Page:United States Statutes at Large Volume 83.djvu/584

This page needs to be proofread.
[83 STAT. 556]
[83 STAT. 556]
PUBLIC LAW 91-000—MMMM. DD, 1969

556

PUBLIC LAW 91-172-DEC. 30, 1969

[33 3^^

basis in such property shall be allocated between the interest con tributed and any interest not contributed in accordance with reoi' lations prescribed by the Secretary or his delegate. ^" "(f) DISALLOWANCE OF DEDUCTION I N CERTAIN CASES AND SPECUT RULES.—

Ante, pp. 494,

"(1) IN GENERAL.—No deduction shall be allowed under this section for a contribution to or for the use of an organization or (;pyst described in section 508(d) or 4948(c)(4) subject to the i T'; conditions specified in such sections. /:

"(2) M:

' = ' ' ' Post. p. 562. Post, p. 558,

^8A Stat. 2^26.

CONTRIBUTIONS OF PROPERTY PLACED I N TRUST.— " (A) REMAINDER INTEREST.—In the case of property trans-

ferred in trust, no deduction shall be allowed under this section for the value of a contribution of a remainder interest unless the trust is a charitable remainder annuity trust or a charitable remainder unitrust (described in section 664) or a pooled income fund (described in section 642(c)(5)). " (B) INCOME INTERESTS, ETC.—No deduction shall be allowed under this section for the value of any interest in property (other than a remainder interest) transferred in trust unless the interest is in the form of a guaranteed annuity or the trust instrument specifies that the interest is a fixed percentage distributed yearly of the fair market value of the trust property (to be determined yearly) and the grantor is treated as the owner of such interest for purposes of applying section 671. If the donor ceases to be treated as the owner of such an interest for purposes of applying section 671, at the time the donor ceases to be so treated, the donor shall for purposes of this chapter be considered as having received an amount of income equal to the amount of any deduction he received under this section for the contribution reduced by the discounted value of all amounts of income earned by the trust and taxable to him before the time at which he ceases to be treated as the owner of the interest. Such amounts of income shall be discounted to the date of the contribution. The Secretary or his delegate shall prescribe such regulations as may be necessary to carry out the purposes of this subparagraph. " (C) DENIAL OF DEDUCTION I N CASE OF PAYMENTS BY CERTAIN TRUSTS.—In any case in which a deduction is allowed

under this section for the value of an interest in property described in subparagraph (B), transferred in trust, no deduction shall be allowed under this section to the grantor or any other person for the amount of any contribution made by the trust with respect to such interest. " (D) EXCEPTION.—This paragraph shall not apply in a case in which the value of all interests in property transferred in trust are deductible under subsection (a). "(3) DENIAL OF DEDUCTION I N CASE OF CERTAIN CONTRIBUTIONS OF PARTIAL INTERESTS I N PROPERTY.

,V '

, »'•

" (A) IN GENERAL.—Inthecaseof a contribution (notmade b j a transfer in trust) of an interest in property which consists of less than the taxpayer's entire interest in such propJf ^ deduction shall be allowed under this section only to the extent that the value of the interest contributed would W allowable as a deduction under this section if such interest had been transferred in trust. For purposes of this subparagraph, a contribution by a taxpayer of the right to use proP' erty shall be treated as a contribution of less than the taxpayer's entire interest in such property.