### Question
How does Accounting Periods and Methods of Accounting define frozen deposit?


### Answer
Under *26 U.S.C. § 451*, **frozen deposit** is defined as:

> any deposit if, as of the close of the calendar year, any portion of such deposit may not be withdrawn because of—


(A) the bankruptcy or insolvency of the qualified financial institution (or threat thereof), or


(B) any requirement imposed by the State in which such institution is located by reason of the bankruptcy or insolvency (or threat thereof) of 1 or more financial institutions in the State

#### Citation:
  - *26 U.S.C. § 451*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter E-Accounting Periods and Methods of Accounting > PART II-METHODS OF ACCOUNTING > Subpart B-Taxable Year for Which Items of Gross Income Included**

