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TITLE 26-INTERNAL REVENUE CODE graph (2) or (3), or of both such paragraphs, for any taxable year shall nevertheless be considered to have satisfied the requirements of such paragraphs for such taxable year if- (A) the nature and amount of each item of its gross income described in such para- graphs is set forth in a schedule attached to its income tax return for such taxable year; (B) the inclusion of any incorrect infor- mation in the schedule referred to in sub- paragraph (A) is not due to fraud with intent to evade tax; and (C) the failure to meet the requirements of paragraph (2) or (3), or of both such paragraphs, is due to reasonable cause and not due to willful neglect. (d) Rents from real property defined (1) Amounts Included For purposes of paragraphs (2) and (3) of subsection (c), the term "rents from real property" includes (subject to paragraph (2))- (A) rents from interests in real property, (B) charges for services customarily fur- nished or rendered in connection with the rental of real property, whether or not such charges are separately stated, and (C) rent attributable to personal property which is leased under, or in connection with, a lease of real property, but only if the rent attributable to such personal prop- erty for the taxable year does not exceed 15 percent of the total rent for the taxable year attributable to both the real and per- sonal property leased under, or in connec- tion with, such lease. For purposes of subparagraph (C), with re- spect to each lease of real property, rent at- tributable to personal property for the tax- able year is that amount which bears the same ratio to total rent for the taxable year as the average of the adjusted bases of the personal property at the beginning and at the end of the taxable year bears to the average of the aggregate adjusted bases of both the real property and the personal property at the beginning and at the end of such taxable year. (2) Amounts excluded For purposes of paragraphs (2) and (3) of subsection (c), the term "rents from real property" does not include- (A) except as provided in paragraph (4), any amount received or accrued, directly or indirectly, with respect to any real or per- sonal property, if the determination of such amount depends in whole or in part on the income or profits derived by any person from such property (except that any amount so received or accrued shall not be excluded from the term "rents from real property" solely by reason of being based on a fixed percentage or percentages of re- ceipts or sales); (B) any amount received or accrued di- rectly or indirectly from any person if the real estate investment trust owns, directly or indirectly- (i) in the case of any person which is a corporation, stock of such person possess- ing 10 percent or more of the total corn- bined voting power of all classes of stock entitled to vote, or 10 percent or more of the total number of shares of all classes of stock of such person; or (ii) in the case of any person which is not a corporation, an interest of 10 per- cent or more in the assets or net profits of such person; and (C) any amount received or accrued, di- rectly or indirectly, with respect to any real or personal property if the real estate in- vestment trust furnishes or renders services to the tenants of such property, or manages or operates such property, other than through an independent contractor from whom the trust itself does not derive or re- ceive any income. (3) Independent contractor defined For purposes of this subsection and subsec- tion (e), the term "independent contractor" means any person- (A) who does not own, directly or indirect- ly, more than 35 percent of the shares, or certificates of beneficial interest, in the real estate investment trust; and (B) if such person is a corporation, not more than 35 percent of the total combined voting power of whose stock (or 35 percent of the total shares of all classes of whose stock), or, if such person is not a corpora- tion, not more than 35 percent of the inter- est in whose assets or net profits is owned, directly or indirectly, by one or more per- sons owning 35 percent or more of the shares or certificates of beneficial interest in the trust. (4) Special rule for certain contingent rents Where a real estate investment trust re- ceives or accrues, with respect to real or per- sonal property, any amount which would be excluded from the term "rents from real property" solely because the tenant of the real estate investment trust receives or ac- crues, directly or indirectly, from subtenants any amount the determination of which de- pends in whole or in part on the income or profits derived by any person from such prop- erty, only a proportionate part (determined pursuant to regulations prescribed by the Secretary) of the amount received or accrued by the real estate investment trust from that tenant will be excluded from the term "rents from real property". (5) Constructive ownership of stock For purposes of this subsection, the rules prescribed by section 318(a) for determining the ownership of stock shall apply in deter- mining the ownership of stock, assets, or net profits of any person; except that "10 per- cent" shall be substituted for "50 percent" in subparagraph (C) of section 318(a)(2) and 318(a)(3). (e) Special rules for foreclosure property (1) Foreclosure property defined For purposes of this part, the term "foreclo- sure property" means any real property (in- cluding interests in real property), and any personal property incident to such real prop- erty, acquired by the real estate investment trust as the result of such trust having bid in Page 545 § 856