[Code of Federal Regulations]
[Title 26, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.243-2]

[Page 384-385]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.243-2  Special rules for certain distributions.

    (a) Dividends paid by mutual savings banks, etc. In determining the 
deduction provided in section 243(a), any amount allowed as a deduction 
under section 591 (relating to deduction for dividends paid by mutual 
savings

[[Page 385]]

banks, cooperative banks, and domestic building and loan associations) 
shall not be considered as a dividend.
    (b) Dividends received from regulated investment companies. In 
determining the deduction provided in section 243(a), dividends received 
from a regulated investment company shall be subject to the limitations 
provided in section 854.
    (c) Dividends received from real estate investment trusts. See 
section 857(c) and paragraph (d) of Sec. 1.857-6 for special rules 
which deny a deduction under section 243 in the case of dividends 
received from a real estate investment trust with respect to a taxable 
year for which such trust is taxable under Part II, Subchapter M, 
Chapter 1 of the Code.
    (d) Dividends received on preferred stock of a public utility. The 
deduction allowed by section 243(a) shall be determined without regard 
to any dividends described in section 244 (relating to dividends on the 
preferred stock of a public utility). That is, such deduction shall be 
determined without regard to any dividends received on the preferred 
stock of a public utility which is subject to taxation under Chapter 1 
of the Code and with respect to which a deduction is allowed by section 
247 (relating to dividends paid on certain preferred stock of public 
utilities). For a deduction with respect to such dividends received on 
the preferred stock of a public utility, see section 244. If a deduction 
for dividends paid is not allowable to the distributing corporation 
under section 247 with respect to the dividends on its preferred stock, 
such dividends received from a domestic public utility corporation 
subject to taxation under Chapter 1 of the Code are includible in 
determining the deduction allowed by section 243(a).

[T.D. 6598, 27 FR 4092, Apr. 28, 1962, as amended by T.D. 6992, 34 FR 
817, Jan. 18, 1969; T.D. 7767, 46 FR 11264, Feb. 6, 1981]