PUBLIC LAW 94^55—OCT. 4, 1976
90 STAT. 1867
for payment of which would not have so arrived shall be paid at the time such installments would have been due if such an election h a d been made. " (i) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to the application of this section. " (j) CROSS REFERENCES.—
"(1) Security.— "For authority of the Secretary to require security in the case of an extension under this section, see section 6165. "(2) L i e n ^ "For special lien (in lieu of bond) in the case of an extension under this section, see section 6324A. "(3) Period of limitation.— "For extension of the period of limitation in the case of an extension under this section, see section 6503(d). "(4) Interest.— "For provisions relating to interest on tax payable in installments under this section, see subsection (j) of section 6601." (b) 4 - P E R C E N T INTEREST RATE.—Section 6601 ( r e l a t i n g to interest
26 USC 6601.
on underpayment, nonpayment, or extension of time for payment of tax) is amended by redesignating subsection (j) as subsection (k) and by inserting after subsection (i) the following new subsection: " (j) 4 - P E R C E N T R A T E ON CERTAIN PORTION OF ESTATE T A X EXTENDED U N D E R SECTION 6166.—
" (1) IN GENERAL.—If the time for payment of a n amount of tax imposed by chapter 11 is extended as provided in section 26 USC 2001. 6166, interest on the 4-percent portion of such amount shall (in lieu of the annual rate provided by subsection (a)) be paid a t the rate of 4 percent. For purposes of this subsection, the amount of any deficiency which is prorated to installments payable under section 6166 shall be treated as an amount of tax payable in install,, ments under such section. "(2)
4-PERCENT PORTION.—For purposes of this subsection, the
term '4-percent portion' means the lesser of— " (A) $345,800 reduced by the amount of the credit allowable under section 2010(a); or ^"^«' P- l ^ ^ " (B) the amount of the tax imposed by chapter 11 which is extended as provided in section 6166. " (3) TREATMENT OF PAYMENTS.—If the a m o u n t of tax imposed
by chapter 11 which is extended as provided in section 6166 exceeds the 4-percent portion, any payment of a portion of such amount shall, for purposes of computing interest for periods after such payment, be treated as reducing the 4-percent portion by an amount which bears the same ratio to the amount of such payment as the amount of the 4-percent portion (determined without regard to this paragraph) bears to the amount of the tax which is extended as provided in section 6166." (c) REASONABLE CAUSE SUBSTITUTED FOR U N D U E H A R D S H I P I N DETERMINING ELIGIBILITY FOR EXTENSIONS OF P A Y M E N T OF ESTATE T A X. —
(1) Paragraph (2) of section 6161(a) (relating to extension 26 USC 6161. of time for p a y i n g estate tax) is amended to read as follows: " (2) ESTATE TAX.—The Secretary may, for reasonable cause, extend the time for payment of— " (A) any part of the amount determined by the executor as the tax imposed by chapter 11, or " (R) any part of any installment under section 6166 or 6166A (including any part of a deficiency prorated to any installment under such section),
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