---
kind: "section"
citation: "7 U.S.C. § 926"
title: "7"
title_heading: "Agriculture"
number: "926"
heading: "Certain rural development investments by qualified telephone borrowers not treated as dividends or distributions"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/7/926"
units:
  - "Chapter 31 — Rural Electrification and Telephone Service"
  - "Subchapter II — Rural Telephone Service"
---

# §926. Certain rural development investments by qualified telephone borrowers not treated as dividends or distributions

- (a) **In general—** The [Secretary](/usc/7/913.md?p=5) shall not—
  - (1) treat any amount invested by any qualified telephone borrower for any purpose described in [section 2204b(c)(2) of this title](/usc/7/2204b.md?p=c-2) (including any investment in, or extension of credit, guarantee, or advance made to, an affiliated company of the borrower, that is used by such company for such a purpose) as a dividend or distribution of capital to the extent that, immediately after such investment, the aggregate of such investments does not exceed ⅓ of the net worth of the borrower; or
  - (2) require a qualified telephone borrower to obtain the approval of the [Secretary](/usc/7/913.md?p=5) in order to make an investment described in [paragraph (1)](#a-1).
- (b) **“Qualified telephone borrower” defined—** As used in [subsection (a)](#a), the term “qualified telephone borrower” means a [person](/usc/7/499a.md?p=b-1)—
  - (1) to whom a telephone loan has been made or guaranteed under this chapter; and
  - (2) whose net worth is at least 20 percent of the total assets of such [person](/usc/7/499a.md?p=b-1).

## Source credit

(May 20, 1936, ch. 432, title II, § 205, as added Pub. L. 101–624, title XXIII, § 2356, Nov. 28, 1990, 104 Stat. 4039; amended Pub. L. 103–354, title II, § 235(a)(13), Oct. 13, 1994, 108 Stat. 3221; Pub. L. 115–334, title VI, § 6602(b)(3), Dec. 20, 2018, 132 Stat. 4776.)

## Notes

### Editorial Notes

### Amendments

2018—Subsec. (a). Pub. L. 115–334, § 6602(b)(3)(A), struck out “and the Governor of the telephone bank” after “The Secretary” in introductory provisions.

Subsec. (a)(2). Pub. L. 115–334, § 6602(b)(3)(B), struck out “or the Governor of the telephone bank” after “the Secretary”.

1994—Subsec. (a). Pub. L. 103–354 substituted “Secretary” for “Administrator” in two places.