[Code of Federal Regulations]
[Title 26, Volume 16]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR46.4701-1]

[Page 47-48]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 46_EXCISE TAX ON POLICIES ISSUED BY FOREIGN INSURERS AND OBLIGATIONS 
NOT IN REGISTERED FORM--Table of Contents
 
       Subpart C_Excise Tax on Obligations Not in Registered Form
 
Sec. 46.4701-1  Tax on issuer of registration-required obligation 
not in registered form.


    (a) In general. Section 4701 imposes a tax (determined under 
paragraph (c) of this section) on any person (referred to as the issuer) 
who issues an obligation that--
    (1) Is a registration-required obligation, and
    (2) Is not issued in registered form.

[[Page 48]]

    (b) Definitions--(1) Person. The term ``person'' includes all 
governmental entities.
    (2) Obligation. The term ``obligation'' includes bonds debentures, 
notes, certificates and other evidences of indebtedness regardless of 
how denominated.
    (3) Registration-required obligation. The term ``registration-
required obligation'' has the same meaning as when used in section 
163(f) (and the regulations thereunder) which relates to the denial of a 
deduction for interest on certain obligations not in registered form. 
However, the term ``registration-required obligation'' does not include 
any obligation which would otherwise be exempt from Federal income tax 
under section 103(a) or any other provision of law.
    (4) Registered form. The term ``registered form'' has the same 
meaning as when used in section 103(j) (and the regulations thereunder) 
which relates to obligations which must be in registered form to be tax-
exempt.
    (5) Issuer. Except as provided in Sec. 1.163-5T(d) (relating to 
pass-through certificates) and Sec. 1.163-5T(e) (relating to REMICs), 
the ``issuer'' is the person whose interest deduction would be 
disallowed solely by reason of section 163(f)(1).
    (6) Date of Issuance. (i) For obligations intended to be offered to 
the public, the term ``date of issuance'' means the date the obligation 
is first sold to the public at the issue price.
    (ii) For an obligation which is privately placed, the term ``date of 
issuance'' is the date the obligation is first sold by the issuer.
    (7) Issue price. See section 1273 (b) and the regulations thereunder 
for the definition of ``issue price''.
    (c) Rate and computation of tax. The tax under section 4701(a) is 
imposed in an amount equal to the product of--
    (1) 1 percent of the principal amount of the obligation, multiplied 
by
    (2) The number of calendar years (or portions thereof) during the 
period beginning on the date of issuance of the obligation and ending on 
the date of maturity.

For purposes of this paragraph, the term ``principal amount'' for a 
discounted obligation is the issue price, and for all other obligations, 
including obligations sold at a premium, the term ``principal amount'' 
is the stated redemption price at maturity.
    (d) Payment of tax. Every person who incurs liability for the tax 
imposed by section 4701 is required to file a return in accordance with 
section 6011 and Sec. 46.6011(a)-1 relating to the general requirement 
of a return, statement or list.
    (e) Effective date. The provisions of this section shall apply to 
obligations issued after December 31, 1982, unless issued on the 
exercise of a warrant or the conversion of a convertible obligation if 
the warrant or obligation was offered or sold outside the United States 
without registration under the Securities Act of 1933 and was issued 
before August 10, 1982. See section 310(d)(3) of the Tax Equity and 
Fiscal Responsibility Act of 1982.

[T.D. 8102, 51 FR 33594, Sept. 22, 1986; 51 FR 36392, Oct. 10, 1986, as 
amended by T.D. 8300, 55 FR 19627, May 10, 1990]