# Prop. Treas. Reg. § 1.1256(g)-2: Foreign currency contract defined.

Proposed regulation, not in force. REG-130675-17, 87 FR 40168, published 2022-07-06 <https://www.federalregister.gov/documents/2022/07/06/2022-14318/definition-of-foreign-currency-contract-under-section-1256>. Interprets 26 U.S.C. § 1256.

Par. 2. Section 1.1256(g)-2 is added to read as follows:

(a) Foreign currency contract. For purposes of section 1256, the term foreign currency contract means a forward contract that—

(1) Requires delivery of, or the settlement of which depends on the value of, a foreign currency that is a currency in which positions are also traded through regulated futures contracts;

(2) Is traded in the interbank market; and

(3) Is entered into at arm's length at a price determined by reference to the price in the interbank market.

(b) Applicability date. This section applies to contracts entered into on or after [date 30 days after date of publication of the final rule in the Federal Register ].