7.26 Ark. Code R. 51-440

Current through Register Vol. 49, No. 10, October, 2024

Rule 7.26-51-440 - Subchapter M - FASITs - Transfers of Assets to FASITs

Where the holder of the ownership interest in a financial asset securitization investment trust (FASIT) or a related person sells or contributes property to the FASIT, gain is recognized immediately in an amount equal to the excess (if any) of the property's value on the date of the contribution over its adjusted basis on that date. This gain is recognized notwithstanding any other income tax Code provision, and the basis of any property is increased by the amount of gain recognized. IRC Sec. 860I.

Losses on assets contributed to the FASIT are not allowed upon their contribution, but may be allowed to the FASIT owner upon their disposition by the FASIT.