Sec. 1.6049-2 Interest and original issue discount subject to reporting in calendar years before 1983.

(1) Interest on evidences of indebtedness issued by a corporation in "registered form" (as defined in paragraph (d) of this section).

The phrase "evidences of indebtedness" includes bond, debentures, notes, certificates and other similar instruments regardless of how denominated.

(2) Interest on deposits (except deposits evidenced by negotiable time certificates of deposit issued in an amount of $100,000 or more) paid (or credited) by persons carrying on the banking business.

In the case of a certificate of deposit issued in bearer form, the term "interest", as used in the preceding sentence and in paragraph (a)(1)(vi) of section 1.6049-1, has the same meaning as in section 1.61-7 (regardless of whether taxable to the payee in the year the information return is made).

(3) Amounts, whether or not designated as interest, paid (or credited) by mutual savings banks, savings and loan associations, building and loan associations, cooperative banks, homestead associations, credit unions, or similar organizations in respect of deposits, face amount certificates, investment certificates, or withdrawable or repurchasable shares.

Thus, even though amounts paid or credited by such organizations with respect to deposits are designated as "dividends", such amounts are included in the definition of interest for purposes of section 6049.

(4) Interest on amounts held by insurance companies under agreements to pay interest thereon.

This includes interest paid by insurance companies with respect to policy "dividend" accumulations (see sections 61 and 451 and the regulations thereunder for rules as to when such interest is considered paid), and interest paid with respect to the proceeds of insurance policies left with the insurer. The so-called "interest element" in the case of annuity or installment payments under life insurance or endowment contracts does not constitute interest for purposes of this section.

(5) Interest on deposits with stockbrokers, bondbrokers, and other persons engaged in the business of dealing in securities.

(1) Interest on obligations described in section 103(a)(1) or (3), relating to certain governmental obligations.

(2) Any payment by:

(3) Any interest which is subject to withholding under section 1441 or 1442 (relating to withholding of tax on nonresident aliens and foreign corporations, respectively) by the person making the payment, or which would be so subject to withholding but for the provisions of a treaty, or for the fact that under section 861(a)(1) it is not from sources within the United States, or for the fact that withholding is not required by reason of paragraph (a) or (f) of section 1.1441-4.

(4) In the case of a nominee, any interest which he receives and with respect to which he is required to withhold under section 1441 or 1442, or would be so required to withhold but for the provisions of a treaty, or for the fact that under section 861(a)(1) it is not from sources within the United States, or for the fact that withholding is not required by reason of paragraph (a) or (f) of section 1.1441-4.

(5) Any amount on which the person making the payment is required to deduct and withhold a tax under section 1451 (relating to tax-free covenant bonds), or would be so required but for section 1451(d) (relating to benefit of personal exemptions).

(6) Any amount which is subject to reporting as original issue discount.

(1) In general.

The term "original issue discount" when used in this section and sections 1.6049-1 and 1.6049-3 means original issue discount subject to the ratable inclusion rules of paragraph (a) of section 1.1232-3A, determined without regard to any reduction by reason of a purchase allowance under paragraph (a)(2)(ii) of section 1.1232-3A or a purchase at a premium as defined in paragraph (d)(2) of section 1.1232-3.

(2) Coordination with interest reporting.

In the case of an obligation issued after May 27, 1969 (other than an obligation issued pursuant to a written commitment which was binding on May 27, 1969, and at all times thereafter) and on or before December 31, 1982, original issue discount which is not subject to the reporting requirements of paragraph (a)(1)(ii) of section 1.6049-1 is interest within the meaning of paragraph (a) of this section. Original issue discount which is subject to the reporting requirements of paragraph (a)(1)(ii) of section 1.6049-1 is not interest within the meaning of paragraph (a) of this section.

(3) Exceptions.

Reporting of original issue discount is not required in respect of an obligation which paragraph (b)(2) of this section except from interest reporting.