Rev. Rul. 66-268

A United States person as defined in section 4920(a)(4) of the Internal Revenue Code of 1954, made acquisitions of foreign securities in the following manner:

(a) With funds held outisde the United States on and after July 18, 1963.

(b) With funds derived outside the United States on and after July 18, 1963.

(c) With funds blocked in a foreign country because of local law.

(d) By trading one foreign security for another foreign security (other than transactions referred to in section 4914(a)(4) of the Code).

Held , any acquisition, whether occurring within or outside the United States, by a United States person of stock of a foreign issuer or of a debt obligation of a foreign obligor (if such obligation has a period remaining to maturity of one year or more) is subject to the interest equalization tax pursuant to section 4911 of the Internal Revenue Code of 1954, unless one or more specific statutory exemptions or exclusions is applicable. The source or currency of the funds used to make such acquisition, or the fact that funds are not used at all (e.g., as when securities of foreign corporation X are traded for an equivalent value of securities of foreign corporation Y ), is not the basis for any statutory exemption or exclusion.