### Question
What is the definition of portfolio interest?


### Answer
The definition of **portfolio interest** is as follows in *26 U.S.C. § 871*:

> any interest (including original issue discount) which—


(A) would be subject to tax under subsection (a) but for this subsection, and


(B) is paid on an obligation—


(i) which is in registered form, and


(ii) with respect to which—


(I) the United States person who would otherwise be required to deduct and withhold tax from such interest under section 1441(a) receives a statement (which meets the requirements of paragraph (5)) that the beneficial owner of the obligation is not a United States person, or


(II) the Secretary has determined that such a statement is not required in order to carry out the purposes of this subsection

#### Citation:
  - *26 U.S.C. § 871*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter N-Tax Based on Income From Sources Within or Without the United States > PART II-NONRESIDENT ALIENS AND FOREIGN CORPORATIONS > Subpart A-Nonresident Alien Individuals**

