[Code of Federal Regulations]
[Title 26, Volume 8]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.669(a)-1]

[Page 229-230]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.669(a)-1  Limitation on tax.

    (a) In general. Section 669 provides that, at the election of a 
beneficiary who is a U.S. person (as defined in section 7701(a)(30)) and 
who satisfies the requirements of section 669(b) (that certain 
information with respect to the operation and accounts of the trust be 
supplied), the tax attributable to the amounts treated under section 
668(a) as having been received by him, from a foreign trust created by a 
U.S. person, on the last day of a preceding taxable year of the trust 
shall not be greater than the tax computed under section 669(a)(1)(A) 
(the computation under this provision will hereinafter be referred to as 
the ``exact throwback'' method) or under section 669(a)(1)(B) (the 
computation under this provision will hereinafter be referred to as the 
``short-cut throwback'' method). This election of the beneficiary with 
respect to the taxable year of the beneficiary in which the distribution 
is made shall be made with the district director before the expiration 
of the period of limitations for assessment provided in section 6501 for 
such taxable year.
    (b) Where no election is made. If the beneficiary does not make the 
election provided in section 669(a) in the manner required in section 
669(b) and Sec. 1.669(b)-2, or furnish the information with respect to 
the operation and accounts of the foreign trust created by a U.S. person 
required by section 669(b) and Sec. 1.669(b)-1, the tax on an 
accumulation distribution treated under section 668(a) as having been 
received by him from such foreign trust on the last day of a preceding 
taxable year of the

[[Page 230]]

trust shall be computed without reference to section 668 or 669. In such 
case, the entire accumulation distribution will be included in the gross 
income of the beneficiary in the year in which it is paid, credited, or 
required to be distributed, and tax for such year will be computed on 
the basis of the beneficiary's total taxable income for the year after 
taking into account such inclusion in gross income.
    (c) Year for which tax is payable. The tax, regardless of the manner 
in which computed, of the beneficiary which is attributable to an 
accumulation distribution is imposed on the beneficiary for the taxable 
year of the beneficiary in which the accumulation distribution is made 
to him unless the taxable year of the beneficiary is different from that 
of the trust. See section 662(c) and Sec. 1.662(c)-1.

[T.D. 6989, 34 FR 738, Jan. 17, 1969]