### Question
How does the law define regulated investment company?


### Answer
Under *26 U.S.C. § 851*, **regulated investment company** is defined as:

> any domestic corporation—



(1) which, at all times during the taxable year—



(A) is registered under the Investment Company Act of 1940, as amended (15 U.S.C. 80a–1 to 80b–2) as a management company or unit investment trust, or



(B) has in effect an election under such Act to be treated as a business development company, or


  


(2) which is a common trust fund or similar fund excluded by section 3(c)(3) of such Act (15 U.S.C. 80a–3(c)) from the definition of "investment company" and is not included in the definition of "common trust fund" by section 584(a)

#### Citation:
  - *26 U.S.C. § 851*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter M-Regulated Investment Companies and Real Estate Investment Trusts > PART I-REGULATED INVESTMENT COMPANIES**

