Note:

Effective January 1, 2005, the special rules for FASITs were repealed. However, the special rules still apply to any FASIT in existence on October 22, 2004, to the extent that regular interests issued by the FASIT before that date continue to remain outstanding following the original issuance.

FASITs are used to securitize debt obligations such as credit card receivables, home equity loans, and auto loans.

A qualified arrangement becomes a FASIT when an eligible corporation, as defined in IRC 860L(a)(2), submits a timely filed election as required under IRC 860L(a)(1)(A).

A timely filed FASIT election is a statement submitted with a timely filed original federal income tax return (including extension) for an eligible C corporation. The statement must be filed in the taxable year in which the FASIT's startup day occurs.