§3019 — Title 12 Banks and Banking | U.S. Code

Summary

State and local governments cannot tax the Bank’s business assets or income — things like its franchise, capital, reserves, surplus, mortgages, securities, or earnings. Any land or buildings the Bank owns, however, must be taxed like other real property based on value. For federal tax rules under subchapter T of the tax code (chapter 1, title 26), the Bank is treated as a cooperative corporation (section 1381(a)(2)). Only patronage refunds given or set aside as class B or class C stock or as allocated surplus under section 3014(i) count as patronage dividends or written notices of allocation. Patrons are treated as agreeing to include those amounts in their income, and those amounts are treated as business earnings by the patrons.

Title 12, §3019

Banks and Banking — Source: USLM XML via OLRC

(a)The Bank, including its franchise, capital, reserves, surplus, mortgages, or other security holdings and income shall be exempt from taxation now or hereafter imposed by any State, county, municipality, or local taxing authority, but any real property held by the Bank shall be subject to any State, county, municipal, or local taxation to the same extent according to its value as other real property is taxed.

(b)Notwithstanding any other provision of law, for purposes of subchapter T of chapter 1 of title 26—

(1)the Bank shall be treated as a corporation operating on the cooperative basis within the meaning of section 1381(a)(2) of title 26;

(2)the term “patronage dividend”, as defined in section 1388(a) of title 26 includes, only as such section applies to the Bank, any patronage refunds in the form of class B or class C stock or allocated surplus that are distributed or set aside by the Bank pursuant to section 3014(i) of this title;

(3)the terms “written notice of allocation” and “qualified written notices of allocation”, as defined in section 1388(b) and (c) of title 26, include (to the extent of par value), only as such sections apply to the Bank, any class B or class C stock distributed by the Bank pursuant to section 3014(i) of this title and shall also include any allocated surplus set aside by the Bank pursuant to section 3014(i) of this title;

(4)patrons of the Bank shall be deemed to have consented under section 1388(c)(2) of title 26 to the inclusion in their incomes of any qualified written notices of allocation received by such patrons from the Bank; and

(5)any amounts required to be included in the incomes of patrons of the Bank with respect to class B or class C stock or allocated surplus shall be treated as earnings from business done by such patrons of the Bank with or for their own patrons.

Notes & Related Subsidiaries

Editorial Notes

References in Text

Subchapter T of chapter 1 of title 26, referred to in subsec. (b), is set out as section 1381 et seq. of Title 26, Internal Revenue Code.

Amendments

1986—Subsec. (b). Pub. L. 99–514 substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text. 1981—Pub. L. 97–35 designated existing provisions as subsec. (a), struck out applicability of Final Government Equity Redemption Date to provisions, and added subsec. (b).

Statutory Notes and Related Subsidiaries

Effective Date

of 1981 Amendment Pub. L. 97–35, title III, § 392(b), Aug. 13, 1981, 95 Stat. 435, provided that: “The

Amendments

made by subsection (a) [amending this section] shall take effect on the day after the Final Government Equity Redemption Date [Dec. 31, 1981].” For definition of “Final Government Equity Redemption Date”, see section 396(a) of Pub. L. 97–35, set out as a note under section 3012 of this title.

§3019 Taxation by State, county, etc., taxing authority; Federal tax status

Summary

Title 12, §3019

Notes & Related Subsidiaries

Editorial Notes

References in Text

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Amendments

Citations & Metadata