Calendar year distribution requirement imposed upon regulated investment companies
What is Excise Tax
100
The excise distribution requirement must be met by this character requirement
What is TOTAL - character does not matter
100
Measured on a calendar year basis
What is Ordinary Income and Expenses
100
Specified Gain/Loss includes...
What is
Market Discount recognized upon disposition
PFIC Sales and MTM gain/loss under §1296(a)(1) and (2)
§988 Foreign Currency gain/loss transactions
§1256 Mark-to-Market of contracts subject to §988
SWAPS Mark-to-Market provisions
Gain on CPDI ((Regulation §1.1275-4)
§751 gain recognized on the disposition of a partnership interest
100
Available to RICs with FYEs of November and December
What is 4982(e)(4) Election
200
If the distribution requirement is not met, this amount of non-deductible excise tax is imposed
What is 4%
200
Determines the Character of distributions as Ordinary, ST, or LT capital gain
What is Subchapter M
200
Measured for the 12 month period 11/1 to 10/31
What is Net capital gain (loss) and Specified gain(loss)
200
Return to be filed of Excise Tax on Undistributed Income of RIC
What is Form 8613
200
Ordering of utilization of CLCO for excise purposes
1. First, offset gain against Post RIC MOD Loss
2. Second, offset any remaining gain against Pre RIC MOD loss
300
In this year Congress enacted the Excise tax rules
What is 1986
300
Prior year's undistributed income and capital gains
What is prior year shortfall
300
Distributions are measured by this time period
What is Calendar period (1/1 to 12/31)
300
Form 7004 is filed to allow the taxpayer what time period of extension
What is 6 months
300
Post-RIC Mod CLCO is incurred after this date
What is 12/22/2010
400
The excise tax provisions were enacted by this Act
What is the 1986 Tax Reform Act
400
RICs can distribute less than 98.2% of Capital Gain and more than 98% of Ordinary Income (or vice versa), as long as this is met
What is total requirement
400
Dividends declared in these months, and paid in January are treated as having been paid on December 31 of the calendar year declared
What is October November December
400
For distributions – funds generally distribute the greater of Excise Requirement or Spillback Requirement. If the Excise Requirement is greater, character is determined by this.
What is Subchapter M
400
Difference between the Excise position and the Subchapter M
What is
Utilization of Net Operating Losses (“NOL”)
Expiring Capital Loss Carryforwards
Return of Capital Distributions
Dividend Payables
500
Code Section imposing a non-deductible 4% tax
What is §4982
500
To avoid the 4% excise tax, a RIC must distribute in each calendar year this amount
What is
98% of the RIC’s ordinary income
PLUS
98.2% of the RIC’s capital gain net income
PLUS
100% PY’s undistributed income and capital gains (prior year shortfall)
500
Net Investment Company Taxable Income for the CALENDAR year
What is Net Short-Term Capital Gain and Dividends Paid Deduction
500
Investments under this amount made in connection with the organization of the RIC (“seed money”) are disregarded and NOT subject to Excise Tax Rules
What is $250,000
500
Each year after 12/31, Funds will need to be "trued up" for actual ordinary income and distributions this purpose