[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: 26CFR1.563-3]

[Page 302-303]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.563-3  Dividends considered as paid on last day of taxable year.

    (a) General rule. Where a distribution made after the close of the 
taxable year is considered as paid during such taxable year, for 
purposes of applying section 562(a) the distribution shall be considered 
as made on the last day of such taxable year.
    (b) Personal holding company tax. In the case of a corporation which 
under the law applicable to the taxable year in respect of which a 
distribution is made under section 563(b) and Sec. 1.563-2 is a 
personal holding company under the law applicable to such taxable year, 
section 316(b)(2) provides that the term dividend means (in addition to 
the general rule under section 316(a)) any distribution to the extent of 
the corporation's undistributed personal holding company income 
(determined under section 545 without regard to distributions under 
section 316(b)(2)) for such year. See paragraph (b) of Sec. 1.316-1.
    (c) Dividends paid on or before December 15, 1955. The Act of June 
15, 1955 (Public Law 74, 84th Cong., 69 Stat. 136), repealed sections 
452 and 462 of the Code, relating to prepaid income and reserve for 
estimated expenses. Under section 4(c)(4) of that Act, dividends paid 
after the 15th day of the third month following the close of the taxable 
year and on or before December 15,

[[Page 303]]

1955, may be treated as having been paid on the last day of the taxable 
year for purposes of the accumulated earnings tax or the personal 
holding company tax and in the case of regulated investment companies, 
but only to the extent that such dividends are attributable to an 
increase in taxable income for the taxable year by reason of the repeal 
of sections 452 and 462. See paragraph (b) of Sec. 1.9000-8, relating 
to treatment of certain dividends, prescribed pursuant to section 
4(c)(4) of the Act of June 15, 1955.