarding an exception for certain NMWHFITs) applies)); </P> <P> (D) <E T="03">Non pro-rata partial principal payments.</E> All non pro-rata partial principal payments (as defined in paragraph (b)(13) of this section) received by the WHFIT that are attributable (or distributed, in the case of a trustee or middleman reporting under paragraph (f)(2)(iii) of this section) to the TIH; </P> <P> (E) <E T="03">Trust sales proceeds.</E> All trust sales proceeds (as defined in paragraph (b)(21) of this section) that are attributable to the TIH for the calendar year, if any, or, if paragraph (c)(2)(iv)(B) of this section (regarding certain NMWHFITs) applies, the amount of trust sales proceeds distributed to the TIH for the calendar year; </P> <P> (F) <E T="03">Reporting Redemptions.</E> All redemption asset proceeds (as defined in paragraph (b)(14) of this section) paid to the TIH for the calendar year, if any, or, if paragraph (c)(2)(v)(C) of this section (regarding an exception for certain NMWHFITs) applies, all redemption proceeds (as defined in paragraph (b)(15) of this section) paid to the TIH for the calendar year; <PRTPAGE P="342"/> </P> <P> (G) <E T="03">Reporting sales of a trust interest on a secondary market.</E> All sales asset proceeds (as defined in paragraph (b)(17) of this section) paid to the TIH for the sale of a trust interest or interests on a secondary market established for the NMWHFIT for the calendar year, if any, or, if paragraph (c)(2)(v)(C) of this section (regarding an exception for certain NMWHFITs) applies, all sales proceeds (as defined in paragraph (b)(18) of this section) paid to the TIH for the calendar year; and </P> <P> (H) <E T="03">Other information.</E> Any other information required by the Form 1099. </P> <P> (3) <E T="03">Time and manner of filing Forms 1099</E> —(i) <E T="03">Time and place.</E> The Forms 1099 required to be filed under this paragraph (d) must be filed on or before February 28 (March 31, if filed electronically) of the year following the year for which the Forms 1099 are being filed. The returns must be filed with the appropriate Internal Revenue Service Center, at the address listed in the instructions for the Forms 1099. For extensions of time for filing returns under this section, see § 1.6081-1, the instructions for the Forms 1099, and applicable revenue procedures (see § 601.601(d)(2) of this chapter). For magnetic media filing requirements, see § 301.6011-2 of this chapter. </P> <P> (ii) <E T="03">Reporting trust sales proceeds, redemption asset proceeds, redemption proceeds, sale asset proceeds, sales proceeds and non pro-rata partial principal payments</E> —(A) <E T="03">Form to be used.</E> Trust sales proceeds, redemption asset proceeds, redemption proceeds, sale asset proceeds, sales proceeds, and non pro-rata partial principal payments are to be reported on the same type of Form 1099 as that required for reporting gross proceeds under section 6045. </P> <P> (B) <E T="03">Appropriate reporting for in-kind redemptions.</E> The value of the assets distributed with respect to an in-kind redemption is not required to be reported to the IRS. Unless paragraph (c)(2)(v)(C) of this section applies, the trustee or middleman must report the gross income attributable to the redeemed trust interest for the calendar year up to the date of the redemption under paragraph (d)(2)(ii)(C) of this section. </P> <P> (e) <E T="03">Requirement to furnish a written tax information statement to the TIH</E> —(1) <E T="03">In general.</E> Every trustee or middleman required to file appropriate Forms 1099 under paragraph (d) of this section with respect to a TIH must furnish to that TIH (the person whose identifying number is required to be shown on the form) a written tax information statement showing the information described in paragraph (e)(2) of this section. The amount of a trust item reported to a TIH under this paragraph (e) must be consistent with the information reported to the IRS with respect to the TIH under paragraph (d) of this section. Information provided in this written statement must be determined in accordance with the rules provided in paragraph (d)(2)(i) of this section (regardless of whether the information was required to be provided on a Form 1099). Further, the trustee or middleman must separately state on the written tax information statement any items that, if taken into account separately by that TIH, would result in an income tax liability that is different from the income tax liability that would result if the items were not taken into account separately. </P> <P> (2) <E T="03">Information required.</E> For the calendar year, the written tax information statement must meet the following requirements: </P> <P> (i) <E T="03">WHFIT information.</E> The written tax information statement must include the name of the WHFIT and the identifying number of the WHFIT ; </P> <P> (ii) <E T="03">Identification of the person furnishing the statement.</E> The written tax information statement must include the name, address, and taxpayer identification number of the person required to furnish the statement; </P> <P> (iii) <E T="03">Items of income, expense, and credit.</E> The written tax information statement must include information regarding the items of income (that is, the information required to be reported to the IRS on Forms 1099), expense (including affected expenses), and credit that are attributable to the TIH for the calendar year; </P> <P> (iv) <E T="03">Non pro-rata partial principal payments.</E> The written tax information statement must include the information required to be reported to the IRS on Forms 1099 under paragraph (d)(2)(ii)(D) of this section (regarding <PRTPAGE P="343"/> the non pro-rata partial principal payments that are attributable (or distributed, in the case of a trustee or middleman reporting under paragraph (f)(2)(iii) of this section) to the TIH for the calendar year). </P> <P> (v) <E T="03">Asset sales and dispositions</E> —(A) <E T="03">General rule.</E> Unless paragraph (c)(2)(iv)(B) (regarding the exception for certain NMWHFITs) or (c)(2)(iv)(C) (regarding the exception for certain WHMTs) of this section applies, the written tax information statement must include, with respect to each sale or disposition of a WHFIT asset for the calendar year— </P> <P> ( <E T="03">1</E> ) The date of sale or disposition; </P> <P> ( <E T="03">2</E> ) Information regarding the trust sales proceeds that are attributable to the TIH as a result of the sale or disposition; and </P> <P> ( <E T="03">3</E> ) Information that will enable the TIH to allocate with reasonable accuracy a portion of the TIH's basis in the TIH's trust interest to the sale or disposition. </P> <P> (B) <E T="03">Special rule for certain NMWHFITs and WHMTs.</E> In the case of a NMWHFIT to which paragraph (c)(2)(iv)(B) of this section applies or in the case of a WHMT to which paragraph (c)(2)(iv)(C) of this section applies, the written tax information statement must include, with respect to asset sales and dispositions, only the information required to be reported to the IRS on Form 1099 under paragraph (d)(2)(ii)(E) of this section. </P> <P> (vi) <E T="03">Redemption or sale of a trust interest.</E> The written tax information statement must include the information required to be reported to the IRS on Forms 1099 under paragraphs (d)(2)(ii)(F) and (G) of this section (regarding the sales and redemptions of trust interests made by the TIH for the calendar year); </P> <P> (vii) <E T="03">Information regarding market discount and bond premium.</E> The written tax information statement must include the information required to be reported by the trustee under paragraphs (c)(2)(vi) and (vii) of this section (regarding bond premium and market discount); </P> <P> (viii) <E T="03">Other information.</E> The written tax information statement must include any other information necessary for the TIH to report, with reasonable accuracy for the calendar year, the items (as defined in paragraph (b)(9) of this section) attributable to the portion of the trust treated as owned by the TIH under section 671. The written tax information statement may include information with respect to a trust item on a per trust interest basis if the trustee has reported (or calculated) the information with respect to that item on a per trust interest basis and information with respect to that item is not required to be reported on a Form 1099; and </P> <P> (ix) <E T="03">Required statement.</E> The written tax information statement must inform the TIH that the items of income, deduction, and credit, and any other information shown on the statement must be taken into account in computing the taxable income and credits of the TIH on the Federal income tax return of the TIH. If the written tax information statement reports that an amount of qualified dividend income is attributable to the TIH, the written tax information statement also must inform the TIH that the TIH must meet the requirements of section 1(h)(11)(B)(iii) to treat the dividends as qualified dividends. </P> <P> (3) <E T="03">Due date and other requirements.</E> The written tax information statement must be furnished to the TIH on or before March 15 of the year following the calendar year for which the statement is being furnished. </P> <P> (4) <E T="03">Requirement to retain records.</E> For a period of no less than five years from the due date for furnishing the written tax information statement, a trustee or middleman must maintain in its records a copy of any written tax information statement furnished to a TIH, and such supplemental data as may be required to establish the correctness of the statement. </P> <P> (f) <E T="03">Safe harbor for providing information for certain NMWHFITs</E> —(1) <E T="03">Safe harbor for trustee reporting of NMWHFIT information.</E> The trustee of a NMWHFIT that meets the requirements of paragraph (f)(1)(i) of this section is deemed to satisfy paragraph (c)(1)(i) of this section, if the trustee calculates and provides WHFIT information in the manner described in this paragraph (f) and provides a statement to a requesting person giving notice that information <PRTPAGE P="344"/> has been calculated in accordance with this paragraph (f)(1). </P> <P> (i) <E T="03">In general</E> —(A) <E T="03">Eligibility to report under this safe harbor.</E> Only NMWHFITs that meet the requirements set forth in paragraphs (f)(1)(i)(A)( <E T="03">1</E> ) and ( <E T="03">2</E> ) of this section may report under this safe harbor. For purposes of determining whether the requirements of paragraph (f)(1)(i)(A)( <E T="03">1</E> ) of this section are met, trust sales proceeds and gross proceeds from sales described in paragraphs (c)(2)(iv)(G) and (H) of this section are ignored. </P> <P> ( <E T="03">1</E> ) Substantially all of the NMWHFIT's income is from dividends or interest; and </P> <P> ( <E T="03">2</E> ) All trust interests have identical value and rights. </P> <P> (B) <E T="03">Consistency requirements.</E> The trustee must— </P> <P> ( <E T="03">1</E> ) Calculate all trust items subject to the safe harbor consistent with the safe harbor; and, ( <E T="03">2</E> ) Report under this paragraph (f)(1) for the life of the NMWHFIT; or, if the NMWHFIT has a start-up date before January 1, 2007, the NMWHFIT must begin reporting under this paragraph (f)(1) as of January 1, 2007 and must continue to report under this paragraph for the life of the NMWHFIT. </P> <P> (ii) <E T="03">Reporting NMWHFIT income and expenses.</E> A trustee must first determine the total amount of NMWHFIT distributions (both actual and deemed) for the calendar year and then express each income or expense item as a fraction of the total amount of NMWHFIT distributions. These fractions (hereinafter referred to as factors) must be accurate to at least four decimal places. </P> <P> (A) <E T="03">Step One: Determine the total amount of NMWHFIT distributions for the calendar year.</E> The trustee must determine the total amount of NMWHFIT distributions (actual and deemed) for the calendar year. If the calculation of the total amount of NMWHFIT distributions under this paragraph (f)(1)(ii)(A) results in a zero or a negative number, the trustee may not determine income and expense information under this paragraph (f)(1)(ii)(A) (but may report all other applicable items under this paragraph (f)(1)). The total amount of NMWHFIT distributions equals the amount of NMWHFIT funds paid out to all TIHs (including all trust sales proceeds, all principal receipts, and all redemption proceeds) for the calendar year— </P> <P> ( <E T="03">1</E> ) Increased by— </P> <P> ( <E T="03">i</E> ) All amounts that would have been distributed during the calendar year, but were instead reinvested pursuant to a reinvestment plan; and </P> <P> ( <E T="03">ii</E> ) All cash held for distribution to TIHs as of December 31 of the year for which the trustee is reporting; and </P> <P> ( <E T="03">2</E> ) Decreased by— </P> <P> ( <E T="03">i</E> ) All cash distributed during the current year that was included in a year-end cash allocation factor (see paragraph (f)(1)(ii)(C)( <E T="03">1</E> ) of this section) for a prior year; </P> <P> ( <E T="03">ii</E> ) All redemption asset proceeds paid for the calendar year, or if paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, all redemption proceeds paid for the calendar year; </P> <P> ( <E T="03">iii</E> ) All trust sales proceeds distributed during the calendar year; and </P> <P> ( <E T="03">iv</E> ) All non pro-rata partial principal payments distributed during the calendar year. </P> <P> ( <E T="03">3</E> ) For the purpose of determining the amount of all redemption asset proceeds or redemption proceeds paid for the calendar year with respect to paragraph (f)(1)(ii)(A)( <E T="03">2</E> )( <E T="03">ii</E> ) of this section, the value of the assets (not including cash) distributed with respect to an in-kind redemption is disregarded. Any cash distributed as part of the redemption must be included in the total amount of NMWHFIT distributions. </P> <P> (B) <E T="03">Step Two: Determine factors that express the ratios of NMWHFIT income and expenses to the total amount of NMWHFIT distributions.</E> The trustee must determine factors that express the ratios of NMWHFIT income and expenses to the total amount of NMWHFIT distributions as follows: </P> <P> ( <E T="03">1</E> ) <E T="03">Income factors.</E> For each item of income generated by the NMWHFIT's assets for the calendar year, the trustee must determine the ratio of the gross amount of that item of income to the total amount of NMWHFIT distributions for the calendar year; and </P> <P> ( <E T="03">2</E> ) <E T="03">Expense factors.</E> For each item of expense paid by a NMWHFIT during the calendar year, the trustee must determine the ratio of the gross amount of that item of expense to the total <PRTPAGE P="345"/> amount of NMWHFIT distributions for the calendar year. </P> <P> (C) <E T="03">Step Three: Determine adjustments for reconciling the total amount of NMWHFIT distributions (determined under Step One) with amounts actually paid to TIHs.</E> Paragraph (f)(1)(ii)(B) of this section (Step Two) requires an item of income or expense to be expressed as a ratio of that item to the total amount of NMWHFIT distributions as determined in paragraph (f)(1)(ii)(A) of this section (Step One). A TIH's share of the total amount of NMWHFIT distributions may differ from the amount actually paid to that TIH. A trustee, therefore, must provide information that can be used to compute a TIH's share of the total amount of NMWHFIT distributions based on the amount actually paid to the TIH. A trustee satisfies this requirement by providing a current year-end cash allocation factor, a prior year cash allocation factor, and the date on which the prior year cash was distributed to TIHs (prior year cash distribution date). </P> <P> ( <E T="03">1</E> ) <E T="03">The current year-end cash allocation factor.</E> The current year-end cash allocation factor is the amount of cash held for distribution to TIHs by the NMWHFIT as of December 31 of the calendar year for which the trustee is reporting, divided by the number of trust interests outstanding as of that date. </P> <P> ( <E T="03">2</E> ) <E T="03">The prior year cash allocation factor.</E> The prior year cash allocation factor is the amount of the distribution during the calendar year for which the trustee is reporting that was included in determining a year-end cash allocation factor for a prior year, divided by the number of trust interests outstanding on the date of the distribution. </P> <P> (iii) <E T="03">Reporting non pro-rata partial principal payments under the safe harbor.</E> The trustee must provide a list of dates on which non pro-rata partial principal payments were distributed by the trust, and the amount distributed, per trust interest. </P> <P> (iv) <E T="03">Reporting sales and dispositions of NMWHFIT assets under the safe harbor</E> —(A) <E T="03">NMWHFITs that must report under the general rule</E> —( <E T="03">1</E> ) <E T="03">In general.</E> If a NMWHFIT must report under the general rule of paragraph (c)(2)(iv)(A) of this section, the trustee must provide a list of dates (from earliest to latest) on which sales or dispositions of NMWHFIT assets occurred during the calendar year for which the trustee is reporting and, for each date identified, provide— </P> <P> ( <E T="03">i</E> ) The trust sales proceeds received by the trust, per trust interest, with respect to the sales and dispositions, on that date; </P> <P> ( <E T="03">ii</E> ) The trust sales proceeds distributed to TIHs, per trust interest, with respect to the sales and dispositions on that date, and the date that the trust sales proceeds were distributed to the TIHs; and </P> <P> ( <E T="03">iii</E> ) The ratio (expressed as a percentage) of the assets sold or disposed of on that date to all assets held by the NMWHFIT. </P> <P> ( <E T="03">2</E> ) <E T="03">Determination of the portion of all assets held by the NMWHFIT that the assets sold or disposed of represented</E> — </P> <P> ( <E T="03">i</E> ) If a NMWHFIT terminates within twenty-four months of its start-up date, the ratio of the assets sold or disposed of on that date to all assets held by the NMWHFIT is based on the fair market value of the NMWHFIT's assets as of the start-up date; or </P> <P> ( <E T="03">ii</E> ) If a NMWHFIT terminates more than twenty-four months after its start-up date, the ratio of the assets sold or disposed of on that date to all assets held by the NMWHFIT is based on the fair market value of the NMWHFIT's assets as of the date of the sale or disposition. </P> <P> (B) <E T="03">NMWHFITs excepted from the general rule.</E> If paragraph (c)(2)(iv)(B) of this section applies to the NMWHFIT, the trustee must provide a list of dates on which trust sales proceeds were distributed, and the amount of trust sales proceeds, per trust interest, that were distributed on that date. The trustee also must also provide requesting persons with the statement required by paragraph (c)(2)(iv)(B) of this section. </P> <P> (v) <E T="03">Reporting redemptions under the safe harbor</E> —(A) <E T="03">In general.</E> The trustee must: </P> <P> ( <E T="03">1</E> ) Provide a list of dates on which the amount of redemption proceeds paid for the redemption of a trust interest was determined and the amount of the redemption asset proceeds determined per trust interest on that date, <PRTPAGE P="346"/> or if paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, the amount of redemption proceeds determined on that date; or </P> <P> ( <E T="03">2</E> ) Provide to each requesting person that held (either for its own behalf or for the behalf of a TIH) a trust interest that was redeemed during the calendar year, the date of the redemption and the amount of the redemption asset proceeds per trust interest determined on that date, or if paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, the amount of the redemption proceeds determined for that date; and </P> <P> (B) <E T="03">Paragraph (c)(2)(v)(C) statement.</E> If paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, the trustee must provide a statement to requesting persons to the effect that the trustee is providing information consistent with paragraph (c)(2)(v)(C) of this section. </P> <P> (vi) <E T="03">Reporting the sale of a trust interest under the safe harbor.</E> If paragraph (c)(2)(v)(C) of this section does not apply to the NMWHFIT, the trustee must provide, for each day of the calendar year, the amount of cash held for distribution, per trust interest, by the NMWHFIT on that date. If the trustee is able to identify the date on which trust interests were sold on the secondary market, the trustee alternatively may provide information for each day on which sales of trust interests occurred rather than for each day during the calendar year. If paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, the trustee is not required to provide any information under this paragraph (f)(1)(vi), other than a statement that the NMWHFIT meets the requirements to report under paragraph (c)(2)(v)(C) of this section. </P> <P> (vii) <E T="03">Reporting OID information under the safe harbor.</E> The trustee must provide, for each calculation period, the average aggregate daily accrual of OID per $1,000 of original principal amount. </P> <P> (viii) <E T="03">Reporting market discount information under the safe harbor</E> —(A) <E T="03">In general</E> —( <E T="03">1</E> ) <E T="03">Trustee required to provide market discount information.</E> If the trustee is required to provide information regarding market discount under paragraph (c)(2)(vii) of this section, the trustee must provide— </P> <P> ( <E T="03">i</E> ) The information required to be provided under paragraph (f)(1)(iv)(A)( <E T="03">1</E> )( <E T="03">iii</E> ) of this section; and </P> <P> ( <E T="03">ii</E> ) If the NMWHFIT holds debt instruments with OID, a list of the aggregate adjusted issue prices of the debt instruments per trust interest calculated as of the start-up date or measuring date (see paragraph (c)(2)(iv)(D)( <E T="03">4</E> ) of this section) (whichever provides more accurate information) and as of January 1 for each subsequent year of the NMWHFIT. </P> <P> ( <E T="03">2</E> ) <E T="03">Trustee not required to provide market discount information.</E> If the trustee is not required to provide market discount information under paragraph (c)(2)(vii) of this section (because the NMWHFIT meets the general de minimis test of paragraph (c)(2)(iv)(D)( <E T="03">1</E> ) of this section, the qualified NMWHFIT exception of paragraph (c)(2)(iv)(E) of this section, or the NMWHFIT final year exception of paragraph (c)(2)(iv)(F) of this section), the trustee is not required under this paragraph (f) to provide any information regarding market discount. </P> <P> (B) <E T="03">Reporting market discount information under the safe harbor when the yield of the debt obligations held by the WHFIT is expected to be affected by prepayments.</E> [Reserved] </P> <P> (ix) <E T="03">Reporting bond premium information under the safe harbor.</E> [Reserved] </P> <P> (x) <E T="03">Reporting additional information.</E> If a requesting person cannot use the information provided by the trustee under paragraphs (f)(1)(ii) through (ix) of this section to determine with reasonable accuracy the trust items that are attributable to a TIH, the requesting person must request, and the trustee must provide, additional information to enable the requesting person to determine the trust items that are attributable to the TIH. See, for example, paragraph (f)(2)(ii)(A)( <E T="03">4</E> ) of this section which requires a middleman to request additional information from the trustee when the total amount of WHFIT distributions attributable to a TIH equals zero or less. </P> <P> (2) <E T="03">Use of information provided by trustees under the safe harbor for NMWHFITs</E> —(i) <E T="03">In general.</E> If a trustee reports NMWHFIT items in accordance with paragraph (f)(1) of this section, the information provided with respect <PRTPAGE P="347"/> to those items on the Forms 1099 required under paragraph (d) of this section to be filed with the IRS and on the statement required under paragraph (e) of this section to be furnished to the TIH must be determined as provided in this paragraph (f)(2). </P> <P> (ii) <E T="03">Determining NMWHFIT income and expense under the safe harbor.</E> The trustee or middleman must determine the amount of each item of income and expense attributable to a TIH as follows— </P> <P> (A) <E T="03">Step One: Determine the total amount of NMWHFIT distributions attributable to the TIH.</E> To determine the total amount of NMWHFIT distributions attributable to a TIH for the calendar year, the total amount paid to, or credited to the account of, the TIH during the calendar year (including amounts paid as trust sales proceeds or partial non-pro rata principal payments, redemption proceeds, and sales proceeds) is— </P> <P> ( <E T="03">1</E> ) Increased by— </P> <P> ( <E T="03">i</E> ) All amounts that would have been distributed during the calendar year to the TIH, but that were reinvested pursuant to a reinvestment plan (unless another person (for example, the custodian of the reinvestment plan) is responsible for reporting these amounts under paragraph (d) of this section); and </P> <P> ( <E T="03">ii</E> ) An amount equal to the current year-end cash allocation factor (provided by the trustee in accordance with paragraph (f)(1)(ii)(C)( <E T="03">1</E> ) of this section) multiplied by the number of trust interests held by the TIH as of December 31 of the calendar year for which the trustee is reporting; and </P> <P> ( <E T="03">2</E> ) Decreased by— </P> <P> ( <E T="03">i</E> ) An amount equal to the prior year cash allocation factor (provided by the trustee in accordance with paragraph (f)(1)(ii)(C)( <E T="03">2</E> ) of this section) multiplied by the number of trust interests held by the TIH on the date of the distribution; </P> <P> ( <E T="03">ii</E> ) An amount equal to all redemption asset proceeds paid to the TIH for the calendar year, or if paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, an amount equal to all redemption proceeds paid to the TIH for the calendar year; </P> <P> ( <E T="03">iii</E> ) An amount equal to all sale asset proceeds paid to the TIH for the calendar year, or if paragraph (c)(2)(v)(C) of this section applies to the NMWHFIT, the amount of sales proceeds paid to the TIH for the calendar year; </P> <P> ( <E T="03">iv</E> ) In the case of a TIH that purchased a trust interest in a NMWHFIT to which paragraph (c)(2)(v)(C) of this section does not apply, an amount equal to the cash held for distribution per trust interest on the date that the TIH acquired its interest, multiplied by the trust interests acquired on that date; </P> <P> ( <E T="03">v</E> ) The amount of the trust sales proceeds distributed to the TIH, calculated as provided in paragraph (f)(2)(iv)(A)( <E T="03">3</E> ) of this section; and </P> <P> ( <E T="03">vi</E> ) The amount of non pro-rata partial principal prepayments distributed to the TIH during the calendar year, calculated as provided in paragraph (f)(2)(iii) of this section. </P> <P> ( <E T="03">3</E> ) <E T="03">Treatment of in-kind distributions under this paragraph (f)(2)(i).</E> The value of the assets (not including cash) received with respect to an in-kind redemption is not included in the amount used in paragraph (f)(2)(ii)(A)( <E T="03">2</E> )( <E T="03">ii</E> ) of this section. The cash distributed as part of the redemption, however, must be included in the total amount of NMWHFIT distributions paid to the TIH. </P> <P> ( <E T="03">4</E> ) <E T="03">The total amount of distributions attributable to a TIH calculated under this paragraph (f)(2)(i)(A) equals zero or less.</E> If the total amount of distributions attributable to a TIH, calculated under this paragraph (f)(2)(i)(A), equals zero or less, the trustee or middleman may not report the income and expense attributable to the TIH under this paragraph (f)(2)(i). The trustee or middleman must request additional information from the trustee of the NMWHFIT to enable the trustee or middleman to determine with reasonable accuracy the items of income and expense that are attributable to the TIH. The trustee or middleman must report the other items subject to paragraph (f)(1) of this section in accordance with this paragraph (f)(2). </P> <P> (B) <E T="03"> Step Two: Apply the factors provided by the trustee to determine the items <PRTPAGE P="348"/> of income and expense that are attributable to the TIH. </E> The amount of each item of income (other than OID) and each item of expense attributable to a TIH is determined as follows— </P> <P> ( <E T="03">1</E> ) <E T="03">Application of income factors.</E> For each income factor, the trustee or middleman must multiply the income factor by the total amount of NMWHFIT distributions attributable to the TIH for the calendar year (as determined in paragraph (f)(2)(i)(A) of this section). </P> <P> ( <E T="03">2</E> ) <E T="03">Application of expense factors.</E> For each expense factor, the trustee or middleman must multiply the expense factor by the total amount of NMWHFIT distributions attributable to the TIH for the calendar year (as determined in paragraph (f)(2)(i)(A) of this section). </P> <P> (iii) <E T="03">Reporting non pro-rata partial principal payments under the safe harbor.</E> To determine the amount of non pro-rata partial principal payments that are distributed to a TIH for the calendar year, the trustee or middleman must aggregate the amount of non pro-rata partial principal payments distributed to a TIH for each day that non pro-rata principal payments were distributed. To determine the amount of non pro-rata principal payments that are distributed to a TIH on each distribution date, the trustee or middleman must multiply the amount of non-pro rata principal payments per trust interest distributed on that date by the number of trust interests held by the TIH. </P> <P> (iv) <E T="03">Reporting sales and dispositions of NMWHFIT assets under the safe harbor—(A) Reporting under the safe harbor if the general rules apply to the NMWHFIT.</E> Unless paragraph (c)(2)(iv)(B) of this section applies, the trustee or middleman must comply with paragraphs (f)(2)(iv)(A)( <E T="03">1</E> ), ( <E T="03">2</E> ), and ( <E T="03">3</E> ) of this section. </P> <P> ( <E T="03">1</E> ) <E T="03">Form 1099.</E> The trustee or middleman must report the amount of trust sales proceeds attributable to the TIH for the calendar year on Form 1099. To determine the amount of trust sales proceeds attributable to a TIH for the calendar year, the trustee or middleman must aggregate the total amount of trust sales proceeds attributable to the TIH for each date on which the NMWHFIT sold or disposed of an asset or assets. To determine the total amount of trust sales proceeds attributable to a TIH for each date that the NMWHFIT sold or disposed of an asset or assets, the trustee or middleman multiplies the amount of trust sales proceeds received by the NMWHFIT per trust interest on that date by the number of trust interests held by the TIH on that date. </P> <P> ( <E T="03">2</E> ) <E T="03">The written tax information statement furnished to the TIH.</E> The written tax information statement required to be furnished to the TIH under paragraph (e) of this section must include a list of dates (in order, from earliest to latest) on which sales or dispositions of trust assets occurred during the calendar year and provide, for each date identified— </P> <P>(i) The trust sales proceeds received by the trust, per trust interest, with respect to the sales or dispositions of trust assets on that date; and</P> <P> ( <E T="03">ii</E> ) The information provided by the trustee under paragraph (f)(1)(iv)(B)( <E T="03">2</E> ) of this section regarding the ratio of the assets sold or disposed of on that date to all the assets of the NMWHFIT held on that date, prior to such sale or disposition. </P> <P> (3) <E T="03">Calculating the total amount of trust sales proceeds distributed to the TIH.</E> To determine the total amount of NMWHFIT distributions attributable to a TIH, the trustee or middleman must calculate the amount of trust sales proceeds distributed to the TIH for the calendar year. (See paragraph (f)(2)(ii)(A)( <E T="03">2</E> )( <E T="03">v</E> ) of this section.) To determine the amount of trust sales proceeds distributed to a TIH for the calendar year, the trustee or middleman must aggregate the total amount of trust sales proceeds distributed to the TIH for each date on which the NMWHFIT distributed trust sales proceeds. To determine the total amount of trust sales proceeds distributed to a TIH for each date that the NMWHFIT distributed trust sales proceeds, the trustee or middleman must multiply the amount of trust sales proceeds distributed by the NMWHFIT per trust interest on that date by the number of trust interests held by the TIH on that date. <PRTPAGE P="349"/> </P> <P> (B) <E T="03">Reporting under the safe harbor if paragraph (c)(2)(iv)(B) of this section applies to the NMWHFIT.</E> If paragraph (c)(2)(iv)(B) of this section applies, the trustee or middleman must calculate, in the manner provided in paragraph (f)(2)(iv)(A)( <E T="03">3</E> ) of this section, the amount of trust sales proceeds distributed to the TIH for the calendar year. The trustee or middleman must report this amount on the Form 1099 filed for the TIH and on the written tax information statement furnished to the TIH. </P> <P> (v) <E T="03">Reporting redemptions under the safe harbor</E> —(A) Except as provided in paragraph (f)(2)(v)(B) or (C) of this section, if the trustee has provided a list of dates for which the amount of the redemption proceeds to be paid for the redemption of a trust interest was determined and the redemption asset proceeds paid for that date, the trustee or middleman must multiply the redemption asset proceeds determined per trust interest for that date by the number of trust interests redeemed by the TIH on that date. </P> <P>(B) If paragraph (c)(2)(v)(C) of this section applies, and the trustee has provided a list of dates for which the amount of the redemption proceeds to be paid for the redemption of a trust interest was determined and the redemption proceeds determined per trust interest on each date, the trustee or middleman must multiply the redemption proceeds per trust interest for each date by the number of trust interests redeemed by the TIH on that date.</P> <P>(C) If the trustee has provided the requesting person with information regarding the redemption asset proceeds paid for each redemption of a trust interest held by the middleman for the calendar year, or if paragraph (c)(2)(v)(C) of this section applies and the trustee has provided the amount of redemption proceeds paid for each redemption of a trust interest held by the middleman during the calendar year, the requesting person may use this information to determine the amount of the redemption asset proceeds or redemption proceeds paid to the TIH for the calendar year.</P> <P> (vi) <E T="03">Reporting sales of trust interests under the safe harbor</E> —(A) Except as provided in paragraph (f)(2)(vi)(B) of this section, the trustee or middleman must subtract the amount of cash held for distribution per trust interest on the date of the sale from the sales proceeds paid to the TIH to determine the sale asset proceeds that are to be reported to the TIH for each sale of a trust interest. </P> <P>(B) If paragraph (c)(2)(v)(C) of this section applies, the trustee or middleman must report the sales proceeds paid to the TIH as a result of each sale of a trust interest.</P> <P> (vii) <E T="03">Reporting OID information under the safe harbor</E> —The trustee or middleman must aggregate the amounts of OID that are allocable to each trust interest held by a TIH for each calculation period. The amount of OID that is allocable to a trust interest, with respect to each calculation period, is determined by multiplying— </P> <P>(A) The product of the OID factor and the original principal balance of the trust interest, divided by 1,000; by</P> <P>(B) The number of days during the OID calculation period in that calendar year that the TIH held the trust interest.</P> <P> (viii) <E T="03">Reporting market discount information under the safe harbor</E> —(A) Except as provided in paragraph (f)(2)(viii)(B) of this section, the trustee or middleman must provide the TIH with the information provided under paragraph (f)(1)(viii) of this section. </P> <P>(B) If paragraph (c)(2)(iv)(B) of this section applies, the trustee and middleman are not required under this paragraph (f)(2) to provide any information regarding market discount.</P> <P> (ix) <E T="03">Reporting bond premium information under the safe harbor.</E> [Reserved] </P> <P> (3) <E T="03">Example of the use of the safe harbor for NMWHFITs.</E> The following example illustrates the use of the factors in this paragraph (f) to calculate and provide NMWHFIT information: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> (i) <E T="03">Facts</E> —(A) <E T="03">In general</E> —( <E T="03">1</E> ) Trust is a NMWHFIT that holds common stock in ten different corporations and has 100 trust interests outstanding. The start-up date for Trust is December 15, 2006, and Trust's registration statement under the Securities Act of 1933 became effective after July 31, 2006. Trust terminates on March 15, 2008. The agreement governing Trust requires Trust to distribute cash held by Trust reduced by accrued but unpaid expenses on April 15, July <PRTPAGE P="350"/> 15, and October 15 of the 2007 calendar year. The agreement also provides that the trust interests will be redeemed by the Trust for an amount equal to the value of the trust interest, as of the close of business, on the day the trust interest is tendered for redemption. There is no reinvestment plan. A secondary market for interests in Trust will be created by Trust's sponsor and Trust's sponsor will provide Trustee with a list of dates on which sales occurred on this secondary market. </P> <P> ( <E T="03">2</E> ) As of December 31, 2006, Trust holds $12x for distribution to TIHs on the next distribution date and has no accrued but unpaid expenses. Trustee includes the $12x in determining the year-end cash allocation factor for December 31, 2006. </P> <P> (B) <E T="03">Events occurring during the 2007 calendar year</E> —( <E T="03">1</E> ) As of January 1, 2007, Broker1 holds ten trust interests in Trust in street name for each of <E T="03">J</E> and <E T="03">A</E> and Broker2 holds ten trust interests in Trust in street name for <E T="03">S. J, A</E> , and <E T="03">S</E> ; are individual, cash method taxpayers. </P> <P> ( <E T="03">2</E> ) As of January 1, 2007, the fair market value of the Trust's assets equals $10,000x. </P> <P> ( <E T="03">3</E> ) During 2007, Trust receives $588x in dividend income. Trustee determines that $400x of the dividend income received during 2007 meets the definition of a qualified dividend in section 1(h)(11)(B)(i) and the holding period requirement in section 1(h)(11)(B)(iii) with respect to the Trust. During 2007, Trust also receives $12x in interest income from investment of Trust's funds pending distribution to TIHs, and pays $45x in expenses, all of which are affected expenses. </P> <P> ( <E T="03">4</E> ) On April 15, 2007, Trustee distributes $135x, which includes the $12x included in determining the year-end cash allocation factor for December 31, 2006. As a result of the distribution, Broker1 credits <E T="03">J</E> 's account and <E T="03">A</E> 's account for $13.50x each. Broker2 credits <E T="03">S</E> 's account for $13.50x. </P> <P> ( <E T="03">5</E> ) On June 1, 2007, Trustee sells shares of stock for $1000x to preserve the soundness of the trust. The stock sold on June 1, 2007, equaled 20% of the aggregate fair market value of the assets held by Trust on the start-up date of Trust. Trustee has chosen not to report sales described in paragraph (c)(2)(iv)( <E T="03">4</E> )( <E T="03">ii</E> ) of Trust's assets under paragraph (c)(2)(iv)(D)( <E T="03">4</E> ) of this section. </P> <P> ( <E T="03">6</E> ) On July 15, 2007, Trustee distributes $1,135x, which includes the $1,000x of trust sales proceeds received by Trust for the sale of assets on June 1, 2007. As a result of the distribution, Broker1 credits <E T="03">J</E> 's account and <E T="03">A</E> 's account for $113.50x each. Broker 2 credits <E T="03">S</E> 's account for $113.50x. </P> <P> ( <E T="03">7</E> ) On September 30 2007, <E T="03">J</E> , through Trust's sponsor, sells a trust interest to <E T="03">S</E> for $115.35x. Trustee determines that the cash held for distribution per trust interest on September 30 is $1.35x. As a result of the sale, Broker1 credits <E T="03">J</E> 's account for $115.35x. </P> <P> ( <E T="03">8</E> ) On October 15, 2007, Trustee distributes $123x. As a result of the distribution, Broker1 credits <E T="03">J</E> 's account for $11.07x and <E T="03">A</E> 's account for $12.30x. Broker2 credits <E T="03">S</E> 's account for $13.53x. </P> <P> ( <E T="03">9</E> ) On December 10, 2007, <E T="03">J</E> tenders a trust interest to Trustee for redemption through Broker1. Trustee determines that the amount of the redemption proceeds to be paid for a trust interest that is tendered for redemption on December 10, 2007 is $116x, of which $115x represents the redemption asset proceeds. Trustee pays this amount to Broker1 on <E T="03">J</E> 's behalf. On December 12, 2007, trustee engages in a non pro-rata sale of shares of common stock for $115x to effect <E T="03">J</E> 's redemption of a trust interest. The stock sold on December 12, 2007, equals 2% of the aggregate fair market value of all the assets of Trust as of the start-up date. </P> <P> ( <E T="03">10</E> ) On December 10, 2007, <E T="03">J</E> , through Trust's sponsor, also sells a trust interest to <E T="03">S</E> for $116x. Trustee determines that the cash held for distribution per trust interest on that date is $1x. As a result of the sale, Broker1 credits <E T="03">J</E> 's account for $116x. </P> <P> ( <E T="03">11</E> ) As of December 31, 2007, Trust holds cash of $173x and has incurred $15x in expenses that Trust has not paid. <E T="03">J</E> is the only TIH to redeem a trust interest during the calendar year. The sale of two trust interests in Trust by <E T="03">J</E> to <E T="03">S</E> are the only sales that occurred on the secondary market established by Trust's sponsor during 2007. </P> <P> (ii) <E T="03">Trustee reporting</E> —(A) <E T="03">Summary of information provided by Trustee.</E> Trustee meets the requirements of paragraph (f)(1) of this section if Trustee provides the following information to requesting persons: </P> <P> ( <E T="03">1</E> ) Income and expense information: </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,xs36"> <ROW> <ENT I="01">Factor for ordinary dividend income</ENT> <ENT>0.3481</ENT> </ROW> <ROW> <ENT I="01">Factor for qualified dividend income</ENT> <ENT>0.7407</ENT> </ROW> <ROW> <ENT I="01">Factor for interest income</ENT> <ENT>0.0222</ENT> </ROW> <ROW> <ENT I="01">Factor for affected expenses</ENT> <ENT>0.0833</ENT> </ROW> <ROW> <ENT I="01">Current year-end cash allocation factor</ENT> <ENT>1.5960</ENT> </ROW> <ROW> <ENT I="01">Prior year cash allocation factor</ENT> <ENT>0.1200</ENT> </ROW> <ROW> <ENT I="01">Prior year cash distribution date</ENT> <ENT>April 15</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">2</E> ) Information regarding asset sales and distributions: </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s22,r20,r32,7"> <BOXHD> <CHED H="1">Date of sale</CHED> <CHED H="1">Trust sales proceeds received</CHED> <CHED H="1">Trust sales proceeds distributed and date distributed</CHED> <CHED H="1">Percent of trust sold</CHED> </BOXHD> <ROW> <ENT I="01">June 1</ENT> <ENT>$10.0000x</ENT> <ENT>$10.0000x (July 15)</ENT> <ENT>20</ENT> </ROW> <ROW> <ENT I="01">December 12</ENT> <ENT>1.1616x</ENT> <ENT>0.0000x</ENT> <ENT>2</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">3</E> ) Information regarding redemptions: </P> <GPOTABLE COLS="2" OPTS="L2" CDEF="s25,12"> <BOXHD> <CHED H="1">Date</CHED> <CHED H="1"> Redemption asset <LI>proceeds</LI> </CHED> </BOXHD> <ROW> <ENT I="01">December 10</ENT> <ENT>$115x</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">4</E> ) Information regarding sales of trust interests <PRTPAGE P="351"/> </P> <GPOTABLE COLS="2" OPTS="L2" CDEF="s25,12"> <BOXHD> <CHED H="1">Date</CHED> <CHED H="1">Cash held for distribution per trust interest</CHED> </BOXHD> <ROW> <ENT I="01">September 30</ENT> <ENT>$1.35x</ENT> </ROW> <ROW> <ENT I="01">December 10</ENT> <ENT>1.00x</ENT> </ROW> </GPOTABLE> <P> (B) <E T="03">Trustee determines this information as follows:</E> </P> <P> (1) <E T="03">Step One: Trustee determines the total amount of NMWHFIT distributions for the calendar year.</E> The total amount of NMWHFIT distributions (actual and deemed) for the calendar year for purposes of determining the safe harbor factors is $540x. This amount consists of the amounts paid on each scheduled distribution date during the calendar year ($1135x, $135x, and $123x), plus the total amount paid to <E T="03">J</E> as a result of <E T="03">J</E> 's redemption of a trust interest ($116x) ($1,135x + $135x + $123x + $116x = $1,509x)— </P> <P> ( <E T="03">i</E> ) Increased by all cash held for distribution to TIHs as of December 31, 2007 ($158x), which is the cash held as of December 31, 2007 ($173x) reduced by the accrued but unpaid expenses as of December 31, 2007 ($15x), and </P> <P> ( <E T="03">ii</E> ) Decreased by all amounts distributed during the calendar year but included in the year-end cash allocation factor from a prior year ($12x); all redemption asset proceeds paid for the calendar year ($115x); and all trust sales proceeds distributed during the calendar year ($1,000x). </P> <P> ( <E T="03">2</E> ) <E T="03">Step Two: Trustee determines factors that express the ratio of NMWHFIT income (other than OID) and expenses to the total amount of NMWHFIT distributions.</E> Trustee determines the factors for each item of income earned by Trust and each item of expense as follows: </P> <P> ( <E T="03">i</E> ) <E T="03">Ordinary dividend income factor.</E> The ordinary dividend income factor is 0.3481, which represents the ratio of the gross amount of ordinary dividends ($188x) to the total amount of NMWHFIT distributions for the calendar year ($540x). </P> <P> ( <E T="03">ii</E> ) <E T="03">Qualified dividend income factor.</E> The qualified dividend income factor is 0.7407 which represents the ratio of the gross amount of qualified dividend income ($400x) to the total amount of NMWHFIT distributions for the calendar year ($540x). </P> <P> ( <E T="03">iii</E> ) <E T="03">Interest income factor.</E> The interest income factor is 0.0222, which represents the ratio of the gross amount of interest income ($12x) to the total amount of NMWHFIT distributions for the calendar year ($540x). </P> <P> ( <E T="03">iv</E> ) <E T="03">Expense factor.</E> The affected expenses factor is 0.0833, which represents the ratio of the gross amount of affected expenses paid by Trust for the calendar year ($45x) to the total amount of NMWHFIT distributions for the calendar year ($540x). </P> <P> ( <E T="03">3</E> ) <E T="03">Step Three: Trustee determines adjustments for reconciling the total amount of NMWHFIT distributions with amounts paid to TIHs.</E> To enable requesting persons to determine the total amount of NMWHFIT distributions that are attributable to a TIH based on amounts actually paid to the TIH, the trustee must provide both a current year-end cash allocation factor and a prior year cash allocation factor. </P> <P> ( <E T="03">i</E> ) <E T="03">Current year-end cash allocation factor.</E> The adjustment factor for cash held by Trust at year end is 1.5960, which represents the cash held for distribution as of December 31, 2007 ($158x) (the amount of cash held by Trust on December 31, 2007 ($173x) reduced by accrued, but unpaid, expenses ($15x)), divided by the number of trust interests outstanding at year-end (99). </P> <P> ( <E T="03">ii</E> ) <E T="03">Prior Year Cash Allocation Factor.</E> The adjustment factor for distributions of year-end cash from the prior year is 0.1200, which represents the amount of the distribution during the current calendar year that was included in a year-end cash allocation factor for a prior year ($12x), divided by the number of trust interests outstanding at the time of the distribution (100). The prior year cash distribution date is April 15, 2007. </P> <P> ( <E T="03">4</E> ) <E T="03">Reporting sales and dispositions of trust assets</E> —( <E T="03">i</E> ) <E T="03">Application of the de minimis test.</E> The aggregate fair market value of the assets of Trust as of January 1, 2007, was $10,000x. During the 2007 calendar year, Trust received trust sales proceeds of $1115x. The trust sales proceeds received by Trust for the 2007 calendar year equal 11.15% of Trust's fair market value as of January 1, 2007. Accordingly, the <E T="03">de minimis</E> test is not satisfied for the 2007 calendar year. The qualified NMWHFIT exception in paragraph (c)(2)(iv)(E) of this section and the NMWHFIT final calendar year exception in (c)(2)(iv)(F) of this section also do not apply to Trust for the 2007 calendar year. </P> <P> ( <E T="03">ii</E> ) <E T="03">Information to be provided.</E> To satisfy the requirements of paragraph (f)(1) of this section with respect to sales and dispositions of Trust's assets, Trustee provides a list of dates on which trust assets were sold during the calendar year, and provides, for each date: the trust sales proceeds (per trust interest) received on that date; the trust sales proceeds distributed to TIHs (per trust interest) with respect to sales or dispositions on that date; the date those trust sales proceeds were distributed, and the ratio of the assets sold or disposed of on that day to all the assets held by Trust. Because Trust will terminate within 15 months of its start-up date, Trustee must use the fair market value of the assets as of the start-up date to determine the portion of Trust sold or disposed of on any particular date. </P> <P> ( <E T="03">5</E> ) <E T="03">Reporting redemptions.</E> Because Trust is not required to make distributions at least as frequently as monthly, and Trust does not satisfy the qualified NMWHFIT exception in paragraph (c)(2)(iv)(E) of this section, the exception in paragraph (c)(2)(v)(C) does not apply to Trust. To satisfy the requirements of paragraph (f)(1) of this section, Trustee <PRTPAGE P="352"/> provides a list of dates for which the redemption proceeds to be paid for the redemption of a trust interest was determined for the 2007 calendar year and the redemptions asset proceeds paid for each date. During 2007, Trustee only determined the amount of redemption proceeds paid for the redemption of a trust interest once, for December 10, 2007 and the redemption asset proceeds determined for that date was $115x. </P> <P> ( <E T="03">6</E> ) <E T="03">Reporting sales of trust interests.</E> Because trust is not required to make distributions at least as frequently as monthly, and Trust does not satisfy the qualified NMWHFIT exception in paragraph (c)(2)(iv)(E) of this section, the exception in paragraph (c)(2)(v)(C) of this section does not apply to Trust. Sponsor, in accordance with the trust agreement, provides Trustee with a list of dates on which sales on the secondary market occurred. To satisfy the requirements of paragraph (f)(1) of this section, Trustee provides requesting persons with a list of dates on which sales on the secondary market occurred and the amount of cash held for distribution, per trust interest, on each date. The first sale during the 2007 calendar year occurred on September 30, 2007, and the amount of cash held for distribution, per trust interest, on that date is $1.35x. The second sale occurred on December 10, 2007, and the amount of cash held for distribution, per trust interest, on that date is $1.00x. </P> <P> ( <E T="03">iii</E> ) <E T="03">Brokers' use of information provided by Trustee.</E> (A) Broker1 and Broker2 use the information furnished by Trustee under the safe harbor to determine that the following items are attributable to J, A, and S— </P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s150,12"> <ROW> <ENT I="22"> With respect to <E T="03">J</E> </ENT> </ROW> <ROW> <ENT I="03">Ordinary Dividend Income</ENT> <ENT>$17.89x</ENT> </ROW> <ROW> <ENT I="03">Qualified Dividend Income</ENT> <ENT>38.07x</ENT> </ROW> <ROW> <ENT I="03">Interest Income</ENT> <ENT>1.14x</ENT> </ROW> <ROW> <ENT I="03">Affected Expenses</ENT> <ENT>4.28x</ENT> </ROW> <ROW> <ENT I="03">Trust sales proceeds reported on Form 1099</ENT> <ENT>108.13x</ENT> </ROW> <ROW> <ENT I="03" O="xl">Redemption asset proceeds</ENT> </ROW> <ROW> <ENT I="05">For redemption on December 10</ENT> <ENT>115.00x</ENT> </ROW> <ROW> <ENT I="03" O="xl">Sale asset proceeds</ENT> </ROW> <ROW> <ENT I="05">For sale on September 30</ENT> <ENT>114.00x</ENT> </ROW> <ROW> <ENT I="05">For sale on December 10</ENT> <ENT>115.00x</ENT> </ROW> <ROW> <ENT I="22"> With respect to <E T="03">A</E> </ENT> </ROW> <ROW> <ENT I="03">Ordinary Dividend Income</ENT> <ENT>18.82x</ENT> </ROW> <ROW> <ENT I="03">Qualified Dividend Income</ENT> <ENT>40.04x</ENT> </ROW> <ROW> <ENT I="03">Interest Income</ENT> <ENT>1.20x</ENT> </ROW> <ROW> <ENT I="03">Affected Expenses</ENT> <ENT>4.50x</ENT> </ROW> <ROW> <ENT I="03">Trust sales proceeds reported on Form 1099</ENT> <ENT>11.62x</ENT> </ROW> <ROW> <ENT I="22"> With respect to <E T="03">S</E> </ENT> </ROW> <ROW> <ENT I="03">Ordinary Dividend Income</ENT> <ENT>19.54x</ENT> </ROW> <ROW> <ENT I="03">Qualified Dividend Income</ENT> <ENT>41.58x</ENT> </ROW> <ROW> <ENT I="03">Interest Income</ENT> <ENT>1.25x</ENT> </ROW> <ROW> <ENT I="03">Affected Expenses</ENT> <ENT>4.68x</ENT> </ROW> <ROW> <ENT I="03">Trust sales proceeds reported on Form 1099</ENT> <ENT>113.94x</ENT> </ROW> </GPOTABLE> <P> With respect to <E T="03">J, A</E> , and <E T="03">S</E> (regarding the sales and dispositions executed by Trust during the calendar year) </P> <GPOTABLE COLS="3" OPTS="L2" CDEF="s20,r20,10"> <BOXHD> <CHED H="1">Date</CHED> <CHED H="1"> Trust sales proceeds <LI>received per trust interest</LI> </CHED> <CHED H="1">Percent of trust sold</CHED> </BOXHD> <ROW> <ENT I="01">June 15</ENT> <ENT>$10.0000x</ENT> <ENT>20</ENT> </ROW> <ROW> <ENT I="01">December 12</ENT> <ENT>1.1616x</ENT> <ENT>2</ENT> </ROW> </GPOTABLE> <P> ( <E T="03">B</E> ) The brokers determine the information provided to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> as follows— </P> <P> ( <E T="03">1</E> ) <E T="03">Step One: Brokers determine the total amount of NMWHFIT distributions attributable to J, A, and S.</E> Broker1 determines that the total amount of NMWHFIT distributions attributable to <E T="03">J</E> is $51.39x and the total amount of NMWHFIT distributions attributable to <E T="03">A</E> is $54.06x. Broker2 determines that the total amount of NMWHFIT distributions attributable to <E T="03">S</E> is $56.13x. </P> <P> ( <E T="03">i</E> ) To calculate these amounts the brokers begin by determining the total amount paid to <E T="03">J, A</E> , and <E T="03">S</E> for the calendar year— </P> <P> ( <E T="03">A</E> ) The total amount paid to J for the calendar year equals $485.42x and includes the April 15, 2007, distribution of $13.50x, the July 15, 2007, distribution of $113.50x, the sales proceeds for the September 30, 2007, sale of $115.35x, the October 15, 2007, distribution of $11.07x, and the redemption proceeds of $116x and sales proceeds of $116x for the redemption and sale on December 10, 2007. </P> <P> ( <E T="03">B</E> ) The total amount paid to <E T="03">A</E> for the calendar year equals $139.30x and includes the April 15, 2007, distribution of $13.50x, the July 15, 2007, distribution of $113.50x and the October 15, 2007, distribution of $12.30x. </P> <P> ( <E T="03">C</E> ) The total amount paid to <E T="03">S</E> for the calendar year equals $140.53x and includes the April 15, 2007, distribution of $13.50x, the July 15, 2007, distribution of $113.50x and the October 15, 2007, distribution of $13.53x. </P> <P> ( <E T="03">ii</E> ) The brokers increase the total amount paid to <E T="03">J, A</E> , and <E T="03">S</E> by an amount equal to the current year-end cash allocation factor (1.5960) multiplied by the number of trust interests held by <E T="03">J</E> (7), <E T="03">A</E> (10), and <E T="03">S</E> (12) as of <PRTPAGE P="353"/> December 31, 2007; that is for <E T="03">J</E> , $11.17x; for <E T="03">A</E> , $15.96x; and for <E T="03">S</E> , $19.15x. </P> <P> ( <E T="03">iii</E> ) The brokers reduce the amount paid to <E T="03">J, A</E> , and <E T="03">S</E> as follows— </P> <P> ( <E T="03">A</E> ) An amount equal to the prior year cash allocation factor (0.1200), multiplied by the number of trust interests held by <E T="03">J</E> (10), <E T="03">A</E> (10), and <E T="03">S</E> (10) on the date of the prior year cash distribution; that is for <E T="03">J, A</E> , and <E T="03">S</E> , $1.20x, each; </P> <P> ( <E T="03">B</E> ) An amount equal to all redemption asset proceeds paid to a TIH for the calendar year; that is, for <E T="03">J</E> , $115x; </P> <P> ( <E T="03">C</E> ) An amount equal to all sales asset proceeds attributable to the TIH for the calendar year; that is for <E T="03">J</E> , $229x (for the September 30, 2007, sale: $115.35x−1.35x (cash held for distribution per trust interest on that date)−$114x; and for the December 10, 2007, sale: $116x−1.00 (cash held for distribution per trust interest on that date) = $115x)); </P> <P> ( <E T="03">D</E> ) In the case of a purchasing TIH, an amount equal to the amount of cash held for distribution per trust interest at the time the TIH purchased its trust interest, multiplied by the number of trust interests purchased; that is for <E T="03">S</E> , $2.35x ($1.35x with respect to the September 30, 2007, sale and $1x with respect to the December 10, 2007, sale); </P> <P> ( <E T="03">E</E> ) All amounts of trust sales proceeds distributed to the TIH for the calendar year; that is for <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> , $100. ($100 each, with respect to the June 15, 2007, sale of assets by Trust, and $0 each, with respect to the December 12, 2007, sale of assets by Trust). </P> <P> ( <E T="03">2</E> ) <E T="03">Step two: The brokers apply the factors provided by Trustee to determine the Trust's income and expenses that are attributable to J, A, and S.</E> The amounts of each item of income (other than OID) and expense that are attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> are determined by multiplying the factor for that type of income or expense by the total amount of NMWHFIT distributions attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> as follows: </P> <P> ( <E T="03">i</E> ) <E T="03">Application of factor for ordinary dividends.</E> The amount of ordinary dividend income attributable to <E T="03">J</E> is $17.89x, to <E T="03">A</E> is $18.82x, and to <E T="03">S</E> is $19.54x. The brokers determine these amounts by multiplying the total amount of NMWHFIT distributions attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> ($51.39x, $54.06x, and $56.13x, respectively) by the factor for ordinary dividends (0.3481). </P> <P> ( <E T="03">ii</E> ) <E T="03">Application of factor for qualified dividend income.</E> The amount of qualified dividend income attributable to <E T="03">J</E> is $38.07x, to <E T="03">A</E> is $40.04x, and to <E T="03">S</E> is $41.58x. The brokers determine these amounts by multiplying the total amount of NMWHFIT distributions attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> ($51.39x, $54.06x, and $56.13x, respectively) by the factor for qualified dividends (0.7407). </P> <P> ( <E T="03">iii</E> ) <E T="03">Application of factor for interest income.</E> The amount of interest income attributable to <E T="03">J</E> is $1.14x, to <E T="03">A</E> is $1.20x, and to <E T="03">S</E> is $1.25x. The brokers determine these amounts by multiplying the total amount of NMWHFIT distributions attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> ($51.39x, $54.06x, and $56.13x, respectively) by the factor for interest (0.0222). </P> <P> ( <E T="03">iv</E> ) <E T="03">Application of factor for affected expenses.</E> The amount of affected expenses attributable to <E T="03">J</E> is $4.28x, to <E T="03">A</E> is $4.50x, and to <E T="03">S</E> is $4.68x. The brokers determine these amounts by multiplying the total amount of NMWHFIT distributions attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> ($51.39x, $54.06x, and $56.13x, respectively) by the factor for affected expenses (0.0833). </P> <P> ( <E T="03">3</E> ) <E T="03">Brokers reporting of sales and dispositions of trust assets</E> —( <E T="03">i</E> ) <E T="03">Determining the amount of trust sales proceeds to be reported on Form 1099 for J, A, and S.</E> The amount of trust sales proceeds to be reported on Form 1099 with respect to <E T="03">J</E> is $108.13x, to <E T="03">A</E> is $111.62x, and to <E T="03">S</E> is $113.94x. To determine these amounts, the brokers aggregate the amount of trust sales proceeds attributable to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> for each date on which Trust sold or disposed of assets. The brokers determine the amount of trust sales proceeds to be reported with respect to the June 15, 2007, asset sale by multiplying the number of trust interests held by <E T="03">J</E> (10), <E T="03">A</E> (10) and <E T="03">S</E> (10) on that date by the trust sales proceeds received per trust interest on that date ($10x). The brokers determine the amount of trust sales proceeds to be reported with respect to the December 12, 2007, asset sale by multiplying the number of trust interests held by <E T="03">J</E> (7), <E T="03">A</E> (10) and <E T="03">S</E> (12) on that date by the trust sales proceeds received per trust interest on that date ($1.1616x). </P> <P> ( <E T="03">ii</E> ) <E T="03">Information provided on the tax information statements furnished to J, A, and S.</E> The tax information statements furnished to <E T="03">J</E> , <E T="03">A</E> , and <E T="03">S</E> must include the dates of each sale or disposition (June 15, 2007, and December 12, 2007); the amount of trust sales proceeds per trust interest received on those dates ($10.00x and $1.1616x, respectively); and, the percentage of Trust sold or disposed of on that date (20% and 2%, respectively). </P> <P> ( <E T="03">4</E> ) <E T="03">Reporting redemptions.</E> Broker1 reports on Form 1099 and on the written tax information statement furnished to <E T="03">J</E> that <E T="03">J</E> received $115x in redemption asset proceeds for the calendar year. </P> <P> ( <E T="03">5</E> ) <E T="03">Reporting sales of trust interests on the secondary market.</E> Broker1 reports on <E T="03">J</E> 's two sales of trust interests. With respect to the sale on September 30, 2007, the sale asset proceeds equals $114x ($115.35x sale proceeds—$1.35x cash held for distribution on that date) and with respect to the sale on December 10, 2007, the sale asset proceeds equal $115x ($116x sale proceeds—$1x cash held for distribution on that date). Broker1 reports these amounts on Form 1099 and on the tax information statement furnished to J. </P> </EXAMPLE> <P> (g) <E T="03">Safe Harbor for certain WHMTs</E> —(1) <E T="03"> Safe harbor for trustee of certain WHMTs <PRTPAGE P="354"/> for reporting information </E> —(i) <E T="03">In general.</E> The trustee of a WHMT that meets the requirements of paragraph (g)(1)(ii) of this section is deemed to satisfy paragraph (c)(1)(i) of this section, if the trustee calculates and provides WHFIT information in the manner described in this paragraph (g) and provides a statement to the requesting person giving notice that information has been calculated in accordance with this paragraph (g)(1). </P> <P> ( <E T="03">ii</E> ) <E T="03">Requirements.</E> A WHMT must meet the following requirements— </P> <P>(A) The WHMT must make monthly distributions of the income and principal payments received by the WHMT to its TIHs;</P> <P>(B) All trust interests in the WHMT must represent the right to receive an equal pro-rata share of both the income and the principal payments received by the WHMT on the mortgages it holds (for example, a WHMT that holds or issues trust interests that qualify as stripped interests under section 1286 may not report under this safe harbor);</P> <P>(C) The WHMT must—</P> <P> ( <E T="03">1</E> ) Report under this paragraph (g)(1)(ii) for the life of the WHMT; or </P> <P> ( <E T="03">2</E> ) If the WHMT has a start-up date before January 1, 2007, the WHMT must begin reporting under this paragraph (g)(1)(ii) as of January 1, 2007, and must continue to report under this paragraph for the life of the WHMT; </P> <P>(D) The WHMT must calculate all items subject to the safe harbor consistent with the safe harbor;</P> <P>(E) The assets of the WHMT must be limited to—</P> <P> ( <E T="03">1</E> ) Mortgages with uniform characteristics; </P> <P> ( <E T="03">2</E> ) Reasonably required reserve funds; and </P> <P> ( <E T="03">3</E> ) Amounts received on mortgages or reserve funds and held for distribution to TIHs; and </P> <P>(F) The aggregate outstanding principal balance (as defined in paragraph (g)(1)(iii)(D) of this section) as of the WHMT's start-up date must equal the aggregate of the original face amounts of all issued trust interests.</P> <P> (iii) <E T="03">Reporting WHMT income, expenses, non pro-rata partial principal payments, and sales and dispositions under the safe harbor.</E> A trustee must comply with each step provided in this paragraph (g)(1)(iii). </P> <P> (A) <E T="03">Step One: Determine monthly pool factors.</E> The trustee must, for each month of the calendar year and for January of the following calendar year, calculate and provide the ratio (expressed as a decimal carried to at least eight places and called a <E T="03">pool factor</E> ) of— </P> <P> ( <E T="03">1</E> ) The amount of the aggregate outstanding principal balance of the WHMT as of the first business day of the month; to </P> <P> ( <E T="03">2</E> ) The amount of the aggregate outstanding principal balance of the WHMT as of the start-up date. </P> <P> (B) <E T="03">Step Two: Determine monthly expense factors.</E> For each month of the calendar year and for each item of expense paid by the WHMT during that month, the trustee must calculate and provide the ratio (expressed as a decimal carried to at least eight places and called an <E T="03">expense factor</E> ) of— </P> <P> ( <E T="03">1</E> ) The gross amount, for the month, of each item of expense; to </P> <P> ( <E T="03">2</E> ) The amount that represents the aggregate outstanding principal balance of the WHMT as of the start-up date, divided by 1,000. </P> <P> (C) <E T="03">Step Three: Determine monthly income factors.</E> For each month of the calendar year and for each item of gross income earned by the WHMT during that month, the trustee must calculate and provide the ratio (expressed as a decimal carried to at least eight places and called an <E T="03">income factor</E> ) of— </P> <P> ( <E T="03">1</E> ) The gross amount, for the month, of each item of income, to </P> <P> ( <E T="03">2</E> ) The amount that represents the aggregate outstanding principal balance of the WHMT as of the start-up date, divided by 1,000. </P> <P> (D) <E T="03">Definition of aggregate outstanding principal balance.</E> For purposes of this paragraph (g)(1)(iii), the amount of the aggregate outstanding principal balance of a WHMT is the aggregate of— </P> <P> ( <E T="03">1</E> ) The outstanding principal balance of all mortgages held by the WHMT; </P> <P> ( <E T="03">2</E> ) The amounts received on mortgages as principal payments and held for distribution by the WHMT; and </P> <P> ( <E T="03">3</E> ) The amount of the reserve fund (exclusive of undistributed income). </P> <P> (iv) <E T="03"> Reporting OID information under the safe harbor—(A) Reporting OID prior <PRTPAGE P="355"/> to the issuance of final regulations under section 1272(a)(6)(C)(iii) </E> —( <E T="03">1</E> ) For calendar years prior to the effective date of final regulations under section 1272(a)(6)(C)(iii), the trustee must provide, for each month during the calendar year, the aggregate daily accrual of OID per $1,000 of aggregate outstanding principal balance as of the start-up date (daily portion). For purposes of this paragraph (g)(1)(iv), the daily portion of OID is determined by allocating to each day of the month its ratable portion of the excess (if any) of— </P> <P> ( <E T="03">i</E> ) The sum of the present value (determined under section 1272(a)(6)(B)) of all remaining payments under the mortgages held by the WHMT at the close of the month, and the payments during the month of amounts included in the stated redemption price of the mortgages, over </P> <P> ( <E T="03">ii</E> ) The aggregate of each mortgage's adjusted issue price as of the beginning of the month. </P> <P> ( <E T="03">2</E> ) In calculating the daily portion of OID, the trustee must use the prepayment assumption used in pricing the original issue of trust interests. If the WHMT has a start-up date prior to January 24, 2006, and the trustee, after a good faith effort to ascertain that information, does not know the prepayment assumption used in pricing the original issue of trust interests, the trustee may use any reasonable prepayment assumption to calculate OID provided it continues to use the same prepayment assumption consistently thereafter. </P> <P> (B) <E T="03">Reporting OID after the issuance of final regulations under section 1272(a)(6)(C)(iii).</E> [Reserved] </P> <P> (v) <E T="03">Reporting market discount information under the safe harbor—(A) Reporting market discount information prior to the issuance of final regulations under sections 1272(a)(6)(C)(iii) and 1276(b)(3).</E> For calendar years prior to the effective date of final regulations under sections 1272(a)(6)(C)(iii) and 1276(b)(3), the trustee must provide— </P> <P> ( <E T="03">1</E> ) In the case of a WHMT holding mortgages issued with OID, the ratio (expressed as a decimal carried to at least eight places) of— </P> <P> ( <E T="03">i</E> ) The OID accrued during the month (calculated in accordance with paragraph (g)(1)(iv) of this section); to </P> <P> ( <E T="03">ii</E> ) The total remaining OID as of the beginning of the month (as determined under paragraph (g)(1)(v)(A)( <E T="03">3</E> ) of this section); or </P> <P> ( <E T="03">2</E> ) In the case of a WHMT holding mortgages issued without OID, the ratio (expressed as a decimal carried to at least eight places) of— </P> <P> ( <E T="03">i</E> ) The amount of stated interest paid to the WHMT during the month; to </P> <P> ( <E T="03">ii</E> ) The total amount of stated interest remaining to be paid to the WHMT as of the beginning of the month (as determined under paragraph (g)(1)(v)(A)( <E T="03">3</E> ) of this section). </P> <P> ( <E T="03">3</E> ) <E T="03">Computing the total amount of stated interest remaining to be paid and the total remaining OID at the beginning of the month.</E> To compute the total amount of stated interest remaining to be paid to the WHMT as of the beginning of the month and the total remaining OID as of the beginning of the month, the trustee must use the prepayment assumption used in pricing the original issue of trust interests. If the WHMT has a start-up date prior to January 24, 2006, and the trustee, after a good faith effort to ascertain that information, does not know the prepayment assumption used in pricing the original issue of trust interests, the trustee may use any reasonable prepayment assumption to calculate these amounts provided it continues to use the same prepayment assumption consistently thereafter. </P> <P> (vi) <E T="03">Reporting bond premium information under the safe harbor.</E> [Reserved] </P> <P> (2) <E T="03">Use of information provided by a trustee under the safe harbor</E> —(i) <E T="03">In general.</E> If a trustee reports WHMT items in accordance with paragraph (g)(1) of this section, the information provided with respect to those items on the Forms 1099 required to be filed with the IRS under paragraph (d) of this section and on the statement required to be furnished to the TIH under paragraph (e) of this section must be determined as provided in this paragraph (g)(2). </P> <P> (ii) <E T="03"> Reporting WHMT income, expenses, non pro-rata partial principal payments, and sales and dispositions under the safe <PRTPAGE P="356"/> harbor. </E> The amount of each item of income, the amount of each item of expense, and the combined amount of non pro-rata partial principal payments and trust sales proceeds that are attributable to a TIH for each month of the calendar year must be computed as follows: </P> <P> (A) <E T="03">Step One: Determine the aggregate of the non pro-rata partial principal payments and trust sales proceeds that are attributable to the TIH for the calendar year.</E> For each month of the calendar year that a trust interest was held on the record date— </P> <P> ( <E T="03">1</E> ) <E T="03">Determine the monthly amounts per trust interest.</E> The trustee or middleman must determine the aggregate amount of non pro-rata partial principal payments and the trust sales proceeds that are attributable to each trust interest for each month by multiplying— </P> <P> ( <E T="03">i</E> ) The original face amount of the trust interest; by </P> <P> ( <E T="03">ii</E> ) The difference between the pool factor for the current month and the pool factor for the following month. </P> <P> ( <E T="03">2</E> ) <E T="03">Determine the amount for the calendar year.</E> The trustee or middleman must multiply the monthly amount per trust interest by the number of trust interests held by the TIH on the record date of each month. The trustee or middleman then must aggregate these monthly amounts, and report the aggregate amount on the Form 1099 filed with the IRS and on the tax information statement furnished to the TIH as trust sales proceeds. No other information is required to be reported to the IRS or the TIH to satisfy the requirements of paragraphs (d) and (e) of this section under this paragraph (g) with respect to sales and dispositions and non pro-rata partial principal payments. </P> <P> (B) <E T="03">Step Two: Determine the amount of each item of expense that is attributable to a TIH</E> —(1) <E T="03">Determine the monthly amounts per trust interest.</E> For each month of the calendar year that a trust interest was held on the record date, the trustee or middleman must determine the amount of each item of expense that is attributable to each trust interest by multiplying— </P> <P> ( <E T="03">i</E> ) The original face amount of the trust interest, divided by 1000; by </P> <P> ( <E T="03">ii</E> ) The expense factor for that month and that item of expense. </P> <P> ( <E T="03">2</E> ) <E T="03">Determine the amount for the calendar year.</E> The trustee or middleman must multiply the monthly amount of each item of expense per trust interest by the number of trust interests held by the TIH on the record date of each month. The trustee or middleman then must aggregate the monthly amounts for each item of expense to determine the total amount of each item of expense that is attributable to the TIH for the calendar year. </P> <P> (C) <E T="03">Step Three: Determine the amount of each item of income that is attributable to the TIH for the calendar year</E> —(1) <E T="03">Determine the monthly amounts per trust interest.</E> For each month of the calendar year that a trust interest was held on the record date, the trustee or middleman must determine the amount of each item of income that is attributable to each trust interest by multiplying— </P> <P> ( <E T="03">i</E> ) The original face amount of the trust interest, divided by 1,000; by </P> <P> ( <E T="03">ii</E> ) The income factor for that month and that item of income. </P> <P> ( <E T="03">2</E> ) <E T="03">Determine the amount for the calendar year.</E> The trustee or middleman must multiply the monthly amount of each item of income per trust interest by the number of trust interests held by the TIH on the record date of each month. The trustee or middleman then must aggregate the monthly amounts for each item of income to determine the total amount of each item of income that is attributable to the TIH for the calendar year. </P> <P> (D) <E T="03">Definitions for this paragraph (g)(2).</E> For purposes of this paragraph (g)(2)(ii)— </P> <P> ( <E T="03">1</E> ) The <E T="03">record date</E> is the date used by the WHMT to determine the owner of the trust interest for the purpose of distributing the payment for the month. </P> <P> ( <E T="03">2</E> ) The <E T="03">original face amount of the trust interest</E> is the original principal amount of a trust interest on its issue date. </P> <P> (iii) <E T="03">Reporting OID information under the safe harbor.</E> With respect to each month, trustee or middleman must determine the amount of OID that is attributable to each trust interest held by a TIH by multiplying— <PRTPAGE P="357"/> </P> <P>(A) The product of the OID factor multiplied by the original face amount of the trust interest, divided by 1,000; by</P> <P>(B) The number of days during the month that the TIH held the trust interest.</P> <P> (iv) <E T="03">Requirement to provide market discount information under the safe harbor.</E> The trustee or middleman must provide the market discount information in accordance with paragraph (g)(1)(v) of this section to the TIH in, or with, the written statement required to be furnished to the TIH under paragraph (e) of this section. </P> <P> (v) <E T="03">Requirement to provide bond premium information under the safe harbor.</E> [Reserved] </P> <P> (3) <E T="03">Example of safe harbor in paragraph (g)(1) of this section.</E> The following example illustrates the use of the factors in this paragraph (g) to calculate and provide WHMT information: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> (i) <E T="03">Facts</E> —(A) <E T="03">In general. X</E> is a WHMT. <E T="03">X</E> 's start-up date is January 1, 2007. As of that date, <E T="03">X</E> 's assets consist of 100 15-year mortgages, each having an unpaid principal balance of $125,000 and a fixed, annual interest rate of 7.25 percent. None of the mortgages were issued with OID. <E T="03">X</E> 's TIHs are entitled to monthly, pro-rata distributions of the principal payments received by <E T="03">X. X</E> 's TIHs are also entitled to monthly, pro-rata distributions of the interest earned on the mortgages held by <E T="03">X,</E> reduced by expenses. Trust interests are issued in increments of $5,000 with a $25,000 minimum. The prepayment assumption used in pricing the original issue of trust interests is six percent. Broker holds a trust interest in <E T="03">X,</E> with an original face amount of $25,000, in street name, for <E T="03">C</E> during the entire 2007 calendar year. </P> <P> (B) <E T="03">Trust events during the 2007 calendar year.</E> During the 2007 calendar year, <E T="03">X</E> collects all interest and principal payments when due and makes all monthly distributions when due. One mortgage is repurchased from <E T="03">X</E> in July 2007 for $122,249, the mortgage's unpaid principal balance plus accrued, but unpaid, interest at the time. During November 2007, another mortgage is prepaid in full. <E T="03">X</E> earns $80 interest income each month from the temporary investment of X's funds pending distribution to the TIHs. All of <E T="03">X</E> 's expenses are affected expenses. The aggregate outstanding principal balance of <E T="03">X</E> 's mortgages, <E T="03">X</E> 's interest income, and <E T="03">X</E> 's expenses, for each month of the 2007 calendar year, along with the aggregate outstanding principal balance of <E T="03">X</E> as of January 2008, are as follows: </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s20,12,8,8"> <BOXHD> <CHED H="1">Month</CHED> <CHED H="1"> Principal <LI>balance</LI> </CHED> <CHED H="1">Income</CHED> <CHED H="1">Expenses</CHED> </BOXHD> <ROW> <ENT I="01">January</ENT> <ENT>$12,500,000</ENT> <ENT>$75,601</ENT> <ENT>$5,288</ENT> </ROW> <ROW> <ENT I="01">February</ENT> <ENT>12,461,413</ENT> <ENT>75,368</ENT> <ENT>5,273</ENT> </ROW> <ROW> <ENT I="01">March</ENT> <ENT>12,422,593</ENT> <ENT>75,133</ENT> <ENT>5,256</ENT> </ROW> <ROW> <ENT I="01">April</ENT> <ENT>12,383,538</ENT> <ENT>74,897</ENT> <ENT>5,240</ENT> </ROW> <ROW> <ENT I="01">May</ENT> <ENT>12,344,247</ENT> <ENT>74,660</ENT> <ENT>5,244</ENT> </ROW> <ROW> <ENT I="01">June</ENT> <ENT>12,304,719</ENT> <ENT>74,421</ENT> <ENT>5,207</ENT> </ROW> <ROW> <ENT I="01">July</ENT> <ENT>12,264,952</ENT> <ENT>74,181</ENT> <ENT>5,191</ENT> </ROW> <ROW> <ENT I="01">August</ENT> <ENT>12,102,696</ENT> <ENT>73,200</ENT> <ENT>5,122</ENT> </ROW> <ROW> <ENT I="01">September</ENT> <ENT>12,062,849</ENT> <ENT>72,960</ENT> <ENT>5,106</ENT> </ROW> <ROW> <ENT I="01">October</ENT> <ENT>12,022,762</ENT> <ENT>72,718</ENT> <ENT>5,089</ENT> </ROW> <ROW> <ENT I="01">November</ENT> <ENT>11,982,432</ENT> <ENT>72,474</ENT> <ENT>5,073</ENT> </ROW> <ROW> <ENT I="01">December</ENT> <ENT>11,821,234</ENT> <ENT>71,500</ENT> <ENT>5,006</ENT> </ROW> <ROW> <ENT I="01">January</ENT> <ENT>11,780,829</ENT> <ENT/> <ENT/> </ROW> </GPOTABLE> <P> (ii) <E T="03">Trustee reporting.</E> (A) Trustee, <E T="03">X</E> 's fiduciary, comes within the safe harbor of paragraph (g)(1)(ii) of this section by providing the following information to requesting persons: </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s20,10,11,12"> <BOXHD> <CHED H="1">Month</CHED> <CHED H="1">Pool factor</CHED> <CHED H="1">Income factor</CHED> <CHED H="1">Expense factor</CHED> </BOXHD> <ROW> <ENT I="01">January</ENT> <ENT>1.00000000</ENT> <ENT>6.04806667</ENT> <ENT>0.42304000</ENT> </ROW> <ROW> <ENT I="01">February</ENT> <ENT>0.99691304</ENT> <ENT>6.02941628</ENT> <ENT>0.42184000</ENT> </ROW> <ROW> <ENT I="01">March</ENT> <ENT>0.99380744</ENT> <ENT>6.01065328</ENT> <ENT>0.42048000</ENT> </ROW> <ROW> <ENT I="01">April</ENT> <ENT>0.99068304</ENT> <ENT>5.99177670</ENT> <ENT>0.41920000</ENT> </ROW> <ROW> <ENT I="01">May</ENT> <ENT>0.98753976</ENT> <ENT>5.97278605</ENT> <ENT>0.41952000</ENT> </ROW> <ROW> <ENT I="01">June</ENT> <ENT>0.98437752</ENT> <ENT>5.95368085</ENT> <ENT>0.41656000</ENT> </ROW> <ROW> <ENT I="01">July</ENT> <ENT>0.98119616</ENT> <ENT>5.93446013</ENT> <ENT>0.41528000</ENT> </ROW> <ROW> <ENT I="01">August</ENT> <ENT>0.96821564</ENT> <ENT>5.85603618</ENT> <ENT>0.40976000</ENT> </ROW> <ROW> <ENT I="01">September</ENT> <ENT>0.96502792</ENT> <ENT>5.83677704</ENT> <ENT>0.40848000</ENT> </ROW> <ROW> <ENT I="01">October</ENT> <ENT>0.96182096</ENT> <ENT>5.81740161</ENT> <ENT>0.40712000</ENT> </ROW> <ROW> <ENT I="01">November</ENT> <ENT>0.95859459</ENT> <ENT>5.79790896</ENT> <ENT>0.40584000</ENT> </ROW> <ROW> <ENT I="01">December</ENT> <ENT>0.94569875</ENT> <ENT>5.71999659</ENT> <ENT>0.40048000</ENT> </ROW> <ROW> <ENT I="01">January</ENT> <ENT>0.94246631</ENT> <ENT/> <ENT/> </ROW> </GPOTABLE> <P>(B) Trustee determines this information as follows:</P> <P> ( <E T="03">1</E> ) <E T="03">Step One: Trustee determines monthly pool factors.</E> Trustee calculates and provides <E T="03">X</E> 's pool factor for each month of the 2007 calendar year. For example, for the month of January 2007 the pool factor is 1.0, which represents the ratio of — </P> <P> ( <E T="03">i</E> ) The amount that represents the aggregate outstanding principal balance of <E T="03">X</E> ($12,500,000) as of the first business day of January; divided by </P> <P> ( <E T="03">ii</E> ) The amount that represents the aggregate outstanding principal balance of X ($12,500,000) as of the start-up day. </P> <P> ( <E T="03">2</E> ) <E T="03">Step Two: Trustee determines monthly expense factors.</E> Trustee calculates and provides the expense factors for each month of the 2007 calendar year. During 2007, <E T="03">X</E> has only affected expenses, and therefore, will have only one expense factor for each month. For example, the expense factor for the month of January 2007 is 0.42304000, which represents the ratio of— </P> <P> ( <E T="03">i</E> ) The gross amount of expenses paid during January by <E T="03">X</E> ($5,288); divided by </P> <P> ( <E T="03">ii</E> ) The amount that represents the aggregate outstanding principal balance of <E T="03">X</E> as of the start-up date ($12,500,000) divided by 1,000 ($12,500). </P> <P> ( <E T="03">3</E> ) <E T="03">Step Three: Trustee determines monthly income factors.</E> Trustee calculates and provides <PRTPAGE P="358"/> the income factors for each month of the 2007 calendar year. During 2007, <E T="03">X</E> has only interest income, and therefore, will have only one income factor for each month. For example, the income factor for the month of January 2007 is 6.04806667, which represents the ratio of— </P> <P> ( <E T="03">i</E> ) The gross amount of interest income earned by <E T="03">X</E> during January ($75,601); divided by </P> <P> ( <E T="03">ii</E> ) The amount that represents that aggregate outstanding principal balance of X as of the start-up date ($12,500,000), divided by 1,000 ($12,500). </P> <P> ( <E T="03">4</E> ) <E T="03">Step Four: Trustee calculates and provides monthly market discount fractions.</E> Trustee calculates and provides a market discount fraction for each month of the 2007 calendar year using a prepayment assumption of 6% and a stated interest rate of 7.25%. </P> <P> ( <E T="03">iii</E> ) <E T="03">Broker's use of the information provided by Trustee.</E> (A) Broker uses the information provided by Trustee under paragraph (g) of this section to determine that the following trust items are attributable to <E T="03">C</E> : </P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s15,15,8,8"> <BOXHD> <CHED H="1">Month</CHED> <CHED H="1">Aggregate trust sales proceeds and non pro-rata partial principal payments</CHED> <CHED H="1"> Affected <LI>expenses</LI> </CHED> <CHED H="1"> Gross <LI>interest income</LI> </CHED> </BOXHD> <ROW> <ENT I="01">January</ENT> <ENT>$77.17</ENT> <ENT>$10.58</ENT> <ENT>$151.20</ENT> </ROW> <ROW> <ENT I="01">February</ENT> <ENT>77.64</ENT> <ENT>10.55</ENT> <ENT>150.74</ENT> </ROW> <ROW> <ENT I="01">March</ENT> <ENT>78.11</ENT> <ENT>10.51</ENT> <ENT>150.27</ENT> </ROW> <ROW> <ENT I="01">April</ENT> <ENT>78.58</ENT> <ENT>10.48</ENT> <ENT>149.79</ENT> </ROW> <ROW> <ENT I="01">May</ENT> <ENT>79.06</ENT> <ENT>10.49</ENT> <ENT>149.32</ENT> </ROW> <ROW> <ENT I="01">June</ENT> <ENT>79.53</ENT> <ENT>10.41</ENT> <ENT>148.84</ENT> </ROW> <ROW> <ENT I="01">July</ENT> <ENT>324.51</ENT> <ENT>10.38</ENT> <ENT>148.36</ENT> </ROW> <ROW> <ENT I="01">August</ENT> <ENT>79.69</ENT> <ENT>10.24</ENT> <ENT>146.40</ENT> </ROW> <ROW> <ENT I="01">September</ENT> <ENT>80.17</ENT> <ENT>10.21</ENT> <ENT>145.92</ENT> </ROW> <ROW> <ENT I="01">October</ENT> <ENT>80.66</ENT> <ENT>10.18</ENT> <ENT>145.43</ENT> </ROW> <ROW> <ENT I="01">November</ENT> <ENT>322.40</ENT> <ENT>10.15</ENT> <ENT>144.95</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">December</ENT> <ENT>80.81</ENT> <ENT>10.01</ENT> <ENT>143.00</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>1438.33</ENT> <ENT>124.19</ENT> <ENT>1774.22</ENT> </ROW> </GPOTABLE> <P>(B) Broker determines this information as follows:</P> <P> ( <E T="03">1</E> ) <E T="03">Step One: Broker determines the amount of the non pro-rata partial principal payments and trust sales proceeds received by X that are attributable to C for the 2007 calendar year.</E> Broker determines the amount of the non pro-rata partial principal payments and trust sales proceeds received by <E T="03">X</E> that are attributable to <E T="03">C</E> for each month of the 2007 calendar year. For example, for the month of January, Broker determines that the amount of principal receipts and the amount of trust sales proceeds that are attributable to <E T="03">C</E> is $77.17. Broker determines this by multiplying the original face amount of <E T="03">C</E> 's trust interest ($25,000) by 0.00308696, the difference between the pool factor for January 2007 (1.00000000) and the pool factor for the following month of February 2007 (0.99691304). Broker reports the aggregate of the monthly amounts of non pro-rata partial principal payments and trust sales proceeds that are attributable to <E T="03">C</E> for the 2007 calendar year as trust sales proceeds on the Form 1099 filed with the IRS. </P> <P> ( <E T="03">2</E> ) <E T="03">Step Two: Broker applies the expense factors provided by Trustee to determine the amount of expenses that are attributable to C for the 2007 calendar year.</E> Broker determines the amount of <E T="03">X</E> 's expenses that are attributable to <E T="03">C</E> for each month of the calendar year. For example, for the month of January 2007, Broker determines that the amount of expenses attributable to <E T="03">C</E> is $10.58. Broker determines this by multiplying the original face amount of <E T="03">C</E> 's trust interest ($25,000), divided by 1,000 ($25) by the expense factor for January 2007 (0.42304000). Broker determines the expenses that are attributable to <E T="03">C</E> for the 2007 calendar year by aggregating the monthly amounts. </P> <P> ( <E T="03">3</E> ) <E T="03">Step Three: Broker applies the income factors provided by Trustee to determine the amount of gross interest income attributable to C for the 2007 calendar year.</E> Broker determines the amount of gross interest income that is attributable to <E T="03">C</E> for each month of the calendar year. For example, for the month of January 2007, Broker determines that the amount of gross interest income attributable to <E T="03">C</E> is $151.20. Broker determines this by multiplying the original face amount of <E T="03">C</E> 's trust interest ($25,000), divided by 1,000 ($25), by the income factor for January 2007 (6.04806667). Broker determines the amount of the gross interest income that is attributable to <E T="03">C</E> for the 2007 calendar year by aggregating the monthly amounts. </P> <P> ( <E T="03">4</E> ) <E T="03">Step Four: Broker provides market discount information to C.</E> Broker provides <E T="03">C</E> with the market discount fractions calculated and provided by the trustee of <E T="03">X</E> under paragraph (g)(3)(ii)(D) of this section. </P> </EXAMPLE> <P> (h) <E T="03">Additional safe harbors</E> —(1) <E T="03">Temporary safe harbor for WHMTs</E> —(i) <E T="03">Application.</E> Pending the issuance of additional guidance, the safe harbor in this paragraph applies to trustees and middlemen of WHMTs that are not eligible to report under the WHMT safe harbor in paragraph (g) of this section because they hold interests in another WHFIT, in a REMIC, or hold or issue stripped interests. </P> <P> (ii) <E T="03">Safe harbor.</E> A trustee is deemed to satisfy the requirements of paragraph (c) of this section, if the trustee calculates and provides trust information in a manner that enables a requesting person to provide trust information to a beneficial owner of a trust interest that enables the owner to reasonably accurately report the tax consequences of its ownership of a trust <PRTPAGE P="359"/> interest on its federal income tax return. Additionally, to be deemed to satisfy the requirements of paragraph (c) of this section, the trustee must calculate and provide trust information regarding market discount and OID by any reasonable manner consistent with section 1272(a)(6). A middleman or a trustee may satisfy its obligation to furnish information to the IRS under paragraph (d) of this section and to the trust interest holder under paragraph (e) of this section by providing information consistent with the information provided under this paragraph by the trustee. </P> <P> (2) <E T="03">Additional safe harbors provided by other published guidance.</E> The IRS and the Treasury Department may provide additional safe harbor reporting procedures for complying with this section or a specific paragraph of this section by other published guidance (see § 601.601(d)(2) of this chapter). </P> <P>(i) [Reserved]</P> <P> (j) <E T="03">Requirement that middlemen furnish information to beneficial owners that are exempt recipients and noncalendar-year beneficial owners</E> —(1) <E T="03">In general.</E> A middleman that holds a trust interest on behalf of, or for the account of, either a beneficial owner that is an exempt recipient defined in paragraph (b)(7) of this section or a noncalendar-year beneficial owner, must provide to such beneficial owner, upon request, the information provided by the trustee to the middleman under paragraph (c) of this section. </P> <P> (2) <E T="03">Time for providing information.</E> The middleman must provide the requested information to any beneficial owner making a request under paragraph (h)(1) of this section on or before the later of the 44th day after the close of the calendar year for which the information was requested, or the day that is 28 days after the receipt of the request. A middleman must provide information with respect to a WHFIT holding an interest in another WHFIT, or a WHFIT holding an interest in a REMIC, on or before the later of the 58th day after the close of the calendar year for which the information was requested, or the 42nd day after the receipt of the request. </P> <P> (3) <E T="03">Manner of providing information.</E> The requested information must be provided— </P> <P>(i) By written statement sent by first class mail to the address provided by the person requesting the information;</P> <P>(ii) By electronic mail provided that the person requesting the information requests that the middleman furnish the information by electronic mail and the person furnishes an electronic address;</P> <P>(iii) At an Internet website of the middleman or the trustee, provided that the beneficial owner requesting the information is notified that the requested information is available at the Internet website and is furnished the address of the site; or</P> <P>(iv) Any other manner agreed to by the middleman and the beneficial owner requesting the information.</P> <P> (4) <E T="03">Clearing organization.</E> A clearing organization described in § 1.163-5(c)(2)(i)(D)( <E T="03">8</E> ) is not required to furnish information to exempt recipients or non-calendar-year TIHs under this paragraph (h). </P> <P> (k) <E T="03">Coordination with other information reporting rules.</E> In general, in cases in which reporting is required for a WHFIT under both this section and subpart B, part III, subchapter A, chapter 61 of the Internal Revenue Code (Sections 6041 through 6050S) (Information Reporting Sections), the reporting rules for WHFITs under this section must be applied. The provisions of the Information Reporting Sections and the regulations thereunder are incorporated into this section as applicable, but only to the extent that such provisions are not inconsistent with the provisions of this section. </P> <P> (l) <E T="03">Backup withholding requirements.</E> Every trustee and middleman required to file a Form 1099 under this section is a payor within the meaning of § 31.3406(a)-2, and must backup withhold as required under section 3406 and any regulations thereunder. </P> <P> (m) <E T="03">Penalties for failure to comply</E> —(1) <E T="03">In general.</E> Every trustee or middleman who fails to comply with the reporting obligations imposed by this section is subject to penalties under sections 6721, 6722, and any other applicable penalty provisions. <PRTPAGE P="360"/> </P> <P> (2) <E T="03">Penalties not imposed on trustees and middlemen of certain WHMTs for failure to report OID.</E> Penalties will not be imposed as a result of a failure to provide OID information for a WHMT that has a start-up date on or after August 13, 1998 and on or before January 24, 2006, if the trustee of the WHMT does not have the historic information necessary to provide this information and the trustee demonstrates that it has attempted in good faith, but without success, to obtain this information. For purposes of calculating a market discount fraction under paragraph (g)(1)(v) of this section, for a WHMT described in this paragraph, it may be assumed that the WHMT is holding mortgages that were issued without OID. A trustee availing itself of this paragraph must include a statement to that effect when providing information to requesting persons under paragraph (c) of these regulations. </P> <P> (n) <E T="03">Effective date.</E> These regulations are applicable January 1, 2007. Trustees must calculate and provide trust information with respect to the 2007 calendar year and all subsequent years consistent with these regulations. Information returns required to be filed with the IRS and the tax information statements required to be furnished to trust interest holders after December 31, 2007 must be consistent with these regulations. </P> <CITA>[T.D. 9241, 71 FR 4009, Jan. 24, 2006, as amended by T.D. 9279, 71 FR 43971, Aug. 3, 2006; T.D. 9308, 71 FR 78356, Dec. 29, 2006]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.672(a)-1</SECTNO> <SUBJECT>Definition of adverse party.</SUBJECT> <P>(a) Under section 672(a) an adverse party is defined as any person having a substantial beneficial interest in a trust which would be adversely affected by the exercise or nonexercise of a power which he possesses respecting the trust. A trustee is not an adverse party merely because of his interest as trustee. A person having a general power of appointment over the trust property is deemed to have a beneficial interest in the trust. An interest is a substantial interest if its value in relation to the total value of the property subject to the power is not insignificant.</P> <P>(b) Ordinarily, a beneficiary will be an adverse party, but if his right to share in the income or corpus of a trust is limited to only a part, he may be an adverse party only as to that part. Thus, if A, B, C, and D are equal income beneficiaries of a trust and the grantor can revoke with A's consent, the grantor is treated as the owner of a portion which represents three-fourths of the trust; and items of income, deduction, and credit attributable to that portion are included in determining the tax of the grantor.</P> <P>(c) The interest of an ordinary income beneficiary of a trust may or may not be adverse with respect to the exercise of a power over corpus. Thus, if the income of a trust is payable to A for life, with a power (which is not a general power of appointment) in A to appoint the corpus to the grantor either during his life or by will, A's interest is adverse to the return of the corpus to the grantor during A's life, but is not adverse to a return of the corpus after A's death. In other words, A's interest is adverse as to ordinary income but is not adverse as to income allocable to corpus. Therefore, assuming no other relevant facts exist, the grantor would not be taxable on the ordinary income of the trust under section 674, 676, or 677, but would be taxable under section 677 on income allocable to corpus (such as capital gains), since it may in the discretion of a nonadverse party be accumulated for future distribution to the grantor. Similarly, the interest of a contingent income beneficiary is adverse to a return of corpus to the grantor before the termination of his interest but not to a return of corpus after the termination of his interest.</P> <P> (d) The interest of a remainderman is adverse to the exercise of any power over the corpus of a trust, but not to the exercise of a power over any income interest preceding his remainder. For example, if the grantor creates a trust which provides for income to be distributed to A for 10 years and then for the corpus to go to X if he is then living, a power exercisable by X to revest corpus in the grantor is a power exercisable by an adverse party; however, a power exercisable by X to distribute part or all of the ordinary income to the grantor may be a power <PRTPAGE P="361"/> exercisable by a nonadverse party (which would cause the ordinary income to be taxed to the grantor). </P> </SECTION> <SECTION> <SECTNO>§ 1.672(b)-1</SECTNO> <SUBJECT>Nonadverse party.</SUBJECT> <P> A <E T="03">nonadverse party</E> is any person who is not an adverse party. </P> </SECTION> <SECTION> <SECTNO>§ 1.672(c)-1</SECTNO> <SUBJECT>Related or subordinate party.</SUBJECT> <P>Section 672(c) defines the term “related or subordinate party”. The term, as used in sections 674(c) and 675(3), means any nonadverse party who is the grantor's spouse if living with the grantor; the grantor's father, mother, issue, brother or sister; an employee of the grantor; a corporation or any employee of a corporation in which the stock holdings of the grantor and the trust are significant from the viewpoint of voting control; or a subordinate employee of a corporation in which the grantor is an executive. For purposes of sections 674(c) and 675(3), these persons are presumed to be subservient to the grantor in respect of the exercise or nonexercise of the powers conferred on them unless shown not to be subservient by a preponderance of the evidence.</P> </SECTION> <SECTION> <SECTNO>§ 1.672(d)-1</SECTNO> <SUBJECT>Power subject to condition precedent.</SUBJECT> <P>Section 672(d) provides that a person is considered to have a power described in subpart E (section 671 and following), part I, subchapter J, chapter 1 of the Code, even though the exercise of the power is subject to a precedent giving of notice or takes effect only after the expiration of a certain period of time. However, although a person may be considered to have such a power, the grantor will nevertheless not be treated as an owner by reason of the power if its exercise can only affect beneficial enjoyment of income received after the expiration of a period of time such that, if the power were a reversionary interest, he would not be treated as an owner under section 673. See sections 674(b)(2), 676(b), and the last sentence of section 677(a). Thus, for example, if a grantor creates a trust for the benefit of his son and retains a power to revoke which takes effect only after the expiration of 2 years from the date of exercise, he is treated as an owner from the inception of the trust. However, if the grantor retains a power to revoke, exercisable at any time, which can only affect the beneficial enjoyment of the ordinary income of a trust received after the expiration of 10 years commencing with the date of the transfer in trust, or after the death of the income beneficiary, the power does not cause him to be treated as an owner with respect to ordinary income during the first 10 years of the trust or during the income beneficiary's life, as the case may be. See section 676(b).</P> </SECTION> <SECTION> <SECTNO>§ 1.672(f)-1</SECTNO> <SUBJECT>Foreign persons not treated as owners.</SUBJECT> <P> (a) <E T="03">General rule</E> —(1) <E T="03">Application of the general rule.</E> Section 672(f)(1) provides that subpart E of part I, subchapter J, chapter 1 of the Internal Revenue Code (the grantor trust rules) shall apply only to the extent such application results in an amount (if any) being currently taken into account (directly or through one or more entities) in computing the income of a citizen or resident of the United States or a domestic corporation. Accordingly, the grantor trust rules apply to the extent that any portion of the trust, upon application of the grantor trust rules without regard to section 672(f), is treated as owned by a United States citizen or resident or domestic corporation. The grantor trust rules do not apply to any portion of the trust to the extent that, upon application of the grantor trust rules without regard to section 672(f), that portion is treated as owned by a person other than a United States citizen or resident or domestic corporation, unless the person is described in § 1.672(f)-2(a) (relating to certain foreign corporations treated as domestic corporations), or one of the exceptions set forth in § 1.672(f)-3 is met, (relating to: trusts where the grantor can revest trust assets; trusts where the only amounts distributable are to the grantor or the grantor's spouse; and compensatory trusts). Section 672(f) applies to domestic and foreign trusts. Any portion of the trust that is not treated as owned by a grantor or another person is subject to the rules of subparts A through D (section 641 and following), <PRTPAGE P="362"/> part I, subchapter J, chapter 1 of the Internal Revenue Code. </P> <P> (2) <E T="03">Determination of portion based on application of the grantor trust rules.</E> The determination of the portion of a trust treated as owned by the grantor or other person is to be made based on the terms of the trust and the application of the grantor trust rules and section 671 and the regulations thereunder. </P> <P> (b) <E T="03">Example.</E> The following example illustrates the rules of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(i) A, a nonresident alien, funds an irrevocable domestic trust, DT, for the benefit of his son, B, who is a United States citizen, with stock of Corporation X. A's brother, C, who also is a United States citizen, contributes stock of Corporation Y to the trust for the benefit of B. A has a reversionary interest within the meaning of section 673 in the X stock that would cause A to be treated as the owner of the X stock upon application of the grantor trust rules without regard to section 672(f). C has a reversionary interest within the meaning of section 673 in the Y stock that would cause C to be treated as the owner of the Y stock upon application of the grantor trust rules without regard to section 672(f). The trustee has discretion to accumulate or currently distribute income of DT to B.</P> <P>(ii) Because A is a nonresident alien, application of the grantor trust rules without regard to section 672(f) would not result in the portion of the trust consisting of the X stock being treated as owned by a United States citizen or resident. None of the exceptions in § 1.672(f)-3 applies because A cannot revest the X stock in A, amounts may be distributed during A's lifetime to B, who is neither a grantor nor a spouse of a grantor, and the trust is not a compensatory trust. Therefore, pursuant to paragraph (a)(1) of this section, A is not treated as an owner under subpart E of part I, subchapter J, chapter 1 of the Internal Revenue Code, of the portion of the trust consisting of the X stock. Any distributions from such portion of the trust are subject to the rules of subparts A through D (641 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code.</P> <P>(iii) Because C is a United States citizen, paragraph (a)(1) of this section does not prevent C from being treated under section 673 as the owner of the portion of the trust consisting of the Y stock.</P> </EXAMPLE> <P> (c) <E T="03">Effective date.</E> The rules of this section are applicable to taxable years of a trust beginning after August 10, 1999. </P> <CITA>[T.D. 8831, 64 FR 43275, Aug. 10, 1999]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.672(f)-2</SECTNO> <SUBJECT>Certain foreign corporations.</SUBJECT> <P> (a) <E T="03">Application of general rule in this section.</E> Subject to the provisions of paragraph (b) of this section, if the owner of any portion of a trust upon application of the grantor trust rules without regard to section 672(f) is a controlled foreign corporation or a passive foreign investment company (as defined in section 1297), the corporation is treated as a domestic corporation for purposes of applying the rules of § 1.672(f)-1. For purposes of this section, a controlled foreign corporation has the meaning provided in section 957, determined without applying section 318(a)(3)(A), (B), and (C) so as to consider a United States person as owning stock which is owned by a person who is not a United States person. </P> <P> (b) <E T="03">Gratuitous transfers to United States persons</E> —(1) <E T="03">Transfer from trust to which corporation made a gratuitous transfer.</E> If a trust (or portion of a trust) to which a controlled foreign corporation, passive foreign investment company, or foreign personal holding company has made a gratuitous transfer (within the meaning of § 1.671-2(e)(2)), makes a gratuitous transfer to a United States person, the controlled foreign corporation, passive foreign investment company, or foreign personal holding company, as the case may be, is treated as a foreign corporation for purposes of § 1.672(f)-4(c), relating to gratuitous transfers from trusts (or portions of trusts) to which a partnership or foreign corporation has made a gratuitous transfer. </P> <P> (2) <E T="03">Transfer from trust over which corporation has a section 678 power.</E> If a trust (or portion of a trust) that a controlled foreign corporation, passive foreign investment company, or foreign personal holding company is treated as owning under section 678 makes a gratuitous transfer to a United States person, the controlled foreign corporation, passive foreign investment company, or foreign personal holding company, as the case may be, is treated as a foreign corporation that had made a gratuitous transfer to the trust (or portion of a trust) and the rules of § 1.672(f)-4(c) apply. </P> <P> (c) <E T="03">Special rules for passive foreign investment companies</E> —(1) <E T="03"> Application of <PRTPAGE P="363"/> section 1297. </E> For purposes of determining whether a foreign corporation is a passive foreign investment company as defined in section 1297, the grantor trust rules apply as if section 672(f) had not come into effect. </P> <P> (2) <E T="03">References to renumbered Internal Revenue Code section.</E> For taxable years of shareholders beginning on or before December 31, 1997, and taxable years of passive foreign investment companies ending with or within such taxable years of the shareholders, all references in this § 1.672(f)-2 to section 1297 are deemed to be references to section 1296. </P> <P> (d) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In each example, FT is an irrevocable foreign trust, and CFC is a controlled foreign corporation. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Application of general rule.</HD> <P>CFC creates and funds FT. CFC is the grantor of FT within the meaning of § 1.671-2(e). CFC has a reversionary interest in FT within the meaning of section 673 that would cause CFC to be treated as the owner of FT upon application of the grantor trust rules without regard to section 672(f). Under paragraph (a) of this section, CFC is treated as a domestic corporation for purposes of applying the general rule of § 1.672(f)-1. Thus, § 1.672(f)-1 does not prevent CFC from being treated as the owner of FT under section 673.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Distribution from trust to which CFC made gratuitous transfer.</HD> <P> A, a nonresident alien, owns 40 percent of the stock of CFC. A's brother B, a resident alien, owns the other 60 percent of the stock of CFC. CFC makes a gratuitous transfer to FT. FT makes a gratuitous transfer to A's daughter, C, who is a resident alien. Under paragraph (b)(1) of this section, CFC will be treated as a foreign corporation for purposes of § 1.672(f)-4(c). For further guidance, see § 1.672(f)-4(g) <E T="03">Example 2</E> through <E T="03">Example 4.</E> </P> </EXAMPLE> <P> (e) <E T="03">Applicability dates.</E> Except as provided in this paragraph (e), the rules of this section apply to taxable years of shareholders of controlled foreign corporations and passive foreign investment companies beginning after August 10, 1999, and taxable years of controlled foreign corporations and passive foreign investment companies ending with or within such taxable years of the shareholders. The provisions in paragraph (a) of this section relating to the controlled foreign corporations taken into account for purposes of this section apply to taxable years of foreign corporations ending on or after October 1, 2019, and taxable years of United States shareholders in which or with which such taxable years of foreign corporations end. For taxable years of foreign corporations ending before October 1, 2019, and taxable years of United States shareholders in which or with which such taxable years of foreign corporations end, a taxpayer may apply such provisions to the last taxable year of a foreign corporation beginning before January 1, 2018, and each subsequent taxable year of the foreign corporation, and to taxable years of United States shareholders in which or with which such taxable years of the foreign corporation end, provided that the taxpayer and United States persons that are related (within the meaning of section 267 or 707) to the taxpayer consistently apply such provisions with respect to all foreign corporations. For taxable years of foreign corporations ending before October 1, 2019, and taxable years of United States shareholders in which or with which such taxable years of foreign corporations end, where the taxpayer does not apply the provisions of paragraph (a) of this section relating to controlled foreign corporations, see paragraph (a) of this section as in effect and contained in 26 CFR part 1, as revised April 1, 2020. </P> <CITA>[T.D. 8831, 64 FR 43276, Aug. 10, 1999, as amended by T.D. 8890, 65 FR 41334, July 5, 2000; T.D. 9908, 85 FR 59433, Sept. 22, 2020]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.672(f)-3</SECTNO> <SUBJECT>Exceptions to general rule.</SUBJECT> <P> (a) <E T="03">Certain revocable trusts</E> —(1) <E T="03">In general.</E> Subject to the provisions of paragraph (a)(2) of this section, the general rule of § 1.672(f)-1 does not apply to any portion of a trust for a taxable year of the trust if the power to revest absolutely in the grantor title to such portion is exercisable solely by the grantor (or, in the event of the grantor's incapacity, by a guardian or other person who has unrestricted authority to exercise such power on the grantor's behalf) without the approval or consent of any other person. If the grantor can exercise such power only with the approval of a related or subordinate party who is subservient to the grantor, such power is treated as exercisable solely <PRTPAGE P="364"/> by the grantor. For the definition of <E T="03">grantor,</E> see § 1.671-2(e). For the definition of <E T="03">related or subordinate party,</E> see § 1.672(c)-1. For purposes of this paragraph (a), a related or subordinate party is subservient to the grantor unless the presumption in the last sentence of § 1.672(c)-1 is rebutted by a preponderance of the evidence. A trust (or portion of a trust) that fails to qualify for the exception provided by this paragraph (a) for a particular taxable year of the trust will be subject to the general rule of § 1.672(f)-1 for that taxable year and all subsequent taxable years of the trust. </P> <P> (2) <E T="03">183-day rule.</E> For purposes of paragraph (a)(1) of this section, the grantor is treated as having a power to revest for a taxable year of the trust only if the grantor has such power for a total of 183 or more days during the taxable year of the trust. If the first or last taxable year of the trust (including the year of the grantor's death) is less than 183 days, the grantor is treated as having a power to revest for purposes of paragraph (a)(1) of this section if the grantor has such power for each day of the first or last taxable year, as the case may be. </P> <P> (3) <E T="03">Grandfather rule for certain revocable trusts in existence on September 19, 1995.</E> Subject to the rules of paragraph (d) of this section (relating to separate accounting for gratuitous transfers to the trust after September 19, 1995), the general rule of § 1.672(f)-1 does not apply to any portion of a trust that was treated as owned by the grantor under section 676 on September 19, 1995, as long as the trust would continue to be so treated thereafter. However, the preceding sentence does not apply to any portion of the trust attributable to gratuitous transfers to the trust after September 19, 1995. </P> <P> (4) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (a): </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Grantor is owner.</HD> <P>FP1, a foreign person, creates and funds a revocable trust, T, for the benefit of FP1's children, who are resident aliens. The trustee is a foreign bank, FB, that is owned and controlled by FP1 and FP2, who is FP1's brother. The power to revoke T and revest absolutely in FP1 title to the trust property is exercisable by FP1, but only with the approval or consent of FB. The trust instrument contains no standard that FB must apply in determining whether to approve or consent to the revocation of T. There are no facts that would suggest that FB is not subservient to FP1. Therefore, the exception in paragraph (a)(1) of this section is applicable.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Death of grantor.</HD> <P>Assume the same facts as in Example 1, except that FP1 dies. After FP1's death, FP2 has the power to withdraw the assets of T, but only with the approval of FB. There are no facts that would suggest that FB is not subservient to FP2. However, the exception in paragraph (a)(1) of this section is no longer applicable, because FP2 is not a grantor of T within the meaning of § 1.671-2(e).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Trustee is not related or subordinate party.</HD> <P> Assume the same facts as in <E T="03">Example 1,</E> except that neither FP1 nor any member of FP1's family has any substantial ownership interest or other connection with FB. FP1 can remove and replace FB at any time for any reason. Although FP1 can replace FB with a related or subordinate party if FB refuses to approve or consent to FP1's decision to revest the trust property in himself, FB is not a related or subordinate party. Therefore, the exception in paragraph (a)(1) of this section is not applicable. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Unrelated trustee will consent to revocation.</HD> <P>FP, a foreign person, creates and funds an irrevocable trust, T. The trustee is a foreign bank, FB, that is not a related or subordinate party within the meaning of § 1.672(c)-1. FB has the discretion to distribute trust income or corpus to beneficiaries of T, including FP. Even if FB would in fact distribute all the trust property to FP if requested to do so by FP, the exception in paragraph (a)(1) of this section is not applicable, because FP does not have the power to revoke T.</P> </EXAMPLE> <P> (b) <E T="03">Certain trusts that can distribute only to the grantor or the spouse of the grantor</E> —(1) <E T="03">In general.</E> The general rule of § 1.672(f)-1 does not apply to any trust (or portion of a trust) if at all times during the lifetime of the grantor the only amounts distributable (whether income or corpus) from such trust (or portion thereof) are amounts distributable to the grantor or the spouse of the grantor. For purposes of this paragraph (b), payments of amounts that are not gratuitous transfers (within the meaning of § 1.671-2(e)(2)) are not amounts distributable. For the definition of <E T="03">grantor,</E> see § 1.671-2(e). </P> <P> (2) <E T="03">Amounts distributable in discharge of legal obligations</E> —(i) <E T="03">In general.</E> A trust (or portion of a trust) does not fail to satisfy paragraph (b)(1) of this <PRTPAGE P="365"/> section solely because amounts are distributable from the trust (or portion thereof) in discharge of a legal obligation of the grantor or the spouse of the grantor. Subject to the provisions of paragraph (b)(2)(ii) of this section, an obligation is considered a legal obligation for purposes of this paragraph (b)(2)(i) if it is enforceable under the local law of the jurisdiction in which the grantor (or the spouse of the grantor) resides. </P> <P> (ii) <E T="03">Related parties</E> —(A) <E T="03">In general.</E> Except as provided in paragraph (b)(2)(ii)(B) of this section, an obligation to a person who is a related person for purposes of § 1.643(h)-1(e) (other than an individual who is legally separated from the grantor under a decree of divorce or of separate maintenance) is not a legal obligation for purposes of paragraph (b)(2)(i) of this section unless it was contracted bona fide and for adequate and full consideration in money or money's worth (see § 20.2043-1 of this chapter). </P> <P> (B) <E T="03">Exceptions</E> —( <E T="03">1</E> ) <E T="03">Amounts distributable in support of certain individuals.</E> Paragraph (b)(2)(ii)(A) of this section does not apply with respect to amounts that are distributable from the trust (or portion thereof) to support an individual who— </P> <P> ( <E T="03">i</E> ) Would be treated as a dependent of the grantor or the spouse of the grantor under section 152(a)(1) through (9), without regard to the requirement that over half of the individual's support be received from the grantor or the spouse of the grantor; and </P> <P> ( <E T="03">ii</E> ) Is either permanently and totally disabled (within the meaning of section 22(e)(3)), or less than 19 years old. </P> <P> ( <E T="03">2</E> ) <E T="03">Certain potential support obligations.</E> The fact that amounts might become distributable from a trust (or portion of a trust) in discharge of a potential obligation under local law to support an individual other than an individual described in paragraph (b)(2)(ii)(B)( <E T="03">1</E> ) of this section is disregarded if such potential obligation is not reasonably expected to arise under the facts and circumstances. </P> <P> ( <E T="03">3</E> ) <E T="03">Reinsurance trusts.</E> [Reserved] </P> <P> (3) <E T="03">Grandfather rule for certain section 677 trusts in existence on September 19, 1995.</E> Subject to the rules of paragraph (d) of this section (relating to separate accounting for gratuitous transfers to the trust after September 19, 1995), the general rule of § 1.672(f)-1 does not apply to any portion of a trust that was treated as owned by the grantor under section 677 (other than section 677(a)(3)) on September 19, 1995, as long as the trust would continue to be so treated thereafter. However, the preceding sentence does not apply to any portion of the trust attributable to gratuitous transfers to the trust after September 19, 1995. </P> <P> (4) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (b): </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Amounts distributable only to grantor or grantor's spouse.</HD> <P>H and his wife, W, are both nonresident aliens. H is 70 years old, and W is 65. H and W have a 30-year-old child, C, a resident alien. There is no reasonable expectation that H or W will ever have an obligation under local law to support C or any other individual. H creates and funds an irrevocable trust, FT, using only his separate property. H is the grantor of FT within the meaning of § 1.671-2(e). Under the terms of FT, the only amounts distributable (whether income or corpus) from FT as long as either H or W is alive are amounts distributable to H or W. Upon the death of both H and W, C may receive distributions from FT. During H's lifetime, the exception in paragraph (b)(1) of this section is applicable.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Effect of grantor's death.</HD> <P> Assume the same facts as in <E T="03">Example 1.</E> H predeceases W. Assume that W would be treated as owning FT under section 678 if the grantor trust rules were applied without regard to section 672(f). The exception in paragraph (b)(1) of this section is no longer applicable, because W is not a grantor of FT within the meaning of § 1.671-2(e). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Amounts temporarily distributable to person other than grantor or grantor's spouse.</HD> <P> Assume the same facts as in <E T="03">Example 1,</E> except that C (age 30) is a law student at the time FT is created and the trust instrument provides that, as long as C is in law school, amounts may be distributed from FT to pay C's expenses. Thereafter, the only amounts distributable from FT as long as either H or W is alive will be amounts distributable to H or W. Even assuming there is an enforceable obligation under local law for H and W to support C while he is in school, distributions from FT in payment of C's expenses cannot qualify as distributions in discharge of a legal obligation under paragraph (b)(2) of this section, because C is neither permanently and totally disabled nor less than 19 years old. The exception in paragraph (b)(1) of this section is not applicable. <PRTPAGE P="366"/> After C graduates from law school, the exception in paragraph (b)(1) still will not be applicable, because amounts were distributable to C during the lifetime of H. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Fixed investment trust.</HD> <P>FC, a foreign corporation, invests in a domestic fixed investment trust, DT, that is classified as a trust under § 301.7701-4(c)(1) of this chapter. Under the terms of DT, the only amounts that are distributable from FC's portion of DT are amounts distributable to FC. The exception in paragraph (b)(1) of this section is applicable to FC's portion of DT.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Reinsurance trust.</HD> <P>A domestic insurance company, DI, reinsures a portion of its business with an unrelated foreign insurance company, FI. To satisfy state regulatory requirements, FI places the premiums in an irrevocable domestic trust, DT. The trust funds are held by a United States bank and may be used only to pay claims arising out of the reinsurance policies, which are legally enforceable under the local law of the jurisdiction in which FI resides. On the termination of DT, any assets remaining will revert to FI. Because the only amounts that are distributable from DT are distributable either to FI or in discharge of FI's legal obligations within the meaning of paragraph (b)(2)(i) of this section, the exception in paragraph (b)(1) of this section is applicable.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6. Trust that provides security for loan.</HD> <P>FC, a foreign corporation, borrows money from B, an unrelated bank, to finance the purchase of an airplane. FC creates a foreign trust, FT, to hold the airplane as security for the loan from B. The only amounts that are distributable from FT while the loan is outstanding are amounts distributable to B in the event that FC defaults on its loan from B. When FC repays the loan, the trust assets will revert to FC. The loan is a legal obligation of FC within the meaning of paragraph (b)(2)(i) of this section, because it is enforceable under the local law of the country in which FC is incorporated. Paragraph (b)(2)(ii) of this section is not applicable, because B is not a related person for purposes of § 1.643(h)-1(e). The exception in paragraph (b)(1) of this section is applicable.</P> </EXAMPLE> <P> (c) <E T="03">Compensatory trusts</E> —(1) <E T="03">In general.</E> The general rule of § 1.672(f)-1 does not apply to any portion of— </P> <P>(i) A nonexempt employees' trust described in section 402(b), including a trust created on behalf of a self-employed individual;</P> <P>(ii) A trust, including a trust created on behalf of a self-employed individual, that would be a nonexempt employees' trust described in section 402(b) but for the fact that the trust's assets are not set aside from the claims of creditors of the actual or deemed transferor within the meaning of § 1.83-3(e); and</P> <P>(iii) Any additional category of trust that the Commissioner may designate in revenue procedures, notices, or other guidance published in the Internal Revenue Bulletin (see § 601.601(d)(2) of this chapter).</P> <P> (2) <E T="03">Exceptions.</E> The Commissioner may, in revenue rulings, notices, or other guidance published in the Internal Revenue Bulletin (see § 601.601(d)(2) of this chapter), designate categories of compensatory trusts to which the general rule of paragraph (c)(1) of this section does not apply. </P> <P> (d) <E T="03">Separate accounting for gratuitous transfers to grandfathered trusts after September 19, 1995.</E> If a trust that was treated as owned by the grantor under section 676 or 677 (other than section 677(a)(3)) on September 19, 1995, contains both amounts held in the trust on September 19, 1995, and amounts that were gratuitously transferred to the trust after September 19, 1995, paragraphs (a)(3) and (b)(3) of this section apply only if the amounts that were gratuitously transferred to the trust after September 19, 1995, are treated as a separate portion of the trust that is accounted for under the rules of § 1.671-3(a)(2). If the amounts that were gratuitously transferred to the trust after September 19, 1995 are not so accounted for, the general rule of § 1.672(f)-1 applies to the entire trust. If such amounts are so accounted for, and without regard to whether there is physical separation of the assets, the general rule of § 1.672(f)-1 does not apply to the portion of the trust that is attributable to amounts that were held in the trust on September 19, 1995. </P> <P> (e) <E T="03">Effective date.</E> The rules of this section are generally applicable to taxable years of a trust beginning after August 10, 1999. The initial separate accounting required by paragraph (d) of this section must be prepared by the due date (including extensions) for the tax return of the trust for the first taxable year of the trust beginning after August 10, 1999. </P> <CITA>[T.D. 8831, 64 FR 43276, Aug. 10, 1999, as amended by T.D. 8890, 65 FR 41334, July 5, 2000]</CITA> </SECTION> <SECTION> <PRTPAGE P="367"/> <SECTNO>§ 1.672(f)-4</SECTNO> <SUBJECT>Recharacterization of purported gifts.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Purported gifts from partnerships.</E> Except as provided in paragraphs (b), (e), and (f) of this section, and without regard to the existence of any trust, if a United States person (United States donee) directly or indirectly receives a purported gift or bequest (as defined in paragraph (d) of this section) from a partnership, the purported gift or bequest must be included in the United States donee's gross income as ordinary income. </P> <P> (2) <E T="03">Purported gifts from foreign corporations.</E> Except as provided in paragraphs (b), (e), and (f) of this section, and without regard to the existence of any trust, if a United States donee directly or indirectly receives a purported gift or bequest (as defined in paragraph (d) of this section) from any foreign corporation, the purported gift or bequest must be included in the United States donee's gross income as if it were a distribution from the foreign corporation. If the foreign corporation is a passive foreign investment company (within the meaning of section 1297), the rules of section 1291 apply. For purposes of section 1012, the United States donee is not treated as having basis in the stock of the foreign corporation. However, for purposes of section 1223, the United States donee is treated as having a holding period in the stock of the foreign corporation on the date of the deemed distribution equal to the weighted average of the holding periods of the actual interest holders (other than any interest holders who treat the portion of the purported gift attributable to their interest in the foreign corporation in the manner described in paragraph (b)(1) of this section). For purposes of section 902, a United States donee that is a domestic corporation is not treated as owning any voting stock of the foreign corporation. </P> <P> (b) <E T="03">Exceptions</E> —(1) <E T="03">Partner or shareholder treats transfer as distribution and gift.</E> Paragraph (a) of this section does not apply to the extent the United States donee can demonstrate to the satisfaction of the Commissioner that either— </P> <P>(i) A United States citizen or resident alien individual who directly or indirectly holds an interest in the partnership or foreign corporation treated and reported the purported gift or bequest for United States tax purposes as a distribution to such individual and a subsequent gift or bequest to the United States donee; or</P> <P>(ii) A nonresident alien individual who directly or indirectly holds an interest in the partnership or foreign corporation treated and reported the purported gift or bequest for purposes of the tax laws of the nonresident alien individual's country of residence as a distribution to such individual and a subsequent gift or bequest to the United States donee, and the United States donee timely complied with the reporting requirements of section 6039F, if applicable.</P> <P> (2) <E T="03">All beneficial owners of domestic partnership are United States citizens or residents or domestic corporations.</E> Paragraph (a)(1) of this section does not apply to a purported gift or bequest from a domestic partnership if the United States donee can demonstrate to the satisfaction of the Commissioner that all beneficial owners (within the meaning of § 1.1441-1(c)(6)) of the partnership are United States citizens or residents or domestic corporations. </P> <P> (3) <E T="03">Contribution to capital of corporate United States donee.</E> Paragraph (a) of this section does not apply to the extent a United States donee that is a corporation can establish that the purported gift or bequest was treated for United States tax purposes as a contribution to the capital of the United States donee to which section 118 applies. </P> <P> (4) <E T="03">Charitable transfers.</E> Paragraph (a) of this section does not apply if either— </P> <P>(i) The United States donee is described in section 170(c); or</P> <P> (ii) The transferor has received a ruling or determination letter, which has been neither revoked nor modified, from the Internal Revenue Service recognizing its exempt status under section 501(c)(3), and the transferor made the transfer pursuant to an exempt purpose for which the transferor was created or organized. For purposes of the preceding sentence, a ruling or determination letter recognizing exemption may not be relied upon if there is a material change, inconsistent with <PRTPAGE P="368"/> exemption, in the character, the purpose, or the method of operation of the organization. </P> <P> (c) <E T="03">Certain transfers from trusts to which a partnership or foreign corporation has made a gratuitous transfer—(1) Generally treated as distribution from partnership or foreign corporation.</E> Except as provided in paragraphs (c)(2) and (3) of this section, if a United States donee receives a gratuitous transfer (within the meaning of § 1.671-2(e)(2)) from a trust (or portion of a trust) to which a partnership or foreign corporation has made a gratuitous transfer, the United States donee must treat the transfer as a purported gift or bequest from the partnership or foreign corporation that is subject to the rules of paragraph (a) of this section (including the exceptions in paragraphs (b) and (f) of this section). This paragraph (c) applies without regard to who is treated as the grantor of the trust (or portion thereof) under § 1.671-2(e)(4). </P> <P> (2) <E T="03">Alternative rule.</E> Except as provided in paragraph (c)(3) of this section, if the United States tax computed under the rules of paragraphs (a) and (c)(1) of this section does not exceed the United States tax that would be due if the United States donee treated the transfer as a distribution from the trust (or portion thereof), paragraph (c)(1) of this section does not apply and the United States donee must treat the transfer as a distribution from the trust (or portion thereof) that is subject to the rules of subparts A through D (section 641 and following), part I, subchapter J, chapter 1 of the Internal Revenue Code. For purposes of paragraph (f) of this section, the transfer is treated as a purported gift or bequest from the partnership or foreign corporation that made the gratuitous transfer to the trust (or portion thereof). </P> <P> (3) <E T="03">Exception.</E> Neither paragraph (c)(1) of this section nor paragraph (c)(2) of this section applies to the extent the United States donee can demonstrate to the satisfaction of the Commissioner that the transfer represents an amount that is, or has been, taken into account for United States tax purposes by a United States citizen or resident or a domestic corporation. A transfer will be deemed to be made first out of amounts that have not been taken into account for United States tax purposes by a United States citizen or resident or a domestic corporation, unless the United States donee can demonstrate to the satisfaction of the Commissioner that another ordering rule is more appropriate. </P> <P> (d) <E T="03">Definition of purported gift or bequest</E> —(1) <E T="03">In general.</E> Subject to the provisions of paragraphs (d)(2) and (3) of this section, <E T="03">a purported gift or bequest</E> for purposes of this section is any transfer of property by a partnership or foreign corporation other than a transfer for fair market value (within the meaning of § 1.671-2(e)(2)(ii)) to a person who is not a partner in the partnership or a shareholder of the foreign corporation (or to a person who is a partner in the partnership or a shareholder of a foreign corporation, if the amount transferred is inconsistent with the partner's interest in the partnership or the shareholder's interest in the corporation, as the case may be). For purposes of this section, the term <E T="03">property</E> includes cash. </P> <P> (2) <E T="03">Transfers for less than fair market value</E> —(i) <E T="03">Excess treated as purported gift or bequest.</E> Except as provided in paragraph (d)(2)(ii) of this section, if a transfer described in paragraph (d)(1) of this section is for less than fair market value, the excess of the fair market value of the property transferred over the value of the property received, services rendered, or the right to use property is treated as a purported gift or bequest. </P> <P> (ii) <E T="03">Exception for transfers to unrelated parties.</E> No portion of a transfer described in paragraph (d)(1) of this section will be treated as a purported gift or bequest for purposes of this section if the United States donee can demonstrate to the satisfaction of the Commissioner that the United States donee is not related to a partner or shareholder of the transferor within the meaning of § 1.643(h)-1(e) or does not have another relationship with a partner or shareholder of the transferor that establishes a reasonable basis for concluding that the transferor would make a gratuitous transfer to the United States donee. <PRTPAGE P="369"/> </P> <P> (e) <E T="03">Prohibition against affirmative use of recharacterization by taxpayers.</E> A taxpayer may not use the rules of this section if a principal purpose for using such rules is the avoidance of any tax imposed by the Internal Revenue Code. Thus, with respect to such taxpayer, the Commissioner may depart from the rules of this section and recharacterize (for all purposes of the Internal Revenue Code) the transfer in accordance with its form or its economic substance. </P> <P> (f) <E T="03">Transfers not in excess of $10,000.</E> This section does not apply if, during the taxable year of the United States donee, the aggregate amount of purported gifts or bequests that is transferred to such United States donee directly or indirectly from all partnerships or foreign corporations that are related (within the meaning of section 643(i)) does not exceed $10,000. The aggregate amount must include gifts or bequests from persons that the United States donee knows or has reason to know are related to the partnership or foreign corporation (within the meaning of section 643(i)). </P> <P> (g) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In each example, the amount that is transferred exceeds $10,000. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Distribution from foreign corporation.</HD> <P>FC is a foreign corporation that is wholly owned by A, a nonresident alien who is resident in Country C. FC makes a gratuitous transfer of property directly to A's daughter, B, who is a resident alien. Under paragraph (a)(2) of this section, B generally must treat the transfer as a dividend from FC to the extent of FC's earnings and profits and as an amount received in excess of basis thereafter. If FC is a passive foreign investment company, B must treat the amount received as a distribution under section 1291. B will be treated as having the same holding period as A. However, under paragraph (b)(1)(ii) of this section, if B can establish to the satisfaction of the Commissioner that, for purposes of the tax laws of Country C, A treated (and reported, if applicable) the transfer as a distribution to himself and a subsequent gift to B, B may treat the transfer as a gift (provided B timely complied with the reporting requirements of section 6039F, if applicable).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Distribution of corpus from trust to which foreign corporation made gratuitous transfer.</HD> <P>FC is a foreign corporation that is wholly owned by A, a nonresident alien who is resident in Country C. FC makes a gratuitous transfer to a foreign trust, FT, that has no other assets. FT immediately makes a gratuitous transfer in the same amount to A's daughter, B, who is a resident alien. Under paragraph (c)(1) of this section, B must treat the transfer as a transfer from FC that is subject to the rules of paragraph (a)(2) of this section. Under paragraph (a)(2) of this section, B must treat the transfer as a dividend from FC unless she can establish to the satisfaction of the Commissioner that, for purposes of the tax laws of Country C, A treated (and reported, if applicable) the transfer as a distribution to himself and a subsequent gift to B and that B timely complied with the reporting requirements of section 6039F, if applicable. The alternative rule in paragraph (c)(2) of this section would not apply as long as the United States tax computed under the rules of paragraph (a)(2) of this section is equal to or greater than the United States tax that would be due if the transfer were treated as a distribution from FT.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Accumulation distribution from trust to which foreign corporation made gratuitous transfer.</HD> <P>FC is a foreign corporation that is wholly owned by A, a nonresident alien. FC is not a passive foreign investment company (as defined in section 1297). FC makes a gratuitous transfer of 100X to a foreign trust, FT, on January 1, 2001. FT has no other assets on January 1, 2001. Several years later, FT makes a gratuitous transfer of 1000X to A's daughter, B, who is a United States resident. Assume that the section 668 interest charge on accumulation distributions will apply if the transfer is treated as a distribution from FT. Under the alternative rule of paragraph (c)(2) of this section, B must treat the transfer as an accumulation distribution from FT, because the resulting United States tax liability is greater than the United States tax that would be due if the transfer were treated as a transfer from FC that is subject to the rules of paragraph (a) of this section.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Transfer from trust that is treated as owned by United States citizen.</HD> <P> Assume the same facts as in <E T="03">Example 3,</E> except that A is a United States citizen. Assume that A treats and reports the transfer to FT as a constructive distribution to himself, followed by a gratuitous transfer to FT, and that A is properly treated as the grantor of FT within the meaning of § 1.671-2(e). A is treated as the owner of FT under section 679 and, as required by section 671 and the regulations thereunder, A includes all of FT's items of income, deductions, and credit in computing his taxable income and credits. Neither paragraph (c)(1) nor paragraph (c)(2) of this section is applicable, because the exception in paragraph (c)(3) of this section applies. </P> </EXAMPLE> <EXAMPLE> <PRTPAGE P="370"/> <HD SOURCE="HED">Example 5. Transfer for less than fair market value.</HD> <P>FC is a foreign corporation that is wholly owned by A, a nonresident alien. On January 15, 2001, FC transfers property directly to A's daughter, B, a resident alien, in exchange for 90X. The Commissioner later determines that the fair market value of the property at the time of the transfer was 100X. Under paragraph (d)(2)(i) of this section, 10X will be treated as a purported gift to B on January 15, 2001.</P> </EXAMPLE> <P> (h) <E T="03">Effective date.</E> The rules of this section are generally applicable to any transfer after August 10, 1999, by a partnership or foreign corporation, or by a trust to which a partnership or foreign corporation makes a gratuitous transfer after August 10, 1999. </P> <CITA>[T.D. 8831, 64 FR 43278, Aug. 10, 1999, as amended by T.D. 8890, 65 FR 41334, July 5, 2000]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.672(f)-5</SECTNO> <SUBJECT>Special rules.</SUBJECT> <P> (a) <E T="03">Transfers by certain beneficiaries to foreign grantor</E> —(1) <E T="03">In general.</E> If, but for section 672(f)(5), a foreign person would be treated as the owner of any portion of a trust, any United States beneficiary of the trust is treated as the grantor of a portion of the trust to the extent the United States beneficiary directly or indirectly made transfers of property to such foreign person (without regard to whether the United States beneficiary was a United States beneficiary at the time of any transfer) in excess of transfers to the United States beneficiary from the foreign person. The rule of this paragraph (a) does not apply to the extent the United States beneficiary can demonstrate to the satisfaction of the Commissioner that the transfer by the United States beneficiary to the foreign person was wholly unrelated to any transaction involving the trust. For purposes of this paragraph (a), the term property includes cash, and a transfer of property does not include a transfer that is not a gratuitous transfer (within the meaning of § 1.671-2(e)(2)). In addition, a gift is not taken into account to the extent such gift would not be characterized as a taxable gift under section 2503(b). For a definition of United States beneficiary, see section 679. </P> <P> (2) <E T="03">Examples.</E> The following examples illustrate the rules of this section: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A, a nonresident alien, contributes property to FC, a foreign corporation that is wholly owned by A. FC creates a foreign trust, FT, for the benefit of A and A's children. FT is revocable by FC without the approval or consent of any other person. FC funds FT with the property received from A. A and A's family move to the United States. Under paragraph (a)(1) of this section, A is treated as a grantor of FT. (A may also be treated as an owner of FT under section 679(a)(4).)</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>B, a United States citizen, makes a gratuitous transfer of $1 million to B's uncle, C, a nonresident alien. C creates a foreign trust, FT, for the benefit of B and B's children. FT is revocable by C without the approval or consent of any other person. C funds FT with the property received from B. Under paragraph (a)(1) of this section, B is treated as a grantor of FT. (B also would be treated as an owner of FT as a result of section 679.)</P> </EXAMPLE> <P> (b) <E T="03">Entity characterization.</E> Entities generally are characterized under United States tax principles for purposes of §§ 1.672(f)-1 through 1.672(f)-5. See §§ 301.7701-1 through 301.7701-4 of this chapter. However, solely for purposes of § 1.672(f)-4, a transferor that is a wholly owned business entity is treated as a corporation, separate from its single owner. </P> <P> (c) <E T="03">Effective date.</E> The rules in paragraph (a) of this section are applicable to transfers to trusts on or after August 10, 1999. The rules in paragraph (b) of this section are applicable August 10, 1999. </P> <CITA>[T.D. 8831, 64 FR 43280, Aug. 10, 1999, as amended by T.D. 8890, 65 FR 41334, July 5, 2000]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.673(a)-1</SECTNO> <SUBJECT>Reversionary interests; income payable to beneficiaries other than certain charitable organizations; general rule.</SUBJECT> <P> (a) Under section 673(a), a grantor, in general, is treated as the owner of any portion of a trust in which he has a reversionary interest in either the corpus or income if, as of the inception of that portion of the trust, the grantor's interest will or may reasonably be expected to take effect in possession or enjoyment within 10 years commencing with the date of transfer of that portion of the trust. However, the following types of reversionary interests are excepted from the general rule of the preceding sentence: <PRTPAGE P="371"/> </P> <P>(1) A reversionary interest after the death of the income beneficiary of a trust (see paragraph (b) of this section); and</P> <P>(2) Except in the case of transfers in trust made after April 22, 1969, a reversionary interest in a charitable trust meeting the requirements of section 673(b) (see § 1.673(b)-1). Even though the duration of the trust may be such that the grantor is not treated as its owner under section 673, and therefore is not taxed on the ordinary income, he may nevertheless be treated as an owner under section 677(a)(2) if he has a reversionary interest in the corpus. In the latter case, items of income, deduction, and credit allocable to corpus, such as capital gains and losses, will be included in the portion he owns. See § 1.671-3 and the regulations under section 677. See § 1.673(d)-1 with respect to a postponement of the date specified for reacquisition of a reversionary interest.</P> <P>(b) Section 673(c) provides that a grantor is not treated as the owner of any portion of a trust by reason of section 673 if his reversionary interest in the portion is not to take effect in possession or enjoyment until the death of the person or persons to whom the income of the portion is regardless of the life expectancies of the income beneficiaries. If his reversionary interest is to take effect on or after the death of an income beneficiary or upon the expiration of a specific term of years, whichever is earlier, the grantor is treated as the owner if the specific term of years is less than 10 years (but not if the term is 10 years or longer).</P> <P>(c) Where the grantor's reversionary interest in a portion of a trust is to take effect in possession or enjoyment by reason of some event other than the expiration of a specific term of years or the death of the income beneficiary, the grantor is treated as the owner of the portion if the event may reasonably be expected to occur within 10 years from the date of transfer of that portion, but he is not treated as the owner under section 673 if the event may not reasonably be expected to occur within 10 years from that date. For example, if the reversionary interest in any portion of a trust is to take effect on or after the death of the grantor (or any person other than the person to whom the income is payable) the grantor is treated under section 673 as the owner of the portion if the life expectancy of the grantor (or other person) is less than 10 years on the date of transfer of the portion, but not if the life expectancy is 10 years or longer. If the reversionary interest in any portion is to take effect on or after the death of the grantor (or any person other than the person to whom the income is payable) or upon the expiration of a specific term of years, whichever is earlier, the grantor is treated as the owner of the portion if on the date of transfer of the portion either the life expectancy of the grantor (or other person) or the specific term is less than 10 years; however, if both the life expectancy and the specific term are 10 years or longer the grantor is not treated as the owner of the portion under section 673. Similarly, if the grantor has a reversionary interest in any portion which will take effect at the death of the income beneficiary or the grantor, whichever is earlier, the grantor is not treated as an owner of the portion unless his life expectancy is less than 10 years.</P> <P>(d) It is immaterial that a reversionary interest in corpus or income is subject to a contingency if the reversionary interest may, taking the contingency into consideration, reasonably be expected to take effect in possession or enjoyment within 10 years. For example, the grantor is taxable where the trust income is to be paid to the grantor's son for 3 years, and the corpus is then to be returned to the grantor if he survives that period, or to be paid to the grantor's son if he is already decreased.</P> <P>(e) See section 671 and §§ 1.671-2 and 1.671-3 for rules for treatment of items of income, deduction, and credit when a person is treated as the owner of all or only a portion of a trust.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7357, 40 FR 23742, June 2, 1975]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.673(b)-1</SECTNO> <SUBJECT>Income payable to charitable beneficiaries before amendment by Tax Reform Act of 1969).</SUBJECT> <P> (a) Pursuant to section 673(b) a grantor is not treated as an owner of <PRTPAGE P="372"/> any portion of a trust under section 673, even though he has a reversionary interest which will take effect within 10 years, to the extent that, under the terms of the trust, the income of the portion is irrevocably payable for a period of at least 2 years (commencing with the date of the transfer) to a designated beneficiary of the type described in section 170(b)(1)(A). </P> <P>(b) Income must be irrevocably payable to a designated beneficiary for at least 2 years commencing with the date of the transfer before the benefit of section 673(b) will apply. Thus, section 673(b) will not apply if income of a trust is irrevocably payable to University A for 1 year and then to University B for the next year; or if income of a trust may be allocated among two or more charitable beneficiaries in the discretion of the trustee or any other person. On the other hand, section 673(b) will apply if half the income of a trust is irrevocably payable to University A and the other half is irrevocably payable to University B for two years.</P> <P>(c) Section 673(b) applies to the period of 2 years or longer during which income is paid to a designated beneficiary of the type described in section 170(b)(1)(A) (i), (ii), or (iii), even though the trust term is to extend beyond that period. However, the other provisions of section 673 apply to the part of the trust term, if any, that extends beyond that period. This paragraph may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>G transfers property in trust with the ordinary income payable to University C (which qualifies under section 170(b)(1)(A)(ii)) for 3 years, and then to his son, B, for 5 years. At the expiration of the term the trust reverts to G. G is not taxed under section 673 of the trust income payable to University C for the first 3 years because of the application of section 673(b). However, he is taxed on income for the next 5 years because he has a reversionary interest which will take effect within 10 years commencing with the date of the transfer. On the other hand, if the income were payable to University C for 3 years and then to R for 7 years so that the trust corpus would not be returned to G within 10 years, G would not be taxable under section 673 on income payable to University C and to B during any part of the term.</P> </EXAMPLE> <P>(d) This section does not apply to transfers in trust made after April 22, 1969.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6605, 27 FR 8097, Aug. 15, 1962; T.D. 7357, 40 FR 23743, June 2, 1975]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.673(c)-1</SECTNO> <SUBJECT>Reversionary interest after income beneficiary's death.</SUBJECT> <P>The subject matter of section 673(c) is covered in paragraph (b) of § 1.673(a)-1.</P> </SECTION> <SECTION> <SECTNO>§ 1.673(d)-1</SECTNO> <SUBJECT>Postponement of date specified for reacquisition.</SUBJECT> <P>Any postponement of the date specified for the reacquisition of possession or enjoyment of any reversionary interest is considered a new transfer in trust commencing with the date on which the postponement is effected and terminating with the date prescribed by the postponement. However, the grantor will not be treated as the owner of any portion of a trust for any taxable year by reason of the foregoing sentence if he would not be so treated in the absence of any postponement. The rules contained in this section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>G places property in trust for the benefit of his son B. Upon the expiration of 12 years or the earlier death of B the property is to be paid over to G or his estate. After the expiration of 9 years G extends the term of the trust for an additional 2 years. G is considered to have made a new transfer in trust for a term of 5 years (the remaining 3 years of the original transfer plus the 2-year extension). However, he is not treated as the owner of the trust under section 673 for the first 3 years of the new term because he would not be so treated if the term of the trust had not been extended. G is treated as the owner of the trust, however, for the remaining 2 years.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.674(a)-1</SECTNO> <SUBJECT>Power to control beneficial enjoyment; scope of section 674.</SUBJECT> <P> (a) Under section 674, the grantor is treated as the owner of a portion of trust if the grantor or a nonadverse party has a power, beyond specified limits, to dispose of the beneficial enjoyment of the income or corpus, whether the power is a fiduciary power, a power of appointment, or any other power. Section 674(a) states in general terms that the grantor is treated as the <PRTPAGE P="373"/> owner in every case in which he or a nonadverse party can affect the beneficial enjoyment of a portion of a trust, the limitations being set forth as exceptions in subsections (b), (c), and (d) of section 674. These exceptions are discussed in detail in §§ 1.674(b)-1 through 1.674(d)—1. Certain limitations applicable to section 674 (b), (c), and (d) are set forth in § 1.674(d)-2. Section 674(b) describes powers which are excepted regardless of who holds them. Section 674(c) describes additional powers of trustees which are excepted if at least half the trustees are independent, and if the grantor is not a trustee. Section 674(d) describes a further power which is excepted if it is held by trustees other than the grantor or his spouse (if living with the grantor). </P> <P>(b) In general terms the grantor is treated as the owner of a portion of a trust if he or a nonadverse party or both has a power to dispose of the beneficial enjoyment of the corpus or income unless the power is one of the following:</P> <P> (1) <E T="03">Miscellaneous powers over either ordinary income or corpus.</E> (i) A power that can only affect the beneficial enjoyment of income (including capital gains) received after a period of time such that the grantor would not be treated as an owner under section 673 if the power were a reversionary interest (section 674(b)(2)); </P> <P>(ii) A testamentary power held by anyone (other than a testamentary power held by the grantor over accumulated income) (section 674(b)(3));</P> <P>(iii) A power to choose between charitable beneficiaries or to affect the manner of their enjoyment of a beneficial interest (section 674(b)(4));</P> <P>(iv) A power to allocate receipts and disbursements between income and corpus (section 674(b)(8)).</P> <P> (2) <E T="03">Powers of distribution primarily affecting only one beneficiary.</E> (i) A power to distribute corpus to or for a current income beneficiary, if the distribution must be charged against the share of corpus from which the beneficiary may receive income (section 674(b)(5)(B)); </P> <P> (ii) A power to distribute income to or for a current income beneficiary or to accumulate it either ( <E T="03">a</E> ) if accumulated income must either be payable to the beneficiary from whom it was withheld or as described in paragraph (b)(6) of § 1.674(b)-1 (section 674(b) (6)); ( <E T="03">b</E> ) if the power is to apply income to the support of a dependent of the grantor, and the income is not so applied (section 674(b)(1)); or ( <E T="03">c</E> ) if the beneficiary is under 21 or under a legal disability and accumulated income is added to corpus (section 674(b)(7)). </P> <P> (3) <E T="03">Powers of distribution affecting more than one beneficiary.</E> A power to distribute corpus or income to or among one or more beneficiaries or to accumulate income, either (i) if the power is held by a trustee or trustees other than the grantor, at least half of whom are independent (section 674(c)), or (ii) if the power is limited by a reasonably definite standard in the trust instrument, and in the case of a power over income, if in addition the power is held by a trustee or trustees other than the grantor and the grantor's spouse living with the grantor (section 674(b)(5)(A) and (d)). (These powers include both powers to “sprinkle” income or corpus among current beneficiaries, and powers to shift income or corpus between current beneficiaries and remaindermen; however, certain of the powers described under subparagraph (2) of this paragraph can have the latter effect incidentally.) </P> <P>(c) See section 671 and §§ 1.671-2 and 1.671-3 for rules for the treatment of income, deductions, and credits when a person is treated as the owner of all or only a portion of a trust.</P> </SECTION> <SECTION> <SECTNO>§ 1.674(b)-1</SECTNO> <SUBJECT>Excepted powers exercisable by any person.</SUBJECT> <P> (a) Paragraph (b) (1) through (8) of this section sets forth a number of powers which may be exercisable by any person without causing the grantor to be treated as an owner of a trust under section 674(a). Further, with the exception of powers described in paragraph (b)(1) of this section, it is immaterial whether these powers are held in the capacity of trustee. It makes no difference under section 674(b) that the person holding the power is the grantor, or a related or subordinate party (with the qualifications noted in paragraph (b) (1) and (3) of this section). <PRTPAGE P="374"/> </P> <P>(b) The exceptions referred to in paragraph (a) of this section are as follows (see, however, the limitations set forth in § 1.674(d)-2):</P> <P> (1) <E T="03">Powers to apply income to support of a dependent.</E> Section 674(b)(1) provides, in effect, that regardless of the general rule of section 674(a), the income of a trust will not be considered as taxable to the grantor merely because in the discretion of any person (other than a grantor who is not acting as a trustee or cotrustee) it may be used for the support of a beneficiary whom the grantor is legally obligated to support, except to the extent that it is in fact used for that purpose. See section 677(b) and the regulations thereunder. </P> <P> (2) <E T="03">Powers affecting beneficial enjoyment only after a period.</E> Section 674(b)(2) provides an exception to section 674(a) if the exercise of a power can only affect the beneficial enjoyment of the income of a trust received after a period of time which is such that a grantor would not be treated as an owner under section 673 if the power were a reversionary interest. See §§ 1.673(a)-1 and 1.673(b)-1. For example, if a trust created on January 1, 1955, provides for the payment of income to the grantor's son, and the grantor reserves the power to substitute other beneficiaries of income or corpus in lieu of his son on or after January 1, 1965, the grantor is not treated under section 674 as the owner of the trust with respect to ordinary income received before January 1, 1965. But the grantor will be treated as an owner on and after that date unless the power is relinquished. If the beginning of the period during which the grantor may substitute beneficiaries is postponed, the rules set forth in § 1.673(d)-1 are applicable in order to determine whether the grantor should be treated as an owner during the period following the postponement. </P> <P> (3) <E T="03">Testamentary powers.</E> Under paragraph (3) of section 674(b) a power in any person to control beneficial enjoyment exercisable only by will does not cause a grantor to be treated as an owner under section 674(a). However, this exception does not apply to income accumulated for testamentary disposition by the grantor or to income which may be accumulated for such distribution in the discretion of the grantor or a nonadverse party, or both, without the approval or consent of any adverse party. For example, if a trust instrument provides that the income is to be accumulated during the grantor's life and that the grantor may appoint the accumulated income by will, the grantor is treated as the owner of the trust. Moreover, if a trust instrument provides that the income is payable to another person for his life, but the grantor has a testamentary power of appointment over the remainder, and under the trust instrument and local law capital gains are added to corpus, the grantor is treated as the owner of a portion of the trust and capital gains and losses are included in that portion. (See § 1.671-3.) </P> <P> (4) <E T="03">Powers to determine beneficial enjoyment of charitable beneficiaries.</E> Under paragraph (4) of section 674(b) a power in any person to determine the beneficial enjoyment of corpus or income which is irrevocably payable (currently or in the future) for purposes specified in section 170(c) (relating to definition of charitable contributions) will not cause the grantor to be treated as an owner under section 674(a). For example, if a grantor creates a trust, the income of which is irrevocably payable solely to educational or other organizations that qualify under section 170(c), he is not treated as an owner under section 674 although he retains the power to allocate the income among such organizations. </P> <P> (5) <E T="03">Powers to distribute corpus.</E> Paragraph (5) of section 674(b) provides an exception to section 674(a) for powers to distribute corpus, subject to certain limitations, as follows: </P> <P> (i) If the power is limited by a reasonably definite standard which is set forth in the trust instrument, it may extend to corpus distributions to any beneficiary or beneficiaries or class of beneficiaries (whether income beneficiaries or remaindermen) without causing the grantor to be treated as an owner under section 674. See section 674(b)(5)(A). It is not required that the standard consist of the needs and circumstances of the beneficiary. A clearly measurable standard under which <PRTPAGE P="375"/> the holder of a power is legally accountable is deemed a reasonably definite standard for this purpose. For instance, a power to distribute corpus for the education, support, maintenance, or health of the beneficiary; for his reasonable support and comfort; or to enable him to maintain his accustomed standard of living; or to meet an emergency, would be limited by a reasonably definite standard. However, a power to distribute corpus for the pleasure, desire, or happiness of a beneficiary is not limited by a reasonably definite standard. The entire context of a provision of a trust instrument granting a power must be considered in determining whether the power is limited by a reasonably definite standard. For example, if a trust instrument provides that the determination of the trustee shall be conclusive with respect to the exercise or nonexercise of a power, the power is not limited by a reasonably definite standard. However, the fact that the governing instrument is phrased in discretionary terms is not in itself an indication that no reasonably definite standard exists. </P> <P>(ii) If the power is not limited by a reasonably definite standard set forth in the trust instrument, the exception applies only if distributions of corpus may be made solely in favor of current income beneficiaries, and any corpus distribution to the current income beneficiary must be chargeable against the proportionate part of corpus held in trust for payment of income to that beneficiary as if it constituted a separate trust (whether or not physically segregated). See section 674(b)(5)(B).</P> <P>(iii) This subparagraph may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>A trust instrument provides for payment of the income to the grantor's two brothers for life, and for payment of the corpus to the grantor's nephews in equal shares. The grantor reserves the power to distribute corpus to pay medical expenses that may be incurred by his brothers or nephews. The grantor is not treated as an owner by reason of this power because section 674(b)(5)(A) excepts a power, exercisable by any person, to invade corpus for any beneficiary, including a remainderman, if the power is limited by a reasonably definite standard which is set forth in the trust instrument. However, if the power were also exercisable in favor of a person (for example, a sister) who was not otherwise a beneficiary of the trust, section 674(b)(5)(A) would not be applicable.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The facts are the same as in example 1 except that the grantor reserves the power to distribute any part of the corpus to his brothers or to his nephews for their happiness. The grantor is treated as the owner of the trust. Paragraph (5)(A) of section 674(b) is inapplicable because the power is not limited by a reasonably definite standard. Paragraph (5)(B) is inapplicable because the power to distribute corpus permits a distribution of corpus to persons other than current income beneficiaries.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>A trust instrument provides for payment of the income to the grantor's two adult sons in equal shares for 10 years, after which the corpus is to be distributed to his grandchildren in equal shares. The grantor reserves the power to pay over to each son up to one-half of the corpus during the 10-year period, but any such payment shall proportionately reduce subsequent income and corpus payments made to the son receiving the corpus. Thus, if one-half of the corpus is paid to one son, all the income from the remaining half is thereafter payable to the other son. The grantor is not treated as an owner under section 674(a) by reason of this power because it qualifies under the exception of section 674(b)(5)(B).</P> </EXAMPLE> <P> (6) <E T="03">Powers to withhold income temporarily.</E> (i) Section 674(b)(6) excepts a power which, in general, enables the holder merely to effect a postponement in the time when the ordinary income is enjoyed by a current income beneficiary. Specifically, there is excepted a power to distribute or apply ordinary income to or for a current income beneficiary or to accumulate the income, if the accumulated income must ultimately be payable either: </P> <P> ( <E T="03">a</E> ) To the beneficiary from whom it was withheld, his estate, or his appointees (or persons designated by name, as a class, or otherwise as alternate takers in default of appointment) under a power of appointment held by the beneficiary which does not exclude from the class of possible appointees any person other than the beneficiary, his estate, his creditors, or the creditors of his estate (section 674(b)(6)(A)); </P> <P> ( <E T="03">b</E> ) To the beneficiary from whom it was withheld, or if he does not survive a date of distribution which could reasonably be expected to occur within his lifetime, to his appointees (or alternate takers in default of appointment) under any power of appointment, general or special, or if he has no power of <PRTPAGE P="376"/> appointment to one or more designated alternate takers (other than the grantor of the grantor's estate) whose shares have been irrevocably specified in the trust instrument (section 674(b)(6)(A) and the flush material following); or </P> <P> ( <E T="03">c</E> ) On termination of the trust, or in conjunction with a distribution of corpus which is augmented by the accumulated income, to the current income beneficiaries in shares which have been irrevocably specified in the trust instrument, or if any beneficiary does not survive a date of distribution which would reasonably be expected to occur within his lifetime, to his appointees (or alternate takers in default of appointment) under any power of appointment, general or special, or if he has no power of appointment to one or more designated alternate takers (other than the grantor or the grantor's estate) whose shares have been irrevocably specified in the trust instrument (section 674(b)(6)(B) and the flush material following). </P> <FP> (In the application of ( <E T="03">a</E> ) of this subdivision, if the accumulated income of a trust is ultimately payable to the estate of the current income beneficiary or is ultimately payable to his appointees or takers in default of appointment, under a power of the type described in ( <E T="03">a</E> ) of this subdivision, it need not be payable to the beneficiary from whom it was withheld under any circumstances. Furthermore, if a trust otherwise qualifies for the exception in ( <E T="03">a</E> ) of this subdivision the trust income will not be considered to be taxable to the grantor under section 677 by reason of the existence of the power of appointment referred to in ( <E T="03">a</E> ) of this subdivision.) In general, the exception in section 674(b)(6) is not applicable if the power is in substance one to shift ordinary income from one beneficiary to another. Thus, a power will not qualify for this exception if ordinary income may be distributed to beneficiary A, or may be added to corpus which is ultimately payable to beneficiary B, a remainderman who is not a current income beneficiary. However, section 674(b)(6)(B), and ( <E T="03">c</E> ) of this subdivision, permit a limited power to shift ordinary income among current income beneficiaries, as illustrated in example 1 of this subparagraph. </FP> <P>(ii) The application of section 674(b)(6) may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> A trust instrument provides that the income shall be paid in equal shares to the grantor's two adult daughters but the grantor reserves the power to withhold from either beneficiary any part of that beneficiary's share of income and to add it to the corpus of the trust until the younger daughter reaches the age of 30 years. When the younger daughter reaches the age of 30, the trust is to terminate and the corpus is to be divided equally between the two daughters or their estates. Although exercise of this power may permit the shifting of accumulated income from one beneficiary to the other (since the corpus with the accumulations is to be divided equally) the power is excepted under section 674(b)(6)(B) and subdivision (i)( <E T="03">c</E> ) of this subparagraph. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>The facts are the same as in example 1, except that the grantor of the trust reserves the power to distribute accumulated income to the beneficiaries in such shares as he chooses. The combined powers are not excepted by section 674(b)(6)(B) since income accumulated pursuant to the first power is neither required to be payable only in conjunction with a corpus distribution nor required to be payable in shares specified in the trust instrument. See, however, section 674(c) and § 1.674(c)-1 for the effect of such a power if it is exercisable only by independent trustees.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>A trust provides for payment of income to the grantor's adult son with the grantor retaining the power to accumulate the income until the grantor's death, when all accumulations are to be paid to the son. If the son predeceases the grantor, all accumulations are, at the death of the grantor, to be paid to his daughter, or if she is not living, to alternate takers (which do not include the grantor's estate) in specified shares. The power is excepted under section 674(b)(6)(A) since the date of distribution (the date of the grantor's death) may, in the usual case, reasonably be expected to occur during the beneficiary's (the son's) lifetime. It is not necessary that the accumulations be payable to the son's estate or his appointees if he should predecease the grantor for this exception to apply.</P> </EXAMPLE> <P> (7) <E T="03">Power to withhold income during disability.</E> Section 674(b)(7) provides an exception for a power which, in general, will permit ordinary income to be withheld during the legal disability of an income beneficiary or while he is under 21. Specifically, there is excepted a power, exercisable only during the existence of a legal disability of any <PRTPAGE P="377"/> current income beneficiary or the period during which any income beneficiary is under the age of 21 years, to distribute or apply ordinary income to or for that beneficiary or to accumulate the income and add it to corpus. To qualify under this exception it is not necessary that the income ultimately be payable to the income beneficiary from whom it was withheld, his estate, or his appointees; that is, the accumulated income may be added to corpus and ultimately distributed to others. For example, the grantor is not treated as an owner under section 674 if the income of a trust is payable to his son for life, remainder to his grandchildren, although he reserves the power to accumulate income and add it to corpus while his son is under 21. </P> <P> (8) <E T="03">Powers to allocate between corpus and income.</E> Paragraph (8) of section 674(b) provides that a power to allocate receipts and disbursements between corpus and income, even though expressed in broad language, will not cause the grantor to be treated as an owner under the general rule of section 674(a). </P> </SECTION> <SECTION> <SECTNO>§ 1.674(c)-1</SECTNO> <SUBJECT>Excepted powers exercisable only by independent trustees.</SUBJECT> <P>Section 674(c) provides an exception to the general rule of section 674(a) for certain powers that are exercisable by independent trustees. This exception is in addition to those provided for under section 674(b) which may be held by any person including an independent trustee. The powers to which section 674(c) apply are powers (a) to distribute, apportion, or accumulate income to or for a beneficiary or beneficiaries, or to, for, or within a class of beneficiaries, or (b) to pay out corpus to or for a beneficiary or beneficiaries or to or for a class of beneficiaries (whether or not income beneficiaries). In order for such a power to fall within the exception of section 674(c) it must be exercisable solely (without the approval or consent of any other person) by a trustee or trustees none of whom is the grantor and no more than half of whom are related or subordinate parties who are subservient to the wishes of the grantor. (See section 672(c) for definitions of these terms.) An example of the application of section 674(c) is a trust whose income is payable to the grantor's three adult sons with power in an independent trustee to allocate without restriction the amounts of income to be paid to each son each year. Such a power does not cause the grantor to be treated as the owner of the trust. See however, the limitations set forth in § 1.674(d)-2.</P> </SECTION> <SECTION> <SECTNO>§ 1.674(d)-1</SECTNO> <SUBJECT>Excepted powers exercisable by any trustee other than grantor or spouse.</SUBJECT> <P>Section 674(d) provides an additional exception to the general rule of section 674(a) for a power to distribute, apportion, or accumulate income to or for a beneficiary or beneficiaries or to, for, or within a class of beneficiaries, whether or not the conditions of section 674(b) (6) or (7) are satisfied, if the power is solely exercisable (without the approval or consent of any other person) by a trustee or trustees none of whom is the grantor or spouse living with the grantor, and if the power is limited by a reasonably definite external standard set forth in the trust instrument (see paragraph (b)(5) of § 1.674(b)-1 with respect to what constitutes a reasonably definite standard). See, however, the limitations set forth in § 1.674(d)-2.</P> </SECTION> <SECTION> <SECTNO>§ 1.674(d)-2</SECTNO> <SUBJECT>Limitations on exceptions in section 674 (b), (c), and (d).</SUBJECT> <P> (a) <E T="03">Power to remove trustee.</E> A power in the grantor to remove, substitute, or add trustees (other than a power exercisable only upon limited conditions which do not exist during the taxable year, such as the death or resignation of, or breach of fiduciary duty by, an existing trustee) may prevent a trust from qualifying under section 674 (c) or (d). For example, if a grantor has an unrestricted power to remove an independent trustee and substitute any person including himself as trustee, the trust will not qualify under section 674 (c) or (d). On the other hand if the grantor's power to remove, substitute, or add trustees is limited so that its exercise could not alter the trust in a manner that would disqualify it under section 674 (c) or (d), as the case may be, the power itself does not disqualify the trust. Thus, for example, a power <PRTPAGE P="378"/> in the grantor to remove or discharge an independent trustee on the condition that he substitute another independent trustee will not prevent a trust from qualifying under section 674(c). </P> <P> (b) <E T="03">Power to add beneficiaries.</E> The exceptions described in section 674 (b) (5), (6), and (7), (c), and (d), are not applicable if any person has a power to add to the beneficiary or beneficiaries or to a class of beneficiaries designated to receive the income or corpus, except where the action is to provide for after-born or after-adopted children. This limitation does not apply to a power held by a beneficiary to substitute other beneficiaries to succeed to his interest in the trust (so that he would be an adverse party as to the exercise or nonexercise of that power). For example, the limitation does not apply to a power in a beneficiary of a nonspendthrift trust to assign his interest. Nor does the limitation apply to a power held by any person which would qualify as an exception under section 674(b)(3) (relating to testamentary powers). </P> </SECTION> <SECTION> <SECTNO>§ 1.675-1</SECTNO> <SUBJECT>Administrative powers.</SUBJECT> <P> (a) <E T="03">General rule.</E> Section 675 provides in effect that the grantor is treated as the owner of any portion of a trust if under the terms of the trust instrument or circumstances attendant on its operation administrative control is exercisable primarily for the benefit of the grantor rather than the beneficiaries of the trust. If a grantor retains a power to amend the administrative provisions of a trust instrument which is broad enough to permit an amendment causing the grantor to be treated as the owner of a portion of the trust under section 675, he will be treated as the owner of the portion from its inception. See section 671 and §§ 1.671-2 and 1.671-3 for rules for treatment of items of income, deduction, and credit when a person is treated as the owner of all or only a portion of a trust. </P> <P> (b) <E T="03">Prohibited controls.</E> The circumstances which cause administrative controls to be considered exercisable primarily for the benefit of the grantor are specifically described in paragraphs (1) through (4) of section 675 as follows: </P> <P>(1) The existence of a power, exercisable by the grantor or a nonadverse party, or both, without the approval or consent of any adverse party, which enables the grantor or any other person to purchase, exchange, or otherwise deal with or dispose of the corpus or the income of the trust for less than adequate consideration in money or money's worth. Whether the existence of the power itself will constitute the holder an adverse party will depend on the particular circumstances.</P> <P>(2) The existence of a power exercisable by the grantor or a nonadverse party, or both, which enables the grantor to borrow the corpus or income of the trust, directly or indirectly, without adequate interest or adequate security. However, this paragraph does not apply where a trustee (other than the grantor acting alone) is authorized under a general lending power to make loans to any person without regard to interest or security. A general lending power in the grantor, acting alone as trustee, under which he has power to determine interest rates and the adequacy of security is not in itself an indication that the grantor has power to borrow the corpus or income without adequate interest or security.</P> <P>(3) The circumstance that the grantor has directly or indirectly borrowed the corpus or income of the trust and has not completely repaid the loan, including any interest, before the beginning of the taxable year. The preceding sentence does not apply to a loan which provides for adequate interest and adequate security, if it is made by a trustee other than the grantor or a related or subordinate trustee subservient to the grantor. See section 672(c) for definition of “a related or subordinate party”.</P> <P> (4) The existence of certain powers of administration exercisable in a nonfiduciary capacity by any nonadverse party without the approval or consent of any person in a fiduciary capacity. The term <E T="03">powers of administration</E> means one or more of the following powers: </P> <P> (i) A power to vote or direct the voting of stock or other securities of a corporation in which the holdings of <PRTPAGE P="379"/> the grantor and the trust are significant from the viewpoint of voting control; </P> <P>(ii) A power to control the investment of the trust funds either by directing investments or reinvestments, or by vetoing proposed investments or reinvestments, to the extent that the trust funds consist of stocks or securities of corporations in which the holdings of the grantor and the trust are significant from the viewpoint of voting control; or</P> <P>(iii) A power to reacquire the trust corpus by substituting other property of an equivalent value.</P> <FP>If a power is exercisable by a person as trustee, it is presumed that the power is exercisable in a fiduciary capacity primarily in the interests of the beneficiaries. This presumption may be rebutted only by clear and convincing proof that the power is not exercisable primarily in the interests of the beneficiaries. If a power is not exercisable by a person as trustee, the determination of whether the power is exercisable in a fiduciary or a nonfiduciary capacity depends on all the terms of the trust and the circumstances surrounding its creation and administration.</FP> <P> (c) <E T="03">Authority of trustee.</E> The mere fact that a power exercisable by a trustee is described in broad language does not indicate that the trustee is authorized to purchase, exchange, or otherwise deal with or dispose of the trust property or income for less than an adequate and full consideration in money or money's worth, or is authorized to lend the trust property or income to the grantor without adequate interest. On the other hand, such authority may be indicated by the actual administration of the trust. </P> </SECTION> <SECTION> <SECTNO>§ 1.676(a)-1</SECTNO> <SUBJECT>Power to revest title to portion of trust property in grantor; general rule.</SUBJECT> <P>If a power to revest in the grantor title to any portion of a trust is exercisable by the grantor or a nonadverse party, or both, without the approval or consent of an adverse party, the grantor is treated as the owner of that portion, except as provided in section 676(b) (relating to powers affecting beneficial enjoyment of income only after the expiration of certain periods of time). If the title to a portion of the trust will revest in the grantor upon the exercise of a power by the grantor or a nonadverse party, or both, the grantor is treated as the owner of that portion regardless of whether the power is a power to revoke, to terminate, to alter or amend, or to appoint. See section 671 and §§ 1.671-2 and 1.671-3 for rules for treatment of items of income, deduction, and credit when a person is treated as the owner of all or only a portion of a trust.</P> </SECTION> <SECTION> <SECTNO>§ 1.676(b)-1</SECTNO> <SUBJECT>Powers exercisable only after a period of time.</SUBJECT> <P>Section 676(b) provides an exception to the general rule of section 676(a) when the exercise of a power can only affect the beneficial enjoyment of the income of a trust received after the expiration of a period of time which is such that a grantor would not be treated as the owner of that portion, except as power were a reversionary interest. See §§ 1.673(a)-1 and 1.673(b)-1. Thus, for example, a grantor is excepted from the general rule of section 676(a) with respect to ordinary income if exercise of a power to revest corpus in him cannot affect the beneficial enjoyment of the income received within 10 years after the date of transfer of that portion of the trust. It is immaterial for this purpose that the power is vested at the time of the transfer. However, the grantor is subject to the general rule of section 676(a) after the expiration of the period unless the power is relinquished. Thus, in the above example, the grantor may be treated as the owner and be taxed on all income in the eleventh and succeeding years if exercise of the power can affect beneficial enjoyment of income received in those years. If the beginning of the period during which the grantor may revest is postponed, the rules set forth in § 1.673(d)-1 are applicable to determine whether the grantor should be treated as an owner during the period following the postponement.</P> </SECTION> <SECTION> <SECTNO>§ 1.677(a)-1</SECTNO> <SUBJECT>Income for benefit of grantor; general rule.</SUBJECT> <P> (a)(1) <E T="03">Scope.</E> Section 677 deals with the treatment of the grantor of a trust as the owner of a portion of the trust <PRTPAGE P="380"/> because he has retained an interest in the income from that portion. For convenience, “grantor” and “spouse” are generally referred to in the masculine and feminine genders, respectively, but if the grantor is a woman the reference to “grantor” is to her and the reference to “spouse” is to her husband. Section 677 also deals with the treatment of the grantor of a trust as the owner of a portion of the trust because the income from property transferred in trust after October 9, 1969, is, or may be, distributed to his spouse or applied to the payment of premiums on policies of insurance on the life of his spouse. However, section 677 does not apply when the income of a trust is taxable to a grantor's spouse under section 71 (relating to alimony and separate maintenance payments) or section 682 (relating to income of an estate or trust in case of divorce, etc.). See section 671-1(b). </P> <P> (2) <E T="03">Cross references.</E> See section 671 and §§ 1.671-2 and 1.671-3 for rules for treatment of items of income, deduction, and credit when a person is treated as the owner of all or a portion of a trust. </P> <P> (b) <E T="03">Income for benefit of grantor or his spouse; general rule</E> —(1) <E T="03">Property transferred in trust prior to October 10, 1969.</E> With respect to property transferred in trust prior to October 10, 1969, the grantor is treated, under section 677, in any taxable year as the owner (whether or not he is treated as an owner under section 674) of a portion of a trust of which the income for the taxable year or for a period not within the exception described in paragraph (e) of this section is, or in the discretion of the grantor or a nonadverse party, or both (without the approval or consent of any adverse party) may be: </P> <P>(i) Distributed to the grantor;</P> <P>(ii) Held or accumulated for future distribution to the grantor; or</P> <P>(iii) Applied to the payment of premiums on policies of insurance on the life of the grantor, except policies of insurance irrevocably payable for a charitable purpose specified in section 170(c).</P> <P> (2) <E T="03">Property transferred in trust after October 9, 1969.</E> With respect to property transferred in trust after October 9, 1969, the grantor is treated, under section 677, in any taxable year as the owner (whether or not he is treated as an owner under section 674) of a portion of a trust of which the income for the taxable year or for a period not within the exception described in paragraph (e) of this section is, or in the discretion of the grantor, or his spouse, or a nonadverse party, or any combination thereof (without the approval or consent of any adverse party other than the grantor's spouse) may be: </P> <P>(i) Distributed to the grantor or the grantor's spouse;</P> <P>(ii) Held or accumulated for future distribution to the grantor or the grantor's spouse; or</P> <P>(iii) Applied to the payment of premiums on policies of insurance on the life of the grantor or the grantor's spouse, except policies of insurance irrevocably payable for a charitable purpose specified in section 170(c).</P> <FP>With respect to the treatment of a grantor as the owner of a portion of a trust solely because its income is, or may be, distributed or held or accumulated for future distribution to a beneficiary who is his spouse or applied to the payment of premiums for insurance on the spouse's life, section 677(a) applies to the income of a trust solely during the period of the marriage of the grantor to a beneficiary. In the case of divorce or separation, see sections 71 and 682 and the regulations thereunder.</FP> <P> (c) <E T="03">Constructive distribution; cessation of interest.</E> Under section 677 the grantor is treated as the owner of a portion of a trust if he has retained any interest which might, without the approval or consent of an adverse party, enable him to have the income from that portion distributed to him at some time either actually or constructively (subject to the exception described in paragraph (e) of this section). In the case of a transfer in trust after October 9, 1969, the grantor is also treated as the owner of a portion of a trust if he has granted or retained any interest which might, without the approval or consent of an adverse party (other than the grantor's spouse), enable his spouse to have the income from the portion at some time, whether or not within the grantor's lifetime, distributed to the spouse either actually or constructively. See <PRTPAGE P="381"/> paragraph (b)(2) of this section for additional rules relating to the income of a trust prior to the grantor's marriage to a beneficiary. Constructive distribution to the grantor or to his spouse includes payment on behalf of the grantor or his spouse to another in obedience to his or her direction and payment of premiums upon policies of insurance on the grantor's, or his spouse's, life (other than policies of insurance irrevocably payable for charitable purposes specified in section 170(c)). If the grantor (in the case of property transferred prior to Oct. 10, 1969) or the grantor and his spouse (in the case of property transferred after Oct. 9, 1969) are divested permanently and completely of every interest described in this paragraph, the grantor is not treated as an owner under section 677 after that divesting. The word “interest” as used in this paragraph does not include the possibility that the grantor or his spouse might receive back from a beneficiary an interest in a trust by inheritance. Further, with respect to transfers in trust prior to October 10, 1969, the word “interest” does not include the possibility that the grantor might receive back from a beneficiary an interest in a trust as a surviving spouse under a statutory right of election or a similar right. </P> <P> (d) <E T="03">Discharge of legal obligation of grantor or his spouse.</E> Under section 677 a grantor is, in general, treated as the owner of a portion of a trust whose income is, or in the discretion of the grantor or a nonadverse party, or both, may be applied in discharge of a legal obligation of the grantor (or his spouse in the case of property transferred in trust by the grantor after October 9, 1969). However, see § 1.677(b)-1 for special rules for trusts whose income may not be applied for the discharge of any legal obligation of the grantor or the grantor's spouse other than the support or maintenance of a beneficiary (other than the grantor's spouse) whom the grantor or grantor's spouse is legally obligated to support. See § 301.7701-4(e) of this chapter for rules on the classification of and application of section 677 to an environmental remediation trust. </P> <P> (e) <E T="03">Exception for certain discretionary rights affecting income.</E> The last sentence of section 677(a) provides that a grantor shall not be treated as the owner when a discretionary right can only affect the beneficial enjoyment of the income of a trust received after a period of time during which a grantor would not be treated as an owner under section 673 if the power were a reversionary interest. See §§ 1.673(a)-1 and 1.673(b)-1. For example, if the ordinary income of a trust is payable to B for 10 years and then in the grantor's discretion income or corpus may be paid to B or to the grantor (or his spouse in the case of property transferred in trust by the grantor after October 9, 1969), the grantor is not treated as an owner with respect to the ordinary income under section 677 during the first 10 years. He will be treated as an owner under section 677 after the expiration of the 10-year period unless the power is relinquished. If the beginning of the period during which the grantor may substitute beneficiaries is postponed, the rules set forth in § 1.673(d)-1 are applicable in determining whether the grantor should be treated as an owner during the period following the postponement. </P> <P> (f) <E T="03">Accumulation of income.</E> If income is accumulated in any taxable year for future distribution to the grantor (or his spouse in the case of property transferred in trust by the grantor after Oct. 9, 1969), section 677(a)(2) treats the grantor as an owner for that taxable year. The exception set forth in the last sentence of section 677(a) does not apply merely because the grantor (or his spouse in the case of property transferred in trust by the grantor after Oct. 9, 1969) must await the expiration of a period of time before he or she can receive or exercise discretion over previously accumulated income of the trust, even though the period is such that the grantor would not be treated as an owner under section 673 if a reversionary interest were involved. Thus, if income (including capital gains) of a trust is to be accumulated for 10 years and then will be, or at the discretion of the grantor, or his spouse in the case of property transferred in trust after October 9, 1969, or a nonadverse party, may be, distributed to the grantor (or his spouse in the case of property transferred in trust after Oct. <PRTPAGE P="382"/> 9, 1969), the grantor is treated as the owner of the trust from its inception. If income attributable to transfers after October 9, 1969 is accumulated in any taxable year during the grantor's lifetime for future distribution to his spouse, section 677(a)(2) treats the grantor as an owner for that taxable year even though his spouse may not receive or exercise discretion over such income prior to the grantor's death. </P> <P> (g) <E T="03">Examples.</E> The application of section 677(a) may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>G creates an irrevocable trust which provides that the ordinary income is to be payable to him for life and that on his death the corpus shall be distributed to B, an unrelated person. Except for the right to receive income, G retains no right or power which would cause him to be treated as an owner under sections 671 through 677. Under the applicable local law capital gains must be applied to corpus. During the taxable year 1970 the trust has the following items of gross income and deductions:</P> <LDRWK> <FL-2>Dividends</FL-2> <LDRFIG>$5,000</LDRFIG> <FL-2>Capital gain</FL-2> <LDRFIG>1,000</LDRFIG> <FL-2>Expenses allocable to income</FL-2> <LDRFIG>200</LDRFIG> <FL-2>Expenses allocable to corpus</FL-2> <LDRFIG>100</LDRFIG> </LDRWK> <FP>Since G has a right to receive income he is treated as an owner of a portion of the trust under section 677. Accordingly, he should include the $5,000 of dividends, $200 income expense, and $100 corpus expense in the computation of his taxable income for 1970. He should not include the $1,000 capital gain since that is not attributable to the portion of the trust that he owns. See § 1.671-3(b). The tax consequences of the capital gain are governed by the provisions of subparts A, B, C, and D (section 641 and following), part I, subchapter J, chapter 1 of the Code. Had the trust sustained a capital loss in any amount the loss would likewise not be included in the computation of G's taxable income, but would also be governed by the provisions of such subparts.</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>G creates a trust which provides that the ordinary income is payable to his adult son. Ten years and one day from the date of transfer or on the death of his son, whichever is earlier, corpus is to revert to G. In addition, G retains a discretionary right to receive $5,000 of ordinary income each year. (Absent the exercise of this right all the ordinary income is to be distributed to his son.) G retained no other right or power which would cause him to be treated as an owner under subpart E (section 671 and following). Under the terms of the trust instrument and applicable local law capital gains must be applied to corpus. During the taxable year 1970 the trust had the following items of income and deductions:</P> <LDRWK> <FL-2>Dividends</FL-2> <LDRFIG>$10,000</LDRFIG> <FL-2>Capital gain</FL-2> <LDRFIG>2,000</LDRFIG> <FL-2>Expenses allocable to income</FL-2> <LDRFIG>400</LDRFIG> <FL-2>Expenses allocable to corpus</FL-2> <LDRFIG>200</LDRFIG> </LDRWK> <FP>Since the capital gain is held or accumulated for future distributions to G, he is treated under section 677(a)(2) as an owner of a portion of the trust to which the gain is attributable. See § 1.671-3(b).</FP> <P>Therefore, he must include the capital gain in the computation of his taxable income. (Had the trust sustained a capital loss in any amount, G would likewise include that loss in the computation of his taxable income.) In addition, because of G's discretionary right (whether exercised or not) he is treated as the owner of a portion of the trust which will permit a distribution of income to him of $5,000. Accordingly, G includes dividends of $5,208.33 and income expenses of $208.33 in computing his taxable income, determined in the following manner:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,11"> <ROW> <ENT I="01">Total dividends</ENT> <ENT>$10,000.00</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Less: Expenses allocable to income</ENT> <ENT>400.00</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">Distributable income of the trust</ENT> <ENT>9,600.00</ENT> </ROW> <ROW> <ENT I="01">Portion of dividends attributable to G (5,000/9,600 × $10,000)</ENT> <ENT>5,208.33</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Portion of income expenses attributable to G (5,000/9,600 × $400)</ENT> <ENT>208.33</ENT> </ROW> <ROW> <ENT I="03">Amount of income subject to discretionary right</ENT> <ENT>5,000.00</ENT> </ROW> </GPOTABLE> <FP>In accordance with § 1.671-3(c), G also takes into account $104.17 (5,000/9,600 × $200) of corpus expenses in computing his tax liability. The portion of the dividends and expenses of the trust not attributable to G are governed by the provisions of subparts A through D.</FP> </EXAMPLE> <CITA>[T.D. 7148, 36 FR 20749, Oct. 29, 1971, as amended by T.D. 8668, 61 FR 19191, May 1, 1996]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.677(b)-1</SECTNO> <SUBJECT>Trusts for support.</SUBJECT> <P> (a) Section 677(b) provides that a grantor is not treated as the owner of a trust merely because its income may in the discretion of any person other than the grantor (except when he is acting as trustee or cotrustee) be applied or distributed for the support or maintenance of a beneficiary (other than the grantor's spouse in the case of income from property transferred in trust after October 9, 1969), such as the child of the grantor, whom the grantor or his spouse is legally obligated to support. If income of the current year of the trust is actually so applied or distributed the grantor may be treated as the owner of any portion of the trust <PRTPAGE P="383"/> under section 677 to that extent, even though it might have been applied or distributed for other purposes. In the case of property transferred to a trust before October 10, 1969, for the benefit of the grantor's spouse, the grantor may be treated as the owner to the extent income of the current year is actually applied for the support or maintenance of his spouse. </P> <P>(b) If any amount applied or distributed for the support of a beneficiary, including the grantor's spouse in the case of property transferred in trust before October 10, 1969, whom the grantor is legally obligated to support is paid out of corpus or out of income other than income of the current year, the grantor is treated as a beneficiary of the trust, and the amount applied or distributed is considered to be an amount paid within the meaning of section 661(a)(2), taxable to the grantor under section 662. Thus, he is subject to the other relevant portions of subparts A through D (section 641 and following), part I, subchapter J, chapter 1 of the Code. Accordingly, the grantor may be taxed on an accumulation distribution or a capital gain distribution under subpart D (section 665 and following) of such part I. Those provisions are applied on the basis that the grantor is the beneficiary.</P> <P>(c) For the purpose of determining the items of income, deduction, and credit of a trust to be included under this section in computing the grantor's tax liability, the income of the trust for the taxable year of distribution will be deemed to have been first distributed. For example, in the case of a trust reporting on the calendar year basis, a distribution made on January 1, 1956, will be deemed to have been made out of ordinary income of the trust for the calendar year 1956 to the extent of the income for that year even though the trust had received no income as of January 1, 1956. Thus, if a distribution of $10,000 is made on January 1, 1956, for the support of the grantor's dependent, the grantor will be treated as the owner of the trust for 1956 to that extent. If the trust received dividends of $5,000 and incurred expenses of $1,000 during that year but subsequent to January 1, he will take into account dividends of $5,000 and expenses of $1,000 in computing his tax liability for 1956. In addition, the grantor will be treated as a beneficiary of the trust with respect to the $6,000 ($10,000 less distributable income of $4,000 (dividends of $5,000 less expenses of $1,000)) paid out of corpus or out of other than income of the current year. See paragraph (b) of this section.</P> <P>(d) The exception provided in section 677(b) relates solely to the satisfaction of the grantor's legal obligation to support or maintain a beneficiary. Consequently, the general rule of section 677(a) is applicable when in the discretion of the grantor or nonadverse parties income of a trust may be applied in discharge of a grantor's obligations other than his obligation of support or maintenance falling within section 677(b). Thus, if the grantor creates a trust the income of which may in the discretion of a nonadverse party be applied in the payment of the grantor's debts, such as the payment of his rent or other household expenses, he is treated as an owner of the trust regardless of whether the income is actually so applied.</P> <P>(e) The general rule of section 677(a), and not section 677(b), is applicable if discretion to apply or distribute income of a trust rests solely in the grantor, or in the grantor in conjunction with other persons, unless in either case the grantor has such discretion as trustee or cotrustee.</P> <P>(f) The general rule of section 677(a), and not section 677(b), is applicable to the extent that income is required, without any discretionary determination, to be applied to the support of a beneficiary whom the grantor is legally obligated to support.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7148, 36 FR 20750, Oct. 29, 1971]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.678(a)-1</SECTNO> <SUBJECT>Person other than grantor treated as substantial owner; general rule.</SUBJECT> <P> (a) Where a person other than the grantor of a trust has a power exercisable solely by himself to vest the corpus or the income of any portion of a testamentary or inter vivos trust in himself, he is treated under section <PRTPAGE P="384"/> 678(a) as the owner of that portion, except as provided in section 678(b) (involving taxation of the grantor) and section 678(c) (involving and obligation of support). The holder of such a power also is treated as an owner of the trust even though he has partially released or otherwise modified the power so that he can no longer vest the corpus or income in himself, if he has retained such control of the trust as would, if retained by a grantor, subject the grantor to treatment as the owner under sections 671 to 677, inclusive. See section 671 and §§ 1.671-2 and 1.671-3 for rules for treatment of items of income, deduction, and credit where a person is treated as the owner of all or only a portion of a trust. </P> <P>(b) Section 678(a) treats a person as an owner of a trust if he has a power exercisable solely by himself to apply the income or corpus for the satisfaction of his legal obligations, other than an obligation to support a dependent (see § 1.678(c)-1 subject to the limitation of section 678(b). Section 678 does not apply if the power is not exercisable solely by himself. However, see § 1.662(a)-4 for principles applicable to income of a trust which, pursuant to the terms of the trust instrument, is used to satisfy the obligations of a person other than the grantor.</P> </SECTION> <SECTION> <SECTNO>§ 1.678(b)-1</SECTNO> <SUBJECT>If grantor is treated as the owner.</SUBJECT> <P>Section 678(a) does not apply with respect to a power over income, as originally granted or thereafter modified, if the grantor of the trust is treated as the owner under sections 671 to 677, inclusive.</P> </SECTION> <SECTION> <SECTNO>§ 1.678(c)-1</SECTNO> <SUBJECT>Trusts for support.</SUBJECT> <P>(a) Section 678(a) does not apply to a power which enables the holder, in the capacity of trustee or cotrustee, to apply the income of the trust to the support or maintenance of a person whom the holder is obligated to support, except to the extent the income is so applied. See paragraphs (a), (b), and (c) of § 1.677(b)-1 for applicable principles where any amount is applied for the support or maintenance of a person whom the holder is obligated to support.</P> <P>(b) The general rule in section 678(a) (and not the exception in section 678(c)) is applicable in any case in which the holder of a power exercisable solely by himself is able, in any capacity other than that of trustee or cotrustee, to apply the income in discharge of his obligation of support or maintenance.</P> <P>(c) Section 678(c) is concerned with the taxability of income subject to a power described in section 678(a). It has no application to the taxability of income which is either required to be applied pursuant to the terms of the trust instrument or is applied pursuant to a power which is not described in section 678(a), the taxability of such income being governed by other provisions of the Code. See § 1.662(a)-4.</P> </SECTION> <SECTION> <SECTNO>§ 1.678(d)-1</SECTNO> <SUBJECT>Renunciation of power.</SUBJECT> <P>Section 678(a) does not apply to a power which has been renounced or disclaimed within a reasonable time after the holder of the power first became aware of its existence.</P> </SECTION> <SECTION> <SECTNO>§ 1.679-0</SECTNO> <SUBJECT>Outline of major topics.</SUBJECT> <P>This section lists the major paragraphs contained in §§ 1.679-1 through 1.679-7 as follows:</P> <EXTRACT> <HD SOURCE="HD2">§ 1.679-1 U.S. transferor treated as owner of foreign trust.</HD> <P>(a) In general.</P> <P>(b) Interaction with sections 673 through 678.</P> <P>(c) Definitions.</P> <P>(1) U.S. transferor.</P> <P>(2) U.S. person.</P> <P>(3) Foreign trust.</P> <P>(4) Property.</P> <P>(5) Related person.</P> <P>(6) Obligation.</P> <P>(d) Examples.</P> <HD SOURCE="HD2">§ 1.679-2 Trusts treated as having a U.S. beneficiary.</HD> <P>(a) Existence of U.S. beneficiary.</P> <P>(1) In general.</P> <P>(2) Benefit to a U.S. person</P> <P>(i) In general.</P> <P>(ii) Certain unexpected beneficiaries.</P> <P>(iii) Examples.</P> <P>(3) Changes in beneficiary's status.</P> <P>(i) In general.</P> <P>(ii) Examples.</P> <P>(4) General rules.</P> <P>(i) Records and documents.</P> <P>(ii) Additional factors.</P> <P>(iii) Examples.</P> <P> (b) Indirect U.S. beneficiaries. <PRTPAGE P="385"/> </P> <P>(1) Certain foreign entities.</P> <P>(2) Other indirect beneficiaries.</P> <P>(3) Examples.</P> <P>(c) Treatment of U.S. transferor upon foreign trust's acquisition or loss of U.S. beneficiary.</P> <P>(1) Trusts acquiring a U.S. beneficiary.</P> <P>(2) Trusts ceasing to have a U.S. beneficiary.</P> <P>(3) Examples.</P> <HD SOURCE="HD2">§ 1.679-3 Transfers.</HD> <P>(a) In general.</P> <P>(b) Transfers by certain trusts.</P> <P>(1) In general.</P> <P>(2) Example.</P> <P>(c) Indirect transfers.</P> <P>(1) Principal purpose of tax avoidance.</P> <P>(2) Principal purpose of tax avoidance deemed to exist.</P> <P>(3) Effect of disregarding intermediary.</P> <P>(i) In general.</P> <P>(ii) Special rule.</P> <P>(iii) Effect on intermediary.</P> <P>(4) Related parties.</P> <P>(5) Examples.</P> <P>(d) Constructive transfers.</P> <P>(1) In general.</P> <P>(2) Examples.</P> <P>(e) Guarantee of trust obligations.</P> <P>(1) In general.</P> <P>(2) Amount transferred.</P> <P>(3) Principal repayments.</P> <P>(4) Guarantee.</P> <P>(5) Examples.</P> <P>(f) Transfers to entities owned by a foreign trust.</P> <P>(1) General rule.</P> <P>(2) Examples.</P> <HD SOURCE="HD2">§ 1.679-4 Exceptions to general rule.</HD> <P>(a) In general.</P> <P>(b) Transfers for fair market value.</P> <P>(1) In general.</P> <P>(2) Special rule.</P> <P>(i) Transfers for partial consideration.</P> <P>(ii) Example.</P> <P>(c) Certain obligations not taken into account.</P> <P>(d) Qualified obligations.</P> <P>(1) In general.</P> <P>(2) Additional loans.</P> <P>(3) Obligations that cease to be qualified.</P> <P>(4) Transfers resulting from failed qualified obligations.</P> <P>(5) Renegotiated loans.</P> <P>(6) Principal repayments.</P> <P>(7) Examples.</P> <HD SOURCE="HD2">§ 1.679-5 Pre-immigration trusts.</HD> <P>(a) In general.</P> <P>(b) Special rules.</P> <P>(1) Change in grantor trust status.</P> <P>(2) Treatment of undistributed income.</P> <P>(c) Examples.</P> <HD SOURCE="HD2">§ 1.679-6 Outbound migrations of domestic trusts.</HD> <P>(a) In general.</P> <P>(b) Amount deemed transferred.</P> <P>(c) Example.</P> <HD SOURCE="HD2">§ 1.679-7 Effective dates.</HD> <P>(a) In general.</P> <P>(b) Special rules.</P> </EXTRACT> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-1</SECTNO> <SUBJECT>U.S. transferor treated as owner of foreign trust.</SUBJECT> <P> (a) <E T="03">In general.</E> A U.S. transferor who transfers property to a foreign trust is treated as the owner of the portion of the trust attributable to the property transferred if there is a U.S. beneficiary of any portion of the trust, unless an exception in § 1.679-4 applies to the transfer. </P> <P> (b) <E T="03">Interaction with sections 673 through 678.</E> The rules of this section apply without regard to whether the U.S. transferor retains any power or interest described in sections 673 through 677. If a U.S. transferor would be treated as the owner of a portion of a foreign trust pursuant to the rules of this section and another person would be treated as the owner of the same portion of the trust pursuant to section 678, then the U.S. transferor is treated as the owner and the other person is not treated as the owner. </P> <P> (c) <E T="03">Definitions.</E> The following definitions apply for purposes of this section and §§ 1.679-2 through 1.679-7: </P> <P> (1) <E T="03">U.S. transferor.</E> The term <E T="03">U.S. transferor</E> means any U.S. person who makes a transfer (as defined in § 1.679-3) of property to a foreign trust. </P> <P> (2) <E T="03">U.S. person.</E> The term <E T="03">U.S. person</E> means a United States person as defined in section 7701(a)(30), a nonresident alien individual who elects under section 6013(g) to be treated as a resident of the United States, and an individual who is a dual resident taxpayer within the meaning of § 301.7701(b)-7(a) of this chapter. </P> <P> (3) <E T="03">Foreign trust.</E> Section 7701(a)(31)(B) defines the term <E T="03">foreign trust.</E> See also § 301.7701-7 of this chapter. </P> <P> (4) <E T="03">Property.</E> The term <E T="03">property</E> means any property including cash. </P> <P> (5) <E T="03">Related person.</E> A person is a <E T="03">related person</E> if, without regard to the transfer at issue, the person is— <PRTPAGE P="386"/> </P> <P>(i) A grantor of any portion of the trust (within the meaning of § 1.671-2(e)(1));</P> <P>(ii) An owner of any portion of the trust under sections 671 through 679;</P> <P>(iii) A beneficiary of the trust; or</P> <P>(iv) A person who is related (within the meaning of section 643(i)(2)(B)) to any grantor, owner or beneficiary of the trust.</P> <P> (6) <E T="03">Obligation.</E> The term <E T="03">obligation</E> means any bond, note, debenture, certificate, bill receivable, account receivable, note receivable, open account, or other evidence of indebtedness, and, to the extent not previously described, any annuity contract. </P> <P> (d) <E T="03">Examples.</E> The following examples illustrate the rules of paragraph (a) of this section. In these examples, <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A</E> 's son, who is a resident alien, <E T="03">C</E> is <E T="03">A</E> 's father, who is a resident alien, <E T="03">D</E> is <E T="03">A</E> 's uncle, who is a nonresident alien, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Interaction with section 678. A</HD> <P> creates and funds <E T="03">FT. FT</E> may provide for the education of <E T="03">B</E> by paying for books, tuition, room and board. In addition, <E T="03">C</E> has the power to vest the trust corpus or income in himself within the meaning of section 678(a)(1). Under paragraph (b) of this section, <E T="03">A</E> is treated as the owner of the portion of <E T="03">FT</E> attributable to the property transferred to <E T="03">FT</E> by <E T="03">A</E> and <E T="03">C</E> is not treated as the owner thereof. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. U.S. person treated as owner of a portion of FT. D</HD> <P> creates and funds <E T="03">FT</E> for the benefit of <E T="03">B. D</E> retains a power described in section 676 and § 1.672(f)-3(a)(1). <E T="03">A</E> transfers property to <E T="03">FT.</E> Under sections 676 and 672(f), <E T="03">D</E> is treated as the owner of the portion of <E T="03">FT</E> attributable to the property transferred by <E T="03">D.</E> Under paragraph (a) of this section, <E T="03">A</E> is treated as the owner of the portion of <E T="03">FT</E> attributable to the property transferred by <E T="03">A.</E> </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-2</SECTNO> <SUBJECT>Trusts treated as having a U.S. beneficiary.</SUBJECT> <P> (a) <E T="03">Existence of U.S. beneficiary</E> —(1) <E T="03">In general.</E> The determination of whether a foreign trust has a U.S. beneficiary is made on an annual basis. A foreign trust is treated as having a U.S. beneficiary unless during the taxable year of the U.S. transferor— </P> <P>(i) No part of the income or corpus of the trust may be paid or accumulated to or for the benefit of, directly or indirectly, a U.S. person; and</P> <P>(ii) If the trust is terminated at any time during the taxable year, no part of the income or corpus of the trust could be paid to or for the benefit of, directly or indirectly, a U.S. person.</P> <P> (2) <E T="03">Benefit to a U.S. person</E> —(i) <E T="03">In general.</E> For purposes of paragraph (a)(1) of this section, income or corpus may be paid or accumulated to or for the benefit of a U.S. person during a taxable year of the U.S. transferor if during that year, directly or indirectly, income may be distributed to, or accumulated for the benefit of, a U.S. person, or corpus may be distributed to, or held for the future benefit of, a U.S. person. This determination is made without regard to whether income or corpus is actually distributed to a U.S. person during that year, and without regard to whether a U.S. person's interest in the trust income or corpus is contingent on a future event. </P> <P> (ii) <E T="03">Certain unexpected beneficiaries.</E> Notwithstanding paragraph (a)(2)(i) of this section, for purposes of paragraph (a)(1) of this section, a person who is not named as a beneficiary and is not a member of a class of beneficiaries as defined under the trust instrument is not taken into consideration if the U.S. transferor demonstrates to the satisfaction of the Commissioner that the person's contingent interest in the trust is so remote as to be negligible. The preceding sentence does not apply with respect to persons to whom distributions could be made pursuant to a grant of discretion to the trustee or any other person. A class of beneficiaries generally does not include heirs who will benefit from the trust under the laws of intestate succession in the event that the named beneficiaries (or members of the named class) have all deceased (whether or not stated as a named class in the trust instrument). </P> <P> (iii) <E T="03">Examples.</E> The following examples illustrate the rules of paragraphs (a)(1) and (2) of this section. In these examples, <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A</E> 's son, who is a resident alien, <E T="03">C</E> is <E T="03">A</E> 's daughter, who is a nonresident alien, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Distribution of income to U.S. person. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that all trust income is to <PRTPAGE P="387"/> be distributed currently to <E T="03">B.</E> Under paragraph (a)(1) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Income accumulation for the benefit of a U.S. person.</HD> <P> In 2001, <E T="03">A</E> transfers property to <E T="03">FT.</E> The trust instrument provides that from 2001 through 2010, the trustee of <E T="03">FT</E> may distribute trust income to <E T="03">C</E> or may accumulate the trust income. The trust instrument further provides that in 2011, the trust will terminate and the trustee may distribute the trust assets to either or both of <E T="03">B</E> and <E T="03">C,</E> in the trustee's discretion. If the trust terminates unexpectedly prior to 2011, all trust assets must be distributed to <E T="03">C.</E> Because it is possible that income may be accumulated in each year, and that the accumulated income ultimately may be distributed to <E T="03">B,</E> a U.S. person, under paragraph (a)(1) of this section <E T="03">FT</E> is treated as having a U.S. beneficiary during each of <E T="03">A</E> 's tax years from 2001 through 2011. This result applies even though no U.S. person may receive distributions from the trust during the tax years 2001 through 2010. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Corpus held for the benefit of a U.S. person.</HD> <P> The facts are the same as in Example 2, except that from 2001 through 2011, all trust income must be distributed to <E T="03">C.</E> In 2011, the trust will terminate and the trustee may distribute the trust corpus to either or both of <E T="03">B</E> and <E T="03">C,</E> in the trustee's discretion. If the trust terminates unexpectedly prior to 2011, all trust corpus must be distributed to <E T="03">C.</E> Because during each of <E T="03">A</E> 's tax years from 2001 through 2011 trust corpus is held for possible future distribution to <E T="03">B,</E> a U.S. person, under paragraph (a)(1) of this section <E T="03">FT</E> is treated as having a U.S. beneficiary during each of those years. This result applies even though no U.S. person may receive distributions from the trust during the tax years 2001 through 2010. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Distribution upon U.S. transferor's death. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that all trust income must be distributed currently to <E T="03">C</E> and, upon <E T="03">A</E> 's death, the trust will terminate and the trustee may distribute the trust corpus to either or both of <E T="03">B</E> and <E T="03">C.</E> Because <E T="03">B</E> may receive a distribution of corpus upon the termination of <E T="03">FT,</E> and <E T="03">FT</E> could terminate in any year, <E T="03">FT</E> is treated as having a U.S. beneficiary in the year of the transfer and in subsequent years. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Distribution after U.S. transferor's death.</HD> <P> The facts are the same as in <E T="03">Example 4,</E> except the trust instrument provides that the trust will not terminate until the year following <E T="03">A</E> 's death. Upon termination, the trustee may distribute the trust assets to either or both of <E T="03">B</E> and <E T="03">C,</E> in the trustee's discretion. All trust assets are invested in the stock of <E T="03">X,</E> a foreign corporation, and <E T="03">X</E> makes no distributions to <E T="03">FT.</E> Although no U.S. person may receive a distribution until the year after <E T="03">A</E> 's death, and <E T="03">FT</E> has no realized income during any year of its existence, during each year in which <E T="03">A</E> is living corpus may be held for future distribution to <E T="03">B,</E> a U.S. person. Thus, under paragraph (a)(1) of this section <E T="03">FT</E> is treated as having a U.S. beneficiary during each of <E T="03">A</E> 's tax years from 2001 through the year of <E T="03">A</E> 's death. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6. Constructive benefit to U.S. person. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that no income or corpus may be paid directly to a U.S. person. However, the trust instrument provides that trust corpus may be used to satisfy <E T="03">B</E> 's legal obligations to a third party by making a payment directly to the third party. Under paragraphs (a)(1) and (2) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7. U.S. person with negligible contingent interest. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that all income is to be distributed currently to <E T="03">C,</E> and upon <E T="03">C</E> 's death, all corpus is to be distributed to whomever of <E T="03">C</E> 's three children is then living. All of <E T="03">C</E> 's children are nonresident aliens. Under the laws of intestate succession that would apply to <E T="03">FT,</E> if all of <E T="03">C</E> 's children are deceased at the time of <E T="03">C</E> 's death, the corpus would be distributed to <E T="03">A</E> 's heirs. <E T="03">A</E> 's living relatives at the time of the transfer consist solely of two brothers and two nieces, all of whom are nonresident aliens, and two first cousins, one of whom, <E T="03">E,</E> is a U.S. citizen. Although it is possible under certain circumstances that <E T="03">E</E> could receive a corpus distribution under the applicable laws of intestate succession, for each year the trust is in existence <E T="03">A</E> is able to demonstrate to the satisfaction of the Commissioner under paragraph (a)(2)(ii) of this section that <E T="03">E</E> 's contingent interest in <E T="03">FT</E> is so remote as to be negligible. Provided that paragraph (a)(4) of this section does not require a different result, <E T="03">FT</E> is not treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8. U.S. person with non-negligible contingent interest. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that all income is to be distributed currently to <E T="03">D, A</E> 's uncle, who is a nonresident alien, and upon <E T="03">A</E> 's death, the corpus is to be distributed to <E T="03">D</E> if he is then living. Under the laws of intestate succession that would apply to <E T="03">FT, B</E> and <E T="03">C</E> would share equally in the trust corpus if <E T="03">D</E> is not living at the time of <E T="03">A</E> 's death. <E T="03">A</E> is unable to demonstrate to the satisfaction of the Commissioner that <E T="03">B</E> 's contingent interest in the trust is so remote as to be negligible. Under paragraph (a)(2)(ii) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary as of the year of the transfer. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9. U.S. person as member of class of beneficiaries. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that all income is to be distributed currently to <E T="03">D, A</E> 's uncle, who is a nonresident alien, and upon <E T="03">A</E> 's death, the corpus is to be distributed to <E T="03">D</E> if he is then living. If <E T="03">D</E> is not then living, the <PRTPAGE P="388"/> corpus is to be distributed to <E T="03">D</E> 's descendants. <E T="03">D</E> 's grandson, <E T="03">E,</E> is a resident alien. Under paragraph (a)(2)(ii) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary as of the year of the transfer. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10. Trustee's discretion in choosing beneficiaries. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that the trustee may distribute income and corpus to, or accumulate income for the benefit of, any person who is pursuing the academic study of ancient Greek, in the trustee's discretion. Because it is possible that a U.S. person will receive distributions of income or corpus, or will have income accumulated for his benefit, <E T="03">FT</E> is treated as having a U.S. beneficiary. This result applies even if, during a tax year, no distributions or accumulations are actually made to or for the benefit of a U.S. person. <E T="03">A</E> may not invoke paragraph (a)(2)(ii) of this section because a U.S. person could benefit pursuant to a grant of discretion in the trust instrument. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 11. Appointment of remainder beneficiary. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that the trustee may distribute current income to <E T="03">C,</E> or may accumulate income, and, upon termination of the trust, trust assets are to be distributed to <E T="03">C.</E> However, the trust instrument further provides that <E T="03">D, A</E> 's uncle, may appoint a different remainder beneficiary. Because it is possible that a U.S. person could be named as the remainder beneficiary, and because corpus could be held in each year for the future benefit of that U.S. person, <E T="03">FT</E> is treated as having a U.S. beneficiary for each year. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 12. Trust not treated as having a U.S. beneficiary. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that the trustee may distribute income and corpus to, or accumulate income for the benefit of <E T="03">C.</E> Upon termination of the trust, all income and corpus must be distributed to <E T="03">C.</E> Assume that paragraph (a)(4) of this section is not applicable under the facts and circumstances and that <E T="03">A</E> establishes to the satisfaction of the Commissioner under paragraph (a)(2)(ii) of this section that no U.S. persons are reasonably expected to benefit from the trust. Because no part of the income or corpus of the trust may be paid or accumulated to or for the benefit of, either directly or indirectly, a U.S. person, and if the trust is terminated no part of the income or corpus of the trust could be paid to or for the benefit of, either directly or indirectly, a U.S. person, <E T="03">FT</E> is not treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 13. U.S. beneficiary becomes non-U.S. person.</HD> <P> In 2001, <E T="03">A</E> transfers property to <E T="03">FT.</E> The trust instrument provides that, as long as <E T="03">B</E> remains a U.S. resident, no distributions of income or corpus may be made from the trust to <E T="03">B.</E> The trust instrument further provides that if <E T="03">B</E> becomes a nonresident alien, distributions of income (including previously accumulated income) and corpus may be made to him. If <E T="03">B</E> remains a U.S. resident at the time of <E T="03">FT</E> 's termination, all accumulated income and corpus is to be distributed to <E T="03">C.</E> In 2007, <E T="03">B</E> becomes a nonresident alien and remains so thereafter. Because income may be accumulated during the years 2001 through 2007 for the benefit of a person who is a U.S. person during those years, <E T="03">FT</E> is treated as having a U.S. beneficiary under paragraph (a)(1) of this section during each of those years. This result applies even though <E T="03">B</E> cannot receive distributions from <E T="03">FT</E> during the years he is a resident alien and even though <E T="03">B</E> might remain a resident alien who is not entitled to any distribution from <E T="03">FT.</E> Provided that paragraph (a)(4) of this section does not require a different result and that <E T="03">A</E> establishes to the satisfaction of the Commissioner under paragraph (a)(2)(ii) of this section that no other U.S. persons are reasonably expected to benefit from the trust, <E T="03">FT</E> is not treated as having a U.S. beneficiary under paragraph (a)(1) of this section during tax years after 2007. </P> </EXAMPLE> <P> (3) <E T="03">Changes in beneficiary's status</E> —(i) <E T="03">In general.</E> For purposes of paragraph (a)(1) of this section, the possibility that a person that is not a U.S. person could become a U.S. person will not cause that person to be treated as a U.S. person for purposes of paragraph (a)(1) of this section until the tax year of the U.S. transferor in which that individual actually becomes a U.S. person. However, if a person who is not a U.S. person becomes a U.S. person for the first time more than 5 years after the date of a transfer to the foreign trust by a U.S. transferor, that person is not treated as a U.S. person for purposes of applying paragraph (a)(1) of this section with respect to that transfer. </P> <P> (ii) <E T="03">Examples.</E> The following examples illustrate the rules of paragraph (a)(3) of this section. In these examples, <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A</E> 's son, who is a resident alien, <E T="03">C</E> is <E T="03">A</E> 's daughter, who is a nonresident alien, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Non-U.S. beneficiary becomes U.S. person.</HD> <P> In 2001, <E T="03">A</E> transfers property to <E T="03">FT.</E> The trust instrument provides that all income is to be distributed currently to <E T="03">C</E> and that, upon the termination of <E T="03">FT,</E> all corpus is to be distributed to <E T="03">C.</E> Assume that paragraph (a)(4) of this section is not applicable under the facts and circumstances and that A establishes to the satisfaction of the Commissioner under paragraph (a)(2)(ii) of this section that no U.S. persons are reasonably <PRTPAGE P="389"/> expected to benefit from the trust. Under paragraph (a)(3)(i) of this section, <E T="03">FT</E> is not treated as having a U.S. beneficiary during the tax years of <E T="03">A</E> in which <E T="03">C</E> remains a nonresident alien. If <E T="03">C</E> first becomes a resident alien in 2004, <E T="03">FT</E> is treated as having a U.S. beneficiary commencing in that year under paragraph (a)(3) of this section. See paragraph (c) of this section regarding the treatment of <E T="03">A</E> upon <E T="03">FT</E> 's acquisition of a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Non-U.S. beneficiary becomes U.S. person more than 5 years after transfer.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except <E T="03">C</E> first becomes a resident alien in 2007. <E T="03">FT</E> is treated as not having a U.S. beneficiary under paragraph (a)(3)(i) of this section with respect to the property transfer by <E T="03">A.</E> However, if <E T="03">C</E> had previously been a U.S. person during any prior period, the 5-year exception in paragraph (a)(3)(i) of this section would not apply in 2007 because it would not have been the first time <E T="03">C</E> became a U.S. person. </P> </EXAMPLE> <P> (4) <E T="03">General rules</E> —(i) <E T="03">Records and documents.</E> Even if, based on the terms of the trust instrument, a foreign trust is not treated as having a U.S. beneficiary within the meaning of paragraph (a)(1) of this section, the trust may nevertheless be treated as having a U.S. beneficiary pursuant to paragraph (a)(1) of this section based on the following— </P> <P>(A) All written and oral agreements and understandings relating to the trust;</P> <P>(B) Memoranda or letters of wishes;</P> <P>(C) All records that relate to the actual distribution of income and corpus; and</P> <P>(D) All other documents that relate to the trust, whether or not of any purported legal effect.</P> <P> (ii) <E T="03">Additional factors.</E> For purposes of determining whether a foreign trust is treated as having a U.S. beneficiary within the meaning of paragraph (a)(1) of this section, the following additional factors are taken into account— </P> <P>(A) If the terms of the trust instrument allow the trust to be amended to benefit a U.S. person, all potential benefits that could be provided to a U.S. person pursuant to an amendment must be taken into account;</P> <P>(B) If the terms of the trust instrument do not allow the trust to be amended to benefit a U.S. person, but the law applicable to a foreign trust may require payments or accumulations of income or corpus to or for the benefit of a U.S. person (by judicial reformation or otherwise), all potential benefits that could be provided to a U.S. person pursuant to the law must be taken into account, unless the U.S. transferor demonstrates to the satisfaction of the Commissioner that the law is not reasonably expected to be applied or invoked under the facts and circumstances; and</P> <P>(C) If the parties to the trust ignore the terms of the trust instrument, or if it is reasonably expected that they will do so, all benefits that have been, or are reasonably expected to be, provided to a U.S. person must be taken into account.</P> <P> (iii) <E T="03">Examples.</E> The following examples illustrate the rules of paragraph (a)(4) of this section. In these examples, <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A</E> 's son, who is a resident alien, <E T="03">C</E> is <E T="03">A</E> 's daughter, who is a nonresident alien, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Amendment pursuant to local law. A</HD> <P> creates and funds <E T="03">FT</E> for the benefit of <E T="03">C.</E> The terms of <E T="03">FT</E> (which, according to the trust instrument, cannot be amended) provide that no part of the income or corpus of <E T="03">FT</E> may be paid or accumulated during the taxable year to or for the benefit of any U.S. person, either during the existence of <E T="03">FT</E> or at the time of its termination. However, pursuant to the applicable foreign law, FT can be amended to provide for additional beneficiaries, and there is an oral understanding between <E T="03">A</E> and the trustee that <E T="03">B</E> can be added as a beneficiary. Under paragraphs (a)(1) and (a)(4)(ii)(B) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Actions in violation of the terms of the trust. A</HD> <P> transfers property to <E T="03">FT.</E> The trust instrument provides that no U.S. person can receive income or corpus from <E T="03">FT</E> during the term of the trust or at the termination of <E T="03">FT.</E> Notwithstanding the terms of the trust instrument, a letter of wishes directs the trustee of <E T="03">FT</E> to provide for the educational needs of <E T="03">B,</E> who is about to begin college. The letter of wishes contains a disclaimer to the effect that its contents are only suggestions and recommendations and that the trustee is at all times bound by the terms of the trust as set forth in the trust instrument. Under paragraphs (a)(1) and (a)(4)(ii)(C) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <P> (b) <E T="03">Indirect U.S. beneficiaries</E> —(1) <E T="03">Certain foreign entities.</E> For purposes of paragraph (a)(1) of this section, an <PRTPAGE P="390"/> amount is treated as paid or accumulated to or for the benefit of a U.S. person if the amount is paid to or accumulated for the benefit of— </P> <P>(i) A controlled foreign corporation, as defined in section 957(a);</P> <P>(ii) A foreign partnership, if a U.S. person is a partner of such partnership; or</P> <P>(iii) A foreign trust or estate, if such trust or estate has a U.S. beneficiary (within the meaning of paragraph (a)(1) of this section).</P> <P> (2) <E T="03">Other indirect beneficiaries.</E> For purposes of paragraph (a)(1) of this section, an amount is treated as paid or accumulated to or for the benefit of a U.S. person if the amount is paid to or accumulated for the benefit of a U.S. person through an intermediary, such as an agent or nominee, or by any other means where a U.S. person may obtain an actual or constructive benefit. </P> <P> (3) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (b). Unless otherwise noted, A is a resident alien. B is A's son and is a resident alien. FT is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Trust benefitting foreign corporation. A</HD> <P> transfers property to <E T="03">FT.</E> The beneficiary of <E T="03">FT</E> is <E T="03">FC,</E> a foreign corporation. <E T="03">FC</E> has outstanding solely 100 shares of common stock. <E T="03">B</E> owns 49 shares of the <E T="03">FC</E> stock and <E T="03">FC2,</E> also a foreign corporation, owns the remaining 51 shares. <E T="03">FC2</E> has outstanding solely 100 shares of common stock. <E T="03">B</E> owns 49 shares of <E T="03">FC2</E> and nonresident alien individuals own the remaining 51 <E T="03">FC2</E> shares. <E T="03">FC</E> is a controlled foreign corporation (as defined in section 957(a), after the application of section 958(a)(2)). Under paragraphs (a)(1) and (b)(1)(i) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Trust benefitting another trust. A</HD> <P> transfers property to <E T="03">FT.</E> The terms of <E T="03">FT</E> permit current distributions of income to <E T="03">B. A</E> transfers property to another foreign trust, <E T="03">FT2.</E> The terms of <E T="03">FT2</E> provide that no U.S. person can benefit either as to income or corpus, but permit current distributions of income to <E T="03">FT.</E> Under paragraph (a)(1) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary and, under paragraphs (a)(1) and (b)(1)(iii) of this section, <E T="03">FT2</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Trust benefitting another trust after transferor's death. A</HD> <P> transfers property to <E T="03">FT.</E> The terms of <E T="03">FT</E> require that all income from <E T="03">FT</E> be accumulated during <E T="03">A</E> 's lifetime. In the year following <E T="03">A</E> 's death, a share of <E T="03">FT</E> is to be distributed to <E T="03">FT2,</E> another foreign trust, for the benefit of <E T="03">B.</E> Under paragraphs (a)(1) and (b)(1)(iii) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary beginning with the year of <E T="03">A</E> 's transfer of property to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Indirect benefit through use of debit card. A</HD> <P> transfers property to FT. The trust instrument provides that no U.S. person can benefit either as to income or corpus. However, <E T="03">FT</E> maintains an account with <E T="03">FB,</E> a foreign bank, and <E T="03">FB</E> issues a debit card to <E T="03">B</E> against the account maintained by <E T="03">FT</E> and <E T="03">B</E> is allowed to make withdrawals. Under paragraphs (a)(1) and (b)(2) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Other indirect benefit. A</HD> <P> transfers property to <E T="03">FT. FT</E> is administered by <E T="03">FTC,</E> a foreign trust company. <E T="03">FTC</E> forms <E T="03">IBC,</E> an international business corporation formed under the laws of a foreign jurisdiction. <E T="03">IBC</E> is the beneficiary of <E T="03">FT. IBC</E> maintains an account with <E T="03">FB,</E> a foreign bank. <E T="03">FB</E> issues a debit card to <E T="03">B</E> against the account maintained by <E T="03">IBC</E> and <E T="03">B</E> is allowed to make withdrawals. Under paragraphs (a)(1) and (b)(2) of this section, <E T="03">FT</E> is treated as having a U.S. beneficiary. </P> </EXAMPLE> <P> (c) <E T="03">Treatment of U.S. transferor upon foreign trust's acquisition or loss of U.S. beneficiary</E> —(1) <E T="03">Trusts acquiring a U.S. beneficiary.</E> If a foreign trust to which a U.S. transferor has transferred property is not treated as having a U.S. beneficiary (within the meaning of paragraph (a) of this section) for any taxable year of the U.S. transferor, but the trust is treated as having a U.S. beneficiary (within the meaning of paragraph (a) of this section) in any subsequent taxable year, the U.S. transferor is treated as having additional income in the first such taxable year of the U.S. transferor in which the trust is treated as having a U.S. beneficiary. The amount of the additional income is equal to the trust's undistributed net income, as defined in section 665(a), at the end of the U.S. transferor's immediately preceding taxable year and is subject to the rules of section 668, providing for an interest charge on accumulation distributions from foreign trusts. </P> <P> (2) <E T="03">Trusts ceasing to have a U.S. beneficiary.</E> If, for any taxable year of a U.S. transferor, a foreign trust that has received a transfer of property from the U.S. transferor ceases to be treated as having a U.S. beneficiary, the U.S. transferor ceases to be treated as the <PRTPAGE P="391"/> owner of the portion of the trust attributable to the transfer beginning in the first taxable year following the last taxable year of the U.S. transferor during which the trust was treated as having a U.S. beneficiary (unless the U.S. transferor is treated as an owner thereof pursuant to sections 673 through 677). The U.S. transferor is treated as making a transfer of property to the foreign trust on the first day of the first taxable year following the last taxable year of the U.S. transferor during which the trust was treated as having a U.S. beneficiary. The amount of the property deemed to be transferred to the trust is the portion of the trust attributable to the prior transfer to which paragraph (a)(1) of this section applied. For rules regarding the recognition of gain on transfers to foreign trusts, see section 684. </P> <P> (3) <E T="03">Examples.</E> The rules of this paragraph (c) are illustrated by the following examples. <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A's</E> son, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Trust acquiring U.S. beneficiary.</HD> <P> (i) In 2001, <E T="03">A</E> transfers stock with a fair market value of $100,000 to <E T="03">FT.</E> The stock has an adjusted basis of $50,000 at the time of the transfer. The trust instrument provides that income may be paid currently to, or accumulated for the benefit of, <E T="03">B</E> and that, upon the termination of the trust, all income and corpus is to be distributed to <E T="03">B.</E> At the time of the transfer, <E T="03">B</E> is a nonresident alien. <E T="03">A</E> is not treated as the owner of any portion of FT under sections 673 through 677. <E T="03">FT</E> accumulates a total of $30,000 of income during the taxable years 2001 through 2003. In 2004, <E T="03">B</E> moves to the United States and becomes a resident alien. Assume paragraph (a)(4) of this section is not applicable under the facts and circumstances. </P> <P> (ii) Under paragraph (c)(1) of this section, <E T="03">A</E> is treated as receiving an accumulation distribution in the amount of $30,000 in 2004 and immediately transferring that amount back to the trust. The accumulation distribution is subject to the rules of section 668, providing for an interest charge on accumulation distributions. </P> <P> (iii) Under paragraphs (a)(1) and (3) of this section, beginning in 2005, <E T="03">A</E> is treated as the owner of the portion of <E T="03">FT</E> attributable to the stock transferred by <E T="03">A</E> to <E T="03">FT</E> in 2001 (which includes the portion attributable to the accumulated income deemed to be retransferred in 2004). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Trust ceasing to have U.S. beneficiary.</HD> <P> (i) The facts are the same as in <E T="03">Example 1.</E> In 2008, B becomes a nonresident alien. On the date B becomes a nonresident alien, the stock transferred by A to <E T="03">FT</E> in 2001 has a fair market value of $125,000 and an adjusted basis of $50,000. </P> <P> (ii) Under paragraph (c)(2) of this section, beginning in 2009, <E T="03">FT</E> is not treated as having a U.S. beneficiary, and <E T="03">A</E> is not treated as the owner of the portion of the trust attributable to the prior transfer of stock. For rules regarding the recognition of gain on the termination of ownership status, see section 684. </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-3</SECTNO> <SUBJECT>Transfers.</SUBJECT> <P> (a) <E T="03">In general.</E> A transfer means a direct, indirect, or constructive transfer. </P> <P> (b) <E T="03">Transfers by certain trusts</E> —(1) <E T="03">In general.</E> If any portion of a trust is treated as owned by a U.S. person, a transfer of property from that portion of the trust to a foreign trust is treated as a transfer from the owner of that portion to the foreign trust. </P> <P> (2) <E T="03">Example.</E> The following example illustrates this paragraph (b): </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> In 2001, <E T="03">A,</E> a U.S. citizen, creates and funds <E T="03">DT,</E> a domestic trust. <E T="03">A</E> has the power to revest absolutely in himself the title to the property in <E T="03">DT</E> and is treated as the owner of <E T="03">DT</E> pursuant to section 676. In 2004, <E T="03">DT</E> transfers property to <E T="03">FT,</E> a foreign trust. <E T="03">A</E> is treated as having transferred the property to <E T="03">FT</E> in 2004 for purposes of this section. </P> </EXAMPLE> <P> (c) <E T="03">Indirect transfers</E> —(1) <E T="03">Principal purpose of tax avoidance.</E> A transfer to a foreign trust by any person (intermediary) to whom a U.S. person transfers property is treated as an indirect transfer by a U.S. person to the foreign trust if such transfer is made pursuant to a plan one of the principal purposes of which is the avoidance of United States tax. </P> <P> (2) <E T="03">Principal purpose of tax avoidance deemed to exist.</E> For purposes of paragraph (c)(1) of this section, a transfer is deemed to have been made pursuant to a plan one of the principal purposes of which was the avoidance of United States tax if— </P> <P> (i) The U.S. person is related (within the meaning of paragraph (c)(4) of this section) to a beneficiary of the foreign trust, or has another relationship with a beneficiary of the foreign trust that establishes a reasonable basis for concluding that the U.S. transferor would <PRTPAGE P="392"/> make a transfer to the foreign trust; and </P> <P>(ii) The U.S. person cannot demonstrate to the satisfaction of the Commissioner that—</P> <P>(A) The intermediary has a relationship with a beneficiary of the foreign trust that establishes a reasonable basis for concluding that the intermediary would make a transfer to the foreign trust;</P> <P>(B) The intermediary acted independently of the U.S. person;</P> <P>(C) The intermediary is not an agent of the U.S. person under generally applicable United States agency principles; and</P> <P>(D) The intermediary timely complied with the reporting requirements of section 6048, if applicable.</P> <P> (3) <E T="03">Effect of disregarding intermediary</E> —(i) <E T="03">In general.</E> Except as provided in paragraph (c)(3)(ii) of this section, if a transfer is treated as an indirect transfer pursuant to paragraph (c)(1) of this section, then the intermediary is treated as an agent of the U.S. person, and the property is treated as transferred to the foreign trust by the U.S. person in the year the property is transferred, or made available, by the intermediary to the foreign trust. The fair market value of the property transferred is determined as of the date of the transfer by the intermediary to the foreign trust. </P> <P> (ii) <E T="03">Special rule.</E> If the Commissioner determines, or if the taxpayer can demonstrate to the satisfaction of the Commissioner, that the intermediary is an agent of the foreign trust under generally applicable United States agency principles, the property will be treated as transferred to the foreign trust in the year the U.S. person transfers the property to the intermediary. The fair market value of the property transferred will be determined as of the date of the transfer by the U.S. person to the intermediary. </P> <P> (iii) <E T="03">Effect on intermediary.</E> If a transfer of property is treated as an indirect transfer under paragraph (c)(1) of this section, the intermediary is not treated as having transferred the property to the foreign trust. </P> <P> (4) <E T="03">Related parties.</E> For purposes of this paragraph (c), a U.S. transferor is treated as related to a U.S. beneficiary of a foreign trust if the U.S. transferor and the beneficiary are related for purposes of section 643(i)(2)(B), with the following modifications— </P> <P>(i) For purposes of applying section 267 (other than section 267(f)) and section 707(b)(1), “at least 10 percent” is used instead of “more than 50 percent” each place it appears; and</P> <P>(ii) The principles of section 267(b)(10), using “at least 10 percent” instead of “more than 50 percent,” apply to determine whether two corporations are related.</P> <P> (5) <E T="03">Examples.</E> The rules of this paragraph (c) are illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Principal purpose of tax avoidance. A,</HD> <P> a U.S. citizen, creates and funds <E T="03">FT,</E> a foreign trust, for the benefit of <E T="03">A</E> 's children, who are U.S. citizens. In 2004, <E T="03">A</E> decides to transfer an additional 1000X to the foreign trust. Pursuant to a plan with a principal purpose of avoiding the application of section 679, A transfers 1000X to <E T="03">I,</E> a foreign person. <E T="03">I</E> subsequently transfers 1000X to <E T="03">FT.</E> Under paragraph (c)(1) of this section, <E T="03">A</E> is treated as having made a transfer of 1000X to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. U.S. person unable to demonstrate that intermediary acted independently. A,</HD> <P> a U.S. citizen, creates and funds <E T="03">FT,</E> a foreign trust, for the benefit of <E T="03">A</E> 's children, who are U.S. citizens. On July 1, 2004, <E T="03">A</E> transfers XYZ stock to <E T="03">D, A</E> 's uncle, who is a nonresident alien. <E T="03">D</E> immediately sells the XYZ stock and uses the proceeds to purchase ABC stock. On January 1, 2007, <E T="03">D</E> transfers the ABC stock to <E T="03">FT. A</E> is unable to demonstrate to the satisfaction of the Commissioner, pursuant to paragraph (c)(2) of this section, that <E T="03">D</E> acted independently of <E T="03">A</E> in making the transfer to <E T="03">FT.</E> Under paragraph (c)(1) of this section, <E T="03">A</E> is treated as having transferred the ABC stock to FT. Under paragraph (c)(3) of this section, <E T="03">D</E> is treated as an agent of <E T="03">A,</E> and the transfer is deemed to have been made on January 1, 2007. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Indirect loan to foreign trust. A,</HD> <P> a U.S. citizen, previously created and funded <E T="03">FT,</E> a foreign trust, for the benefit of <E T="03">A</E> 's children, who are U.S. citizens. On July 1, 2004, <E T="03">A</E> deposits 500X with <E T="03">FB,</E> a foreign bank. On January 1, 2005, <E T="03">FB</E> loans 450X to <E T="03">FT. A</E> is unable to demonstrate to the satisfaction of the Commissioner, pursuant to paragraph (c)(2) of this section, that <E T="03">FB</E> has a relationship with <E T="03">FT</E> that establishes a reasonable basis for concluding that <E T="03">FB</E> would make a loan to <E T="03">FT</E> or that <E T="03">FB</E> acted independently of <E T="03">A</E> in making the loan. Under paragraph (c)(1) of this section, <E T="03">A</E> is deemed to have transferred 450X directly to <E T="03">FT</E> on January 1, 2005. Under paragraph (c)(3) of this section, <E T="03">FB</E> is <PRTPAGE P="393"/> treated as an agent of <E T="03">A.</E> For possible exceptions with respect to qualified obligations of the trust, and the treatment of principal repayments with respect to obligations of the trust that are not qualified obligations, see § 1.679-4. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Loan to foreign trust prior to deposit of funds in foreign bank.</HD> <P> The facts are the same as in <E T="03">Example 3,</E> except that <E T="03">A</E> makes the 500X deposit with <E T="03">FB</E> on January 2, 2005, the day after <E T="03">FB</E> makes the loan to <E T="03">FT.</E> The result is the same as in <E T="03">Example 3.</E> </P> </EXAMPLE> <P> (d) <E T="03">Constructive transfers</E> —(1) <E T="03">In general.</E> For purposes of paragraph (a) of this section, a constructive transfer includes any assumption or satisfaction of a foreign trust's obligation to a third party. </P> <P> (2) <E T="03">Examples.</E> The rules of this paragraph (d) are illustrated by the following examples. In each example, <E T="03">A</E> is a U.S. citizen and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Payment of debt of foreign trust. FT</HD> <P> owes 1000X to <E T="03">Y,</E> an unrelated foreign corporation, for the performance of services by <E T="03">Y</E> for <E T="03">FT.</E> In satisfaction of <E T="03">FT</E> 's liability to <E T="03">Y, A</E> transfers to <E T="03">Y</E> property with a fair market value of 1000X. Under paragraph (d)(1) of this section, <E T="03">A</E> is treated as having made a constructive transfer of the property to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Assumption of liability of foreign trust. FT</HD> <P> owes 1000X to <E T="03">Y,</E> an unrelated foreign corporation, for the performance of services by <E T="03">Y</E> for <E T="03">FT. A</E> assumes <E T="03">FT</E> 's liability to pay <E T="03">Y.</E> Under paragraph (d)(1) of this section, <E T="03">A</E> is treated as having made a constructive transfer of property with a fair market value of 1000X to <E T="03">FT.</E> </P> </EXAMPLE> <P> (e) <E T="03">Guarantee of trust obligations</E> —(1) <E T="03">In general.</E> If a foreign trust borrows money or other property from any person who is not a related person (within the meaning of § 1.679-1(c)(5)) with respect to the trust (lender) and a U.S. person (U.S. guarantor) that is a related person with respect to the trust guarantees (within the meaning of paragraph (e)(4) of this section) the foreign trust's obligation, the U.S. guarantor is treated for purposes of this section as a U.S. transferor that has made a transfer to the trust on the date of the guarantee in an amount determined under paragraph (e)(2) of this section. To the extent this paragraph causes the U.S. guarantor to be treated as having made a transfer to the trust, a lender that is a U.S. person shall not be treated as having transferred that amount to the foreign trust. </P> <P> (2) <E T="03">Amount transferred.</E> The amount deemed transferred by a U.S. guarantor described in paragraph (e)(1) of this section is the guaranteed portion of the adjusted issue price of the obligation (within the meaning of § 1.1275-1(b)) plus any accrued but unpaid qualified stated interest (within the meaning of § 1.1273-1(c)). </P> <P> (3) <E T="03">Principal repayments.</E> If a U.S. person is treated under this paragraph (e) as having made a transfer by reason of the guarantee of an obligation, payments of principal to the lender by the foreign trust with respect to the obligation are taken into account on and after the date of the payment in determining the portion of the trust attributable to the property deemed transferred by the U.S. guarantor. </P> <P> (4) <E T="03">Guarantee.</E> For purposes of this section, the term guarantee— </P> <P>(i) Includes any arrangement under which a person, directly or indirectly, assures, on a conditional or unconditional basis, the payment of another's obligation;</P> <P>(ii) Encompasses any form of credit support, and includes a commitment to make a capital contribution to the debtor or otherwise maintain its financial viability; and</P> <P>(iii) Includes an arrangement reflected in a comfort letter, regardless of whether the arrangement gives rise to a legally enforceable obligation. If an arrangement is contingent upon the occurrence of an event, in determining whether the arrangement is a guarantee, it is assumed that the event has occurred.</P> <P> (5) <E T="03">Examples.</E> The rules of this paragraph (e) are illustrated by the following examples. In all of the examples, <E T="03">A</E> is a U.S. resident and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Foreign lender. X,</HD> <P> a foreign corporation, loans 1000X of cash to <E T="03">FT</E> in exchange for <E T="03">FT</E> 's obligation to repay the loan. <E T="03">A</E> guarantees the repayment of 600X of <E T="03">FT</E> 's obligation. Under paragraph (e)(2) of this section, <E T="03">A</E> is treated as having transferred 600X to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Unrelated U.S. lender.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except <E T="03">X</E> is a U.S. person that is not a related person within the meaning of § 1.679-1(c)(5). The result is the same as in <E T="03">Example 1.</E> </P> </EXAMPLE> <PRTPAGE P="394"/> <P> (f) <E T="03">Transfers to entities owned by a foreign trust</E> —(1) <E T="03">General rule.</E> If a U.S. person is a related person (as defined in § 1.679-1(c)(5)) with respect to a foreign trust, any transfer of property by the U.S. person to an entity in which the foreign trust holds an ownership interest is treated as a transfer of such property by the U.S. person to the foreign trust followed by a transfer of the property from the foreign trust to the entity owned by the foreign trust, unless the U.S. person demonstrates to the satisfaction of the Commissioner that the transfer to the entity is properly attributable to the U.S. person's ownership interest in the entity. </P> <P> (2) <E T="03">Examples.</E> The rules of this paragraph (f) are illustrated by the following examples. In all of the examples, <E T="03">A</E> is a U.S. citizen, <E T="03">FT</E> is a foreign trust, and <E T="03">FC</E> is a foreign corporation. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Transfer treated as transfer to trust. A</HD> <P> creates and funds <E T="03">FT,</E> which is treated as having a U.S. beneficiary under § 1.679-2. <E T="03">FT</E> owns all of the outstanding stock of <E T="03">FC. A</E> transfers property directly to <E T="03">FC.</E> Because <E T="03">FT</E> is the sole shareholder of <E T="03">FC, A</E> is unable to demonstrate to the satisfaction of the Commissioner that the transfer is properly attributable to <E T="03">A</E> 's ownership interest in <E T="03">FC.</E> Accordingly, under this paragraph (f), <E T="03">A</E> is treated as having transferred the property to <E T="03">FT,</E> followed by a transfer of such property by <E T="03">FT</E> to <E T="03">FC.</E> Under § 1.679-1(a), <E T="03">A</E> is treated as the owner of the portion of <E T="03">FT</E> attributable to the property treated as transferred directly to <E T="03">FT.</E> Under § 1.367(a)-1T(c)(4)(ii), the transfer of property by <E T="03">FT</E> to <E T="03">FC</E> is treated as a transfer of the property by <E T="03">A</E> to <E T="03">FC.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Transfer treated as transfer to trust.</HD> <P> The facts are the same as in <E T="03">Example 1,</E> except that <E T="03">FT</E> is not treated as having a U.S. beneficiary under § 1.679-2. Under this paragraph (f), <E T="03">A</E> is treated as having transferred the property to <E T="03">FT,</E> followed by a transfer of such property by <E T="03">FT</E> to <E T="03">FC. A</E> is not treated as the owner of <E T="03">FT</E> for purposes of § 1.679-1(a). For rules regarding the recognition of gain on the transfer, see section 684. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Transfer not treated as transfer to trust. A</HD> <P> creates and funds <E T="03">FT. FC</E> has outstanding solely 100 shares of common stock. <E T="03">FT</E> owns 50 shares of <E T="03">FC</E> stock, and <E T="03">A</E> owns the remaining 50 shares. On July 1, 2001, <E T="03">FT</E> and <E T="03">A</E> each transfer 1000X to <E T="03">FC. A</E> is able to demonstrate to the satisfaction of the Commissioner that <E T="03">A</E> 's transfer to <E T="03">FC</E> is properly attributable to <E T="03">A</E> 's ownership interest in <E T="03">FC.</E> Accordingly, under this paragraph (f), <E T="03">A</E> 's transfer to <E T="03">FC</E> is not treated as a transfer to <E T="03">FT.</E> </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-4</SECTNO> <SUBJECT>Exceptions to general rule.</SUBJECT> <P> (a) <E T="03">In general.</E> Section 1.679-1 does not apply to— </P> <P>(1) Any transfer of property to a foreign trust by reason of the death of the transferor;</P> <P>(2) Any transfer of property to a foreign trust described in sections 402(b), 404(a)(4), or 404A;</P> <P>(3) Any transfer of property to a foreign trust described in section 501(c)(3) (without regard to the requirements of section 508(a)); and</P> <P>(4) Any transfer of property to a foreign trust to the extent the transfer is for fair market value.</P> <P> (b) <E T="03">Transfers for fair market value</E> —(1) <E T="03">In general.</E> For purposes of this section, a transfer is for fair market value only to the extent of the value of property received from the trust, services rendered by the trust, or the right to use property of the trust. For example, rents, royalties, interest, and compensation paid to a trust are transfers for fair market value only to the extent that the payments reflect an arm's length price for the use of the property of, or for the services rendered by, the trust. For purposes of this determination, an interest in the trust is not property received from the trust. For purposes of this section, a distribution to a trust with respect to an interest held by such trust in an entity other than a trust or an interest in certain investment trusts described in § 301.7701-4(c) of this chapter, liquidating trusts described in § 301.7701-4(d) of this chapter, or environmental remediation trusts described in § 301.7701-4(e) of this chapter is considered to be a transfer for fair market value. </P> <P> (2) <E T="03">Special rule</E> —(i) <E T="03">Transfers for partial consideration.</E> For purposes of this section, if a person transfers property to a foreign trust in exchange for property having a fair market value that is less than the fair market value of the property transferred, the exception in paragraph (a)(4) of this section applies only to the extent of the fair market value of the property received. </P> <P> (ii) <E T="03">Example.</E> This paragraph (b) is illustrated by the following example: </P> <EXAMPLE> <PRTPAGE P="395"/> <HD SOURCE="HED">Example. A,</HD> <P> a U.S. citizen, transfers property that has a fair market value of 1000X to <E T="03">FT,</E> a foreign trust, in exchange for 600X of cash. Under this paragraph (b), § 1.679-1 applies with respect to the transfer of 400X (1000X less 600X) to <E T="03">FT.</E> </P> </EXAMPLE> <P> (c) <E T="03">Certain obligations not taken into account.</E> Solely for purposes of this section, in determining whether a transfer by a U.S. transferor that is a related person (as defined in § 1.679-1(c)(5)) with respect to the foreign trust is for fair market value, any obligation (as defined in § 1.679-1(c)(6)) of the trust or a related person (as defined in § 1.679-1(c)(5)) that is not a qualified obligation within the meaning of paragraph (d)(1) of this section shall not be taken into account. </P> <P> (d) <E T="03">Qualified obligations</E> —(1) <E T="03">In general.</E> For purposes of this section, an obligation is treated as a qualified obligation only if— </P> <P>(i) The obligation is reduced to writing by an express written agreement;</P> <P>(ii) The term of the obligation does not exceed five years (for purposes of determining the term of an obligation, the obligation's maturity date is the last possible date that the obligation can be outstanding under the terms of the obligation);</P> <P>(iii) All payments on the obligation are denominated in U.S. dollars;</P> <P>(iv) The yield to maturity is not less than 100 percent of the applicable Federal rate and not greater that 130 percent of the applicable Federal rate (the applicable Federal rate for an obligation is the applicable Federal rate in effect under section 1274(d) for the day on which the obligation is issued, as published in the Internal Revenue Bulletin (see § 601.601(d)(2) of this chapter));</P> <P>(v) The U.S. transferor extends the period for assessment of any income or transfer tax attributable to the transfer and any consequential income tax changes for each year that the obligation is outstanding, to a date not earlier than three years after the maturity date of the obligation (this extension is not necessary if the maturity date of the obligation does not extend beyond the end of the U.S. transferor's taxable year for the year of the transfer and is paid within such period); when properly executed and filed, such an agreement is deemed to be consented to for purposes of § 301.6501(c)-1(d) of this chapter; and</P> <P>(vi) The U.S. transferor reports the status of the loan, including principal and interest payments, on Form 3520 for every year that the loan is outstanding.</P> <P> (2) <E T="03">Additional loans.</E> If, while the original obligation is outstanding, the U.S. transferor or a person related to the trust (within the meaning of § 1.679-1(c)(5)) directly or indirectly obtains another obligation issued by the trust, or if the U.S. transferor directly or indirectly obtains another obligation issued by a person related to the trust, the original obligation is deemed to have the maturity date of any such subsequent obligation in determining whether the term of the original obligation exceeds the specified 5-year term. In addition, a series of obligations issued and repaid by the trust (or a person related to the trust) is treated as a single obligation if the transactions giving rise to the obligations are structured with a principal purpose to avoid the application of this provision. </P> <P> (3) <E T="03">Obligations that cease to be qualified.</E> If an obligation treated as a qualified obligation subsequently fails to be a qualified obligation (e.g., renegotiation of the terms of the obligation causes the term of the obligation to exceed five years), the U.S. transferor is treated as making a transfer to the trust in an amount equal to the original obligation's adjusted issue price (within the meaning of § 1.1275-1(b)) plus any accrued but unpaid qualified stated interest (within the meaning of § 1.1273-1(c)) as of the date of the subsequent event that causes the obligation to no longer be a qualified obligation. If the maturity date is extended beyond five years by reason of the issuance of a subsequent obligation by the trust (or person related to the trust), the amount of the transfer will not exceed the issue price of the subsequent obligation. The subsequent obligation is separately tested to determine if it is a qualified obligation. </P> <P> (4) <E T="03">Transfers resulting from failed qualified obligations.</E> In general, a transfer resulting from a failed qualified obligation is deemed to occur on the date of <PRTPAGE P="396"/> the subsequent event that causes the obligation to no longer be a qualified obligation. However, based on all of the facts and circumstances, the Commissioner may deem a transfer to have occurred on any date on or after the issue date of the original obligation. For example, if at the time the original obligation was issued, the transferor knew or had reason to know that the obligation would not be repaid, the Commissioner could deem the transfer to have occurred on the issue date of the original obligation. </P> <P> (5) <E T="03">Renegotiated loans.</E> Any loan that is renegotiated, extended, or revised is treated as a new loan, and any transfer of funds to a foreign trust after such renegotiation, extension, or revision under a pre-existing loan agreement is treated as a transfer subject to this section. </P> <P> (6) <E T="03">Principal repayments.</E> The payment of principal with respect to any obligation that is not treated as a qualified obligation under this paragraph is taken into account on and after the date of the payment in determining the portion of the trust attributable to the property transferred. </P> <P> (7) <E T="03">Examples.</E> The rules of this paragraph (d) are illustrated by the following examples. In the examples, <E T="03">A</E> and <E T="03">B</E> are U.S. residents and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Demand loan. A</HD> <P> transfers 500X to <E T="03">FT</E> in exchange for a demand note that permits <E T="03">A</E> to require repayment by <E T="03">FT</E> at any time. <E T="03">A</E> is a related person (as defined in § 1.679-1(c)(5)) with respect to <E T="03">FT.</E> Because <E T="03">FT's</E> obligation to <E T="03">A</E> could remain outstanding for more than five years, the obligation is not a qualified obligation within the meaning of paragraph (d) of this section and, pursuant to paragraph (c) of this section, it is not taken into account for purposes of determining whether <E T="03">A</E> 's transfer is eligible for the fair market value exception of paragraph (a)(4) of this section. Accordingly, § 1.679-1 applies with respect to the full 500X transfer to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Private annuity. A</HD> <P> transfers 4000X to <E T="03">FT</E> in exchange for an annuity from the foreign trust that will pay <E T="03">A</E> 100X per year for the rest of <E T="03">A</E> 's life. <E T="03">A</E> is a related person (as defined in § 1.679-1(c)(5)) with respect to <E T="03">FT.</E> Because <E T="03">FT</E> 's obligation to <E T="03">A</E> could remain outstanding for more than five years, the obligation is not a qualified obligation within the meaning of paragraph (d)(1) of this section and, pursuant to paragraph (c) of this section, it is not taken into account for purposes of determining whether <E T="03">A</E> 's transfer is eligible for the fair market value exception of paragraph (a)(4) of this section. Accordingly, § 1.679-1 applies with respect to the full 4000X transfer to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Loan to unrelated foreign trust. B</HD> <P> transfers 1000X to <E T="03">FT</E> in exchange for an obligation of the trust. The term of the obligation is fifteen years. <E T="03">B</E> is not a related person (as defined in § 1.679-1(c)(5)) with respect to <E T="03">FT.</E> Because <E T="03">B</E> is not a related person, the fair market value of the obligation received by <E T="03">B</E> is taken into account for purposes of determining whether <E T="03">B</E> 's transfer is eligible for the fair market value exception of paragraph (a)(4) of this section, even though the obligation is not a qualified obligation within the meaning of paragraph (d)(1) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Transfer for an obligation with term in excess of 5 years. A</HD> <P> transfers property that has a fair market value of 5000X to <E T="03">FT</E> in exchange for an obligation of the trust. The term of the obligation is ten years. <E T="03">A</E> is a related person (as defined in § 1.679-1(c)(5)) with respect to <E T="03">FT.</E> Because the term of the obligation is greater than five years, the obligation is not a qualified obligation within the meaning of paragraph (d)(1) of this section and, pursuant to paragraph (c) of this section, it is not taken into account for purposes of determining whether <E T="03">A</E> 's transfer is eligible for the fair market value exception of paragraph (a)(4) of this section. Accordingly, § 1.679-1 applies with respect to the full 5000X transfer to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Transfer for a qualified obligation.</HD> <P> The facts are the same as in <E T="03">Example 4,</E> except that the term of the obligation is 3 years. Assuming the other requirements of paragraph (d)(1) of this section are satisfied, the obligation is a qualified obligation and its adjusted issue price is taken into account for purposes of determining whether <E T="03">A</E> 's transfer is eligible for the fair market value exception of paragraph (a)(4) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6. Effect of subsequent obligation on original obligation. A</HD> <P> transfers property that has a fair market value of 1000X to <E T="03">FT</E> in exchange for an obligation that satisfies the requirements of paragraph (d)(1) of this section. <E T="03">A</E> is a related person (as defined in § 1.679-1(c)(5)) with respect to <E T="03">FT.</E> Two years later, <E T="03">A</E> transfers an additional 2000X to <E T="03">FT</E> and receives another obligation from <E T="03">FT</E> that has a maturity date four years from the date that the second obligation was issued. Under paragraph (d)(2) of this section, the original obligation is deemed to have the maturity date of the second obligation. Under paragraph (a) of this section, <E T="03">A</E> is treated as having made a transfer in an amount equal to the original obligation's adjusted issue price (within the meaning of § 1.1275-1(b)) plus any accrued but unpaid qualified stated interest (within the meaning of § 1.1273-1(c)) as of the <PRTPAGE P="397"/> date of issuance of the second obligation. The second obligation is tested separately to determine whether it is a qualified obligation for purposes of applying paragraph (a) of this section to the second transfer. </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-5</SECTNO> <SUBJECT>Pre-immigration trusts.</SUBJECT> <P> (a) <E T="03">In general.</E> If a nonresident alien individual becomes a U.S. person and the individual has a residency starting date (as determined under section 7701(b)(2)(A)) within 5 years after directly or indirectly transferring property to a foreign trust (the original transfer), the individual is treated as having transferred to the trust on the residency starting date an amount equal to the portion of the trust attributable to the property transferred by the individual in the original transfer. </P> <P> (b) <E T="03">Special rules</E> —(1) <E T="03">Change in grantor trust status.</E> For purposes of paragraph (a) of this section, if a nonresident alien individual who is treated as owning any portion of a trust under the provisions of subpart E of part I of subchapter J, chapter 1 of the Internal Revenue Code, subsequently ceases to be so treated, the individual is treated as having made the original transfer to the foreign trust immediately before the trust ceases to be treated as owned by the individual. </P> <P> (2) <E T="03">Treatment of undistributed income.</E> For purposes of paragraph (a) of this section, the property deemed transferred to the foreign trust on the residency starting date includes undistributed net income, as defined in section 665(a), attributable to the property deemed transferred. Undistributed net income for periods before the individual's residency starting date is taken into account only for purposes of determining the amount of the property deemed transferred. </P> <P> (c) <E T="03">Examples.</E> The rules of this section are illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Nonresident alien becomes resident alien.</HD> <P> On January 1, 2002, <E T="03">A,</E> a nonresident alien individual, transfers property to a foreign trust, <E T="03">FT.</E> On January 1, 2006, <E T="03">A</E> becomes a resident of the United States within the meaning of section 7701(b)(1)(A) and has a residency starting date of January 1, 2006, within the meaning of section 7701(b)(2)(A). Under paragraph (a) of this section, <E T="03">A</E> is treated as a U.S. transferor and is deemed to transfer the property to <E T="03">FT</E> on January 1, 2006. Under paragraph (b)(2) of this section, the property deemed transferred to <E T="03">FT</E> on January 1, 2006, includes the undistributed net income of the trust, as defined in section 665(a), attributable to the property originally transferred. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Nonresident alien loses power to revest property.</HD> <P> On January 1, 2002, <E T="03">A,</E> a nonresident alien individual, transfers property to a foreign trust, <E T="03">FT. A</E> has the power to revest absolutely in himself the title to such property transferred and is treated as the owner of the trust pursuant to sections 676 and 672(f). On January 1, 2008, the terms of <E T="03">FT</E> are amended to remove <E T="03">A'</E> s power to revest in himself title to the property transferred, and <E T="03">A</E> ceases to be treated as the owner of <E T="03">FT.</E> On January 1, 2010, <E T="03">A</E> becomes a resident of the United States. Under paragraph (b)(1) of this section, for purposes of paragraph (a) of this section <E T="03">A</E> is treated as having originally transferred the property to <E T="03">FT</E> on January 1, 2008. Because this date is within five years of <E T="03">A</E> 's residency starting date, <E T="03">A</E> is deemed to have made a transfer to the foreign trust on January 1, 2010, his residency starting date. Under paragraph (b)(2) of this section, the property deemed transferred to the foreign trust on January 1, 2010, includes the undistributed net income of the trust, as defined in section 665(a), attributable to the property deemed transferred. </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-6</SECTNO> <SUBJECT>Outbound migrations of domestic trusts.</SUBJECT> <P> (a) <E T="03">In general.</E> Subject to the provisions of paragraph (b) of this section, if an individual who is a U.S. person transfers property to a trust that is not a foreign trust, and such trust becomes a foreign trust while the U.S. person is alive, the U.S. individual is treated as a U.S. transferor and is deemed to transfer the property to a foreign trust on the date the domestic trust becomes a foreign trust. </P> <P> (b) <E T="03">Amount deemed transferred.</E> For purposes of paragraph (a) of this section, the property deemed transferred to the trust when it becomes a foreign trust includes undistributed net income, as defined in section 665(a), attributable to the property previously transferred. Undistributed net income for periods prior to the migration is taken into account only for purposes of determining the portion of the trust that is attributable to the property transferred by the U.S. person. </P> <P> (c) <E T="03">Example.</E> The following example illustrates the rules of this section. For <PRTPAGE P="398"/> purposes of the example, <E T="03">A</E> is a resident alien, <E T="03">B</E> is <E T="03">A</E> 's son, who is a resident alien, and <E T="03">DT</E> is a domestic trust. The example is as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example. Outbound migration of domestic trust.</HD> <P> On January 1, 2002, <E T="03">A</E> transfers property to <E T="03">DT,</E> for the benefit of <E T="03">B.</E> On January 1, 2003, <E T="03">DT</E> acquires a foreign trustee who has the power to determine whether and when distributions will be made to <E T="03">B.</E> Under section 7701(a)(30)(E) and § 301.7701-7(d)(ii)(A) of this chapter, <E T="03">DT</E> becomes a foreign trust on January 1, 2003. Under paragraph (a) of this section, <E T="03">A</E> is treated as transferring property to a foreign trust on January 1, 2003. Under paragraph (b) of this section, the property deemed transferred to the trust when it becomes a foreign trust includes undistributed net income, as defined in section 665(a), attributable to the property deemed transferred. </P> </EXAMPLE> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.679-7</SECTNO> <SUBJECT>Effective dates.</SUBJECT> <P> (a) <E T="03">In general.</E> Except as provided in paragraph (b) of this section, the rules of §§ 1.679-1, 1.679-2, 1.679-3, and 1.679-4 apply with respect to transfers after August 7, 2000. </P> <P> (b) <E T="03">Special rules.</E> (1) The rules of § 1.679-4(c) and (d) apply to an obligation issued after February 6, 1995, whether or not in accordance with a pre-existing arrangement or understanding. For purposes of the rules of § 1.679-4(c) and (d), if an obligation issued on or before February 6, 1995, is modified after that date, and the modification is a significant modification within the meaning of § 1.1001-3, the obligation is treated as if it were issued on the date of the modification. However, the penalty provided in section 6677 applies only to a failure to report transfers in exchange for obligations issued after August 20, 1996. </P> <P>(2) The rules of § 1.679-5 apply to persons whose residency starting date is after August 7, 2000.</P> <P>(3) The rules of § 1.679-6 apply to trusts that become foreign trusts after August 7, 2000.</P> <CITA>[T.D. 8955, 66 FR 37889, July 20, 2001]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">miscellaneous</HD> <SECTION> <SECTNO>§ 1.681(a)-1</SECTNO> <SUBJECT>Limitation on charitable contributions deductions of trusts; scope of section 681.</SUBJECT> <P>Under section 681, the unlimited charitable contributions deduction otherwise allowable to a trust under section 642(c) is, in general, subject to percentage limitations, corresponding to those applicable to contributions by an individual under section 170(b)(1) (A) and (B), under the following circumstances;</P> <P>(a) To the extent that the deduction is allocable to “unrelated business income”;</P> <P>(b) For taxable years beginning before January 1, 1970, if the trust has engaged in a prohibited transaction;</P> <P>(c) For taxable years beginning before January 1, 1970, if income is accumulated for a charitable purpose and the accumulation is (1) unreasonable, (2) substantially diverted to a noncharitable purpose, or (3) invested against the interests of the charitable beneficiaries.</P> <FP>Further, if the circumstance set forth in paragraph (a) or (c) of this section is applicable, the deduction is limited to income actually paid out for charitable purposes, and is not allowed for income only set aside or to be used for those purposes. If the circumstance set forth in paragraph (b) of this section is applicable, deductions for contributions to the trust may be disallowed. The provisions of section 681 are discussed in detail in §§ 1.681(a)-2 through 1.681(c)-1. For definition of the term “income”, see section 643(b) and § 1.643(b)-1.</FP> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7428, 41 FR 34627, Aug. 16, 1976]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.681(a)-2</SECTNO> <SUBJECT>Limitation on charitable contributions deduction of trusts with trade or business income.</SUBJECT> <P> (a) <E T="03">In general.</E> No charitable contributions deduction is allowable to a trust under section 642(c) for any taxable year for amounts allocable to the trust's unrelated business income for the taxable year. For the purpose of section 681(a) the term <E T="03">unrelated business income</E> of a trust means an amount which would be computed as the trust's unrelated business taxable income <PRTPAGE P="399"/> under section 512 and the regulations thereunder, if the trust were an organization exempt from tax under section 501(a) by reason of section 501(c)(3). For the purpose of the computation under section 512, the term <E T="03">unrelated trade or business</E> includes a trade or business carried on by a partnership of which a trust is a member, as well as one carried on by the trust itself. While the charitable contributions deduction under section 642(c) is entirely disallowed by section 681(a) for amounts allocable to “unrelated business income”, a partial deduction is nevertheless allowed for such amounts by the operation of section 512(b)(11), as illustrated in paragraphs (b) and (c) of this section. This partial deduction is subject to the percentage limitations applicable to contributions by an individual under section 170(b)(1) (A) and (B), and is not allowed for amounts set aside or to be used for charitable purposes but not actually paid out during the taxable year. Charitable contributions deductions otherwise allowable under section 170, 545(b)(2), or 642(c) for contributions to a trust are not disallowed solely because the trust has unrelated business income. </P> <P> (b) <E T="03">Determination of amounts allocable to unrelated business income.</E> In determining the amount for which a charitable contributions deduction would otherwise be allowable under section 642(c) which are allocable to unrelated business income, and therefore not allowable as a deduction, the following steps are taken: </P> <P>(1) There is first determined the amount which would be computed as the trust's unrelated business taxable income under section 512 and the regulations thereunder if the trust were an organization exempt from tax under section 501(a) by reason of section 501(c)(3), but without taking the charitable contributions deduction allowed under section 512(b)(11).</P> <P>(2) The amount for which a charitable contributions deduction would otherwise be allowable under section 642(c) is then allocated between the amount determined in subparagraph (1) of this paragraph and any other income of the trust. Unless the facts clearly indicate to the contrary, the allocation to the amount determined in subparagraph (1) of this paragraph is made on the basis of the ratio (but not in excess of 100 percent) of the amount determined in subparagraph (1) of this paragraph to the taxable income of the trust, determined without the deduction for personal exemption under section 642(b), the charitable contributions deduction under section 642(c), or the deduction for distributions to beneficiaries under section 661(a).</P> <P>(3) The amount for which a charitable contributions deduction would otherwise be allowable under section 642(c) which is allocable to unrelated business income as determined in subparagraph (2) of this paragraph, and therefore not allowable as a deduction, is the amount determined in subparagraph (2) of this paragraph reduced by the charitable contributions deduction which would be allowed under section 512(b)(11) if the trust were an organization exempt from tax under section 501(a) by reason of section 501(c)(3).</P> <P> (c) <E T="03">Examples.</E> (1) The application of this section may be illustrated by the following examples, in which it is assumed that the Y charity is not a charitable organization qualifying under section 170(b)(1)(A) (see subparagraph (2) of this paragraph): </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>The X trust has income of $50,000. There is included in this amount a net profit of $31,000 from the operation of a trade or business. The trustee is required to pay half of the trust income to A, an individual, and the balance of the trust income to the Y charity, an organization described in section 170(c)(2). The trustee pays each beneficiary $25,000. Under these facts, the unrelated business income of the trust (computed before the charitable contributions deduction which would be allowed under section 512(b)(11)) is $30,000 ($31,000 less the deduction of $1,000 allowed by section 512(b)(12)). The deduction otherwise allowable under section 642(c) is $25,000, the amount paid to the Y charity. The portion allocable to the unrelated business income (computed as prescribed in paragraph (b)(2) of this section) is $15,000, that is, an amount which bears the same ratio to $25,000 as $30,000 bears to $50,000. The portion allocable to the unrelated business income, and therefore disallowed as a deduction, is $15,000 reduced by $6,000 (20 percent of $30,000, the charitable contributions deduction which would be allowable under section 512(b)(11)), or $9,000.</P> </EXAMPLE> <EXAMPLE> <PRTPAGE P="400"/> <HD SOURCE="HED">Example 2.</HD> <P>Assume the same facts as in example 1, except that the trustee has discretion as to the portion of the trust income to be paid to each beneficiary, and the trustee pays $40,000 to A and $10,000 to the Y charity. The deduction otherwise allowable under section 642(c) is $10,000. The portion allocable to the unrelated business income computed as prescribed in paragraph (b)(2) of this section is $6,000, that is, an amount which bears the same ratio to $10,000 as $30,000 bears to $50,000. Since this amount does not exceed the charitable contributions deduction which would be allowable under section 512(b)(11) ($6,000, determined as in example 1), no portion of it is disallowed as a deduction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>Assume the same facts as in example 1, except that the terms of the trust instrument require the trustee to pay to the Y charity the trust income, if any, derived from the trade or business, and to pay to A all the trust income derived from other sources. The trustee pays $31,000 to the Y charity and $19,000 to A. The deduction otherwise allowable under section 642(c) is $31,000. Since the entire income from the trade or business is paid to Y charity, the amount allocable to the unrelated business income computed before the charitable contributions deduction under section 512(b)(11) is $30,000 ($31,000 less the deduction of $1,000 allowed by section 512(b)(12)). The amount allocable to the unrelated business income and therefore disallowed as a deduction is $24,000 ($30,000 less $6,000).</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>(i) Under the terms of the trust, the trustee is required to pay half of the trust income to A, an individual, for his life, and the balance of the trust income to the Y charity, an organization described in section 170(c)(2). Capital gains are allocable to corpus and upon A's death the trust is to terminate and the corpus is to be distributed to the Y charity. The trust has taxable income of $50,000 computed without any deduction for personal exemption, charitable contributions, or distributions. The amount of $50,000 includes $10,000 capital gains, $30,000 ($31,000 less the $1,000 deduction allowed under section 512(b)(12)) unrelated business income (computed before the charitable contributions deduction which would be allowed under section 512(b)(11)) and other income of $9,000. The trustee pays each beneficiary $20,000.</P> <P>(ii) The deduction otherwise allowable under section 642(c) is $30,000 ($20,000 paid to Y charity and $10,000 capital gains allocated to corpus and permanently set aside for charitable purposes). The portion allocable to the unrelated business income is $15,000, that is, an amount which bears the same ratio to $20,000 (the amount paid to Y charity) as $30,000 bears to $40,000 ($50,000 less $10,000 capital gains allocable to corpus). The portion allocable to the unrelated business income, and therefore disallowed as a deduction, is $15,000 reduced by $6,000 (the charitable contributions deduction which would be allowable under section 512(b)(11)), or $9,000.</P> </EXAMPLE> <P>(2) If, in the examples in subparagraph (1) of this paragraph, the Y charity were a charitable organization qualifying under section 170(b)(1)(A), then the deduction allowable under section 512(b)(11) would be computed at a rate of 30 percent.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6605, 27 FR 8097, Aug. 15, 1962]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.681(b)-1</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <P>For disallowance of certain charitable, etc., deductions otherwise allowable under section 642(c), see sections 508(d) and 4948(c)(4). See also 26 CFR 1.681(b)-1 and 1.681(c)-1 (rev. as of Apr. 1, 1974) for provisions applying before January 1, 1970.</P> <CITA>[T.D. 7428, 41 FR 34627, Aug. 16, 1976]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.682(a)-1</SECTNO> <SUBJECT>Income of trust in case of divorce, etc.</SUBJECT> <P> (a) <E T="03">In general.</E> (1) Section 682(a) provides rules in certain cases for determining the taxability of income of trusts as between spouses who are divorced, or who are separated under a decree of separate maintenance or a written separation agreement. In such cases, the spouse actually entitled to receive payments from the trust is considered the beneficiary rather than the spouse in discharge of whose obligations the payments are made, except to the extent that the payments are specified to be for the support of the obligor spouse's minor children in the divorce or separate maintenance decree, the separation agreement or the governing trust instrument. For convenience, the beneficiary spouse will hereafter in this section and in § 1.682(b)-1 be referred to as the “wife” and the obligor spouse from whom she is divorced or legally separated as the “husband”. (See section 7701(a)(17).) Thus, under section 682(a) income of a trust: </P> <P>(i) Which is paid, credited, or required to be distributed to the wife in a taxable year of the wife, and</P> <P> (ii) Which, except for the provisions of section 682, would be includible in the gross income of her husband, <PRTPAGE P="401"/> </P> <FP>is includible in her gross income and is not includible in his gross income.</FP> <P>(2) Section 682(a) does not apply in any case to which section 71 applies. Although section 682(a) and section 71 seemingly cover some of the same situations, there are important differences between them. Thus, section 682(a) applies, for example, to a trust created before the divorce or separation and not in contemplation of it, while section 71 applies only if the creation of the trust or payments by a previously created trust are in discharge of an obligation imposed upon or assumed by the husband (or made specific) under the court order or decree divorcing or legally separating the husband and wife, or a written instrument incident to the divorce status or legal separation status, or a written separation agreement. If section 71 applies, it requires inclusion in the wife's income of the full amount of periodic payments received attributable to property in trust (whether or not out of trust income), while, if section 71 does not apply, section 682(a) requires amounts paid, credited, or required to be distributed to her to be included only to the extent they are includible in the taxable income of a trust beneficiary under subparts A through D (section 641 and following), part I, subchapter J, chapter 1 of the Code.</P> <P>(3) Section 682(a) is designed to produce uniformity as between cases in which, without section 682(a), the income of a so-called alimony trust would be taxable to the husband because of his continuing obligation to support his wife or former wife, and other cases in which the income of a so-called alimony trust is taxable to the wife or former wife because of the termination of the husband's obligation. Furthermore, section 682(a) taxes trust income to the wife in all cases in which the husband would otherwise be taxed not only because of the discharge of his alimony obligation but also because of his retention of control over the trust income or corpus. Section 682(a) applies whether the wife is the beneficiary under the terms of the trust instrument or is an assignee of a beneficiary.</P> <P>(4) The application of section 682(a) may be illustrated by the following examples, in which it is assumed that both the husband and wife make their income tax returns on a calendar year basis:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>Upon the marriage of H and W, H irrevocably transfers property in trust to pay the income to W for her life for support, maintenance, and all other expenses. Some years later, W obtains a legal separation from H under an order of court. W, relying upon the income from the trust payable to her, does not ask for any provision for her support and the decree recites that since W is adequately provided for by the trust, no further provision is being made for her. Under these facts, section 682(a), rather than section 71, is applicable. Under the provisions of section 682(a), the income of the trust which becomes payable to W after the order of separation is includible in her income and is deductible by the trust. No part of the income is includible in H's income or deductible by him.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>H transfers property in trust for the benefit of W, retaining the power to revoke the trust at any time. H, however, promises that if he revokes the trust he will transfer to W property in the value of $100,000. The transfer in trust and the agreement were not incident to divorce, but some years later W divorces H. The court decree is silent as to alimony and the trust. After the divorce, income of the trust which becomes payable to W is taxable to her, and is not taxable to H or deductible by him. If H later terminates the trust and transfers $100,000 of property to W, the $100,000 is not income to W nor deductible by H.</P> </EXAMPLE> <P> (b) <E T="03">Alimony trust income designated for support of minor children.</E> Section 682(a) does not require the inclusion in the wife's income of trust income which the terms of the divorce or separate maintenance decree, separation agreement, or trust instrument fix in terms of an amount of money or a portion of the income as a sum which is payable for the support of minor children of the husband. The portion of the income which is payable for the support of the minor children is includible in the husband's income. If in such a case trust income fixed in terms of an amount of money is to be paid but a lesser amount becomes payable, the trust income is considered to be payable for the support of the husband's minor children to the extent of the sum which would be payable for their support out of the originally specified amount of trust income. This rule is similar to <PRTPAGE P="402"/> that provided in the case of periodic payments under section 71. See § 1.71-1. </P> </SECTION> <SECTION> <SECTNO>§ 1.682(b)-1</SECTNO> <SUBJECT>Application of trust rules to alimony payments.</SUBJECT> <P>(a) For the purpose of the application of subparts A through D (section 641 and following), part I, subchapter J, chapter 1 of the Code, the wife described in section 682 or section 71 who is entitled to receive payments attributable to property in trust is considered a beneficiary of the trust, whether or not the payments are made for the benefit of the husband in discharge of his obligations. A wife treated as a beneficiary of a trust under this section is also treated as the beneficiary of such trust for purposes of the tax imposed by section 56 (relating to the minimum tax for tax preferences). For rules relating to the treatment of items of tax preference with respect to a beneficiary of a trust, see § 1.58-3.</P> <P>(b) A periodic payment includible in the wife's gross income under section 71 attributable to property in trust is included in full in her gross income in her taxable year in which any part is required to be included under section 652 or 662. Assume, for example, in a case in which both the wife and the trust file income tax returns on the calendar year basis, that an annuity of $5,000 is to be paid to the wife by the trustee every December 31 (out of trust income if possible and, if not, out of corpus) pursuant to the terms of a divorce decree. Of the $5,000 distributable on December 31, 1954, $4,000 is payable out of income and $1,000 out of corpus. The actual distribution is made in 1955. Although the periodic payment is received by the wife in 1955, since under section 662 the $4,000 income distributable on December 31, 1954, is to be included in the wife's income for 1954, the $1,000 payment out of corpus is also to be included in her income for 1954.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7564, 43 FR 40495, Sept. 12, 1978]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.682(c)-1</SECTNO> <SUBJECT>Definitions.</SUBJECT> <P>For definitions of the terms “husband” and “wife” as used in section 682, see section 7701(a)(17) and the regulations thereunder.</P> </SECTION> <SECTION> <SECTNO>§ 1.683-1</SECTNO> <SUBJECT>Applicability of provisions; general rule.</SUBJECT> <P>Part I (section 641 and following), subchapter J, chapter 1 of the Code, applies to estates and trusts and to beneficiaries only with respect to taxable years which begin after December 31, 1953, and end after August 16, 1954 the date of enactment of the Internal Revenue Code of 1954. In the case of an estate or trust, the date on which a trust is created or amended or on which an estate commences, and the taxable years of beneficiaries, grantors, or decedents concerned are immaterial. This provision applies equally to taxable years of normal and of abbreviated length.</P> </SECTION> <SECTION> <SECTNO>§ 1.683-2</SECTNO> <SUBJECT>Exceptions.</SUBJECT> <P>(a) In the case of any beneficiary of an estate or trust, sections 641 through 682 do not apply to any amount paid, credited, or to be distributed by an estate or trust in any taxable year of the estate or trust which begins before January 1, 1954, or which ends before August 17, 1954. Whether an amount so paid, credited, or to be distributed is to be included in the gross income of a beneficiary is determined with reference to the Internal Revenue Code of 1939. Thus, if a trust in its fiscal year ending June 30, 1954, distributed its current income to a beneficiary on June 30, 1954, the extent to which the distribution is includible in the beneficiary's gross income for his taxable year (the calendar year 1954) and the character of such income will be determined under the Internal Revenue Code of 1939. The Internal Revenue Code of 1954, however, determines the beneficiary's tax liability for a taxable year of the beneficiary to which such Code applies, with respect even to gross income of the beneficiary determined under the Internal Revenue Code of 1939 in accordance with this paragraph. Accordingly, the beneficiary is allowed credits and deductions pursuant to the Internal Revenue Code of 1954 for a taxable year governed by the Internal Revenue Code of 1954. See subparagraph (ii) of example (1) in paragraph (c) of this section.</P> <P> (b) For purposes of determining the time of receipt of dividends under sections 34 (for purposes of the credit for <PRTPAGE P="403"/> dividends received on or before December 31, 1964) and 116, the dividends paid, credited, or to be distributed to a beneficiary are deemed to have been received by the beneficiary ratably on the same dates that the dividends were received by the estate or trust. </P> <P>(c) The application of this section may be illustrated by the following examples:</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>(i) A trust, reporting on the fiscal year basis, receives in its taxable year ending November 30, 1954, dividends on December 3, 1953, and April 3, July 5, and October 4, 1954. It distributes the dividends to A, its sole beneficiary (who reports on the calendar year basis) on November 30, 1954. Since the trust has received dividends in a taxable year ending after July 31, 1954, it will receive a dividend credit under section 34 with respect to dividends received which otherwise qualify under that section, in this case dividends received on October 4, 1954 (i. e., received after July 31, 1954). See section 7851(a)(1)(C). This credit, however, is reduced to the extent the dividends are allocable to the beneficiary as a result of income being paid, credited, or required to be distributed to him. The trust will also be permitted the dividend exclusion under section 116, since it received its dividends in a taxable year ending after July 31, 1954.</P> <P>(ii) A is entitled to the section 34 credit with respect to the portion of the October 4, 1954, dividends which is distributed to him even though the determination of whether the amount distributed to him is includible in his gross income is made under the Internal Revenue Code of 1939. The credit allowable to the trust is reduced proportionately to the extent A is deemed to have received the October 4 dividends. A is not entitled to a credit with respect to the dividends received by the trust on December 3, 1953, and April 3, and July 5, 1954, because, although he receives after July 31, 1954, the distribution resulting from the trust's receipt of dividends, he is deemed to have received the dividends ratably with the trust on dates prior to July 31, 1954. In determining the exclusion under section 116 to which he is entitled, all the dividends received by the trust in 1954 and distributed to him are aggregated with any other dividends received by him in 1954, since he is deemed to have received such dividends in 1954 and therefore within a taxable year ending after July 31, 1954. He is not, however, entitled to the exclusion for the dividends received by the trust in December 1953.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>(i) A simple trust reports on the basis of a fiscal year ending July 31. It receives dividends on October 3, 1953, and January 4, April 3, and July 5, 1954. It distributes the dividends to A, its sole beneficiary, on September 1, 1954. The trust, receiving dividends in a taxable year ending prior to August 17, 1954, is entitled neither to the dividend received credit under section 34 nor the dividend exclusion under section 116.</P> <P>(ii) A (reporting on the calendar year basis) is not entitled to the section 34 credit, because, although he receives after July 31, 1954, the distribution resulting from the trust's receipt of dividends, he is deemed to have received the dividends ratably with the trust, that is, on October 3, 1953, and January 4, April 3, and July 5, 1954. He is, however, entitled to the section 116 exclusion with respect to the dividends received by the trust in 1954 (along with other dividends received by him in 1954) and distributed to him, since he is deemed to have received such dividends on January 4, April 3, and July 5, 1954, each a date in this taxable year ending after July 31, 1954. He is entitled to no exclusion for the dividends received by the trust on October 3, 1953, since he is deemed to receive the resulting distribution on the same date, which falls within a taxable year of his which ends before August 1, 1954, although he is required to include the October 1953 dividends in his 1954 income. See section 164 of the Internal Revenue Code of 1939.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>A simple trust on a fiscal year ending July 31, 1954, receives dividends August 5 and November 4, 1953. It distributes the dividends to A, its sole beneficiary (who is on a calendar year basis), on September 1, 1954. Neither the trust nor A is entitled to a credit under section 34 or an exclusion under section 116.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6777, 29 FR 17809, Dec. 16, 1964]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.683-3</SECTNO> <SUBJECT>Application of the 65-day rule of the Internal Revenue Code of 1939.</SUBJECT> <P>If an amount is paid, credited, or to be distributed in the first 65 days of the first taxable year of an estate or trust (heretofore subject to the provisions of the Internal Revenue Code of 1939) to which the Internal Revenue Code of 1954 applies and the amount would be treated, if the Internal Revenue Code of 1939 were applicable, as if paid, credited, or to be distributed on the last day of the preceding taxable year, sections 641 through 682 do not apply to the amount. The amount so paid, credited, or to be distributed is taken into account as provided in the Internal Revenue Code of 1939. See 26 CFR (1939) 39.162-2 (c) and (d) (Regulations 118).</P> </SECTION> <SECTION> <PRTPAGE P="404"/> <SECTNO>§ 1.684-1</SECTNO> <SUBJECT>Recognition of gain on transfers to certain foreign trusts and estates.</SUBJECT> <P> (a) <E T="03">Immediate recognition of gain</E> —(1) <E T="03">In general.</E> Any U.S. person who transfers property to a foreign trust or foreign estate shall be required to recognize gain at the time of the transfer equal to the excess of the fair market value of the property transferred over the adjusted basis (for purposes of determining gain) of such property in the hands of the U.S. transferor unless an exception applies under the provisions of § 1.684-3. The amount of gain recognized is determined on an asset-by-asset basis. </P> <P> (2) <E T="03">No recognition of loss.</E> Under this section a U.S. person may not recognize loss on the transfer of an asset to a foreign trust or foreign estate. A U.S. person may not offset gain realized on the transfer of an appreciated asset to a foreign trust or foreign estate by a loss realized on the transfer of a depreciated asset to the foreign trust or foreign estate. </P> <P> (b) <E T="03">Definitions.</E> The following definitions apply for purposes of this section: </P> <P> (1) <E T="03">U.S. person.</E> The term <E T="03">U.S. person</E> means a United States person as defined in section 7701(a)(30), and includes a nonresident alien individual who elects under section 6013(g) to be treated as a resident of the United States. </P> <P> (2) <E T="03">U.S. transferor.</E> The term <E T="03">U.S. transferor</E> means any U.S. person who makes a transfer (as defined in § 1.684-2) of property to a foreign trust or foreign estate. </P> <P> (3) <E T="03">Foreign trust.</E> Section 7701(a)(31)(B) defines foreign trust. See also § 301.7701-7 of this chapter. </P> <P> (4) <E T="03">Foreign estate.</E> Section 7701(a)(31)(A) defines foreign estate. </P> <P> (c) <E T="03">Reporting requirements.</E> A U.S. person who transfers property to a foreign trust or foreign estate must comply with the reporting requirements under section 6048. </P> <P> (d) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In all examples, <E T="03">A</E> is a U.S. person and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Transfer to foreign trust. A</HD> <P> transfers property that has a fair market value of 1000X to <E T="03">FT. A</E> 's adjusted basis in the property is 400X. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT.</E> Under paragraph (a)(1) of this section, <E T="03">A</E> recognizes gain at the time of the transfer equal to 600X. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Transfer of multiple properties. A</HD> <P> transfers property Q, with a fair market value of 1000X, and property R, with a fair market value of 2000X, to <E T="03">FT.</E> At the time of the transfer, <E T="03">A</E> 's adjusted basis in property Q is 700X, and <E T="03">A</E> 's adjusted basis in property R is 2200X. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT.</E> Under paragraph (a)(1) of this section, <E T="03">A</E> recognizes the 300X of gain attributable to property Q. Under paragraph (a)(2) of this section, <E T="03">A</E> does not recognize the 200X of loss attributable to property R, and may not offset that loss against the gain attributable to property Q. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Transfer for less than fair market value. A</HD> <P> transfers property that has a fair market value of 1000X to <E T="03">FT</E> in exchange for 400X of cash. <E T="03">A</E> 's adjusted basis in the property is 200X. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT.</E> Under paragraph (a)(1) of this section, <E T="03">A</E> recognizes gain at the time of the transfer equal to 800X. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Exchange of property for private annuity. A</HD> <P> transfers property that has a fair market value of 1000X to <E T="03">FT</E> in exchange for <E T="03">FT</E> 's obligation to pay A 50X per year for the rest of <E T="03">A</E> 's life. <E T="03">A</E> 's adjusted basis in the property is 100X. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT. A</E> is required to recognize gain equal to 900X immediately upon transfer of the property to the trust. This result applies even though <E T="03">A</E> might otherwise have been allowed to defer recognition of gain under another provision of the Internal Revenue Code. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Transfer of property to related foreign trust in exchange for qualified obligation. A</HD> <P> transfers property that has a fair market value of 1000X to <E T="03">FT</E> in exchange for <E T="03">FT</E> 's obligation to make payments to <E T="03">A</E> during the next four years. <E T="03">FT</E> is related to <E T="03">A</E> as defined in § 1.679-1(c)(5). The obligation is treated as a qualified obligation within the meaning of § 1.679-4(d), and no person is treated as owning any portion of <E T="03">FT. A</E> 's adjusted basis in the property is 100X. <E T="03">A</E> is required to recognize gain equal to 900X immediately upon transfer of the property to the trust. This result applies even though <E T="03">A</E> might otherwise have been allowed to defer recognition of gain under another provision of the Internal Revenue Code. Section 1.684-3(d) provides rules relating to transfers for fair market value to unrelated foreign trusts. </P> </EXAMPLE> <CITA>[T.D. 8956, 66 FR 37899, July 20, 2001]</CITA> </SECTION> <SECTION> <PRTPAGE P="405"/> <SECTNO>§ 1.684-2</SECTNO> <SUBJECT>Transfers.</SUBJECT> <P> (a) <E T="03">In general.</E> A transfer means a direct, indirect, or constructive transfer. </P> <P> (b) <E T="03">Indirect transfers</E> —(1) <E T="03">In general.</E> Section 1.679-3(c) shall apply to determine if a transfer to a foreign trust or foreign estate, by any person, is treated as an indirect transfer by a U.S. person to the foreign trust or foreign estate. </P> <P> (2) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (b). In all examples, <E T="03">A</E> is a U.S. citizen, <E T="03">FT</E> is a foreign trust, and <E T="03">I</E> is <E T="03">A</E> 's uncle, who is a nonresident alien. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Principal purpose of tax avoidance. A</HD> <P> creates and funds <E T="03">FT</E> for the benefit of <E T="03">A</E> 's cousin, who is a nonresident alien. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT.</E> In 2004, <E T="03">A</E> decides to transfer additional property with a fair market value of 1000X and an adjusted basis of 600X to <E T="03">FT.</E> Pursuant to a plan with a principal purpose of avoiding the application of section 684, <E T="03">A</E> transfers the property to <E T="03">I. I</E> subsequently transfers the property to <E T="03">FT.</E> Under paragraph (b) of this section and § 1.679-3(c), <E T="03">A</E> is treated as having transferred the property to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. U.S. person unable to demonstrate that intermediary acted independently. A</HD> <P> creates and funds <E T="03">FT</E> for the benefit of <E T="03">A</E> 's cousin, who is a nonresident alien. <E T="03">FT</E> has no U.S. beneficiary within the meaning of § 1.679-2, and no person is treated as owning any portion of <E T="03">FT.</E> On July 1, 2004, <E T="03">A</E> transfers property with a fair market value of 1000X and an adjusted basis of 300X to <E T="03">I,</E> a foreign person. On January 1, 2007, at a time when the fair market value of the property is 1100X, <E T="03">I</E> transfers the property to <E T="03">FT. A</E> is unable to demonstrate to the satisfaction of the Commissioner, under § 1.679-3(c)(2)(ii), that <E T="03">I</E> acted independently of <E T="03">A</E> in making the transfer to <E T="03">FT.</E> Under paragraph (b) of this section and § 1.679-3(c), <E T="03">A</E> is treated as having transferred the property to <E T="03">FT.</E> Under paragraph (b) of this section and § 1.679-3(c)(3), <E T="03">I</E> is treated as an agent of <E T="03">A,</E> and the transfer is deemed to have been made on January 1, 2007. Under § 1.684-1(a), <E T="03">A</E> recognizes gain equal to 800X on that date. </P> </EXAMPLE> <P> (c) <E T="03">Constructive transfers.</E> Section 1.679-3(d) shall apply to determine if a transfer to a foreign trust or foreign estate is treated as a constructive transfer by a U.S. person to the foreign trust or foreign estate. </P> <P> (d) <E T="03">Transfers by certain trusts</E> —(1) <E T="03">In general.</E> If any portion of a trust is treated as owned by a U.S. person, a transfer of property from that portion of the trust to a foreign trust is treated as a transfer from the owner of that portion to the foreign trust. </P> <P> (2) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (d). In all examples, <E T="03">A</E> is a U.S. person, <E T="03">DT</E> is a domestic trust, and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Transfer by a domestic trust.</HD> <P> On January 1, 2001, <E T="03">A</E> transfers property which has a fair market value of 1000X and an adjusted basis of 200X to <E T="03">DT. A</E> retains the power to revoke <E T="03">DT.</E> On January 1, 2003, <E T="03">DT</E> transfers property which has a fair market value of 500X and an adjusted basis of 100X to <E T="03">FT.</E> At the time of the transfer, <E T="03">FT</E> has no U.S. beneficiary as defined in § 1.679-2 and no person is treated as owning any portion of <E T="03">FT. A</E> is treated as having transferred the property to <E T="03">FT</E> and is required to recognize gain of 400X, under § 1.684-1, at the time of the transfer by <E T="03">DT</E> to <E T="03">FT.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Transfer by a foreign trust.</HD> <P> On January 1, 2001, <E T="03">A</E> transfers property which has a fair market value of 1000X and an adjusted basis of 200X to <E T="03">FT1.</E> At the time of the transfer, <E T="03">FT1</E> has a U.S. beneficiary as defined in § 1.679-2 and <E T="03">A</E> is treated as the owner of <E T="03">FT1</E> under section 679. On January 1, 2003, <E T="03">FT1</E> transfers property which has a fair market value of 500X and an adjusted basis of 100X to <E T="03">FT2.</E> At the time of the transfer, <E T="03">FT2</E> has no U.S. beneficiary as defined in § 1.679-2 and no person is treated as owning any portion of <E T="03">FT2. A</E> is treated as having transferred the property to <E T="03">FT2</E> and is required to recognize gain of 400X, under § 1.684-1, at the time of the transfer by <E T="03">FT1</E> to <E T="03">FT2.</E> </P> </EXAMPLE> <P> (e) <E T="03">Deemed transfers when foreign trust no longer treated as owned by a U.S. person</E> —(1) <E T="03">In general.</E> If any portion of a foreign trust is treated as owned by a U.S. person under subpart E of part I of subchapter J, chapter 1 of the Internal Revenue Code, and such portion ceases to be treated as owned by that person under such subpart (other than by reason of an actual transfer of property from the trust to which § 1.684-2(d) applies), the U.S. person shall be treated as having transferred, immediately before (but on the same date that) the trust is no longer treated as owned by that U.S. person, the assets of such portion to a foreign trust. </P> <P> (2) <E T="03">Examples.</E> The following examples illustrate the rules of this paragraph (e). In all examples, <E T="03">A</E> is a U.S. citizen <PRTPAGE P="406"/> and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Loss of U.S. beneficiary.</HD> <P> (i) On January 1, 2001, <E T="03">A</E> transfers property, which has a fair market value of 1000X and an adjusted basis of 400X, to <E T="03">FT.</E> At the time of the transfer, <E T="03">FT</E> has a U.S. beneficiary within the meaning of § 1.679-2, and <E T="03">A</E> is treated as owning <E T="03">FT</E> under section 679. Under § 1.684-3(a), § 1.684-1 does not cause <E T="03">A</E> to recognize gain at the time of the transfer. </P> <P> (ii) On July 1, 2003, <E T="03">FT</E> ceases to have a U.S. beneficiary as defined in § 1.679-2(c) and as of that date neither <E T="03">A</E> nor any other person is treated as owning any portion of <E T="03">FT.</E> Pursuant to § 1.679-2(c)(2), if <E T="03">FT</E> ceases to be treated as having a U.S. beneficiary, <E T="03">A</E> will cease to be treated as owner of <E T="03">FT</E> beginning on the first day of the first taxable year following the last taxable year in which there was a U.S. beneficiary. Thus, on January 1, 2004, <E T="03">A</E> ceases to be treated as owner of <E T="03">FT.</E> On that date, the fair market value of the property is 1200X and the adjusted basis is 350X. Under paragraph (e)(1) of this section, <E T="03">A</E> is treated as having transferred the property to <E T="03">FT</E> on January 1, 2004, and must recognize 850X of gain at that time under § 1.684-1. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Death of grantor.</HD> <P> (i) The initial facts are the same as in paragraph (i) of <E T="03">Example 1.</E> </P> <P> (ii) On July 1, 2003, <E T="03">A</E> dies, and as of that date no other person is treated as the owner of <E T="03">FT.</E> On that date, the fair market value of the property is 1200X, and its adjusted basis equals 350X. Under paragraph (e)(1) of this section, <E T="03">A</E> is treated as having transferred the property to <E T="03">FT</E> immediately before his death, and generally is required to recognize 850X of gain at that time under § 1.684-1. However, an exception may apply under § 1.684-3(c). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Release of a power.</HD> <P> (i) On January 1, 2001, <E T="03">A</E> transfers property that has a fair market value of 500X and an adjusted basis of 200X to <E T="03">FT.</E> At the time of the transfer, <E T="03">FT</E> does not have a U.S. beneficiary within the meaning of § 1.679-2. However, <E T="03">A</E> retains the power to revoke the trust. <E T="03">A</E> is treated as the owner of the trust under section 676 and, therefore, under § 1.684-3(a), <E T="03">A</E> is not required to recognize gain under § 1.684-1 at the time of the transfer. </P> <P> (ii) On January 1, 2007, <E T="03">A</E> releases the power to revoke the trust and, as of that date, neither <E T="03">A</E> nor any other person is treated as owning any portion of <E T="03">FT.</E> On that date, the fair market value of the property is 900X, and its adjusted basis is 200X. Under paragraph (e)(1) of this section, <E T="03">A</E> is treated as having transferred the property to <E T="03">FT</E> on January 1, 2007, and must recognize 700X of gain at that time. </P> </EXAMPLE> <P> (f) <E T="03">Transfers to entities owned by a foreign trust.</E> Section 1.679-3(f) provides rules that apply with respect to transfers of property by a U.S. person to an entity in which a foreign trust holds an ownership interest. </P> <CITA>[T.D. 8956, 66 FR 37899, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.684-3</SECTNO> <SUBJECT>Exceptions to general rule of gain recognition.</SUBJECT> <P> (a) <E T="03">Transfers to grantor trusts.</E> The general rule of gain recognition under § 1.684-1 shall not apply to any transfer of property by a U.S. person to a foreign trust to the extent that any person is treated as the owner of the trust under section 671. Section 1.684-2(e) provides rules regarding a subsequent change in the status of the trust. </P> <P> (b) <E T="03">Transfers to charitable trusts.</E> The general rule of gain recognition under § 1.684-1 shall not apply to any transfer of property to a foreign trust that is described in section 501(c)(3) (without regard to the requirements of section 508(a)). </P> <P> (c) <E T="03">Certain transfers at death</E> —(1) <E T="03">Section 1014 basis.</E> The general rule of gain recognition under § 1.684-1 shall not apply to any transfer of property to a foreign trust or foreign estate or, in the case of a transfer of property by a U.S. transferor decedent dying in 2010, to a foreign trust, foreign estate, or a nonresident alien, by reason of death of the U.S. transferor, if the basis of the property in the hands of the transferee is determined under section 1014(a). </P> <P> (2) <E T="03">Section 1022 basis election.</E> For U.S. transferor decedents dying in 2010, the general rule of gain recognition under § 1.684-1 shall apply to any transfer of property by reason of death of the U.S. transferor if the basis of the property in the hands of the foreign trust, foreign estate, or the nonresident alien individual is determined under section 1022. The gain on the transfer shall be calculated as set out under § 1.684-1(a), except that adjusted basis will reflect any increases allocated to such property under section 1022. </P> <P> (d) <E T="03">Transfers for fair market value to unrelated trusts.</E> The general rule of gain recognition under § 1.684-1 shall not apply to any transfer of property for fair market value to a foreign trust that is not a related foreign trust as <PRTPAGE P="407"/> defined in § 1.679-1(c)(5). Section 1.671-2(e)(2)(ii) defines fair market value. </P> <P> (e) <E T="03">Transfers to which section 1032 applies.</E> The general rule of gain recognition under § 1.684-1 shall not apply to any transfer of stock (including treasury stock) by a domestic corporation to a foreign trust if the domestic corporation is not required to recognize gain on the transfer under section 1032. </P> <P> (f) <E T="03">Certain distributions to trusts.</E> For purposes of this section, a transfer does not include a distribution to a trust with respect to an interest held by such trust in an entity other than a trust or an interest in certain investment trusts described in § 301.7701-4(c) of this chapter, liquidating trusts described in § 301.7701-4(d) of this chapter, or environmental remediation trusts described in § 301.7701-4(e) of this chapter. </P> <P> (g) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In all examples, <E T="03">A</E> is a U.S. citizen and <E T="03">FT</E> is a foreign trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Transfer to owner trust.</HD> <P> In 2001, <E T="03">A</E> transfers property which has a fair market value of 1000X and an adjusted basis equal to 400X to <E T="03">FT.</E> At the time of the transfer, <E T="03">FT</E> has a U.S. beneficiary within the meaning of § 1.679-2, and <E T="03">A</E> is treated as owning <E T="03">FT</E> under section 679. Under paragraph (a) of this section, § 1.684-1 does not cause <E T="03">A</E> to recognize gain at the time of the transfer. See § 1.684-2(e) for rules that may require <E T="03">A</E> to recognize gain if the trust is no longer owned by <E T="03">A.</E> </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Transfer of property at death: Basis determined under section 1014(a).</HD> <P> (i) The initial facts are the same as <E T="03">Example 1.</E> </P> <P> (ii) <E T="03">A</E> dies on July 1, 2004. The fair market value at <E T="03">A'</E> s death of all property transferred to <E T="03">FT</E> by <E T="03">A</E> is 1500X. The basis in the property is 400X. <E T="03">A</E> retained the power to revoke <E T="03">FT,</E> thus, the value of all property owned by <E T="03">FT</E> at <E T="03">A'</E> s death is includible in <E T="03">A'</E> s gross estate for U.S. estate tax purposes. Pursuant to paragraph (c) of this section, <E T="03">A</E> is not required to recognize gain under § 1.684-1 because the basis of the property in the hands of the foreign trust is determined under section 1014(a). </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Transfer of property at death: Basis not determined under section 1014(a).</HD> <P> (i) The initial facts are the same as <E T="03">Example 1.</E> </P> <P> (ii) <E T="03">A</E> dies on July 1, 2004. The fair market value at <E T="03">A'</E> s death of all property transferred to <E T="03">FT</E> by <E T="03">A</E> is 1500X. The basis in the property is 400X. <E T="03">A</E> retains no power over <E T="03">FT,</E> and <E T="03">FT'</E> s basis in the property transferred is not determined under section 1014(a). Under § 1.684-2(e)(1), <E T="03">A</E> is treated as having transferred the property to <E T="03">FT</E> immediately before his death, and must recognize 1100X of gain at that time under § 1.684-1. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Transfer of property for fair market value to an unrelated foreign trust. A</HD> <P> sells a house with a fair market value of 1000X to <E T="03">FT</E> in exchange for a 30-year note issued by <E T="03">FT. A</E> is not related to <E T="03">FT</E> as defined in § 1.679-1(c)(5). <E T="03">FT</E> is not treated as owned by any person. Pursuant to paragraph (d) of this section, <E T="03">A</E> is not required to recognize gain under § 1.684-1. </P> </EXAMPLE> <CITA>[T.D. 8956, 66 FR 37899, July 20, 2001, as amended by T.D. 9811, 82 FR 6239, Jan. 19, 2017]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.684-4</SECTNO> <SUBJECT>Outbound migrations of domestic trusts.</SUBJECT> <P> (a) <E T="03">In general.</E> If a U.S. person transfers property to a domestic trust, and such trust becomes a foreign trust, and neither trust is treated as owned by any person under subpart E of part I of subchapter J, chapter 1 of the Internal Revenue Code, the trust shall be treated for purposes of this section as having transferred all of its assets to a foreign trust and the trust is required to recognize gain on the transfer under § 1.684-1(a). The trust must also comply with the rules of section 6048. </P> <P> (b) <E T="03">Date of transfer.</E> The transfer described in this section shall be deemed to occur immediately before, but on the same date that, the trust meets the definition of a foreign trust set forth in section 7701(a)(31)(B). </P> <P> (c) <E T="03">Inadvertent migrations.</E> In the event of an inadvertent migration, as defined in § 301.7701-7(d)(2) of this chapter, a trust may avoid the application of this section by complying with the procedures set forth in § 301.7701-7(d)(2) of this chapter. </P> <P> (d) <E T="03">Examples.</E> The following examples illustrate the rules of this section. In all examples, <E T="03">A</E> is a U.S. citizen, <E T="03">B</E> is a U.S. citizen, <E T="03">C</E> is a nonresident alien, and <E T="03">T</E> is a trust. The examples are as follows: </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Migration of domestic trust with U.S. beneficiaries. A</HD> <P> transfers property which has a fair market value of 1000X and an adjusted basis equal to 400X to <E T="03">T,</E> a domestic trust, for the benefit of <E T="03">A</E> 's children who are also U.S. citizens. <E T="03">B</E> is the trustee of <E T="03">T.</E> On January 1, 2001, while <E T="03">A</E> is still alive, <E T="03">B</E> resigns as trustee and <E T="03">C</E> becomes successor <PRTPAGE P="408"/> trustee under the terms of the trust. Pursuant to § 301.7701-7(d) of this chapter, <E T="03">T</E> becomes a foreign trust. <E T="03">T</E> has U.S. beneficiaries within the meaning of § 1.679-2 and <E T="03">A</E> is, therefore, treated as owning <E T="03">FT</E> under section 679. Pursuant to § 1.684-3(a), neither <E T="03">A</E> nor <E T="03">T</E> is required to recognize gain at the time of the migration. Section 1.684-2(e) provides rules that may require <E T="03">A</E> to recognize gain upon a subsequent change in the status of the trust. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Migration of domestic trust with no U.S. beneficiaries. A</HD> <P> transfers property which has a fair market value of 1000X and an adjusted basis equal to 400X to <E T="03">T,</E> a domestic trust for the benefit of <E T="03">A</E> 's mother who is not a citizen or resident of the United States. <E T="03">T</E> is not treated as owned by another person. <E T="03">B</E> is the trustee of <E T="03">T.</E> On January 1, 2001, while <E T="03">A</E> is still alive, <E T="03">B</E> resigns as trustee and <E T="03">C</E> becomes successor trustee under the terms of the trust. Pursuant to § 301.7701-7(d) of this chapter, <E T="03">T</E> becomes a foreign trust, <E T="03">FT. FT</E> has no U.S. beneficiaries within the meaning of § 1.679-2 and no person is treated as owning any portion of <E T="03">FT. T</E> is required to recognize gain of 600X on January 1, 2001. Paragraph (c) of this section provides rules with respect to an inadvertent migration of a domestic trust. </P> </EXAMPLE> <CITA>[T.D. 8956, 66 FR 37899, July 20, 2001]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.684-5</SECTNO> <SUBJECT>Effective/applicability dates.</SUBJECT> <P>(a) Sections 1.684-1 through 1.684-4 apply to transfers of property to foreign trusts and foreign estates after August 7, 2000, except as provided in paragraph (b) of this section.</P> <P>(b) In the case a U.S. transferor decedent dying in 2010, § 1.684-3(c) applies to transfers of property to foreign trusts, foreign estates, and nonresident aliens after December 31, 2009, and before January 1, 2011.</P> <CITA>[T.D. 9811, 82 FR 6239, Jan. 19, 2017]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">income in respect of decedents</HD> <SECTION> <SECTNO>§ 1.691(a)-1</SECTNO> <SUBJECT>Income in respect of a decedent.</SUBJECT> <P> (a) <E T="03">Scope of section 691.</E> In general, the regulations under section 691 cover: (1) The provisions requiring that amounts which are not includible in gross income for the decedent's last taxable year or for a prior taxable year be included in the gross income of the estate or persons receiving such income to the extent that such amounts constitute “income in respect of a decedent”; (2) the taxable effect of a transfer of the right to such income; (3) the treatment of certain deductions and credit in respect of a decedent which are not allowable to the decedent for the taxable period ending with his death or for a prior taxable year; (4) the allowance to a recipient of income in respect of a decedent of a deduction for estate taxes attributable to the inclusion of the value of the right to such income in the decedent's estate; (5) special provisions with respect to installment obligations acquired from a decedent and with respect to the allowance of a deduction for estate taxes to a surviving annuitant under a joint and survivor annuity contract; and (6) special provisions relating to installment obligations transmitted at death when prior law applied to the transmission. </P> <P> (b) <E T="03">General definition.</E> In general, the term <E T="03">income in respect of a decedent</E> refers to those amounts to which a decedent was entitled as gross income but which were not properly includible in computing his taxable income for the taxable year ending with the date of his death or for a previous taxable year under the method of accounting employed by the decedent. See the regulations under section 451. Thus, the term includes: </P> <P>(1) All accrued income of a decedent who reported his income by use of the cash receipts and disbursements method;</P> <P>(2) Income accrued solely by reason of the decedent's death in case of a decedent who reports his income by use of an accrual method of accounting; and</P> <P>(3) Income to which the decedent had a contingent claim at the time of his death.</P> <FP>See sections 736 and 753 and the regulations thereunder for “income in respect of a decedent” in the case of a deceased partner.</FP> <P> (c) <E T="03">Prior decedent.</E> The term <E T="03">income in respect of a decedent</E> also includes the amount of all items of gross income in respect of a prior decedent, if (1) the right to receive such amount was acquired by the decedent by reason of the death of the prior decedent or by bequest, devise, or inheritance from the prior decedent and if (2) the amount of gross income in respect of the prior decedent was not properly includible in <PRTPAGE P="409"/> computing the decedent's taxable income for the taxable year ending with the date of his death or for a previous taxable year. See example 2 of paragraph (b) of § 1.691(a)-2. </P> <P> (d) <E T="03">Items excluded from gross income.</E> Section 691 applies only to the amount of items of gross income in respect of a decedent, and items which are excluded from gross income under subtitle A of the Code are not within the provisions of section 691. </P> <P> (e) <E T="03">Cross reference.</E> For items deemed to be income in respect of a decedent for purposes of the deduction for estate taxes provided by section 691(c), see paragraph (c) of § 1.691(c)-1. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6808, 30 FR 3435, Mar. 16, 1965]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.691(a)-2</SECTNO> <SUBJECT>Inclusion in gross income by recipients.</SUBJECT> <P>(a) Under section 691(a)(1), income in respect of a decedent shall be included in the gross income, for the taxable year when received, of:</P> <P>(1) The estate of the decedent, if the right to receive the amount is acquired by the decedent's estate from the decedent;</P> <P>(2) The person who, by reason of the death of the decedent, acquires the right to receive the amount, if the right to receive the amount is not acquired by the decedent's estate from the decedent; or</P> <P>(3) The person who acquires from the decedent the right to receive the amount by bequest, devise, or inheritance, if the amount is received after a distribution by the decedent's estate of such right.</P> <FP>These amounts are included in the income of the estate or of such persons when received by them whether or not they report income by use of the cash receipts and disbursements methods.</FP> <P>(b) The application of paragraph (a) of this section may be illustrated by the following examples, in each of which it is assumed that the decedent kept his books by use of the cash receipts and disbursements method.</P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>The decedent was entitled at the date of his death to a large salary payment to be made in equal annual installments over five years. His estate, after collecting two installments, distributed the right to the remaining installment payments to the residuary legatee of the estate. The estate must include in its gross income the two installments received by it, and the legatee must include in his gross income each of the three installments received by him.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>A widow acquired, by bequest from her husband, the right to receive renewal commissions on life insurance sold by him in his lifetime, which commissions were payable over a period of years. The widow died before having received all of such commissions, and her son inherited the right to receive the rest of the commissions. The commissions received by the widow were includible in her gross income. The commissions received by the son were not includible in the widow's gross income but must be included in the gross income of the son.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3.</HD> <P>The decedent owned a Series E United States savings bond, with his wife as co-owner or beneficiary, but died before the payment of such bond. The entire amount of interest accruing on the bond and not includible in income by the decedent, not just the amount accruing after the death of the decedent, would be treated as income to his wife when the bond is paid.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4.</HD> <P>A, prior to his death, acquired 10,000 shares of the capital stock of the X Corporation at a cost of $100 per share. During his lifetime, A had entered into an agreement with X Corporation whereby X Corporation agreed to purchase and the decedent agreed that his executor would sell the 10,000 shares of X Corporation stock owned by him at the book value of the stock at the date of A's death. Upon A's death, the shares are sold by A's executor for $500 a share pursuant to the agreement. Since the sale of stock is consummated after A's death, there is no income in respect of a decedent with respect to the appreciation in value of A's stock to the date of his death. If, in this example, A had in fact sold the stock during his lifetime but payment had not been received before his death, any gain on the sale would constitute income in respect of a decedent when the proceeds were received.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5.</HD> <P> (1) A owned and operated an apple orchard. During his lifetime, A sold and delivered 1,000 bushels of apples to X, a canning factory, but did not receive payment before his death. A also entered into negotiations to sell 3,000 bushels of apples to Y, a canning factory, but did not complete the sale before his death. After A's death, the executor received payment from X. He also completed the sale to Y and transferred to Y 1,200 bushels of apples on hand at A's death and harvested and transferred an additional 1,800 bushels. The gain from the sale of apples by A to X constitutes income in respect of a decedent when received. On the other hand, the gain from the sale of apples by the executor to Y does not. <PRTPAGE P="410"/> </P> <P>(2) Assume that, instead of the transaction entered into with Y, A had disposed of the 1,200 bushels of harvested apples by delivering them to Z, a cooperative association, for processing and sale. Each year the association commingles the fruit received from all of its members into a pool and assigns to each member a percentage interest in the pool based on the fruit delivered by him. After the fruit is processed and the products are sold, the association distributes the net proceeds from the pool to its members in proportion to their interests in the pool. After A's death, the association made distributions to the executor with respect to A's share of the proceeds from the pool in which A had in interest. Under such circumstances, the proceeds from the disposition of the 1,200 bushels of apples constitute income in respect of a decedent.</P> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.691(a)-3</SECTNO> <SUBJECT>Character of gross income.</SUBJECT> <P>(a) The right to receive an amount of income in respect of a decedent shall be treated in the hands of the estate, or by the person entitled to receive such amount by bequest, devise, or inheritance from the decedent or by reason of his death, as if it had been acquired in the transaction by which the decedent (or a prior decedent) acquired such right, and shall be considered as having the same character it would have had if the decedent (or a prior decedent) had lived and received such amount. The provisions of section 1014(a), relating to the basis of property acquired from a decedent, and section 1022, relating to the basis of property acquired from certain decedents who died in 2010, do not apply to these amounts in the hands of the estate and such persons. See sections 1014(c) and 1022(f).</P> <P>(b) The application of paragraph (a) of this section may be illustrated by the following:</P> <P>(1) If the income would have been capital gain to the decedent, if he had lived and had received it, from the sale of property, held for more than 1 year (6 months for taxable years beginning before 1977; 9 months for taxable years beginning in 1977), the income, when received, shall be treated in the hands of the estate or of such person as capital gain from the sale of the property, held for more than 1 year (6 months for taxable years beginning before 1977; 9 months for taxable years beginning in 1977), in the same manner as if such person had held the property for the period the decedent held it, and had made the sale.</P> <P>(2) If the income is interest on United States obligations which were owned by the decedent, such income shall be treated as interest on United States obligations in the hands of the person receiving it, for the purpose of determining the credit provided by section 35, as if such person had owned the obligations with respect to which such interest is paid.</P> <P>(3) If the amounts received would be subject to special treatment under part I (section 1301 and following), subchapter Q, chapter 1 of the Code, relating to income attributable to serveral taxable years, as in effect for taxable years beginning before January 1, 1964, if the decedent had lived and included such amounts in his gross income, such sections apply with respect to the recipient of the income.</P> <P>(4) The provisions of sections 632 and 1347, relating to the tax attributable to the sale of certain oil or gas property and to certain claims against the United States, apply to any amount included in gross income, the right to which was obtained by the decedent by a sale or claim within the provisions of those sections.</P> <P> (c) <E T="03">Effective/applicability dates.</E> The last two sentences of paragraph (a) of this section apply on and after January 19, 2017. For rules before January 19, 2017, see § 1.691(a)-3 as contained in 26 CFR part 1 revised as of April 1, 2016. </P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6885, 31 FR 7803, June 2, 1966; T.D. 7728, 45 FR 72650, Nov. 3, 1980; T.D. 9811, 82 FR 6239, Jan. 19, 2017]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.691(a)-4</SECTNO> <SUBJECT>Transfer of right to income in respect of a decedent.</SUBJECT> <P> (a) Section 691(a)(2) provides the rules governing the treatment of income in respect of a decedent (or a prior decedent) in the event a right to receive such income is transferred by the estate or person entitled thereto by bequest, devise, or inheritance, or by reason of the death of the decedent. In general, the transferor must include in his gross income for the taxable period in which the transfer occurs the amount of the consideration, if any, received for the right or the fair market value of the right at the time of the <PRTPAGE P="411"/> transfer, whichever is greater. Thus, upon a sale of such right by the estate or person entitled to receive it, the fair market value of the right or the amount received upon the sale, whichever is greater, is included in the gross income of the vendor. Similarly, if such right is disposed of by gift, the fair market value of the right at the time of the gift must be included in the gross income of the donor. In the case of a satisfaction of an installment obligation at other than face value, which is likewise considered a transfer under section 691(a)(2), see § 1.691(a)-5. </P> <P>(b) If the estate of a decedent or any person transmits the right to income in respect of a decedent to another who would be required by section 691(a)(1) to include such income when received in his gross income, only the transferee will include such income when received in his gross income. In this situation, a transfer within the meaning of section 691(a)(2) has not occurred. This paragraph may be illustrated by the following:</P> <P>(1) If a person entitled to income in respect of a decedent dies before receiving such income, only his estate or other person entitled to such income by bequest, devise, or inheritance from the latter decedent, or by reason of the death of the latter decedent, must include such amount in gross income when received.</P> <P>(2) If a right to income in respect of a decedent is transferred by an estate to a specific or residuary legatee, only the specific or residuary legatee must include such income in gross income when received.</P> <P>(3) If a trust to which is bequeathed a right of a decedent to certain payments of income terminates and transfers the right to a beneficiary, only the beneficiary must include such income in gross income when received.</P> <FP>If the transferee described in subparagraphs (1), (2), and (3) of this paragraph transfers his right to receive the amounts in the manner described in paragraph (a) of this section, the principles contained in paragraph (a) are applied to such transfer. On the other hand, if the transferee transmits his right in the manner described in this paragraph, the principles of this paragraph are again applied to such transfer.</FP> </SECTION> <SECTION> <SECTNO>§ 1.691(a)-5</SECTNO> <SUBJECT>Installment obligations acquired from decedent.</SUBJECT> <P>(a) Section 691(a)(4) has reference to an installment obligation which remains uncollected by a decedent (or a prior decedent) and which was originally acquired in a transaction the income from which was properly reportable by the decedent on the installment method under section 453. Under the provisions of section 691(a)(4), an amount equal to the excess of the face value of the obligation over its basis in the hands of the decedent (determined under section 453(d)(2) and the regulations thereunder) shall be considered an amount of income in respect of a decedent and shall be treated as such. The decedent's estate (or the person entitled to receive such income by bequest or inheritance from the decedent or by reason of the decedent's death) shall include in its gross income when received the same proportion of any payment in satisfaction of such obligations as would be returnable as income by the decedent if he had lived and received such payment. No gain on account of the transmission of such obligations by the decedent's death is required to be reported as income in the return of the decedent for the year of his death. See § 1.691(e)-1 for special provisions relating to the filing of an election to have the provisions of section 691(a)(4) apply in the case of installment obligations in respect of which section 44(d) of the Internal Revenue Code of 1939 (or corresponding provisions of prior law) would have applied but for the filing of a bond referred to therein.</P> <P> (b) If an installment obligation described in paragraph (a) of this section is transferred within the meaning of section 691(a)(2) and paragraph (a) of § 1.691(a)-4, the entire installment obligation transferred shall be considered a right to income in respect of a decedent but the amount includible in the gross income of the transferor shall be reduced by an amount equal to the basis of the obligation in the hands of the decedent (determined under section 453(d)(2) and the regulations thereunder) adjusted, however, to take into <PRTPAGE P="412"/> account the receipt of any installment payments after the decedent's death and before such transfer. Thus, the amount includible in the gross income of the transferor shall be the fair market value of such obligation at the time of the transfer or the consideration received for the transfer of the installment obligation, whichever is greater, reduced by the basis of the obligation as described in the preceding sentence. For purposes of this paragraph, the term “transfer” in section 691(a)(2) and paragraph (a) of § 1.691(a)-4 includes the satisfaction of an installment obligation at other than face value. </P> <P>(c) The application of this section may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>An heir of a decedent is entitled to collect an installment obligation with a face value of $100, a fair market value of $80, and a basis in the hands of the decedent of $60. If the heir collects the obligation at face value, the excess of the amount collected over the basis is considered income in respect of a decedent and includible in the gross income of the heir under section 691(a)(1). In this case, the amount includible would be $40 ($100 less $60). If the heir collects the obligation at $90, an amount other than face value, the entire obligation is considered a right to receive income in respect of a decedent but the amount ordinarily required to be included in the heir's gross income under section 691(a)(2) (namely, the consideration received in satisfaction of the installment obligation or its fair market value, whichever is greater) shall be reduced by the amount of the basis of the obligation in the hands of the decedent. In this case, the amount includible would be $30 ($90 less $60).</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6808, 30 FR 3435, Mar. 16, 1965]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.691(b)-1</SECTNO> <SUBJECT>Allowance of deductions and credit in respect to decedents.</SUBJECT> <P>(a) Under section 691(b) the expenses, interest, and taxes described in sections 162, 163, 164, and 212 for which the decedent (or a prior decedent) was liable, which were not properly allowable as a deduction in his last taxable year or any prior taxable year, are allowed when paid:</P> <P>(1) As a deduction by the estate; or</P> <P>(2) If the estate was not liable to pay such obligation, as a deduction by the person who by bequest, devise, or inheritance from the decedent or by reason of the death of the decedent acquires, subject to such obligation, an interest in property of the decedent (or the prior decedent).</P> <FP>Similar treatment is given to the foreign tax credit provided by section 33. For the purposes of subparagraph (2) of this paragraph, the right to receive an amount of gross income in respect of a decedent is considered property of the decedent; on the other hand, it is not necessary for a person, otherwise within the provisions of subparagraph (2) of this paragraph, to receive the right to any income in respect of a decedent. Thus, an heir who receives a right to income in respect of a decedent (by reason of the death of the decedent) subject to any income tax imposed by a foreign country during the decedent's life, which tax must be satisfied out of such income, is entitled to the credit provided by section 33 when he pays the tax. If a decedent who reported income by use of the cash receipts and disbursements method owned real property on which accrued taxes had become a lien, and if such property passed directly to the heir of the decedent in a jurisdiction in which real property does not become a part of a decedent's estate, the heir, upon paying such taxes, may take the same deduction under section 164 that would be allowed to the decedent if, while alive, he had made such payment.</FP> <P> (b) The deduction for percentage depletion is allowable only to the person (described in section 691(a)(1)) who receives the income in respect of the decedent to which the deduction relates, whether or not such person receives the property from which such income is derived. Thus, an heir who (by reason of the decedent's death) receives income derived from sales of units of mineral by the decedent (who reported income by use of the cash receipts and disbursements method) shall be allowed the deduction for percentage depletion, computed on the gross income from such number of units as if the heir had the same economic interest in the property as the decedent. Such heir need not also receive any interest in the mineral property other than such <PRTPAGE P="413"/> income. If the decedent did not compute his deduction for depletion on the basis of percentage depletion, any deduction for depletion to which the decedent was entitled at the date of his death would be allowable in computing his taxable income for his last taxable year, and there can be no deduction in respect of the decedent by any other person for such depletion. </P> </SECTION> <SECTION> <SECTNO>§ 1.691(c)-1</SECTNO> <SUBJECT>Deduction for estate tax attributable to income in respect of a decedent.</SUBJECT> <P> (a) <E T="03">In general.</E> A person who is required to include in gross income for any taxable year an amount of income in respect of a decedent may deduct for the same taxable year that portion of the estate tax imposed upon the decedent's estate which is attributable to the inclusion in the decedent's estate of the right to receive such amount. The deduction is determined as follows: </P> <P>(1) Ascertain the net value in the decedent's estate of the items which are included under section 691 in computing gross income. This is the excess of the value included in the gross estate on account of the items of gross income in respect of the decedent (see § 1.691(a)-1 and paragraph (c) of this section) over the deductions from the gross estate for claims which represent the deductions and credit in respect of the decedent (see § 1.691(b)-1). But see section 691(d) and paragraph (b) of § 1.691(d)-1 for computation of the special value of a survivor's annuity to be used in computing the net value for estate tax purposes in cases involving joint and survivor annuities.</P> <P>(2) Ascertain the portion of the estate tax attributable to the inclusion in the gross estate of such net value. This is the excess of the estate tax over the estate tax computed without including such net value in the gross estate. In computing the estate tax without including such net value in the gross estate, any estate tax deduction (such as the marital deduction) which may be based upon the gross estate shall be recomputed so as to take into account the exclusion of such net value from the gross estate. See example 2, paragraph (e) of § 1.691(d)-1.</P> <FP> For purposes of this section, the term <E T="03">estate tax</E> means the tax imposed under section 2001 or 2101 (or the corresponding provisions of the Internal Revenue Code of 1939), reduced by the credits against such tax. Each person including in gross income an amount of income in respect of a decedent may deduct as his share of the portion of the estate tax (computed under subparagraph (2) of this paragraph) an amount which bears the same ratio to such portion as the value in the gross estate of the right to the income included by such person in gross income (or the amount included in gross income if lower) bears to the value in the gross estate of all the items of gross income in respect of the decedent. </FP> <P> (b) <E T="03">Prior decedent.</E> If a person is required to include in gross income an amount of income in respect of a prior decedent, such person may deduct for the same taxable year that portion of the estate tax imposed upon the prior decedent's estate which is attributable to the inclusion in the prior decedent's estate of the value of the right to receive such amount. This deduction is computed in the same manner as provided in paragraph (a) of this section and is in addition to the deduction for estate tax imposed upon the decedent's estate which is attributable to the inclusion in the decedent's estate of the right to receive such amount. </P> <P> (c) <E T="03">Amounts deemed to be income in respect of a decedent.</E> For purposes of allowing the deduction under section 691(c), the following items are also considered to be income in respect of a decedent under section 691(a): </P> <P>(1) The value for estate tax purposes of stock options in respect of which amounts are includible in gross income under section 421(b) (prior to amendment by section 221(a) of the Revenue Act of 1964), in the case of taxable years ending before January 1, 1964, or under section 422(c)(1), 423(c), or 424(c)(1), whichever is applicable, in the case of taxable years ending after December 31, 1963. See section 421(d)(6) (prior to amendment by sec. 221(a) of the Revenue Act of 1964), in the case of taxable years ending before January 1, 1964, and section 421(c)(2), in the case of taxable years ending after December 31, 1963.</P> <P> (2) Amounts received by a surviving annuitant during his life expectancy <PRTPAGE P="414"/> period as an annuity under a joint and survivor annuity contract to the extent included in gross income under section 72. See section 691(d). </P> <P> (d) <E T="03">Examples.</E> Paragraphs (a) and (b) of this section may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P>X, an attorney who kept his books by use of the cash receipts and disbursements method, was entitled at the date of his death to a fee for services rendered in a case not completed at the time of his death, which fee was valued in his estate at $1,000, and to accrued bond interest, which was valued in his estate at $500. In all, $1,500 was included in his gross estate in respect of income described in section 691(a)(1). There were deducted as claims against his estate $150 for business expenses for which his estate was liable and $50 for taxes accrued on certain property which he owned. In all, $200 was deducted for claims which represent amounts described in section 691(b) which are allowable as deductions to his estate or to the beneficiaries of his estate. His gross estate was $185,000 and, considering deductions of $15,000 and an exemption of $60,000, his taxable estate amounted to $110,000. The estate tax on this amount is $23,700 from which is subtracted a $75 credit for State death taxes leaving an estate tax liability of $23,625. In the year following the closing of X's estate, the fee in the amount of $1,200 was collected by X's son, who was the sole beneficiary of the estate. This amount was included under section 691(a)(1)(C) in the son's gross income. The son may deduct, in computing his taxable income for such year, $260 on account of the estate tax attributable to such income, computed as follows:</P> <GPOTABLE COLS="2" OPTS="L0" CDEF="s25,9"> <ROW> <ENT I="01">(1) (i) Value of income described in section 691(a)(1) included in computing gross estate</ENT> <ENT>$1,500</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">(ii) Deductions in computing gross estate for claims representing deductions described in section 691(b)</ENT> <ENT>200</ENT> </ROW> <ROW RUL="n,d"> <ENT I="01">(iii) Net value of items described in section 691(a)(1)</ENT> <ENT>1,300</ENT> </ROW> <ROW> <ENT I="01">(2) (i) Estate tax</ENT> <ENT>23,625</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">(ii) Less: Estate tax computed without including $1,300 (item (1)(iii)) in gross estate</ENT> <ENT>23,235</ENT> </ROW> <ROW RUL="n,d"> <ENT I="01">(iii) Portion of estate tax attributable to net value of items described in section 691(a)(1)</ENT> <ENT>390</ENT> </ROW> <ROW> <ENT I="01">(3) (i) Value in gross estate of items described in section 691(a)(1) received in taxable year (fee)</ENT> <ENT>1,000</ENT> </ROW> <ROW> <ENT I="01">(ii) Value in gross estate of all income items described in section 691(a)(1) (item (1)(i))</ENT> <ENT>1,500</ENT> </ROW> <ROW> <ENT I="01">(iii) Part of estate tax deductible on account of receipt of $1,200 fee (1,000/1,500 of $390)</ENT> <ENT>260</ENT> </ROW> </GPOTABLE> <FP>Although $1,200 was later collected as the fee, only the $1,000 actually included in the gross estate is used in the above computations. However, to avoid distortion, section 691(c) provides that if the value included in the gross estate is greater than the amount finally collected, only the amount collected shall be used in the above computations. Thus, if the amount collected as the fee were only $500, the estate tax deductible on the receipt of such amount would be 500/1,500 of $390, or $130. With respect to taxable years ending before January 1, 1964, see paragraph (d)(3) of § 1.421-5 for a similar example involving a restricted stock option. With respect to taxable years ending after December 31, 1963, see paragraph (c)(3) of § 1.421-8 for a similar example involving a stock option subject to the provisions of part II of subchapter D.</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Assume that in example 1 the fee valued at $1,000 had been earned by prior decedent Y and had been inherited by X who died before collecting it. With regard to the son, the fee would be considered income in respect of a prior decedent. Assume further that the fee was valued at $1,000 in Y's estate, that the net value in Y's estate of items described in section 691 (a)(1) was $5,000 and that the estate tax imposed on Y's estate attributable to such net value was $550. In such case, the portion of such estate tax attributable to the fee would be 1,000/5,000 of $550, or $110. When the son collects the $1,200 fee, he will receive for the same taxable year a deduction of $110 with respect to the estate tax imposed on the estate of prior decedent Y as well as the deduction of $260 (as computed in example 1) with respect to the estate tax imposed on the estate of decedent X.</P> </EXAMPLE> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 6887, 31 FR 8812, June 24, 1966]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.691(c)-2</SECTNO> <SUBJECT>Estates and trusts.</SUBJECT> <P>(a) In the case of an estate or trust, the deduction prescribed in section 691(c) is determined in the same manner as described in § 1.691(c)-1, with the following exceptions:</P> <P>(1) If any amount properly paid, credited, or required to be distributed by an estate or trust to a beneficiary consists of income in respect of a decedent received by the estate or trust during the taxable year:</P> <P>(i) Such income shall be excluded in determining the income in respect of the decedent with respect to which the estate or trust is entitled to a deduction under section 691(c), and</P> <P> (ii) Such income shall be considered income in respect of a decedent to such beneficiary for purposes of allowing the deduction under section 691(c) to such beneficiary. <PRTPAGE P="415"/> </P> <P>(2) For determination of the amount of income in respect of a decedent received by the beneficiary, see sections 652 and 662, and §§ 1.652(b)-2 and 1.662(b)-2. However, for this purpose, distributable net income as defined in section 643 (a) and the regulations thereunder shall be computed without taking into account the estate tax deduction provided in section 691(c) and this section. Distributable net income as modified under the preceding sentence shall be applied for other relevant purposes of subchapter J, chapter 1 of the Code, such as the deduction provided by section 651 or 661, or subpart D, part I of subchapter J, relating to excess distributions by trusts.</P> <P>(3) The rule stated in subparagraph (1) of this paragraph does not apply to income in respect of a decedent which is properly allocable to corpus by the fiduciary during the taxable year but which is distributed to a beneficiary in a subsequent year. The deduction provided by section 691(c) in such a case is allowable only to the estate or trust. If any amount properly paid, credited, or required to be distributed by a trust qualifies as a distribution under section 666, the fact that a portion thereof constitutes income in respect of a decedent shall be disregarded for the purposes of determining the deduction of the trust and of the beneficiaries under section 691(c) since the deduction for estate taxes was taken into consideration in computing the undistributed net income of the trust for the preceding taxable year.</P> <P>(b) This section shall apply only to amounts properly paid, credited, or required to be distributed in taxable years of an estate or trust beginning after December 31, 1953, and ending after August 16, 1954, except as otherwise provided in paragraph (c) of this section.</P> <P>(c) In the case of an estate or trust heretofore taxable under the provisions of the Internal Revenue Code of 1939, amounts paid, credited, or to be distributed during its first taxable year subject to the Internal Revenue Code of 1954 which would have been treated as paid, credited, or to be distributed on the last day of the preceding taxable year if the Internal Revenue Code of 1939 were still applicable shall not be subject to the provisions of section 691(c)(1)(B) or this section. See section 683 and the regulations thereunder.</P> <P>(d) The provisions of this section may be illustrated by the following example, in which it is assumed that the estate and the beneficiary make their returns on the calendar year basis:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>(1) The fiduciary of an estate receives taxable interest of $5,500 and income in respect of a decedent of $4,500 during the taxable year. Neither the will of the decedent nor local law requires the allocation to corpus of income in respect of a decedent. The estate tax attributable to the income in respect of a decedent is $1,500. In his discretion, the fiduciary distributes $2,000 (falling within sections 661(a) and 662(a)) to a beneficiary during that year. On these facts the fiduciary and beneficiary are respectively entitled to estate tax deductions of $1,200 and $300, computed as follows:</P> <P>(2) Distributable net income computed under section 643(a) without regard to the estate tax deduction under section 691(c) is $10,000, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Taxable interest</ENT> <ENT>$5,500</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">Income in respect of a decedent</ENT> <ENT>4,500</ENT> </ROW> <ROW> <ENT I="03">Total</ENT> <ENT>10,000</ENT> </ROW> </GPOTABLE> <P>(3) Inasmuch as the distributable net income of $10,000 exceeds the amount of $2,000 distributed to the beneficiary, the deduction allowable to the estate under section 661(a) and the amount taxable to the beneficiary under section 662(a) is $2,000.</P> <P>(4) The character of the amounts distributed to the beneficiary under section 662 (b) is shown in the following table:</P> <GPOTABLE COLS="4" OPTS="L2" CDEF="s25,8,8,8"> <BOXHD> <CHED H="1"> </CHED> <CHED H="1">Taxable interest</CHED> <CHED H="1">Income in respect of a decedent</CHED> <CHED H="1">Total</CHED> </BOXHD> <ROW> <ENT I="01">Distributable net income</ENT> <ENT>$5,500</ENT> <ENT>$4,500</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="01">Amount deemed distributed under section 662(b)</ENT> <ENT>1,100</ENT> <ENT>900</ENT> <ENT>2,000</ENT> </ROW> </GPOTABLE> <P>(5) Accordingly, the beneficiary will be entitled to an estate tax deduction of $300 (900/4,500 × $1,500) and the estate will be entitled to an estate tax deduction of $1,200 (3,600/4,500 × $1,500).</P> <P>(6) The taxable income of the estate is $6,200, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Gross income</ENT> <ENT>$10,000</ENT> </ROW> <ROW> <ENT I="11">Less:</ENT> </ROW> <ROW EXPSTB="00"> <ENT I="02">Distributions to the beneficiary</ENT> <ENT>$2,000</ENT> </ROW> <ROW> <ENT I="01">Estate tax deduction under section 691(c)</ENT> <ENT>1,200</ENT> </ROW> <ROW> <ENT I="01">Personal exemption</ENT> <ENT>600</ENT> </ROW> <ROW EXPSTB="01" RUL="n,s"> <ENT I="22"> </ENT> <ENT>3,800</ENT> </ROW> <ROW> <ENT I="03">Taxable income</ENT> <ENT>6,200</ENT> </ROW> </GPOTABLE> </EXAMPLE> </SECTION> <SECTION> <PRTPAGE P="416"/> <SECTNO>§ 1.691(d)-1</SECTNO> <SUBJECT>Amounts received by surviving annuitant under joint and survivor annuity contract.</SUBJECT> <P> (a) <E T="03">In general.</E> Under section 691(d), annuity payments received by a surviving annuitant under a joint and survivor annuity contract (to the extent indicated in paragraph (b) of this section) are treated as income in respect of a decedent under section 691(a) for the purpose of allowing the deduction for estate tax provided for in section 691(c)(1)(A). This section applies only if the deceased annuitant died after December 31, 1953, and after the annuity starting date as defined in section 72(c)(4). </P> <P> (b) <E T="03">Special value for surviving annuitant's payments.</E> Section 691(d) provides a special value for the surviving annuitant's payments to determine the amount of the estate tax deduction provided for in section 691(c)(1)(A). This special value is determined by multiplying: </P> <P>(1) The excess of the value of the annuity at the date of death of the deceased annuitant over the total amount excludable from the gross income of the surviving annuitant under section 72 during his life expectancy period (see paragraph (d)(1)(i) of this section)</P> <FP>by</FP> <P>(2) A fraction consisting of the value of the annuity for estate tax purposes over the value of the annuity at the date of death of the deceased annuitant.</P> <FP>This special value is used for the purpose of determining the net value for estate tax purposes (see section 691(c)(2)(B) and paragraph (a)(1) of § 1.691(c)-1) and for the purpose of determining the portion of estate tax attributable to the survivor's annuity (see paragraph (a) of § 1.691(c)-1).</FP> <P> (c) <E T="03">Amount of deduction.</E> The portion of estate tax attributable to the survivor's annuity (see paragraph (a) of § 1.691(c)-1) is allowable as a deduction to the surviving annuitant over his life expectancy period. If the surviving annuitant continues to receive annuity payments beyond this period, there is no further deduction under section 691(d). If the surviving annuitant dies before expiration of such period, there is no compensating adjustment for the unused deduction. </P> <P> (d) <E T="03">Definitions.</E> (1) For purposes of section 691(d) and this section: </P> <P> (i) The term <E T="03">life expectancy period</E> means the period beginning with the first day of the first period for which an amount is received by the surviving annuitant under the contract and ending with the close of the taxable year with or in which falls the termination of the life expectancy of the surviving annuitant. </P> <P>(ii) The life expectancy of the surviving annuitant shall be determined as of the date of death of the deceased annuitant, with reference to actuarial Table I set forth in § 1.72-9 (but without making any adjustment under paragraph (a)(2) of § 1.72-5).</P> <P>(iii) The value of the annuity at the date of death of the deceased annuitant shall be the entire value of the survivor's annuity determined by reference to the principles set forth in section 2031 and the regulations thereunder, relating to the valuation of annuities for estate tax purposes.</P> <P>(iv) The value of the annuity for estate tax purposes shall be that portion of the value determined under subdivision (iii) of this subparagraph which was includible in the deceased annuitant's gross estate.</P> <P>(2) The determination of the “life expectancy period” of the survivor for purposes of section 691(d) may be illustrated by the following example:</P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P> H and W file their income tax returns on the calendar year basis. H dies on July 15, 1955, on which date W is 70 years of age. On August 1, 1955, W receives a monthly payment under a joint and survivor annuity contract. W's life expectancy determined as of the date of H's death is 15 years as determined from Table I in § 1.72-9; thus her life expectancy ends on July 14, 1970. Under the provisions of section 691(d), her life expectancy period begins as of July 1, 1955, and ends as of December 31, 1970, thus giving her a life expectancy period of 15 <FR>1/2</FR> years. </P> </EXAMPLE> <P> (e) <E T="03">Examples.</E> The application of section 691(d) and this section may be illustrated by the following examples: </P> <EXAMPLE> <HD SOURCE="HED">Example 1.</HD> <P> (1) H and W, husband and wife, purchased a joint and survivor annuity contract for $203,800 providing for monthly payments of $1,000 starting January 28, 1954, and continuing for their joint lives and for the remaining life of the survivor. H contributed <PRTPAGE P="417"/> $152,850 and W contributed $50,950 to the cost of the annuity. As of the annuity starting date, January 1, 1954, H's age at his nearest birthday was 70 and W's age at her nearest birthday was 67. H dies on January 1, 1957, and beginning on January 28, 1957, W receives her monthly payments of $1,000. The value of the annuity at the date of H's death is $159,000 (see paragraph (d)(1)(iii) of this section), and the value of the annuity for estate tax purposes (see paragraph (d)(1)(iv) of this section) is $119,250 (152,850/203,800 of $159,000). As of the date of H's death, W's age is 70 and her life expectancy period is 15 years (see paragraph (d) of this section for method of computation). Both H and W reported income by use of the cash receipts and disbursements method and filed income tax returns on the calendar year basis. </P> <P>(2) The following computations illustrate the application of section 72 in determining the excludable portions of the annuity payments to W during her life expectancy period:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Amount of annuity payments per year (12 × $1,000)</ENT> <ENT>$12,000</ENT> </ROW> <ROW> <ENT I="01">Life expectancy of H and W as of the annuity starting date (see section 72(c)(3)(A) and Table II of § 1.72-9 (male, age 70; female, age 67))</ENT> <ENT>19.7</ENT> </ROW> <ROW> <ENT I="01">Expected return as of the annuity starting date, January 1, 1954 ($12,000 × 19.7 as determined under section 72(c)(3)(A) and paragraph (b) of § 1.72-5)</ENT> <ENT>$236,400</ENT> </ROW> <ROW> <ENT I="01">Investment in the contract as of the annuity starting date, Jan. 1, 1954 (see section 72(c)(1) and paragraph (a) of § 1.72-6)</ENT> <ENT>$203,800</ENT> </ROW> <ROW> <ENT I="01">Exclusion ratio (203,800/236,400 as determined under section 72(b) and § 1.72-4) (percent)</ENT> <ENT>86.2</ENT> </ROW> <ROW> <ENT I="01">Exclusion per year under section 72 ($12,000 × 86.2 percent)</ENT> <ENT>$10,344</ENT> </ROW> <ROW> <ENT I="01">Excludable during W's life expectancy period ($10,344 × 15)</ENT> <ENT>$155,160</ENT> </ROW> </GPOTABLE> <P>(3) For the purpose of computing the deduction for estate tax under section 691(c), the value for estate tax purposes of the amounts includible in W's gross income and considered income in respect of a decedent by virtue of section 691(d)(1) is $2,880. This amount is arrived at in accordance with the formula contained in section 691(d)(2), as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">Value of annuity at the date of H's death</ENT> <ENT>$159,000</ENT> </ROW> <ROW> <ENT I="01">Total amount excludable from W's gross income under section 72 during W's life expectancy period (see subparagraph (2) of this example)</ENT> <ENT>$155,160</ENT> </ROW> <ROW> <ENT I="01">Excess</ENT> <ENT>$3,840</ENT> </ROW> <ROW> <ENT I="01">Ratio which value of annuity for estate tax purposes bears to value of annuity at date of H's death (119,250/159,000) (percent)</ENT> <ENT>75</ENT> </ROW> <ROW> <ENT I="01">Value for estate tax purposes (75 percent of $3,840)</ENT> <ENT>$2,880</ENT> </ROW> </GPOTABLE> <FP>This amount ($2,880) is included in the items of income under section 691(a)(1) for the purpose of determining the estate tax attributable to each item under section 691(c)(1)(A). The estate tax determined to be attributable to the item of $2,880 is then allowed as a deduction to W over her 15-year life expectancy period (see example 2 of this paragraph).</FP> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2.</HD> <P>Assume, in addition to the facts contained in example 1 of this paragraph, that H was an attorney and was entitled at the date of his death to a fee for services rendered in a case not completed at the time of his death, which fee was valued at $1,000, and to accrued bond interest, which was valued at $500. Taking into consideration the annuity payments of example 1, valued at $2,880, a total of $4,380 was included in his gross estate in respect of income described in section 691(a)(1). There were deducted as claims against his estate $280 for business expenses for which his estate was liable and $100 for taxes accrued on certain property which he owned. In all, $380 was deducted for claims which represent amounts described in section 691(b) which are allowable as deductions to his estate or to the beneficiaries of his estate. His gross estate was $404,250 and considering deductions of $15,000, a marital deduction of $119,250 (assuming the annuity to be the only qualifying gift) and an exemption of $60,000, his taxable estate amounted to $210,000. The estate tax on this amount is $53,700 from which is subtracted a $175 credit for State death taxes, leaving an estate tax liability of $53,525. W may deduct, in computing her taxable income during each year of her 15-year life expectancy period, $14.73 on account of the estate tax attributable to the value for estate tax purposes of that portion of the annuity payments considered income in respect of a decedent, computed as follows:</P> <GPOTABLE COLS="3" OPTS="L0" CDEF="s25,8,8"> <ROW EXPSTB="01"> <ENT I="01">(1)(i) Value of income described in section 691(a)(1) included in computing gross estate</ENT> <ENT>$4,380.00</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">(ii) Deductions in computing gross estate for claims representing deductions described in section 691(b)</ENT> <ENT>380.00</ENT> </ROW> <ROW RUL="n,d"> <ENT I="03">(iii) Net value of items described in section 691(a) (1)</ENT> <ENT>4,000.00</ENT> </ROW> <ROW> <ENT I="01">(2)(i) Estate tax</ENT> <ENT>53,525.00</ENT> </ROW> <ROW RUL="n,s"> <ENT I="01">(ii) Less: estate tax computed without including $4,000 (item (1) (iii)) in gross estate and by reducing marital deduction by $2,880 (portion of item (1)(iii) allowed as a marital deduction)</ENT> <ENT>53,189.00</ENT> </ROW> <ROW> <ENT I="03">(iii) Portion of estate tax attributable to net value of income items</ENT> <ENT>336.00</ENT> </ROW> <ROW> <ENT I="01">(3)(i) Value in gross estate of income attributable to annuity payments</ENT> <ENT>2,880.00</ENT> </ROW> <ROW> <ENT I="01">(ii) Value in gross estate of all income items described in section 691(a)(1) (item (1)(i))</ENT> <ENT>4,380.00</ENT> </ROW> <ROW> <ENT I="01">(iii) Part of estate tax attributable to annuity income (2,880/4,380 of $336)</ENT> <ENT>220.93</ENT> </ROW> <ROW> <ENT I="01">(iv) Deduction each year on account of estate tax attributable to annuity income ($220.93 ÷ 15 (life expectancy period))</ENT> <ENT>14.73</ENT> </ROW> </GPOTABLE> </EXAMPLE> </SECTION> <SECTION> <SECTNO>§ 1.691(e)-1</SECTNO> <SUBJECT>Installment obligations transmitted at death when prior law applied.</SUBJECT> <P> (a) <E T="03">In general</E> —(1) <E T="03">Application of prior law.</E> Under section 44(d) of the Internal <PRTPAGE P="418"/> Revenue Code of 1939 and corresponding provisions of prior law, gains and losses on account of the transmission of installment obligations at the death of a holder of such obligations were required to be reported in the return of the decedent for the year of his death. However, an exception to this rule was provided if there was filed with the Commissioner a bond assuring the return as income of any payment in satisfaction of these obligations in the same proportion as would have been returnable as income by the decedent had he lived and received such payments. Obligations in respect of which such bond was filed are referred to in this section as “obligations assured by bond”. </P> <P> (2) <E T="03">Application of present law.</E> Section 691(a)(4) of the Internal Revenue Code of 1954 (effective for taxable years beginning after December 31, 1953, and ending after August 16, 1954) in effect makes the exception which under prior law applied to obligations assured by bond the general rule for obligations transmitted at death, but contains no requirement for a bond. Section 691(e)(1) provides that if the holder of the installment obligation makes a proper election, the provisions of section 691(a)(4) shall apply in the case of obligations assured by bond. Section 691(e)(1) further provides that the estate tax deduction provided by section 691(c)(1) is not allowable for any amount included in gross income by reason of filing such an election. </P> <P> (b) <E T="03">Manner and scope of election</E> —(1) <E T="03">In general.</E> The election to have obligations assured by bond treated as obligations to which section 691(a)(4) applies shall be made by the filing of a statement with respect to each bond to be released, containing the following information: </P> <P>(i) The name and address of the decedent from whom the obligations assured by bond were transmitted, the date of his death, and the internal revenue district in which the last income tax return of the decedent was filed.</P> <P>(ii) A schedule of all obligations assured by the bond on which is listed—</P> <P> ( <E T="03">a</E> ) The name and address of the obligors, face amount, date of maturity, and manner of payment of each obligation, </P> <P> ( <E T="03">b</E> ) The name, identifying number (provided under section 6109 and the regulations thereunder), and address of each person holding the obligations, and </P> <P> ( <E T="03">c</E> ) The name, identifying number, and address, of each person who at the time of the election possesses an interest in each obligation, and a description of such interest. </P> <P>(iii) The total amount of income in respect of the obligations which would have been reportable as income by the decedent if he had lived and received such payment.</P> <P>(iv) The amount of income referred to in subdivision (iii) of this subparagraph which has previously been included in gross income.</P> <P>(v) An unqualified statement, signed by all persons holding the obligations, that they elect to have the provisions of section 691(a)(4) apply to such obligations and that such election shall be binding upon them, all current beneficiaries, and any person to whom the obligations may be transmitted by gift, bequest, or inheritance.</P> <P>(vi) A declaration that the election is made under the penalties of perjury.</P> <P> (2) <E T="03">Filing of statement.</E> The statement with respect to each bond to be released shall be filed in duplicate with the district director of internal revenue for the district in which the bond is maintained. The statement shall be filed not later than the time prescribed for filing the return for the first taxable year (including any extension of time for such filing) to which the election applies. </P> <P> (3) <E T="03">Effect of election.</E> The election referred to in subparagraph (1) of this paragraph shall be irrevocable. Once an election is made with respect to an obligation assured by bond, it shall apply to all payments made in satisfaction of such obligation which were received during the first taxable year to which the election applies and to all such payments received during each taxable year thereafter, whether the recipient is the person who made the election, a current beneficiary, or a person to whom the obligation may be transmitted by gift, bequest, or inheritance. Therefore, all payments received to which the election applies shall be <PRTPAGE P="419"/> treated as payments made on installment obligations to which section 691(a)(4) applies. However, the estate tax deduction provided by section 691(c) is not allowable for any such payment. The application of this subparagraph may be illustrated by the following example: </P> <EXAMPLE> <HD SOURCE="HED">Example.</HD> <P>A, the holder of an installment obligation, died in 1952. The installment obligation was transmitted at A's death to B who filed a bond on Form 1132 pursuant to paragraph (c) of § 39.44-5 of Regulations 118 (26 CFR part 39, 1939 ed.) for the necessary amount. On January 1, 1965, B, a calendar year taxpayer, filed an election under section 691(e) to treat the obligation assured by bond as an obligation to which section 691(a)(4) applies, and B's bond was released for 1964 and subsequent taxable years. B died on June 1, 1965, and the obligation was bequeathed to C. On January 1, 1966, C received an installment payment on the obligation which had been assured by the bond. Because B filed an election with respect to the obligation assured by bond, C is required to treat the proper proportion of the January 1, 1966, payment and all subsequent payments made in satisfaction of this obligation as income in respect of a decedent. However, no estate tax deduction is allowable to C under section 691(c)(1) for any estate tax attributable to the inclusion of the value of such obligation in the estate of either A or B.</P> </EXAMPLE> <P> (c) <E T="03">Release of bond.</E> If an election according to the provisions of paragraph (b) of this section is filed, the liability under any bond filed under section 44(d) of the 1939 Code (or the corresponding provisions of prior law) shall be released with respect to each taxable year to which such election applies. However, the liability under any such bond for an earlier taxable year to which the election does not apply shall not be released until the district director of internal revenue for the district in which the bond is maintained is assured that the proper portion of each installment payment received in such taxable year has been reported and the tax thereon paid. </P> <CITA>[T.D. 6808, 30 FR 3436, Mar. 16, 1965]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.691(f)-1</SECTNO> <SUBJECT>Cross reference.</SUBJECT> <P>See section 753 and the regulations thereunder for application of section 691 to income in respect of a deceased partner.</P> <CITA>[T.D. 6808, 30 FR 3436, Mar. 16, 1965]</CITA> </SECTION> <SECTION> <SECTNO>§ 1.692-1</SECTNO> <SUBJECT>Abatement of income taxes of certain members of the Armed Forces of the United States upon death.</SUBJECT> <P>(a)(1) This section applies if:</P> <P>(i) An individual dies while in active service as a member of the Armed Forces of the United States, and</P> <P>(ii) His death occurs while he is serving in a combat zone (as determined under section 112), or at any place as a result of wounds, disease, or injury incurred while he was serving in a combat zone.</P> <P>(2) If an individuals dies as described in paragraph (a)(1), the following liabilities for tax, under subtitle A of the Internal Revenue Code of 1954 or under chapter 1 of the Internal Revenue Code of 1939, are canceled:</P> <P>(i) The libaility of the deceased individual, for the last taxable year, ending on the date of his death, and for any prior taxable year ending on or after the first day he served in a combat zone in active service as a member of the U.S. Armed Forces after June 24, 1950, and</P> <P>(ii) The liability of any other person to the extent the liability is attributable to an amount received after the individual's death (including income in respect of a decedent under section 691) which would have been includible in the individual's gross income for his taxable year in which the date of his death falls (determined as if he had survived).</P> <FP>If the tax (including interest, additions to the tax, and additional amounts) is assessed, the assessment will be abated. If the amount of the tax is collected (regardless of the date of collection), the amount so collected will be credited or refunded as an overpayment.</FP> <P> (3) If an individual dies as described in paragraph (a)(1), there will not be assessed any amount of tax of the indvidual for taxable years preceding the years specified in paragraph (a)(2), under subtitle A of the Internal Revenue Code of 1954, chapter 1 of the Internal Revenue Code of 1939, or corresponding provisions of prior revenue laws, remaining unpaid as of the date of death. If any such unpaid tax (including interest, additions to the tax, <PRTPAGE P="420"/> and additional amounts) has been assessed, the assessments will be abated. If the amount of any such unpaid tax is collected after the date of death, the amount so collected will be credited or refunded as an overpayment. </P> <P>(4) As to what constitutes active service as a member of the Armed Forces, service in a combat zone, and wounds, disease, or injury incurred while serving in a combat zone, see section 112. As to who are members of the Armed Forces, see section 7701(a)(15). As to the period of time within which any claim for refund must be filed, see sections 6511(a) and 7508(a)(1)(E).</P> <P>(b) If such an individual and his spouse have for any such year filed a joint return, the tax abated, credited, or refunded pursuant to the provisions of section 692 for such year shall be an amount equal to that portion of the joint tax liability which is the same percentage of such joint tax liability as a tax computed upon the separate income of such individual is of the sum of the taxes computed upon the separate income of such individual and his spouse, but with respect to taxable years ending before June 24, 1950, and with respect to taxable years ending before the first day such individual served in a combat zone, as determined under section 112, the amount so abated, credited, or refunded shall not exceed the amount unpaid at the date of death. For such purpose, the separate tax of each spouse:</P> <P>(1) For taxable years beginning after December 31, 1953, and ending after August 16, 1954, shall be the tax computed under subtitle A of the Internal Revenue Code of 1954 before the application of sections 31, 32, 6401(b), and 6402, but after the application of section 33, as if such spouse were required to make a separate income tax return; and</P> <P>(2) For taxable years beginning before January 1, 1954, and for taxable years beginning after December 31, 1953, and ending before August 17, 1954, shall be the tax computed under chapter 1 of the Internal Revenue Code of 1939 before the application of sections 32, 35, and 322(a), but after the application of section 31, as if such spouse were required to make a separate income tax return.</P> <P>(c) If such an individual and his spouse filed a joint declaration of estimated tax for the taxable year ending with the date of his death, the estimated tax paid pursuant to such declaration may be treated as the estimated tax of either such individual or his spouse, or may be divided between them, in such manner as his legal representative and such spouse may agree. Should they agree to treat such estimated tax, or any portion thereof, as the estimated tax of such individual, the estimated tax so paid shall be credited or refunded as an overpayment for the taxable year ending with the date of his death.</P> <P>(d) For the purpose of determining the tax which is unpaid at the date of death, amounts deducted and withheld under chapter 24, subtitle C of the Internal Revenue Code of 1954, or under subchapter D, chapter 9 of the Internal Revenue Code of 1939 (relating to income tax withheld at source on wages), constitute payment of tax imposed under subtitle A of the Internal Revenue Code of 1954 or under chapter 1 of the Internal Revenue Code of 1939, as the case may be.</P> <P>(e) This section shall have no application whatsoever with respect to the liability of an individual as a transferee of property of a taxpayer where such liability relates to the tax imposed upon the taxpayer by subtitle A of the Internal Revenue Code of 1954 or by chapter 1 of the Internal Revenue Code of 1939.</P> <CITA>[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7543, 43 FR 19392, May 5, 1978]</CITA> </SECTION> </SUBJGRP> <SUBJGRP> <HD SOURCE="HED">PARTNERS AND PARTNERSHIPS</HD> <HD SOURCE="HD1">Determination of Tax Liability</HD> <SECTION> <SECTNO>§ 1.701-1</SECTNO> <SUBJECT>Partners, not partnership, subject to tax.</SUBJECT> <P> Partners are liable for income tax only in their separate capacities. Partnerships as such are not subject to the income tax imposed by subtitle A but are required to make returns of income under the provisions of section 6031 and the regulations thereunder. For definition of the terms “partner” and “partnership”, see sections 761 and 7701(a)(2), and the regulations thereunder. For <PRTPAGE P="421"/> provisions relating to the election of certain partnerships to be taxed as domestic corporations, see section 1361 and the regulations thereunder. </P> </SECTION> <SECTION> <SECTNO>§ 1.701-2</SECTNO> <SUBJECT>Anti-abuse rule.</SUBJECT> <P> (a) <E T="03">Intent of subchapter K.</E> Subchapter K is intended to permit taxpayers to conduct joint business (including investment) activities through a flexible economic arrangement without incurring an entity-level tax. Implicit in the intent of subchapter K are the following requirements— </P> <P>(1) The partnership must be bona fide and each partnership transaction or series of related transactions (individually or collectively, the transaction) must be entered into for a substantial business purpose.</P> <P>(2) The form of each partnership transaction must be respected under substance over form principles.</P> <P> (3) Except as otherwise provided in this paragraph (a)(3), the tax consequences under subchapter K to each partner of partnership operations and of transactions between the partner and the partnership must accurately reflect the partners' economic agreement and clearly reflect the partner's income (collectively, <E T="03">proper reflection of income</E> ). However, certain provisions of subchapter K and the regulations thereunder were adopted to promote administrative convenience and other policy objectives, with the recognition that the application of those provisions to a transaction could, in some circumstances, produce tax results that do not properly reflect income. Thus, the proper reflection of income requirement of this paragraph (a)(3) is treated as satisfied with respect to a transaction that satisfies paragraphs (a)(1) and (2) of this section to the extent that the application of such a provision to the transaction and the ultimate tax results, taking into account all the relevant facts and circumstances, are clearly contemplated by that provision. See, for example, paragraph (d) <E T="03">Example 6</E> of this section (relating to the value-equals-basis rule in § 1.704-1(b)(2)(iii)( <E T="03">c</E> )), paragraph (d) <E T="03">Example 9</E> of this section (relating to the election under section 754 to adjust basis in partnership property), and paragraph (d) <E T="03">Examples 10 and 11</E> of this section (relating to the basis in property distributed by a partnership under section 732). See also, for example, §§ 1.704-3(e)(1) and 1.752-2(e)(4) (providing certain de minimis exceptions). </P> <P> (b) <E T="03">Application of subchapter K rules.</E> The provisions of subchapter K and the regulations thereunder must be applied in a manner that is consistent with the intent of subchapter K as set forth in paragraph (a) of this section ( <E T="03">intent of subchapter K</E> ). Accordingly, if a partnership is formed or availed of in connection with a transaction a principal purpose of which is to reduce substantially the present value of the partners' aggregate federal tax liability in a manner that is inconsistent with the intent of subchapter K, the Commissioner can recast the transaction for federal tax purposes, as appropriate to achieve tax results that are consistent with the intent of subchapter K, in light of the applicable statutory and regulatory provisions and the pertinent facts and circumstances. Thus, even though the transaction may fall within the literal words of a particular statutory or regulatory provision, the Commissioner can determine, based on the particular facts and circumstances, that to achieve tax results that are consistent with the intent of subchapter K— </P> <P>(1) The purported partnership should be disregarded in whole or in part, and the partnership's assets and activities should be considered, in whole or in part, to be owned and conducted, respectively, by one or more of its purported partners;</P> <P>(2) One or more of the purported partners of the partnership should not be treated as a partner;</P> <P>(3) The methods of accounting used by the partnership or a partner should be adjusted to reflect clearly the partnership's or the partner's income;</P> <P>(4) The partnership's items of income, gain, loss, deduction, or credit should be reallocated; or</P> <P>(5) The claimed tax treatment should otherwise be adjusted or modified.</P> <P> (c) <E T="03">Facts and circumstances analysis; factors.</E> Whether a partnership was formed or availed of with a principal purpose to reduce substantially the present value of the partners' aggregate federal tax liability in a manner <PRTPAGE P="422"/> inconsistent with the intent of subchapter K is determined based on all of the facts and circumstances, including a comparison of the purported business purpose for a transaction and the claimed tax benefits resulting from the transaction. The factors set forth below may be indicative, but do not necessarily establish, that a partnership was used in such a manner. These factors are illustrative only, and therefore may not be the only factors taken into account in making the determination under this section. Moreover, the weight given to any factor (whether specified in this paragraph or otherwise) depends on all the facts and circumstances. The presence or absence of any factor described in this paragraph does not create a presumption that a partnership was (or was not) used in such a manner. Factors include: </P> <P>(1) The present value of the partners' aggregate federal tax liability is substantially less than had the partners owned the partnership's assets and conducted the partnership's activities directly;</P> <P>(2) The present value of the partners' aggregate federal tax liability is substantially less than would be the case if purportedly separate transactions that are designed to achieve a particular end result are integrated and treated as steps in a single transaction. For example, this analysis may indicate that it was contemplated that a partner who was necessary to achieve the intended tax results and whose interest in the partnership was liquidated or disposed of (in whole or in part) would be a partner only temporarily in order to provide the claimed tax benefits to the remaining partners;</P> <P>(3) One or more partners who are necessary to achieve the claimed tax results either have a nominal interest in the partnership, are substantially protected from any risk of loss from the partnership's activities (through distribution preferences, indemnity or loss guaranty agreements, or other arrangements), or have little or no participation in the profits from the partnership's activities other than a preferred return that is in the nature of a payment for the use of capital;</P> <P>(4) Substantially all of the partners (measured by number or interests in the partnership) are related (directly or indirectly) to one another;</P> <P>(5) Partnership items are allocated in compliance with the literal language of §§ 1.704-1 and 1.704-2 but with results that are inconsistent with the purpose of section 704(b) and those regulations. In this regard, particular scrutiny will be paid to partnerships in which income or gain is specially allocated to one or more partners that may be legally or effectively exempt from federal taxation (for example, a foreign person, an exempt organization, an insolvent taxpayer, or a taxpayer with unused federal tax attributes such as net operating losses, capital losses, or foreign tax credits);</P> <P>(6) The benefits and burdens of ownership of property nominally contributed to the partnership are in substantial part retained (directly or indirectly) by the contributing partner (or a related party); or</P> <P>(7) The benefits and burdens of ownership of partnership property are in substantial part shifted (directly or indirectly) to the distributee partner before or after the property is actually distributed to the distributee partner (or a related party).</P> <P> (d) <E T="03">Examples.</E> The following examples illustrate the principles of paragraphs (a), (b), and (c) of this section. The examples set forth below do not delineate the boundaries of either permissible or impermissible types of transactions. Further, the addition of any facts or circumstances that are not specifically set forth in an example (or the deletion of any facts or circumstances) may alter the outcome of the transaction described in the example. Unless otherwise indicated, parties to the transactions are not related to one another. </P> <EXAMPLE> <HD SOURCE="HED">Example 1. Choice of entity; avoidance of entity-level tax; use of partnership consistent with the intent of subchapter K.</HD> <P>(i) A and B form limited partnership PRS to conduct a bona fide business. A, the corporate general partner, has a 1% partnership interest. B, the individual limited partner, has a 99% interest. PRS is properly classified as a partnership under §§ 301.7701-2 and 301.7701-3. A and B chose limited partnership form as a means to provide B with limited liability without subjecting the income from the business operations to an entity-level tax.</P> <P> (ii) Subchapter K is intended to permit taxpayers to conduct joint business activity <PRTPAGE P="423"/> through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. Although B has retained, indirectly, substantially all of the benefits and burdens of ownership of the money or property B contributed to PRS (see paragraph (c)(6) of this section), the decision to organize and conduct business through PRS under these circumstances is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1), (2), and (3) of this section have been satisfied. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 2. Choice of entity; avoidance of subchapter S shareholder requirements; use of partnership consistent with the intent of subchapter K.</HD> <P>(i) A and B form partnership PRS to conduct a bona fide business. A is a corporation that has elected to be treated as an S corporation under subchapter S. B is a nonresident alien. PRS is properly classified as a partnership under §§ 301.7701-2 and 301.7701-3. Because section 1361(b) prohibits B from being a shareholder in A, A and B chose partnership form, rather than admit B as a shareholder in A, as a means to retain the benefits of subchapter S treatment for A and its shareholders.</P> <P> (ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1), (2), and (3) of this section have been satisfied. Although it may be argued that the form of the partnership transaction should not be respected because it does not reflect its substance (inasmuch as application of the substance over form doctrine arguably could result in B being treated as a shareholder of A, thereby invalidating A's subchapter S election), the facts indicate otherwise. The shareholders of A are subject to tax on their pro rata shares of A's income (see section 1361 <E T="03">et seq.</E> ), and B is subject to tax on B's distributive share of partnership income (see sections 871 and 875). Thus, the form in which this arrangement is cast accurately reflects its substance as a separate partnership and S corporation. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 3. Choice of entity; avoidance of more restrictive foreign tax credit limitation; use of partnership consistent with the intent of subchapter K.</HD> <P>(i) X, a domestic corporation, and Y, a foreign corporation, form partnership PRS under the laws of foreign Country A to conduct a bona fide joint business. X and Y each owns a 50% interest in PRS. PRS is properly classified as a partnership under §§ 301.7701-2 and 301.7701-3. PRS pays income taxes to Country A. X and Y chose partnership form to enable X to qualify for a direct foreign tax credit under section 901, with look-through treatment under § 1.904-5(h)(1). Conversely, if PRS were a foreign corporation for U.S. tax purposes, X would be entitled only to indirect foreign tax credits under section 902 with respect to dividend distributions from PRS. The look-through rules, however, would not apply, and pursuant to section 904(d)(1)(E) and § 1.904-4(g), the dividends and associated taxes would be subject to a separate foreign tax credit limitation for dividends from PRS, a noncontrolled section 902 corporation.</P> <P>(ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS in order to take advantage of the look-through rules for foreign tax credit purposes, thereby maximizing X's use of its proper share of foreign taxes paid by PRS, is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1), (2), and (3) of this section have been satisfied. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 4. Choice of entity; avoidance of gain recognition under sections 351(e) and 357(c); use of partnership consistent with the intent of subchapter K.</HD> <P> (i) X, ABC, and DEF form limited partnership PRS to conduct a bona fide real estate management business. PRS is properly classified as a partnership under §§ 301.7701-2 and 301.7701-3. X, the general partner, is a newly formed corporation that elects to be treated as a real estate investment trust as defined in section 856. X offers its stock to the public and contributes substantially all of the proceeds from the public offering to PRS. ABC and DEF, the limited partners, are existing partnerships with substantial real estate holdings. ABC and DEF contribute all of their real property assets to PRS, subject to liabilities that exceed their respective aggregate bases in the real property contributed, and terminate under section 708(b)(1)(A). In addition, some of the former partners of ABC and DEF each have the right, beginning two years after the formation of PRS, to require the redemption of their limited partnership interests in PRS in exchange for cash or X stock (at X's option) equal to the fair market value of their respective interests in PRS at the time of the redemption. These partners are not compelled, as a legal or practical matter, to exercise their exchange rights at any time. X, ABC, and DEF chose to form a partnership rather than have ABC and DEF invest directly in X to allow ABC and DEF to avoid recognition of gain under sections 351(e) and 357(c). Because PRS would not be treated as <PRTPAGE P="424"/> an investment company within the meaning of section 351(e) if PRS were incorporated (so long as it did not elect under section 856), section 721(a) applies to the contribution of the real property to PRS. See section 721(b). </P> <P>(ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS, thereby avoiding the tax consequences that would have resulted from contributing the existing partnerships' real estate assets to X (by applying the rules of sections 721, 731, and 752 in lieu of the rules of sections 351(e) and 357(c)), is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1), (2), and (3) of this section have been satisfied. Although it may be argued that the form of the transaction should not be respected because it does not reflect its substance (inasmuch as the present value of the partners' aggregate federal tax liability is substantially less than would be the case if the transaction were integrated and treated as a contribution of the encumbered assets by ABC and DEF directly to X, see paragraph (c)(2) of this section), the facts indicate otherwise. For example, the right of some of the former ABC and DEF partners after two years to exchange their PRS interests for cash or X stock (at X's option) equal to the fair market value of their PRS interest at that time would not require that right to be considered as exercised prior to its actual exercise. Moreover, X may make other real estate investments and other business decisions, including the decision to raise additional capital for those purposes. Thus, although it may be likely that some or all of the partners with the right to do so will, at some point, exercise their exchange rights, and thereby receive either cash or X stock, the form of the transaction as a separate partnership and real estate investment trust is respected under substance over form principles (see paragraph (a)(2) of this section). The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 5. Special allocations; dividends received deductions; use of partnership consistent with the intent of subchapter K.</HD> <P>(i) Corporations X and Y contribute equal amounts to PRS, a bona fide partnership formed to make joint investments. PRS pays $100x for a share of common stock of Z, an unrelated corporation, which has historically paid an annual dividend of $6x. PRS specially allocates the dividend income on the Z stock to X to the extent of the London Inter-Bank Offered Rate (LIBOR) on the record date, applied to X's contribution of $50x, and allocates the remainder of the dividend income to Y. All other items of partnership income and loss are allocated equally between X and Y. The allocations under the partnership agreement have substantial economic effect within the meaning of § 1.704-1(b)(2). In addition to avoiding an entity-level tax, a principal purpose for the formation of the partnership was to invest in the Z common stock and to allocate the dividend income from the stock to provide X with a floating-rate return based on LIBOR, while permitting X and Y to claim the dividends received deduction under section 243 on the dividends allocated to each of them.</P> <P>(ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1), (2), and (3) of this section have been satisfied. Section 704(b) and § 1.704-1(b)(2) permit income realized by the partnership to be allocated validly to the partners separate from the partners' respective ownership of the capital to which the allocations relate, provided that the allocations satisfy both the literal requirements of the statute and regulations and the purpose of those provisions (see paragraph (c)(5) of this section). Section 704(e)(2) is not applicable to the facts of this example (otherwise, the allocations would be required to be proportionate to the partners' ownership of contributed capital). The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 6. Special allocations; nonrecourse financing; low-income housing credit; use of partnership consistent with the intent of subchapter K.</HD> <P> (i) A and B, high-bracket taxpayers, and X, a corporation with net operating loss carryforwards, form general partnership PRS to own and operate a building that qualifies for the low-income housing credit provided by section 42. The project is financed with both cash contributions from the partners and nonrecourse indebtedness. The partnership agreement provides for special allocations of income and deductions, including the allocation of all depreciation deductions attributable to the building to A and B equally in a manner that is reasonably consistent with allocations that have substantial economic effect of some other significant partnership item attributable to the building. The section 42 credits are allocated to A and B in accordance with the allocation of depreciation deductions. PRS's allocations comply with all applicable regulations, including the requirements of §§ 1.704-1(b)(2)(ii) (pertaining to economic effect) and 1.704-2(e) (requirements for allocations of nonrecourse deductions). The nonrecourse indebtedness is validly allocated to the partners under the rules of § 1.752-3, thereby increasing the basis of the partners' respective <PRTPAGE P="425"/> partnership interests. The basis increase created by the nonrecourse indebtedness enables A and B to deduct their distributive share of losses from the partnership (subject to all other applicable limitations under the Internal Revenue Code) against their nonpartnership income and to apply the credits against their tax liability. </P> <P> (ii) At a time when the depreciation deductions attributable to the building are not treated as nonrecourse deductions under § 1.704-2(c) (because there is no net increase in partnership minimum gain during the year), the special allocation of depreciation deductions to A and B has substantial economic effect because of the value-equals-basis safe harbor contained in § 1.704-1(b)(2)(iii)( <E T="03">c</E> ) and the fact that A and B would bear the economic burden of any decline in the value of the building (to the extent of the partnership's investment in the building), notwithstanding that A and B believe it is unlikely that the building will decline in value (and, accordingly, they anticipate significant timing benefits through the special allocation). Moreover, in later years, when the depreciation deductions attributable to the building are treated as nonrecourse deductions under § 1.704-2(c), the special allocation of depreciation deductions to A and B is considered to be consistent with the partners' interests in the partnership under § 1.704-2(e). </P> <P>(iii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a) (1), (2), and (3) of this section have been satisfied. Section 704(b), § 1.704-1(b)(2), and § 1.704-2(e) allow partnership items of income, gain, loss, deduction, and credit to be allocated validly to the partners separate from the partners' respective ownership of the capital to which the allocations relate, provided that the allocations satisfy both the literal requirements of the statute and regulations and the purpose of those provisions (see paragraph (c)(5) of this section). Moreover, the application of the value-equals-basis safe harbor and the provisions of § 1.704-2(e) with respect to the allocations to A and B, and the tax results of the application of those provisions, taking into account all the facts and circumstances, are clearly contemplated. Accordingly, even if the allocations would not otherwise be considered to satisfy the proper reflection of income standard in paragraph (a)(3) of this section, that requirement will be treated as satisfied under these facts. Thus, even though the partners' aggregate federal tax liability may be substantially less than had the partners owned the partnership's assets directly (due to X's inability to use its allocable share of the partnership's losses and credits) (see paragraph (c)(1) of this section), the transaction is not inconsistent with the intent of subchapter K. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 7. Partner with nominal interest; temporary partner; use of partnership not consistent with the intent of subchapter K.</HD> <P> (i) Pursuant to a plan a principal purpose of which is to generate artificial losses and thereby shelter from federal taxation a substantial amount of income, X (a foreign corporation), Y (a domestic corporation), and Z (a promoter) form partnership PRS by contributing $9,000 <E T="03">x,</E> $990 <E T="03">x,</E> and $10 <E T="03">x,</E> respectively, for proportionate interests (90.0%, 9.9%, and 0.1%, respectively) in the capital and profits of PRS. PRS purchases offshore equipment for $10,000 <E T="03">x</E> and validly leases the equipment offshore for a term representing most of its projected useful life. Shortly thereafter, PRS sells its rights to receive income under the lease to a third party for $9,000 <E T="03">x,</E> and allocates the resulting $9,000 <E T="03">x</E> of income $8,100 <E T="03">x</E> to X, $891 <E T="03">x</E> to Y, and $9 <E T="03">x</E> to Z. PRS thereafter makes a distribution of $9,000 <E T="03">x</E> to X in complete liquidation of its interest. Under § 1.704-1(b)(2)(iv)( <E T="03">f</E> ), PRS restates the partners' capital accounts immediately before making the liquidating distribution to X to reflect its assets consisting of the offshore equipment worth $1,000 <E T="03">x</E> and $9,000 <E T="03">x</E> in cash. Thus, because the capital accounts immediately before the distribution reflect assets of $19,000 <E T="03">x</E> (that is, the initial capital contributions of $10,000 <E T="03">x</E> plus the $9,000 <E T="03">x</E> of income realized from the sale of the lease), PRS allocates a $9,000 <E T="03">x</E> book loss among the partners (for capital account purposes only), resulting in restated capital accounts for X, Y, and Z of $9,000 <E T="03">x,</E> $990 <E T="03">x,</E> and $10 <E T="03">x,</E> respectively. Thereafter, PRS purchases real property by borrowing the $8,000 <E T="03">x</E> purchase price on a recourse basis, which increases Y's and Z's bases in their respective partnership interests from $1,881 <E T="03">x</E> and $19 <E T="03">x,</E> to $9,801 <E T="03">x</E> and $99 <E T="03">x,</E> respectively (reflecting Y's and Z's adjusted interests in the partnership of 99% and 1%, respectively). PRS subsequently sells the offshore equipment, subject to the lease, for $1,000 <E T="03">x</E> and allocates the $9,000 <E T="03">x</E> tax loss $8,910 <E T="03">x</E> to Y and $90 <E T="03">x</E> to Z. Y's and Z's bases in their partnership interests are therefore reduced to $891 <E T="03">x</E> and $9 <E T="03">x,</E> respectively. </P> <P> (ii) On these facts, any purported business purpose for the transaction is insignificant in comparison to the tax benefits that would result if the transaction were respected for federal tax purposes (see paragraph (c) of this section). Accordingly, the transaction lacks a substantial business purpose (see paragraph (a)(1) of this section). In addition, factors (1), (2), (3), and (5) of paragraph (c) of this section indicate that PRS was used with <PRTPAGE P="426"/> a principal purpose to reduce substantially the partners' tax liability in a manner inconsistent with the intent of subchapter K. On these facts, PRS is not bona fide (see paragraph (a)(1) of this section), and the transaction is not respected under applicable substance over form principles (see paragraph (a)(2) of this section) and does not properly reflect the income of Y (see paragraph (a)(3) of this section). Thus, PRS has been formed and availed of with a principal purpose of reducing substantially the present value of the partners' aggregate federal tax liability in a manner inconsistent with the intent of subchapter K. Therefore (in addition to possibly challenging the transaction under judicial principles or the validity of the allocations under § 1.704-1(b)(2) (see paragraph (h) of this section)), the Commissioner can recast the transaction as appropriate under paragraph (b) of this section. </P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 8. Plan to duplicate losses through absence of section 754 election; use of partnership not consistent with the intent of subchapter K.</HD> <P> (i) A owns land with a basis of $100 <E T="03">x</E> and a fair market value of $60 <E T="03">x.</E> A would like to sell the land to B. A and B devise a plan a principal purpose of which is to permit the duplication, for a substantial period of time, of the tax benefit of A's built-in loss in the land. To effect this plan, A, C (A's brother), and W (C's wife) form partnership PRS, to which A contributes the land, and C and W each contribute $30 <E T="03">x.</E> All partnership items are shared in proportion to the partners' respective contributions to PRS. PRS invests the cash in an investment asset (that is not a marketable security within the meaning of section 731(c)). PRS also leases the land to B under a three-year lease pursuant to which B has the option to purchase the land from PRS upon the expiration of the lease for an amount equal to its fair market value at that time. All lease proceeds received are immediately distributed to the partners. In year 3, at a time when the values of the partnership's assets have not materially changed, PRS agrees with A to liquidate A's interest in exchange for the investment asset held by PRS. Under section 732(b), A's basis in the asset distributed equals $100 <E T="03">x,</E> A's basis in A's partnership interest immediately before the distribution. Shortly thereafter, A sells the investment asset to X, an unrelated party, recognizing a $40 <E T="03">x</E> loss. </P> <P> (ii) PRS does not make an election under section 754. Accordingly, PRS's basis in the land contributed by A remains $100 <E T="03">x.</E> At the end of year 3, pursuant to the lease option, PRS sells the land to B for $60 <E T="03">x</E> (its fair market value). Thus, PRS recognizes a $40 <E T="03">x</E> loss on the sale, which is allocated equally between C and W. C's and W's bases in their partnership interests are reduced to $10 <E T="03">x</E> each pursuant to section 705. Their respective interests are worth $30 <E T="03">x</E> each. Thus, upon liquidation of PRS (or their interests therein), each of C and W will recognize $20 <E T="03">x</E> of gain. However, PRS's continued existence defers recognition of that gain indefinitely. Thus, if this arrangement is respected, C and W duplicate for their benefit A's built-in loss in the land prior to its contribution to PRS. </P> <P>(iii) On these facts, any purported business purpose for the transaction is insignificant in comparison to the tax benefits that would result if the transaction were respected for federal tax purposes (see paragraph (c) of this section). Accordingly, the transaction lacks a substantial business purpose (see paragraph (a)(1) of this section). In addition, factors (1), (2), and (4) of paragraph (c) of this section indicate that PRS was used with a principal purpose to reduce substantially the partners' tax liability in a manner inconsistent with the intent of subchapter K. On these facts, PRS is not bona fide (see paragraph (a)(1) of this section), and the transaction is not respected under applicable substance over form principles (see paragraph (a)(2) of this section). Further, the tax consequences to the partners do not properly reflect the partners' income; and Congress did not contemplate application of section 754 to partnerships such as PRS, which was formed for a principal purpose of producing a double tax benefit from a single economic loss (see paragraph (a)(3) of this section). Thus, PRS has been formed and availed of with a principal purpose of reducing substantially the present value of the partners' aggregate federal tax liability in a manner inconsistent with the intent of subchapter K. Therefore (in addition to possibly challenging the transaction under judicial principles or other statutory authorities, such as the substance over form doctrine or the disguised sale rules under section 707 (see paragraph (h) of this section)), the Commissioner can recast the transaction as appropriate under paragraph (b) of this section.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 9. Absence of section 754 election; use of partnership consistent with the intent of subchapter K.</HD> <P> (i) PRS is a bona fide partnership formed to engage in investment activities with contributions of cash from each partner. Several years after joining PRS, A, a partner with a capital account balance and basis in its partnership interest of $100 <E T="03">x,</E> wishes to withdraw from PRS. The partnership agreement entitles A to receive the balance of A's capital account in cash or securities owned by PRS at the time of withdrawal, as mutually agreed to by A and the managing general partner, P. P and A agree to distribute to A $100 <E T="03">x</E> worth of non-marketable securities (see section 731(c)) in which PRS has an aggregate basis of $20 <E T="03">x.</E> Upon distribution, A's aggregate basis in the securities is $100 <E T="03">x</E> under section 732(b). PRS does not make an election to adjust the basis in its remaining assets under section 754. Thus, <PRTPAGE P="427"/> PRS's basis in its remaining assets is unaffected by the distribution. In contrast, if a section 754 election had been in effect for the year of the distribution, under these facts section 734(b) would have required PRS to adjust the basis in its remaining assets downward by the amount of the untaxed appreciation in the distributed property, thus reflecting that gain in PRS's retained assets. In selecting the assets to be distributed, A and P had a principal purpose to take advantage of the facts that A's basis in the securities will be determined by reference to A's basis in its partnership interest under section 732(b), and because PRS will not make an election under section 754, the remaining partners of PRS will likely enjoy a federal tax timing advantage ( <E T="03">i.e.</E> , from the $80 <E T="03">x</E> of additional basis in its assets that would have been eliminated if the section 754 election had been made) that is inconsistent with proper reflection of income under paragraph (a)(3) of this section. </P> <P>(ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS is consistent with this intent. In addition, on these facts, the requirements of paragraphs (a)(1) and (2) of this section have been satisfied. The validity of the tax treatment of this transaction is therefore dependent upon whether the transaction satisfies (or is treated as satisfying) the proper reflection of income standard under paragraph (a)(3) of this section. A's basis in the distributed securities is properly determined under section 732(b). The benefit to the remaining partners is a result of PRS not having made an election under section 754. Subchapter K is generally intended to produce tax consequences that achieve proper reflection of income. However, paragraph (a)(3) of this section provides that if the application of a provision of subchapter K produces tax results that do not properly reflect income, but application of that provision to the transaction and the ultimate tax results, taking into account all the relevant facts and circumstances, are clearly contemplated by that provision (and the transaction satisfies the requirements of paragraphs (a)(1) and (2) of this section), then the application of that provision to the transaction will be treated as satisfying the proper reflection of income standard.</P> <P>(iii) In general, the adjustments that would be made if an election under section 754 were in effect are necessary to minimize distortions between the partners' bases in their partnership interests and the partnership's basis in its assets following, for example, a distribution to a partner. The electivity of section 754 is intended to provide administrative convenience for bona fide partnerships that are engaged in transactions for a substantial business purpose, by providing those partnerships the option of not adjusting their bases in their remaining assets following a distribution to a partner. Congress clearly recognized that if the section 754 election were not made, basis distortions may result. Taking into account all the facts and circumstances of the transaction, the electivity of section 754 in the context of the distribution from PRS to A, and the ultimate tax consequences that follow from the failure to make the election with respect to the transaction, are clearly contemplated by section 754. Thus, the tax consequences of this transaction will be treated as satisfying the proper reflection of income standard under paragraph (a)(3) of this section. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 10. Basis adjustments under section 732; use of partnership consistent with the intent of subchapter K.</HD> <P> (i) A, B, and C are partners in partnership PRS, which has for several years been engaged in substantial bona fide business activities. For valid business reasons, the partners agree that A's interest in PRS, which has a value and basis of $100 <E T="03">x,</E> will be liquidated with the following assets of PRS: a nondepreciable asset with a value of $60 <E T="03">x</E> and a basis to PRS of $40 <E T="03">x,</E> and related equipment with two years of cost recovery remaining and a value and basis to PRS of $40 <E T="03">x.</E> Neither asset is described in section 751 and the transaction is not described in section 732(d). Under section 732 (b) and (c), A's $100 <E T="03">x</E> basis in A's partnership interest will be allocated between the nondepreciable asset and the equipment received in the liquidating distribution in proportion to PRS's bases in those assets, or $50 <E T="03">x</E> to the nondepreciable asset and $50 <E T="03">x</E> to the equipment. Thus, A will have a $10 <E T="03">x</E> built-in gain in the nondepreciable asset ($60 <E T="03">x</E> value less $50 <E T="03">x</E> basis) and a $10 <E T="03">x</E> built-in loss in the equipment ($50 <E T="03">x</E> basis less $40 <E T="03">x</E> value), which it expects to recover rapidly through cost recovery deductions. In selecting the assets to be distributed to A, the partners had a principal purpose to take advantage of the fact that A's basis in the assets will be determined by reference to A's basis in A's partnership interest, thus, in effect, shifting a portion of A's basis from the nondepreciable asset to the equipment, which in turn would allow A to recover that portion of its basis more rapidly. This shift provides a federal tax timing advantage to A, with no offsetting detriment to B or C. </P> <P> (ii) Subchapter K is intended to permit taxpayers to conduct joint business activity through a flexible economic arrangement without incurring an entity-level tax. See paragraph (a) of this section. The decision to organize and conduct business through PRS is consistent with this intent. In addition, on these facts, the requirements of paragraphs <PRTPAGE P="428"/> (a)(1) and (2) of this section have been satisfied. The validity of the tax treatment of this transaction is therefore dependent upon whether the transaction satisfies (or is treated as satisfying) the proper reflection of income standard under paragraph (a)(3) of this section. Subchapter K is generally intended to produce tax consequences that achieve proper reflection of income. However, paragraph (a)(3) of this section provides that if the application of a provision of subchapter K produces tax results that do not properly reflect income, but the application of that provision to the transaction and the ultimate tax results, taking into account all the relevant facts and circumstances, are clearly contemplated by that provision (and the transaction satisfies the requirements of paragraphs (a)(1) and (2) of this section), then the application of that provision to the transaction will be treated as satisfying the proper reflection of income standard. </P> <P>(iii) A's basis in the assets distributed to it was determined under section 732 (b) and (c). The transaction does not properly reflect A's income due to the basis distortions caused by the distribution and the shifting of basis from a nondepreciable to a depreciable asset. However, the basis rules under section 732, which in some situations can produce tax results that are inconsistent with the proper reflection of income standard (see paragraph (a)(3) of this section), are intended to provide simplifying administrative rules for bona fide partnerships that are engaged in transactions with a substantial business purpose. Taking into account all the facts and circumstances of the transaction, the application of the basis rules under section 732 to the distribution from PRS to A, and the ultimate tax consequences of the application of that provision of subchapter K, are clearly contemplated. Thus, the application of section 732 to this transaction will be treated as satisfying the proper reflection of income standard under paragraph (a)(3) of this section. The Commissioner therefore cannot invoke paragraph (b) of this section to recast the transaction.</P> </EXAMPLE> <EXAMPLE> <HD SOURCE="HED">Example 11. Basis adjustments under section 732; plan or arrangement to distort basis allocations artificially; use of partnership not consistent with the intent of subchapter K.</HD> <P> (i) Partnership PRS has for several years been engaged in the development and management of commercial real estate projects. X, an unrelated party, desires to acquire undeveloped land owned by PRS, which has a value of $95 <E T="03">x</E>