### Question
How does REAL ESTATE MORTGAGE INVESTMENT CONDUITS define Federal long-term rate?


### Answer
Under *26 U.S.C. § 860E*, **Federal long-term rate** is defined as:

> the Federal long-term rate which would have applied to the residual interest under section 1274(d) (determined without regard to paragraph (2) thereof) if it were a debt instrument

#### Citation:
  - *26 U.S.C. § 860E*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter M-Regulated Investment Companies and Real Estate Investment Trusts > PART IV-REAL ESTATE MORTGAGE INVESTMENT CONDUITS**

