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Notwithstanding section 861(a)(1) and the regulations
thereunder, however, certain interest is treated as income from
sources without the United States. Sec. 1.861-2(b), Income Tax
Regs. Interest received by a nonresident alien individual or a
foreign corporation on "deposits with persons carrying on the
banking business" is not treated as income from sources within
the United States, if such interest is not effectively connected
with the conduct of trade or business within the United States.
Sec. 861(a)(1)(A), (c)(1).
As we have stated supra p. 167, the Code and the regulations
do not define "deposits" for purposes of section 861(c). The
Commissioner, however, has interpreted the term "deposits" to
include, for purposes of section 861(c), "time certificates of
deposit, open account time deposits, and multiple maturity time
deposits, all of which are interest bearing." Rev. Rul. 72-104,
1972-1 C.B. 209, 209. We agree with the reasoning of Rev. Rul.
72-104, and we apply that reasoning in our interpretation of the
term "deposits" in section 861(c)(1).26 Accordingly, we conclude
26
A revenue ruling is entitled to no special deference.
Higgins v. Commissioner, 312 U.S. 212, 215 (1941); Helvering v.
New York Trust, 292 U.S. 455 (1934); Stark v. Commissioner, 86
T.C. 243, 250-251 (1986). The Court of Appeals for the Fifth
Circuit has stated:
a [revenue] ruling is merely the opinion of a lawyer in
the agency and must be accepted as such. It may be
helpful in interpreting a statute, but it is not
binding on the Secretary [of the Treasury] or the
courts. It does not have the effect of a regulation or
a Treasury Decision. * * * [Stubbs, Overbeck &
Associates v. United States, 445 F.2d 1142, 1146-1147
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