[Code of Federal Regulations]
[Title 26, Volume 7]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.501(c)(21)-1]

[Page 39]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.501(c)(21)-1  Black lung trusts--certain terms.

    (a) Created or organized in the United States. A trust is not 
created or organized in the United States unless it is maintained at all 
times as a domestic trust in the United States. For this purpose, 
section 7701(a)(9) limits the term United States to the District of 
Columbia and States of the United States.
    (b) Insurance company. The term insurance company means an 
insurance, surety, bonding or other company whose liability for the 
kinds of claims to which section 501(c)(21)(A)(i) applies is as an 
insurer or guarantor of the liabilities of another.
    (c) Black Lung Acts. The term Black Lung Acts includes any State law 
providing compensation for disability or death due to pneumoconiosis 
even though the State law compensates for other kinds of injuries. In 
such a case, section 501(c)(21) applies only to the extent that the 
liability is attributable to disability or death due to pneumoconiosis. 
For this purpose, the term pneumoconiosis has the same meaning as it has 
under federal law. See 30 U.S.C. 902.
    (d) Insurance exclusively covering such liability. The term 
insurance exclusively covering such liability includes insurance that 
covers risk for liabilities in addition to the liabilities to which 
section 501(c)(21)(A)(i) applies. In such a case, payment for premiums 
may be made from the trust only to the extent of that portion of the 
premiums that has been separately allocated and stated by the insurer as 
attributable solely to coverage of the liabilities to which section 
501(c)(21)(A)(i) applies.
    (e) Administrative and other incidental expenses. The term 
administrative and other incidental expenses means expenditures that are 
appropriate and helpful to the trust making them in carrying out the 
purposes for which its assets may be used under section 501(c)(21)(B). 
The term includes any exicse tax imposed on the trust under section 4952 
(relating to taxes on taxable expenditures) and reasonable expenses, 
such as legal expenses, incurred by the trust in connection with an 
assertion against the trust of liability for a taxable expenditure. The 
term does not include an excise tax imposed on the trustee or on other 
disqualified persons under section 4951 (relating to taxes on self-
dealing) or under section 4953 (relating to tax on excess contributions 
to black lung benefit trusts) or any expenses incurred in connection 
with the assertion of these taxes other than expenses that are treated 
as part of reasonable compensation under section 4951(d)(2)(C). See 
Sec. Sec. 53.4941 (d)-2(f)(3) and (d)-3(c) for interpretations of 
similar provisions under section 4941(d)(2)(E), relating to reasonable 
compensation for private foundation disqualified persons.
    (f) Public debt securities of the United States. The term public 
debt securities of the United States means obligations that are taken 
into consideration for purposes of the public debt limit. See, for 
example 31 U.S.C. 757b.
    (g) Obligations of a State or local government. The term obligations 
of a State or local government means the obligations of a State or local 
governmental unit the interest on which is exempt from tax under section 
103(a). See Sec. 1.103-1(a).
    (h) Time or demand deposits. The term time or demand deposits 
includes checking accounts, savings accounts, certificates of deposit or 
other time or demand deposits. The term does not include common or 
collective trust funds such as a common trust fund as defined in section 
584.

[44 FR 52197, Sept. 7, 1979]