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TITLE 26-INTERNAL REVENUE CODE by this section) [section 666(a) of this title] shall not apply, and the amount of the accumulation distribu- tion of the trust for such taxable years shall be deemed to be an amount within the meaning of paragraph (2) of section 661(a) [section 661(a)(2) of this title] distributed on the last day of each of the preceding taxable years to the extent that such amount exceeds the total of any undistributed net income for any taxable years Intervening between the taxable year with respect of which the accumu- lation distribution is determined and such preceding taxable year. "(C) In the case of a trust which was in existence on December 31, 1969, section 669 of the Internal Revenue Code of 1954, as amended by this section [section 669 of this title], shall not apply to capital gain distributions made to a beneficiary before Janu- ary 1, 1973. If the beneficiary receives capital gain distributions from more than one such trust before January 1, 1973, the preceding sentence shall apply to capital gain distributions from only one such trust, such one to be designated by the taxpayer in accordance with regulations prescribed by the Secre- tary or his delegate. For purposes of the preceding sentence, capital gain distributions received from a trust qualifying under section 2056(b)(5) of the In- ternal Revenue Code of 1954 [section 2056(b)(5) of this title] by a surviving spouse (who is the benefi- ciary of only one such trust) shall be disregarded." ErFEcTivE DAT OF 1962 AmENDuMNT Amendment of section by Pub. L. 87-834 applicable with respect to distributions made after Dec. 31, 1962, see section 7(j) of Pub. L. 87-834, set out as an Effec- tive Date of 1962 Amendment note under section 643 of this title § 666. Accumulation distribution allocated to preced. ing years (a) Amount allocated In the case of a trust which is subject to sub- part C, the amount of the accumulation distri- bution of such trust for a taxable year shall be deemed to be an amount within the meaning of paragraph (2) of section 661(a) distributed on the last day of each of the preceding taxable years, commencing with the earliest of such years, to the extent that such amount exceeds the total of any undistributed net income for all earlier preceding taxable years. The amount deemed to be distributed in any such preceding taxable year under the preceding sentence shall not exceed the undistributed net. income for such preceding taxable year. For purposes of this subsection, undistributed net income for each of such preceding taxable years shall be computed without regard to such accumulation distribution and without regard to any accumu- lation distribution determined for any succeed- ing taxable year. (b) Total taxes deemed distributed If any portion of an accumulation distribu- tion for any taxable year is deemed under sub- section (a) to be an amount within the meaning of paragraph (2) of section 661(a) distributed on the last day of any preceding taxable year, and such portion of such distribution is not less than the undistributed net income for such pre- ceding taxable year, the trust shall be deemed to have distributed on the last day of such pre- ceding taxable year an additional amount within the meaning of paragraph (2) of section 661(a). Such additional amount shall be equal to the taxes imposed on the trust for such pre- ceding taxable year attributable to the undistri- buted net income. For purposes of this subsec- tion, the undistributed net income and the taxes imposed on the trust for such preceding taxable year attributable to such undistributed net income shall be computed without regard to such accumulation distribution and without regard to any accumulation distribution deter- mined for any succeeding taxable year. (c) Pro rata portion of taxes deemed distributed If any portion of an accumulation distribu- tion for any taxable year is deemed under sub- section (a) to be an amount within the meaning of paragraph (2) of section 661(a) distributed on the last day of any preceding taxable year and such portion of the accumulation distribu- tion is less than the undistributed net income for such preceding taxable year, the trust shall be deemed to have distributed on the last day of such preceding taxable year an additional amount within the meaning of paragraph (2) of section 661(a). Such additional amount shall be equal to the taxes imposed on the trust for such taxable year attributable to the undistri- buted net income multiplied by the ratio of the portion of the accumulation distribution to the undistributed net income of the trust for such year. For purposes of this subsection, the undis- tributed net income and the taxes imposed on the trust for such preceding taxable year at- tributable to such undistributed net income shall be computed without regard to the accu- mulation distribution and without regard to any accumulation distribution determined for any succeeding taxable year. (d) Rule when information is not available If adequate records are not available to deter- mine the proper application of this subpart to an amount distributed by a trust, such amount shall be deemed to be an accumulation distribu- tion consisting of undistributed net income earned during the earliest preceding taxable year of the trust in which it can be established that the trust was in existence. (e) Denial of refund to trusts and beneficiaries No refund or credit shall be allowed to a trust or a beneficiary of such trust for any preceding taxable year by reason of a distribution deemed to have been made by such. trust In such year under this section. (Aug. 16, 1954, ch. 736, 68A Stat. 224; Oct. 16, 1962, Pub. L. 87-834, § 7(c), 76 Stat. 986; Dec. 30, 1969, Pub. L. 91-172, title III,§ 331(a), 83 Stat. 593; Oct. 4, 197Q, Pub. L. 94-455, title VII, § 701(a)(2), 90 Stat. 1577.) AmmDMEtrrs 1978-Subsec. (e). Pub. L. 94-455 added subsec. (e). 1969-Subsec. (a). Pub. L. 91-172 substituted in the first sentence "In the case of a trust which is subject to subpart (C)" for "In the case of a trust (other than a foreign trust created by a United States person) which for a taxable year beginning after December 31, 1953, is subject to subpart (C)", "for a taxable year" for "for such taxable year", and "undistributed net income for all earlier preceding taxable years" for "undistributed net incomes for any taxable years in- tervening between the taxable year with respect to which the accumulation distribution is determined and such preceding taxable year" and in the second sentence "for such" for "of such", inserted in the first sentence ", commencing with the earliest of such years," following "preceding taxable years", deleted § 666 Page 470