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Instrumentality
Source:
Encyclopedia of Banking & Finance (9h Edition) by Charles J Woelfel
(We recommend this as work of authority and you can order
it here)
Literally,
an agency. Corporations organized
under act of Congress are exempt from federal incomes taxes if such corporations
are instrumentalities of the United States and if Congress has specifically
provided for such exemption under such act.
Examples are project notes issued under Section 11(b) of the United
States Housing Act of 1937, as amended, and Section 102(g) of the Housing
Act of 1949, as amended. Obligations
of federal instrumentalities are not automatically guaranteed as to principal
and interest by the United States.
One example of such a guarantee is that provided for FHA debenture
obligations.
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