Tap any paragraph to write a margin note. Your notes collect in the Desk below the text and file under cases with @. The side-by-side margin rail opens on a larger screen.

§
Marginalia
Code · STATUTES-AT-LARGE · Vol. 49 STAT. · June 30, 1936 · Public Law 740

Public Law 740.

94,777 words·~431 min read·/statutes-at-large/vol-49/public-law-740·

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(/us/pl/74/739).] *Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled*, That the followingFirst Deficiency Appropriation Act, fiscal year 1936. sums are appropriated, out of any money in the Treasury not otherwise appropriated, to supply deficiencies in certain appropriations for the fiscal year ending June 30, 1936, and prior fiscal years, to provide supplemental appropriations for the fiscal years ending June 30, 1936, and June 30, 1937, and for other purposes, namely:
TITLE I— GENERAL APPROPRIATIONSGeneral appropriations. LEGISLATIVELegislative. senateSenate. To pay Anna Louise Fletcher, widow of Honorable Duncan U.Duncan U. Fletcher.Pay to widow. Fletcher, late a Senator from the State of Florida, $10,000. To pay to Beatrice Trammell, widow of Honorable Park Trammell,Park Trammell.Pay to widow. late a Senator from the State of Florida, $10,000. For additional amount for the assistant clerk of the CommitteeCommittee on Appropriations.Assistant clerk. on Appropriations to make the salary $4,800 per annum, fiscal year 1937, $600.
For miscellaneous items, exclusive of labor, fiscal year 1936,Miscellaneous items. $50,000: *Provided*, That no motor-propelled passenger-carrying*Proviso*.Automobile purchase forbidden. vehicles shall be purchased from this or any other appropriation for this purpose. For expenses of inquiries and investigations ordered by the Senate,Inquiries and investigations, expenses. including compensation to stenographers of committees, at such rate as may be fixed by the Committee to Audit and Control the Contingent Expenses of the Senate, but not exceeding 25 cents per hundred words, fiscal year 1936, $75,000: *Provided*, That no part of*Provisos.*Salary restriction. this appropriation shall be expended for services, personal, professional, or otherwise, in excess of the rate of $3,600 per annum: *Provided further*, That no part of this appropriation shall bePer diem and subsistence expenses.Vol. 44, p. 688; [U.
S. C., p. 103](/us/usc/p103). expended for per-diem and subsistence expenses except in accordance with the Subsistence Expense Act of 1926, approved June 3, 1926, as amended. The unobligated balance of the appropriation for expenses ofBalance reappropriated.*Ante*, pp. 462, 1109. inquiries and investigations ordered by the Senate, contingent fund of the Senate, for the fiscal year 1936, is reappropriated and made available for the fiscal year 1937. 1598 House of Representatives.house of representatives John T.
Buckbee.Pay to widow.For payment to the widow of John T. Buckbee, late a Representative from the State of Illinois, $10,000. Stephen A. Rudd.Pay to widow.For payment to the widow of Stephen A. Rudd, late a Representative from the State of New York, $10,000. Randolph Perkins.Pay to widow.For payment to the widow of Randolph Perkins, late a Representative from the State of New Jersey, $10,000. William D. Thomas.Pay to widow.For payment to the widow of William D. Thomas, late a Representative from the State of New York, $10,000.
The foregoing sums to be disbursed by the Sergeant at Arms of the House. Joseph W. Byrns.Pay to widow.For payment to the widow of Joseph W. Byrns, late a Representative from the State of Tennessee, $10,000, to be disbursed by the Sergeant at Arms of the House. Contested-election expenses.*Post*, p. 1827.Contested-election expenses: For payment to the contestant and the contestee for expenses incurred in the contested-election case of Miller against Cooper, as audited and recommended by the Committee on Elections Numbered Three, namely:
John G. Cooper.To John G. Cooper, contestee, $1,821.65; Locke Miller.To Locke Miller, contestant, $2,000. Lincoln Loy McCandless.For payment to Lincoln Loy McCandless, contestant, for expenses incurred in the contested-election case of McCandless against King, as audited and recommended by the Committee on Elections Numbered Two, $2,000. Samuel Wilder King.For payment to Samuel Wilder King, contestee, for expenses incurred in the contested-election case of McCandless against King, as audited and recommended by the Committee on Elections Numbered Two, $2,000.
The four foregoing sums to be disbursed by the Clerk of the House. Contingent expenses.Hearings.Contingent expenses: For stenographic reports of hearings of committees other than special and select committees, fiscal year 1936, $5,000. Special and select committees, expenses.Expenses of special and select committees: For an additional amount for special and select committees authorized by the House, *Provisos.*Coordination of Federal executive agencies.fiscal year 1937, $20,000 to be immediately available: *Provided*, That such sum, or so much thereof as may be necessary, shall be available for each and every expense of the select committee of the House of Representatives acting pursuant to H.
Res. 460, adopted April 29, 1936, including the employment of personal services, the traveling and incidental expenses of such committee or any subcommittee or member or employee thereof, and the pay and travel of witnesses; all such expenses to be paid on vouchers authorized by the committee, signed by the chairman thereof, and approved by the Committee on Salary restriction.Accounts: *Provided further*, That no person shall be employed under such appropriation at a rate of compensation in excess of Cooperation by Federal agencies.$3,600 per annum: *Provided further*, That the committee is authorized to procure information and assistance from any Federal executive agency, including the services of personnel therein, and any such agency is hereby authorized to render such assistance, furnish such information, and detail such personnel as the House committee stenographers, services.committee may request: *Provided further*, That the official committee stenographers of the House of Representatives may be used at all hearings held in the District of Columbia if not otherwise officially engaged.
Compiling testimony in contested-election cases.For services in compiling, arranging for the printer, reading proof, indexing testimony, stenography and typewriting, supervision of the work, and expenses incurred in the contested-election cases of the Vol. 24, p. 445.[U. S. C., p. 19](/us/usc/p19).Seventy-fourth Congress, as authorized by the Act entitled “An Act 1599relating to contested elections”, approved March 2, 1887 (U. S. C., title 2, secs. 201–226), $750. joint committee on internal revenue taxationJoint Committee on Internal Revenue Taxation.Salaries and expenses.
For payment of the salaries and other expenses of the Joint Committee on Internal Revenue Taxation as authorized by law, fiscal year 1936, $700, one-half of such amount to be disbursed by the Secretary of the Senate and one-half by the Clerk of the House of Representatives. joint committee on inaugural ceremonies of 1937Inaugural Ceremonies of 1937. To enable the Secretary of the Senate and the Clerk of the HouseCongressional expenses. of Representatives to pay the necessary expenses of the inaugural ceremonies of the President of the United States, January 20, 1937, in accordance with such program as may be adopted by the joint committee of the Senate and House of Representatives, appointed*Post*, p. 2386. under a concurrent resolution of the two Houses, including the pay for extra police, fiscal year 1937, $35,000. united states constitution sesquicentennial commissionUnited States Constitution Sesquicentennial Commission.Expenses.*Ante*, p. 1393.
For carrying out the provisions of the public resolution entitled “Joint resolution to enable the United States Constitution Sesquicentennial Commission to carry out and give effect to certain approved plans, and for other purposes”, approved June 1, 1936, including payment of salaries and expenses heretofore incurred in preparing to carry out the provisions of such Act, $200,000, to remain available until June 30, 1938. government printing officeGovernment Printing Office.Designated messengers on night duty.
For payment to Samuel Robinson, William Madden, Preston L. George, and William S. Houston, messengers on night duty during the second session of the Seventy-fourth Congress, $900 each; in all, $3,600, to be paid from the appropriation for printing and binding*Ante*, p. 474. for Congress for the fiscal year 1936. office of architect of the capitolOffice of Architect of the Capitol.Capitol Grounds, care, improvement, etc. Capitol Grounds: For an additional amount for care and improvement of grounds surrounding the Capitol, Senate and House Office Buildings, Capitol power plant, and so forth, including the same objects specified under this head in the Legislative Branch Appropriation *Ante*, p. 469.Act, 1936, $10,320, of which $7,950 shall remain available until June 30, 1937.
Senate Office Building: For repairing and painting four hundredSenate Office Building, repairs, etc. thirty-five corridor doors, for painting all outside window frames, and painting one hundred and four rooms, $44,180, to remain available during the fiscal year 1937. For rewiring electrical circuits and new panel boards, $5,000; forRewiring, etc. parts for air-conditioning plant electrical equipment, $500; for electric-lightElectric equipment. bulbs, $1,500; in all, $7,000, to remain available during the fiscal year 1937.
Capitol Power Plant: For an additional amount for lighting, Capitol Power Plant.Maintenance, etc.heating, and power for the Capitol, Senate, and House Office Buildings, Supreme Court Building, Congressional Library buildings, and the grounds about the same, Botanic Garden, Government Printing Office, and Washington city post office, including the same objects specified under this head in the Legislative Branch Appropriation*Ante*, p. 470. Act, 1936, $45,580. 1600 Library of Congress.library of congress Compilation of laws held unconstitutional; printing and binding.For the printing and binding of a compilation containing the provisions of Federal laws held unconstitutional by the Supreme Court of the United States, to remain available during the fiscal year 1937, $1,200.
Independent Offices.EXECUTIVE INDEPENDENT OFFICES Executive Office.executive office Oil lands in former naval reserves.Protection of interests, etc., in.Protection of interests of the United States in matters affecting oil lands in former naval reserves: For compensation and expenses of special counsel and for all other expense, including employment of experts and other assistants at such rates as may be authorized or approved by the President, in connection with carrying into effect Vol. 43, p. 15.the joint resolution entitled “Joint resolution directing the Secretary of the Interior to institute proceedings touching sections 16 and 36, township 30 south, range 23 east, Mount Diablo meridian”, approved February 21, 1924, fiscal year 1937, $34,000, to be expended by the *Proviso*.Salary restriction.President: *Provided*, That no part of this sum shall be used to compensate any person at a rate in excess of $10,000 per annum.
Study of Executive agencies.Funds available for.*Ante*, p. 115.Study of Executive Agencies: The President of the United States is hereby authorized to allocate, out of funds appropriated by the Emergency Relief Appropriation Act of 1935 (49 Stat., 115), not to exceed $100,000 for the expenses of a committee designated by him to make a study of the emergency and regular agencies of the executive branch of the Government for the purpose of making recommendations to secure the most efficient organization and management of that branch of the public service.
Such committee shall ascertain whether the activities of any such agency conflict with or overlap the activities of any other such agency and whether, in the interest of simplification, efficiency, and economy, any of such agencies should be coordinated with other agencies or abolished, or the personnel thereof reduced, and make recommendations with respect Report.thereto. Copies of the report or reports of such studies and recommendations, together with the essential facts in connection therewith, shall be transmitted to the President and to Congress.
Executive Mansion and Grounds, maintenance.*Ante*, p. 6.Availability.Maintenance, Executive Mansion and Grounds: For an additional amount for repairs and alterations of the Executive Mansion, including the same objects specified under this head in the Independent Offices Appropriation Act, 1936, $78,000, to remain available until June 30, 1937, and to be expended as the President may determine, notwithstanding the provisions of any other Act. Patrick Henry bi-centennial.celebration of the bicentennial of the birth of patrick henry Expenses of celebration.*Ante*, p. 1485.For carrying out the provisions of the Act entitled “An Act to aid in defraying the expenses for the celebration of the bicentennial of the birth of Patrick Henry to be held at Hanover Courthouse, Virginia, July 15, 16, and 17, 1936”, approved June 5, 1936, fiscal year 1936, $10,000, to remain available until June 30, 1937.
Arkansas Centennial Commission.arkansas centennial commission Contribution.To provide for the contribution of the United States to the commemoration of the admission of the State of Arkansas into the Federal Union, to be paid to the Arkansas Centennial Commission of the State of Arkansas, to be expended by said Commission for such purposes as it may deem appropriate in connection with such commemoration, $75,000. 1601 district of columbia alley dwelling authorityDistrict of Columbia Alley Dwelling Authority.Funds for, continued available.*Ante*, p. 673.Vol. 48, p. 932.
The unexpended balance of the “Conversion of inhabited alleys fund” of $500,000 established pursuant to the provisions of the District of Columbia Alley Dwelling Act, approved June 12, 1934, is hereby continued available for the purposes of said Act until June 30, 1937, together with all receipts derived from sales, leases, or other sources, prior to June 30, 1937, as authorized in section 3
(b)of said Act. emergency conservation workEmergency Conservation work. For the purpose of carrying into effect the provisions of the ActAppropriation for administrative expenses and compensation payments.Vol. 48, p. 22. entitled “An Act for the relief of unemployment through the performance of useful public work, and for other purposes”, approved March 31, 1933, as amended, including personal services, without regard to civil-service laws and regulations and the Classification Act of 1923, as amended, supplies and equipment, purchase and exchange of law books, books of reference, periodicals and newspapers, printing and binding, travel expenses, rents in the District of Columbia and elsewhere, purchase, exchange, maintenance, repair and operation of motor-propelled, passenger-carrying vehicles, also the purchase (including exchange) of one at not to exceed $1,500, and other necessary expenses, fiscal year 1937, $308,000,000, to be expended under the direction of the President and to remain available until March 31, 1937, of which sum $10,000,000 shall be immediatelyAmount immediately available.*Proviso*.Supplies and services.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). available: *Provided*, That the provisions of section 3709, Revised Statutes (U. S. C., title 41, sec. 5), shall not be construed to apply to any purchase or service rendered in carrying out the purposes of this appropriation when the aggregate amount involved is less than $100: *Provided further*, That an enrollee in the CivilianPayments for blood transfusions. Conservation Corps, or member, or former member, of the Military Establishment, who shall furnish blood from his or her veins for transfusion to the veins of an enrollee or discharged enrollee of the Civilian Conservation Corps undergoing hospital treatment awaiting return to his home, and who is a patient in a Government or civilian hospital authorized to treat such patient, shall be entitled to be paid therefor a reasonable sum not to exceed $50: *And provided further*,Payments for previous services. That such services heretofore rendered and payments heretofore made, are hereby authorized and validated at duly authorized rates, not to exceed $50: *Provided*, That nothing herein shall be construedSoil Conservation Service, etc.Status of positions under.*Ante*, p. 163. to affect the status under the civil-service laws of any positions created under and by virtue of the Act of April 27, 1935, or other positions brought under the civil-service laws by Executive order heretofore issued. employees’ compensation commissionEmployees’ Compensation Commission. Employees’ Compensation Fund, Emergency Relief: For administrativeEmployees’ Compensation Fund, Emergency Relief. expenses and the payment of compensation in connection with the administration of the benefits authorized by section 2 of the Act entitled “Emergency Relief Appropriation Act of 1935”,*Ante*, p. 117. approved April 8, 1935 (49 Stat. 115–119), $6,000,000 of the specialSpecial fund, sum available from. fund set up on the books of the Treasury pursuant to the provisions of the said Act shall be available for expenditure during the fiscal year 1937. federal communications commissionFederal Communications Commission. Special investigation: For an additional amount for all authorizedAmerican Telephone and Telegraph Company, etc., investigation. expenditures of the Federal Communications Commission, including personal services in the District of Columbia and elsewhere, in conducting the investigation and reporting to Congress 1602on matters with respect to the American Telephone and Telegraph Company and all other companies engaged directly or indirectly in telephone communication in interstate commerce, as authorized and *Ante*, p. 43.directed in Public Resolution Numbered 8 of the Seventy-fourth Congress, approved March 15, 1935 (49 Stat. 43), fiscal year 1936, $400,000, to remain available until June 30, 1937. Federal Trade Commission.Commissioners, and all other expenses.federal trade commission For an additional amount for five commissioners, and for all other authorized expenditures of the Federal Trade Commission in performing the duties imposed by law or in pursuance of law, including *Ante*, p. 1172.the same objects specified under this head in the Independent Offices Appropriation Act, 1937, $100,000. General Accounting Office.Temporary employees.general accounting office Salaries: For temporary employees to be appointed without regard to civil-service laws and regulations, $370,000, to continue available until June 30, 1937. Contingent expenses.Contingent expenses: For an additional amount for contingent expenses, General Accounting Office, including the same objects *Ante*, p. 11.specified under this head in the Independent Offices Appropriations1So in originalAct, 1936, $37,000 to continue available until June 30, 1937. Printing and binding.Printing and binding: For an additional amount for printing and binding for the General Accounting Office, including the same *Ante*, p. 11.objects specified under this head in the Independent Offices Appropriation Act, 1936, $2,000, to continue available until June 30, 1937. National Advisory Committee for Aeronautics.All expenses, scientific research, etc.*Ante*, p. 13.national advisory committee for aeronautics For an additional amount for scientific research, special investigations, and technical reports in the field of aeronautics, including the same objects specified under this head in the Independent Offices Appropriation Act, 1936, $1,367,000, to continue available until June 30, 1937, of which amount there may be expended not to exceed Wind tunnel, etc.$1,100,000 for the construction and equipment of an additional wind tunnel, and not to exceed $267,000 for increasing the length of the present seaplane model testing tank and providing necessary additional equipment therefor. National Capital Park and Planning Commission.Incidental expenses.Vol. 46, p. 485.national capital park and planning commission For the work of the National Capital Park and Planning Commission necessary toward carrying into effect the provisions of section 4 of the Act approved May 29, 1930 (46 Stat. 482), providing for a comprehensive park, parkway, and playground system of the Personal services.National Capital, and so forth; personal services in the District of Columbia, including real-estate and other technical services, at rates of pay to be fixed by the Commission and not exceeding those usual for similar services and without reference to civil-service rules and [U. S. C., pp. 81, 85](/us/usc/p81/85).the Classification Act of 1923, as amended; travel expenses; expenses of surveys and searching of titles, purchase of options, and all other costs incident to the acquisition of land; reimbursements to be made as prescribed in such Act, as amended; fiscal year 1937, $200,000: *Proviso*.Balance available.*Provided*, That the unexpended balance of the appropriation of $800,000 made available under this head for the fiscal year 1936 in the *Ante*, p. 574.Second Deficiency Appropriation Act, fiscal year 1935, is hereby continued available for the same purposes until June 30, 1937. 1603 national labor relations boardNational Labor Relations Board. For an additional amount for salaries and expenses of the NationalSalaries and expenses.*Ante*, p. 1112. Labor Relations Board for the fiscal year 1936, including the same objects specified under this head in the Supplemental Appropriation Act, fiscal year 1936, approved February 11, 1936, $65,000. national mediation boardNational Mediation Board. National Mediation Board, salaries and expenses: For an additionalSalaries and expenses. amount for three members of the Board, and for other authorized expenditures of the National Mediation Board, fiscal year 1937, including the same objects specified under this head in the Independent *Ante*, p. 1177.Offices Appropriation Act, 1937, $3,000: *Provided*, That the*Proviso.*Fund reduced. amount of $10,000 of the unexpended balance of the 1935 appropriation for this purpose, made available for the fiscal year 1937 under this head in the Independent Offices Appropriation Act, 1937, is hereby reduced to $7,000. National Railroad Adjustment Board: For an additional amountNational Railroad Adjustment Board.Salaries and expenses.*Ante*, 1178. for salaries and expenses, National Railroad Adjustment Board, fiscal year 1937, including the same objects specified under this head in the Independent Offices Appropriation Act, 1937, $25,000, of whichPersonal services. $6,000 may be expended for personal services: *Provided*, That the*Proviso.*Reappropriation repealed.*Ante*, pp. 23, 674, 1178. reappropriation under this head in the Independent Offices Appropriation Act, 1937, making available for the fiscal year 1937, $25,000 of the unexpended balance of the appropriation for this purpose for the fiscal year 1935, is hereby repealed. For an additional amount for salaries and expenses, National Salaries and expenses, additional.*Ante*, p. 14.Railroad Adjustment Board, fiscal year 1936, including the same objects specified under this head in the Independent Offices Appropriation Act, 1936, $12,500. Printing and binding: For all printing and binding for the NationalPrinting and binding. Railroad Adjustment Board, fiscal year 1936, in addition to the amount made available for those purposes in the Second Deficiency*Ante*, p. 574. Appropriation Act, fiscal year 1935, $7,500. northwest territory celebration commissionNorthwest Territory Celebration Commission.Expenses. For every expenditure requisite for and incident to the performance of the duties of the Northwest Territory Celebration Commission in carrying into effect the provisions of Public Resolution Numbered*Ante*, p. 511. 41, Seventy-fourth Congress, approved August 2, 1935, including personal services in the District of Columbia and elsewhere; erection of monuments, markers, and memorials; postage, printing and binding, services, office supplies and equipment; pageantry, cartographic maps and publications and their distribution, promotion and stimulation of school activities through and by means of essay and public-speaking contests and by other methods, cooperation with State commissions established by the various legislatures and with veterans’ organizations and patriotic societies, in the six States embraced in the Northwest Territory, $100,000, to remainAvailability. available until June 30, 1938. railroad retirement boardRailroad Retirement Board.Salaries and expenses.Balance reappropriated.*Ante*, p. 1112. The unexpended balance of the appropriation for salaries and expenses, Railroad Retirement Board, fiscal year 1936, contained in the Supplemental Appropriation Act, fiscal year 1936, approved February 11, 1936 (Public Act Numbered 440, Seventy-fourth Congress), is hereby continued available until June 30, 1937, for the 1604same purposes (exclusive of printing and binding) and, in addition thereto, the appropriations for salaries and expenses of the Board for Vehicles.the fiscal years 1936 and 1937 shall be available for the operation, maintenance, and repair of motor-propelled passenger-carrying vehicles to be used only for official purposes. Rural Electrification Administration.rural electrification administration Salaries and expenses.Salaries and expenses: For administrative expenses and expenses of studies, investigations, publications, and reports necessary to carry *Ante*, p. 1363.out the provisions of the Rural Electrification Act of 1936, approved Administrator, etc.May 20, 1936, including the salary of the Administrator and other personal services in the District of Columbia and elsewhere; Traveling expenses, etc.traveling expenses, including expenses of attendance of officers and employees at meetings when determined by the Administrator to be necessary in furthering the work of the Administration; contract Fees, rent, etc.stenographic reporting services; expert witness fees; materials, supplies, equipment, and services; rentals including buildings and parts of buildings and garages, in the District of Columbia and elsewhere; purchase and exchange of books, law books, books of reference, directories, and periodicals; financial and credit reports; purchase, rental, exchange, operation, maintenance, and repair of typewriters, Vehicles.calculating machines, and other office appliances; purchase (not to exceed two), rental, exchange, operation, maintenance, and repair of motor-propelled, passenger-carrying vehicles to be used only for official purposes; printing and binding; and all other expenses necessary to *Proviso.*Minor purchases.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803).administer said Act, fiscal year 1937, $1,000,000: *Provided*, [a-z]hat section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5) shall not be construed to apply to any purchase or service rendered for the Rural Electrification Administration when the aggregate amount involved does not exceed $100. Smithsonian Institution.Smithsonian Institution National Museum.national museum “Winnie Mae” airplane.Purchase.*Ante*, p. 743.For the purchase of the airplane Winnie Mae with the original instruments used on its world trips by Wiley Post as authorized by the Act approved August 24, 1935 (Public Act Numbered 316, Seventy-fourth Congress), fiscal year 1936, $25,000. Printing and binding.Printing and binding: For an additional amount for printing and binding, Smithsonian Institution, including the same objects specified *Ante*, p. 16.under this head in the Independent Offices Appropriation Act, 1936, fiscal year 1936, $12,000, to remain available until June 30, 1937. Social Security Board.social security board Salaries and expenses.Salaries and expenses: For all authorized and necessary *Ante*, pp. 620, 622, 626, 627, 635, 639, 645.administrative expenses of the Social Security Board in performing the duties imposed upon it in titles I, II, III, IV, VII, IX, and X of the Social Security Act, approved August 14, 1935, including three Board members, an executive director at a salary of $9,500 a year, a director of the old-age benefits division at a salary of $9,000 a year, and other personal services in the District of Columbia and Travel expenses.elsewhere; travel expenses, including expenses of attendance at meetings concerned with the work of such Board; not to exceed $10,000 for payment of actual transportation expenses and not to exceed $10 per Expenses of persons invited for advisory, etc., purposes.diem to cover subsistence and other expenses while in conference and en route from and to his home, to any person other than an employee of the Federal Government who may from time to time be1605 invited to the city of Washington and elsewhere for conference and advisory purposes in furthering the work of the Board; supplies; reproducing, photographing, and all other equipment, office appliances, and labor-saving devices; services; advertising, postage, telephone, telegraph, and not to exceed $900 for teletype services and tolls; newspapers and press clippings (not to exceed $1,000), periodicals, manuscripts and special reports, law books and other books of reference; membership fees or dues in organizations which issue publications to members only or to members at a lower price than to others, payment for which may be made in advance; alterations and repairs; printing and binding; rentals, including garages, in the District of Columbia or elsewhere; purchase and exchange, not toVehicles. exceed $60,000, operation, maintenance, and repair of motor-propelled passenger-carrying vehicles to be used only for official purposes in the District of Columbia and in the field; and miscellaneous items, including those for public instruction and information deemed necessary by the Board, fiscal year 1937, $18,400,000, of which sum $600,000 shall be available immediately: *Provided*, That section 3709*Provisos*.Minor purchases.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). of the Revised Statutes (U. S. C., title 41, sec. 5) shall not be construed to apply to any purchase by the Board when the aggregate amount involved does not exceed the sum of $300: *Provided further*,Special contract services. That the Board may expend not to exceed $75,000 of the sum herein appropriated for employing persons or organizations, by contract or otherwise, for special accounting, actuarial, statistical, and reporting, services determined necessary by the Board, without regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5), and the provisions of other laws applicable to the employment and compensation of officers and employees of the United States: *Provided further*,Transfer of funds for completion of wage records. That upon approval by the Board there may be transferred from this appropriation to the appropriation hereinafter made for “Wage records, Social Security Board”, such sum or sums as the Board may hereafter find to be necessary to complete the purposes for which such latter appropriation is made. Grants to States for old-age assistance: For grants to States forGrants to States.Old-age assistance, 1937.*Ante*, p. 620.Amount for 1936, since March. old-age assistance, as authorized in title I of the Social Security Act, approved August 14, 1935, fiscal year 1937, $85,000,000, of which sum such amount as may be necessary shall be available for grants under such title I for any period in the fiscal year 1936 subsequent to March 31, 1936: *Provided*, That payments to States for the fourth*Proviso*.Payments restricted prior to approval of State plans. quarter of the fiscal year 1936 and for any quarter in the fiscal year 1937 under such title I may be made with respect to any State plan approved under such title I by the Social Security Board prior to or during such period, but no such payment shall be made with respect to any plan for any period prior to the quarter in which such plan was submitted to the Board for approval. Grants to States for unemployment compensation administration:Unemployment compensation administration, 1937.*Ante*, p. 626. For grants to States for unemployment compensation administration, as authorized in title III of the Social Security Act, approved August 14, 1935, fiscal year 1937, $29,000,000, of which sumAvailability, 1936. such amount as may be necessary shall be available for grants under such title III for any period in the fiscal year 1936 from and after January 1, 1936. Grants to States for aid to dependent children: For grants toAid to dependent children, 1937.*Ante*, p. 627. States for the purpose of enabling each State to furnish financial assistance to needy dependent children, as authorized in title IV of the Social Security Act, approved August 14, 1935, fiscal year 1937, $35,000,000, of which sum such amount as may be necessaryAvailability, 1936. shall be available for grants under such title IV for any period in the fiscal year 1936 subsequent to March 31, 1936: *Provided*, That*Proviso.*Payments restricted prior to approval of State plans. payments to States for the fourth quarter of the fiscal year 1936 1606and for any quarter in the fiscal year 1937 under such title IV may be made with respect to any State plan approved under such title IV by the Social Security Board prior to or during such period, but no such payment shall be made with respect to any plan for any period prior to the quarter in which such plan was submitted to the Board for approval. Aid to the blind. 1937.*Ante*, p. 645.Availability, 1936.Grants to States for aid to the blind: For grants to States for aid to the blind, as authorized in title X of the Social Security Act, approved August 14, 1935, fiscal year 1937, $8,000,000, of which sum such amount as may be necessary shall be available for grants under such title X for any period in the fiscal year 1936 subsequent to *Proviso.*Payments restricted prior to approval of State plans.March 31, 1936: *Provided*, That payments to States for the fourth quarter of the fiscal year 1936 and for any quarter in the fiscal year 1937 under such title X may be made with respect to any State plan approved under such title X by the Social Security Board prior to or during such period, but no such payment shall be made with respect to any plan for any period prior to the quarter in which such plan was submitted to the Board for approval. Interchangeability of designated funds.The appropriations herein made for “Grants to States for Old-Age Assistance”, “Grants to States for Aid to Dependent Children”, and “Grants to States for Aid to the Blind”, shall be available interchangeably for transfer of appropriations but no such transfer shall be made except upon determination by the Social Security Board that the appropriation from which the transfer is proposed is in excess of the purposes thereof and the appropriation to which such *Proviso.*Statement of transfers to be reported.transfer is proposed is insufficient for the purposes thereof: *Provided*, That a statement of any such transfers shall be reported to Congress in the annual Budget. Wage records, Social Security Board.Securing and maintaining, for old-age benefits.Wage records, Social Security Board: For all expenditures necessary to enable the Social Security Board to collect and record initial basic data concerning employers and employees, which, together with current individual wage records subsequently to be maintained, will thereafter constitute current total individual wage records and a basis for the identification of employees incidental to, and necessary for, *Ante*, p. 622.benefit payments under title II of the Social Security Act, approved August 14, 1935, including furnishing identification cards and emblems to employers and employees; personal services in the District of Columbia and elsewhere; travel expenses, including Attendance at meetings.expenses of attendance at meetings concerned with the work of the Board; supplies; reproducing, photographing, and all other equipment, office appliances, and labor-saving devices; services; advertising, postage, telephone and telegraph; printing and binding; rentals, including garages, in the District of Columbia or elsewhere; not to exceed $250,000 for the employment of persons or organizations by contract or otherwise in the District of Columbia and elsewhere for special accounting, statistical, and mechanical services determined necessary by the Board without regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5) and the provisions of laws applicable to the employment and compensation of officers and employees of the United States, but such sum of $250,000 shall not be available for any contract for a period of service exceeding six Miscellaneous items.months; and miscellaneous items, including those for public instruction and information deemed necessary by the Board, $12,400,000 to *Proviso.*Purchase of supplies, etc. [R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803).remain available until June 30, 1937: *Provided*, That section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5) shall not be construed to apply to any purchase of supplies or equipment for the Board when the aggregate amount involved does not exceed the sum of $300. 1607 tariff commissionTariff Commission. Printing and binding: For an additional amount for all printingPrinting and binding. and binding of the Tariff Commission, fiscal year 1936, including*Ante*, p. 16. the same objects specified under this head in the Independent Offices Appropriation Act, 1936, $4,000. tennessee valley authorityTennessee Valley Authority. For the purpose of carrying out the provisions of the Act entitledContinuation of construction.Vol. 48, p. 58; *Ante*, p. 1075.[U. S. C., p. 701](/us/usc/p701).Designated dams. “The Tennessee Valley Authority Act of 1933”, approved May 18, 1933 (U. S. C., title 16, ch. 12a) as amended by the Act approved August 31, 1935 (49 Stat., 1075–1081), including the continued construction of Norris Dam, Wheeler Dam, Pickwick Landing Dam, Guntersville Dam, and Chickamauga Dam and the beginning of construction on a dam on the Hiwassee River, a tributary of the Tennessee River, at or near Fowler Bend, and the continuation of preliminary investigations as to the appropriate location and type of a dam on the lower Tennessee River, and the acquisition of necessary land, the clearing of such land, relocation of highways, and the construction or purchase of transmission lines and other facilities, and all other necessary works authorized by such Acts, and for printingPrinting and binding. and binding, law nooks, books of reference, newspapers, periodicals, purchase, maintenance, and operation of passenger-carrying vehicles, rents in the District of Columbia and elsewhere, and all necessarySalaries and expenses. salaries and expenses connected with the organization, operation, and investigations of the Tennessee Valley Authority, fiscal year 1937, $39,900,000: *Provided*, That this appropriation and any unexpended*Proviso*.Accounting.*Ante*, p. 597. balance on June 30, 1936, in the “Tennessee Valley Authority Fund, 1936”, and the receipts of the Tennessee Valley Authority from all sources during the fiscal year 1937 (except as limited by section 26 of the Tennessee Valley Authority Act of 1933, as amended), shall be covered into and accounted for as one fund to be known as the “Tennessee Valley Authority Fund, 1937”, to remain available untilAvailability. June 30, 1937, and to be available for the payment of obligations chargeable against the “Tennessee Valley Authority Fund, 1936.” thomas jefferson memorial commissionThomas Jefferson Memorial Commission.Expenses.Vol. 48, p. 1243.*Ante*, p. 1397. For every expenditure requisite for and incident to the performance of the duties of the Thomas Jefferson Memorial Commission, created by Public Resolution Numbered 49, Seventy-third Congress, approved June 26, 1934 (48 Stat., 1243), including personal services in the District of Columbia and elsewhere without regard to the provisions of the civil-service laws and regulations, and the Classification Act of 1923, as amended, purchase or preparation of plans, designs, and estimates, printing and binding, office equipment andPrinting and binding. supplies, contract stenographic reporting services, books and periodicals, traveling expenses of members and employees of the Commission (including such expenses and allowances for members of the Commission when required to be in Washington, District of Columbia, in connection with the work of the Commission), and such other contingent and miscellaneous expenses as may be necessary, fiscal year 1937, $15,000: *Provided*, That section 3709*Provisos.*Minor purchases, etc.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). of the Revised Statutes (U. S. C., title 41, sec. 5) shall not be construed to apply to any purchase or service rendered for the Commission: *Provided further*, That all expenses of the Commission shall be paidTreasury, Division of Disbursement, payments by. by the Division of Disbursement, Treasury Department, upon vouchers approved by the Chairman of the Commission: *Provided* 1608Cooperation of other agencies.*further*, That the Commission is authorized to procure advice and assistance from any governmental agency, including the services of technical and other personnel therein, and such agencies are hereby authorized to render such aid. United States Harvard University Tercentenary Commission.Representation expenses.*Ante*, p. 1266.united states harvard university tercentenary commission For the expenses of carrying out the provisions of Public Resolution Numbered 88, approved May 7, 1936, authorizing the recognition of the three-hundredth anniversary of the founding of Harvard College and the beginning of higher education in the United States and providing for the representation of the Government and people of the United States in the observance of the anniversary, including Personal services.[U. S. C., p. 85](/us/usc/p85).Purchases without advertising.[U. S. C., p. 1803](/us/usc/p1803).personal services in the District of Columbia or elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting and other services by contract if deemed necessary without regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5); traveling expenses; rent; printing and binding; official cards; entertainment; and such other expenses as may be authorized by the President, fiscal year 1937, $1,500. TITLE II— Title II—Relief and Work Relief.RELIEF AND WORK RELIEF Emergency Relief Appropriation Act of 1936.Continuation of relief and work relief.This title may be cited as the Emergency Relief Appropriation Act of 1936. To continue to provide relief, and work relief on useful projects, in the United States and its Territories and possessions (including projects heretofore approved for the Works Progress Administration which projects shall not be subject to the limitations hereinafter specified in this paragraph), $1,425,000,000, to be used in the Balances reappropriated.*Ante*, p. 115.discretion and under the direction of the President, together with such unexpended balances of funds appropriated and made available by the Emergency Relief Appropriation Act of 1935 as the President may determine, which are hereby reappropriated and made available for the purposes of this paragraph, to remain available until June *Provisos.*Classes of projects; amounts.30, 1937 (except as herein otherwise authorized): *Provided*, That this appropriation shall be available for the following classes of public projects, Federal and non-Federal, and the amounts to be used for each class shall not, except as hereinafter provided, exceed the respective amounts stated, namely:
(a)Highways, roads, and streets, $413,250,000;
(b)public buildings, $156,750,000;
(c)parks and other recreational facilities, including buildings therein, $156,750,000;
(d)public utilities, including sewer systems, water supply and purification, airports, and other transportation facilities, $171,000,000;
(e)flood control and other conservation, $128,250,000;
(f)assistance for educational, professional, and clerical persons, $85,500,000;
(g)women’s projects, $85,500,000;
(h)miscellaneous work projects, $71,250,000;
(i)National Youth Administration, $71,250,000; and
(j)rural rehabilitation, loans and relief to farmers Increases allowed; use of balances.and livestock growers, $85,500,000: *Provided further* That the amount specified for any of the foregoing classes may be increased proportionately in accordanc, [a-z] with the amount of such unexpended balances of funds as the President may transfer from the funds appropriated and made available by the Emergency Relief Interchange of funds limited.Appropriation Act of 1935 for the purpose of this paragraph: *Provided further*, That the amount specified for any of the foregoing classes may be increased by not to exceed 15 per centum thereof by transfer of an amount or amounts from any other class or classes in order to effectuate the purposes of the foregoing appropriation. 1609 The departments, agencies, or establishments having supervisionRestriction on employing illegally entered aliens. of projects for which funds from the foregoing appropriation are made available shall not knowingly employ aliens illegally within the limits of the continental United States on such projects and they shall make every reasonable effort consistent with prompt employment of the destitute unemployed to see that such aliens are not employed, and if employed and their status as such alien is disclosed they shall thereupon be discharged. No Federal project shall be undertaken or prosecuted under theWork forbidden unless sum for completion allocated. foregoing appropriation unless and until an amount sufficient for its completion has been allocated and irrevocably set aside for its completion. Appointments to Federal positions of an administrative or advisoryFederal administrative or advisory positions; appointments. capacity under the foregoing appropriation in any State shall be made from among the bona-fide residents of that State so far as not inconsistent with efficient administration. The rates of pay for persons engaged upon projects underPrevailing rates of pay. the foregoing appropriation shall be not less than the prevailing rates of pay for work of a similar nature as determined by the Works Progress Administration with the approval of the President. The President is authorized to prescribe such rules and regulationsPresident to prescribe rules, etc.*Provisos.*Eligibility for employment of needy not heretofore listed. as may be necessary to carry out the purposes of the foregoing appropriation: *Provided, however*, That in the employment of persons, applicants in actual need whose names have not heretofore been placed on relief rolls shall be given the same eligibility for employment as applicants whose names have heretofore appeared on such rolls: *Provided further*, That the fact that a person is entitled to orAdjusted-service payment not a bar. has received either adjusted-service bonds or a Treasury check in payment of an adjusted-compensation certificate shall not be considered in determining actual need of such employment. In carrying out the purpose of the foregoing appropriation theUtilization of Government agencies. President is authorized to utilize agencies within the Government and to empower such agencies to prescribe rules and regulations to carry out the functions delegated to such agencies by the President. In order to increase employment by providing for useful publicGrants to aid in financing projects. works projects of the kind and character for which the Federal Emergency Administrator of Public Works (hereinafter called the Administrator) has heretofore made loans or grants pursuant toUse of designated funds.Vol. 48, p. 200.*Ante*, p. 115. Title II of the National Industrial Recovery Act or the Emergency Relief Appropriation Act of 1935, the Administrator may, upon the direction of the President, use not to exceed $300,000,000 from funds on hand or to be received from the sale of securities, for the making of grants, to aid in the financing of such projects: *Provided*, That*Provisos.*Time limit for completion of projects. no part of the sum made available by this paragraph shall be granted for any project unless, in the determination of the Administrator, the completion thereof can be substantially accomplished prior to July 1, 1938, and adequate provision has been made or is assured for financing such part of the entire cost thereof as is not to be supplied through the Federal Emergency Administration of Public Works: *Provided further*, That this limitation upon time shall notTime limitation inapplicable to project enjoined by court.Maximum grant. apply to any project enjoined in any Federal or State court: *Provided further*, That in no case shall the amount of the grant exceed forty-five per centum of the cost of the project. Nothing hereinReconstruction Finance Corporation, amount of obligations not increased. shall be construed to increase the amount of notes, bonds, debentures, and other such obligations which the Reconstruction Finance Corporation is authorized and empowered under existing law to issue and to have outstanding at any one time, and nothing herein shallPowers of Federal Emergency Administration of Public Works not curtailed. be construed to limit or curtail in any way any powers which the Federal Emergency Administration of Public Works or the Administrator is now authorized to exercise. 1610 Unlawful acts.Fraud, etc.Any person who knowingly and with intent to defraud the United States makes any false statement in connection with any application for any project, employment, or relief aid under the foregoing appropriation, or diverts, or attempts to divert, or assists in diverting for the benefit of any person or persons not entitled thereto, any portion of the Penalty.foregoing appropriation, or any services or real or personal property acquired thereunder, or who knowingly, by means of any Race, etc., discrimination.fraud, force, threat, intimidation, or boycott, or discrimination on account of race, religion, or political affiliations, deprives any person of any of the benefits to which he may be entitled under the foregoing appropriation, or attempts so to do, or assists in so doing, shall be deemed guilty of a misdemeanor and fined not more than $2,000 or imprisoned not more than one year, or both. Candidate for office, or campaign manager; pay restriction.No part of the foregoing appropriation shall be used to pay the salary or expenses of any person who is a candidate for any State, District, County or Municipal office (such office requiring full time of such person and to which office a salary attaches), in any primary, general or special election, or who is serving as a campaign manager or assistant thereto for any such candidate. Disability or death compensation.Vol. 48, p. 351.Persons entitled; exception.The provisions of the Act of February 15, 1934 (48 Stat. 351), relating to disability or death compensation and benefits shall apply to persons (except administrative employees qualifying as civil employees of the United States) receiving compensation from the foregoing appropriation for services rendered as employees of the United States, and to persons receiving assistance in the form of payments National Youth Administration.from the United States for services rendered under the National Youth Administration, created by Executive order of June 26, 1935: *Provisos.*Special fund provided.*Provided*, That so much of the foregoing appropriation as the United States Employees’ Compensation Commission, with the approval of the Director of the Bureau of the Budget, estimates and certifies to the Secretary of the Treasury will be necessary for the payment of such compensation and administrative expenses shall be set aside in a special fund to be administered by the Commission for such Availability.purposes; and after June 30, 1937, such special fund shall be available for such purposes annually in such amounts as may be specified Application to State administrations.therefor in the annual appropriation Acts: *Provided further*, That this paragraph shall also apply to persons employed and paid by the United States in those States in which the Federal Relief Vol. 48, p. 56.Administrator assumed control under section 3
(b)of the Limitation.Federal Emergency Relief Act of 1933 but such compensation shall be limited to fatal cases and permanent partial and permanent total disability cases where claim is filed within one year from the date of enactment Cases within purview of workmen’s compensation laws of State, etc.of this Act: *Provided further*, That this paragraph shall not apply in any case coming within the purview of the workmen’s compensation law of any State or Territory, or in which the claimant has received or is entitled to receive similar benefits for injury or death. Allotments (or administrative expenses.So much of the foregoing appropriation as may be determined by the Director of the Bureau of the Budget to be necessary for administrative expenses of any department, establishment, or agency of the United States for additional work incident to carrying out of the purposes of the foregoing appropriation shall be allotted by the Availability.President and shall remain available to such agencies until June 30, 1938; the funds so allotted shall be available for expenditure for the same purposes for which funds have been allotted for administrative expenses under the Emergency Relief Appropriation Act of 1935. Minor purchases without advertising.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803).The provisions of section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5) shall not apply to any purchase made or service procured in connection with the foregoing appropriation when the aggregate amount involved is less than $300. 1611 Any Administrator or other officer named to have general supervisionSupervisory, etc., officers; appointment by the President, with consent of Senate. at the seat of Government over the program and work contemplated under the foregoing appropriation and receiving a salary of $5,000 or more per annum from such appropriation, and any State or regional administrator receiving a salary of $5,000 or more per annum from such appropriation, except persons now serving as such under other law, shall be appointed by the President, by and with the advice and consent of the Senate: *Provided*, That the provisions*Proviso.*Filling vacancies during recess of Senate.[R. S., sec. 1761, p. 313](/us/rs/s1761/p313); [U. S. C., p. 38](/us/usc/p38).Salary increase limitation.Federal Emergency Relief Administration, liquidation.Vol. 48, p. 55. of section 1761 of the Revised Statutes shall not apply to any such appointee and the salary of any person so appointed shall not be increased for a period of six months after confirmation. The Federal Emergency Relief Administrator is hereby authorized and directed to liquidate and wind up the affairs of the Federal Emergency Relief Administration under the Act of May 12, 1933, as amended, and funds available to it shall be available for expenditure for such purpose until June 30, 1937. A report of the operations under the foregoing appropriationReport of operations to Congress. shall be submitted by the President to Congress before the 10th day of January in each of the next two regular sessions of Congress, which report shall include a statement of the expenditures made and obligations incurred, by classes and amounts. TITLE III— DISTRICT OF COLUMBIADistrict of Columbia. general expensesGeneral expenses. Care of District Building: For an additional amount for fuel,Care of District Building. light, and power, repairs, laundry, and miscellaneous supplies, fiscal year 1936, $3,500. Municipal Architect’s office: For an additional amount for personalMunicipal Architect’s office. services, fiscal year 1936, $566. Employees’ compensation fund, District of Columbia: For anEmployees’ compensation fund.Vol. 41, p. 104. additional amount for carrying out the provisions of section 11 of the District of Columbia Appropriation Act, approved July 11, 1919, extending to the employees of the government of the District of Columbia the provisions of the Act entitled “An Act to provideVol. 39, p. 742.[U. S. C., p. 98](/us/usc/p98). compensation for employees of the United States suffering injuries while in the performance of their duties, and for other purposes”, approved September 7, 1916, fiscal year 1936. $6,000. District of Columbia Unemployment Compensation Act: For theUnemployment Compensation Act.Contribution. contribution of the District of Columbia under the provisions of section 5
(a)of the District of Columbia Unemployment Compensation*Ante*, p. 949. Act, approved August 28, 1935, fiscal year 1936, $100,000. contingent and miscellaneous expensesContingent expenses. Printing and binding, District of Columbia: For an additionalPrinting and binding. amount for printing and binding, under the same limitations and conditions applicable to the appropriation for this purpose in the District of Columbia Appropriation Act for the fiscal year 1936,*Ante*, p. 345. $2,000. Judicial expenses: For an additional amount for judicial expenses,Judicial expenses. including the same objects and under the same conditions and limitations applicable to the appropriation for this purpose in the District of Columbia Appropriation Act for the fiscal year 1935, $351.80.Vol. 48, p. 865. General advertising: For an additional amount for general advertising,Advertising. authorized and required by law, and for tax and school notices 1612and notices of changes in regulations, fiscal year 1935, $1,523.44: *Proviso*.Newspaper advertising outside District of Columbia.*Provided*, That this appropriation shall not be available for the payment of advertising in newspapers published outside of the District of Columbia, notwithstanding the requirement for such advertising provided by existing law. Refund of erroneous collections.Refund or erroneous collections: For an additional amount for payment of amounts collected by the District erroneously on account of taxes, fines, fees, and similar charges, which are returned to the respective parties who may have paid the same, fiscal year 1936, *Proviso.*Availability.$35,000: *Provided*, That this appropriation shall be available for refund of such erroneous payments made within the past three years only. Street and road improvement, etc.street and road improvement and repair Gasoline tax fund.Designated railroad underpasses, approaches.Gasoline tax, road and street improvements: For grading, paving, and otherwise improving, including curbing and gutters where necessary, storm water drains, catch basins and connections thereto, the approaches to the underpass beneath the tracks of the Baltimore and Ohio Railroad and the Pennsylvania Railroad between the intersection of Seventeenth Street and Douglas Street, northeast, and the intersection of New York Avenue and West Virginia Avenue, northeast, fiscal years 1936 and 1937, $90,000. Sewers.sewers Cleaning, repair, etc.For an additional amount for cleaning and repairing sewers and basins, including the same objects specified under this head in the *Ante*, p. 351.District of Columbia Appropriation Act for the fiscal year 1936, $7,000. City refuse.collection and disposal of refuse Collection and disposal.*Ante*, p. 351.For an additional amount for dust prevention, sweeping, and cleaning streets, avenues, alleys, and suburban streets, including the same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1936, $11,000. Garbage, dead animals, ashes, etc.For an additional amount to enable the Commissioners to carry out the provisions of existing law governing the collection and disposal of garbage, dead animals, night soil, and miscellaneous refuse and ashes in the District of Columbia, including the same objects and under the same limitations specified under this heading in the District of Columbia Appropriation Act for the fiscal year 1936, $32,000. Public playgrounds.public playgrounds Maintenance.For an additional amount for general maintenance, including the Vol. 48, p. 858.same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1935, $163. Public schools.public schools Transportation.Miscellaneous: For an additional amount for transportation for pupils attending schools for tubercular pupils, sight conservation pupils, and crippled pupils, fiscal year 1936, $1,350. Fuel, light, and power.For an additional amount for fuel, gas, and electric light and power for the following fiscal years: For 1935, $1,751.11. For 1936, $40,000. Health department.health department Vehicles.For an additional amount for maintenance and operation of motor ambulances and motor vehicles, fiscal years 1So in original. 1936, $200. 1613 courtsCourts. Police court: For an additional amount for witness fees and compensationPolice court, fees. of jurors, fiscal year 1936, $630. supreme court, district of columbiaSupreme Court, District of Columbia. Pay of bailiffs, and so forth: For an additional amount for pay ofBailiffs, etc. bailiffs, and so forth, Supreme Court, District of Columbia, incluing the same objects specified under this head in the District of*Ante*, p. 361. Columbia Appropriation Act, fiscal year 1936, $2,240. Fees of jurors and witnesses: For an additional amount for fees ofJurors and witnesses, fees. jurors and witnesses, Supreme Court, District of Columbia, including the same objects specified under this head in the District of Columbia Appropriation Act, fiscal year 1936, $15,000. Court of Appeals: For eleven copies each of volumes 63 and 64Court of Appeals, reports. of the Reports of the Court of Appeals of the District of Columbia, authorized to be furnished under title 18, section 31, page 161, of the Code of Law of the District of Columbia, at $6.50 each for the following fiscal years: For 1935, $71.50; For 1936, $71.50. Support of convicts: For an additional amount for support, maintenance,Support of convicts transferred from the District. and transportation of convicts transferred from the District of Columbia, including the same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1935,Vol. 48, p. 860. $38,675.85. Miscellaneous court expenses: For an additional amount for suchMiscellaneous expenses. miscellaneous expenses as may be authorized by the Attorney General for the Supreme Court of the District of Columbia and its officers, including the same objects specified under this head in the Act making appropriations for the District of Columbia for the fiscal*Ante*, p. 362. year 1936, $15,000. Printing and binding: For an additional amount for printing andPrinting and binding. binding for the Supreme Court and the Court of Appeals of the District of Columbia, except records and briefs in cases in which the United States is a party, fiscal year 1935, $769.81. public welfarePublic welfare. Division of Child Welfare: For an additional amount for boardChild Welfare Division. and care of all children committed to the guardianship of said Board by the courts of the District, including the same objects specified under this head in the District of Columbia Appropriation Act for*Ante*, p. 363. the fiscal year 1936, $12,000. For an additional amount for the maintenance, under the jurisdictionReceiving home for children under seventeen. of the Board of Public Welfare, of a suitable place in a building entirely separate and apart from the house of detention for the reception and detention of children under seventeen years of age arrested by the police on charge of offense against any laws in force in the District of Columbia, including the same objects specified under this head in the District of Columbia Appropriation Acts for the following fiscal years, respectively: For 1935, $211.12;Vol. 48, p. 867.*Ante*, p. 363. For 1936, $1,500. Jail: For an additional amount for maintenance and support of Jail.Maintenance, etc., of prisoners.*Ante*, p. 363.prisoners of the District of Columbia at the jail, including the same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1936, $11,000. 1614 Work house and reformatory.Maintenance.Workhouse and reformatory: For an additional amount for maintenance, care, and support of inmates, rewards for fugitives, discharge gratuities provided by law, including the same objects *Ante*, p. 361.specified under this head in the District of Columbia Appropriation Act for the fiscal year 1936, $80,000. National Training School for Boys.Care of boys committed to.National Training School for Boys: For an additional amount for care and maintenance of boys committed to the National Training School for Boys by the courts of the District of Columbia under a contract made by the Board of Public Welfare with the authorities of such school, for the following fiscal years: For 1935, $9,120.44; For 1936, $83,917. Care, etc., indigent patients.Medical charities: For an additional amount for care and treatment of indigent patients under contracts made by the Board of Public Welfare with the following institutions and for not to exceed the following amounts, respectively, for the following fiscal years: Children’s Hospital.Children’s Hospital: For 1935, $3,576.16; For 1936, $39,566. Central Dispensary and Emergency Hospital.Central Dispensary and Emergency Hospital: For 1935, $3,623.04; For 1936, $14,665. Eastern Dispensary and Casualty Hospital.Eastern Dispensary and Casualty Hospital: For 1935, $4,462.53; For 1936, $25,608. Garfield Hospital.Garfield Hospital: For an additional amount for isolating wards Vol. 48, p. 864.for minor contagious diseases at Garfield Memorial Hospital, maintenance, fiscal year 1935, $2,835. Tuberculosis Hospital.Tuberculosis Hospital: For an additional amount for provisions, fuel, forage, and so forth, including the same objects specified under this head in the District of Columbia Appropriation Acts for the following fiscal years, respectively: Vol. 48, p. 245.*Ante*, p. 365.For 1934, $1.52; For 1936, $12,000. Gallinger Municipal Hospital.Gallinger Municipal Hospital: For an additional amount for maintenance of the hospital, including the same objects specified Vol. 47, p. 372.under this head in the District of Columbia Appropriation Act for the fiscal year 1933, $3,526.62. District Training School, services.District Training School: For an additional amount for personal services, including not to exceed $1,000 for temporary labor, fiscal year 1936, $2,020. Maintenance, etc.For an additional amount for maintenance and other necessary expenses, including the same objects specified under this head in the *Ante*, p. 366.District of Columbia Appropriation Act for the fiscal year 1936, $12,000. Industrial Home School for Colored Children, services.Vol. 47, p. 372.Industrial Home School for Colored Children: For an additional amount for personal services, including the same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1933, $22.78. Maintenance, etc.*Ante*, p. 366.For an additional amount for maintenance, including the same objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1936, $500. Industrial Home School, motor vehicle.Industrial Home School: For an additional amount for maintenance, including purchase of equipment, maintenance of non-passenger-carrying motor vehicle, fiscal year 1936, $2,500. Home for Aged and Infirm.Home for Aged and Infirm: For an additional amount for provisions, fuel, forage, including the same objects specified under this 1615 head in the District of Columbia Appropriation Acts for the following fiscal years, respectively: For 1935, $399.10;Vol. 48, p. 246. *Ante*, p. 366. For 1936, $9,000. Saint Elizabeths Hospital: For additional amount for support ofSaint Elizabeths Hospital.Support of District insane. indigent insane of the District of Columbia in Saint Elizabeths Hospital, as provided by law, fiscal year 1936, $64,598. Nonresident insane: For an additional amount for deportation ofDeportation of non-resident insane. nonresident insane persons, in accordance with the Act entitled “An Act to change the proceedings for admission to the Government Hospital for the Insane in certain cases, and for other purposes”, approved January 31, 1899, including persons held in the psychopathicVol. 30, p. 811. ward of the Gallinger Municipal Hospital, including the same objects specified under this head in the District of Columbia *Ante*, p. 367.Appropriation Act for the fiscal year 1936, $1,000. Relief of the poor: For an additional amount for relief of theRelief of the poor. poor, including medical and surgical supplies, artificial limbs, and for pay to physicians to the poor, to be expended under the direction of the Board of Public Welfare, fiscal year 1936, $1,000. militiaMilitia. For an additional amount for the militia, including the sameExpenses.*Ante*, p. 368. objects specified under this head in the District of Columbia Appropriation Act for the fiscal year 1936, $1,000. water serviceWater Service. Washington Aqueduct: The unexpended balance of the appropriationWashington Aqueduct.Balance reappropriated.*Ante*, p. 579.Replacing pumping equipment, McMillan plant. of $150,000 made by the Second Deficiency Appropriation Act, fiscal year 1935, approved August 12, 1935, for replacing the pumping equipment and appurtenant features of the pumping station of the McMillan filter plant and for each and every purpose connected therewith, is hereby continued available for the fiscal year 1937. Water department: For an additional amount for extension ofExtensions. the water department distribution system, laying of such service mains as may be necessary under the assessment system, fiscal year 1936, $40,000. The appropriation of $123,000 contained in the District of ColumbiaNew pumping units, sum reappropriated.*Ante*, p. 371. Appropriation Act for the fiscal year 1936, approved June 14, 1935, for the purchase and installation of two 25-million-gallon-daily electrical motor-driven centrifugal pumping units at the Bryant Street pumping station, including all necessary appurtenances and alterations and removal of one 12-million-gallon and one 20-million-gallon obsolete steam pumping units, is continued available in the fiscal year 1937. settlement of claims For the payment of claims approved by the Commissioners under Settlement of claims.Vol. 45, p. 1160; Vol. 46, p. 500.and in accordance with the provisions of the Act entitled “An Act authorizing the Commissioners of the District of Columbia to settle claims and suits against the District of Columbia”, approved February 11, 1929 (45 Stat. 1160), as amended by the Act approved June 5, 1930 (46 Stat. 500), and reported in House Documents Numbered 439 and 468, Seventy-fourth Congress, $7,738. For the payment of claims approved by the Commissioners under and in accordance with the provisions of the Act entitled “An Act authorizing the Commissioners of the District of Columbia to settle 1616claims and suits against the District of Columbia”, approved February 11, 1929 (45 Stat. 1160), as amended by the Act approved June 5, 1930 (46 Stat. 500), and reported in Senate Document Numbered 252, $1,708.77. refund of assessments Refunds of street, etc., assessments.Vol. 46, p. 1199.For payment of refunds of assessments for paving streets, avenues, and roads, and laying curbs, as authorized by the provisions of section 11 of the Act entitled “An Act to provide for special assessments for the paving of roadways and the laying of curbs and gutters”, approved February 20, 1931 (46 Stat. 1199), $26,922.87, to continue available until June 30, 1937. Judgments.judgments Payment of.For the payment of final judgments, including costs, rendered against the District of Columbia, as set forth in House Documents Numbered 442 and 475, and Senate Document Numbered 211, Seventy-fourth Congress, $10,161.35, together with the further sum Interest.to pay the interest at not exceeding 4 per centum per annum on such judgments, as provided by law, from the date the same became due until the date of payment. Audited claims.audited claims Payment of.For the payment of the following claims, certified to be due by the accounting officers of the District of Columbia, under appropriations the balances of which have been exhausted or carried to Vol. 18, p. 110.[U. S. C., p. 1410](/us/usc/p1410).the surplus fund under the provisions of section 5 of the Act of June 20, 1874 (U. S. C., title 31, sec. 713), being for the service of the fiscal year 1933 and prior years: For Metropolitan Police, District of Columbia, 1933, motor vehicles, $4; For playgrounds, District of Columbia, 1933, maintenance, $22.96; For electrical department, District of Columbia, 1933, wires underground, $22.16; For street and road improvement and repair, District of Columbia, 1933, repairs to streets, $4; For gasoline tax, road and street improvements, District of Columbia, 1933, $157.75; For contingent and miscellaneous expenses, District of Columbia, 1932, $6; For contingent and miscellaneous expenses, District of Columbia, 1933, $7.50; For public schools, District of Columbia, 1933, $61.98; For miscellaneous expenses, Supreme Court, District of Columbia, 1933, $20; For expenses, trees, and parkings, District of Columbia, 1932, $1.60; For Industrial Home School for Colored Children, District of Columbia, 1931, $25.50; For police court, District of Columbia, 1931, witness fees, 75 cents; For miscellaneous expenses, Supreme Court, District of Columbia, 1927, $406; In all, audited claims, $740.20. Fiscal year, 1933 and prior years.Audited claims, District of Columbia: For the payment of the following claims, certified to be due by the accounting officers of the District of Columbia in Senate Document Numbered 211, under 1617appropriations the balances of which have been exhausted or carried to the surplus fund under the provisions of section 5 of the Act ofVol. 18, p. 110.[U. S. C., p. 1410](/us/usc/p1410). June 20, 1874 (U. S. C., title 31, sec. 713, p. 10221So in original.), being for the service of the fiscal year 1933 and prior fiscal years: Refund taxes,Refund taxes. District of Columbia, $747.99. division of expenses The foregoing sums for the District of Columbia, unless otherwiseDivision of expenses. therein specifically provided, shall be paid out of the revenues of the District of Columbia and the Treasury of the United States in the manner prescribed by the District of Columbia Appropriation Acts for the respective fiscal years for which the such sums are provided. DEPARTMENT OF AGRICULTUREDepartment of Agriculture. weather bureauWeather Bureau. Salaries and expenses: For an additional amount, for the sameLynchburg, Va., station.*Ante*, p. 1428. objects specified under this head in the Agriculture Appropriation Act for the fiscal year 1937, for the reestablishment, maintenance, and operation of the Weather Bureau station at Lynchburg, Virginia, $12,000. bureau of animal industryAnimal Industry Bureau. Marketing agreements with respect to hog cholera virus andHog cholera virus and serum, marketing agreements.Vol. 48, p. 38. serum: The sum of $30,000 of the appropriation made by section 12
(a)of the Agricultural Adjustment Act, approved May 12, 1933, is hereby made available during the fiscal years 1936 and 1937, to carry into effect sections 56 to 60. inclusive, of the Act approved August 24, 1935 (49 Stat., 781, 782), entitled “An Act to amend the*Ante*, p. 781. Agricultural Adjustment Act, and for other purposes”, including the employment of persons and means in the District of Columbia and elsewhere. forest serviceForest Service. Salaries and expenses, Forest Service (National forest administration):National forest administration. For an additional amount for national forest administration, including the same objects specified under this head in the Department *Ante*, p. 261.of Agriculture Appropriation Act for the fiscal year 1936, $100,000. bureau of chemistry and soilsBureau of Chemistry and Soils. Soil survey of the Hawaiian Islands: Not to exceed $15,000 ofHawaii, soil survey.Vol. 48, p. 38. the funds appropriated by section 12
(a)of the Agricultural Adjustment Act, as amended, is hereby made available, to remain available until June 30, 1937, to meet all necessary expenses of the Bureau of Chemistry and Soils, Department of Agriculture, for the completion of a soil survey of the Hawaiian Islands, including personal services for map-drafting work in the District of Columbia and elsewhere. agricultural adjustment administrationAgricultural Adjustment Administration. Tobacco compacts and agreements among States: Not to exceedState tobacco compacts and agreements.Sum reappropriated.Vol. 48, p. 38. $300,000 of the funds appropriated by section 12
(a)of the Agricultural Adjustment Act, as amended, is hereby made available, to remain available until June 30, 1938, to carry into effect the provisions of the Act approved April 25, 1936 (Public Act Numbered 1618*Ante*, p. 1239.534, Seventy-fourth Congress), entitled “An Act relating to compacts and agreements among States in which tobacco is produced providing for the control of production of, or commerce in, tobacco in such States, and for other purposes”; including the employment of persons and means in the District of Columbia and elsewhere, printing, advances to tobacco commissions, loans to associations of tobacco producers, and other expenses authorized by the provisions of the said Act. Department of Commerce.DEPARTMENT OF COMMERCE Secretary’s office.office of the secretary Accident Prevention Conference.General Committee of the Accident Prevention Conference: For salaries and expenses of the General Committee of the Accident *Ante*, p. 1389.Prevention Conference, authorized in the Act entitled “An Act to advance a program of national safety and accident prevention,” approved May 28, 1936, including personal services in the District of Columbia and elsewhere, printing and binding, and all other expenditures authorized in said Act, fiscal year 1937, $35,000. Bureau of Air Commerce.bureau of air commerce Air-navigation facilities.Air-navigation facilities: For an additional amount for the establishment and maintenance of aids to air navigation, including the *Ante*, p. 86.same objects specified under this head in the Department of Commerce Appropriation Act, 1936, $14,600. Maintenance of air-navigation facilities: For an additional amount for maintenance of air-navigation facilities, including the same *Ante*, p. 1332.objects specified under this head in the Department of Commerce Appropriation Act, 1937, $80,000. Bureau of Lighthouses.bureau of lighthouses Establishing and improving aids to navigation, etc.Special projects: For establishing and improving aids to navigation and other works as may be specifically approved by the Secretary of Commerce, $120,000, to continue available until June 30, 1938. Lighthouse tender.Special projects: For establishing and improving aids to navigation and other works, including the construction, or purchase, and equipment of a lighthouse tender at a cost not to exceed $125,000, as may be specifically approved by the Secretary of Commerce, $227,000, to continue available until June 30, 1937. Flood damages, repairs. etc.Repairs, and so forth, due to flood damages: For rebuilding, repairing, and reestablishing such aids to navigation and structures connected therewith as were damaged or destroyed by flood conditions in March 1936 on the Atlantic coast and tributary rivers, and in the Mississippi River Basin, $91,500, to remain available until June 30, 1937. Retired pay.Retired pay: For an additional amount for retired pay of officers and employees of the Lighthouse Service, including the same objects *Ante*, p. 94.specified under this head in the Department of Commerce Appropriation Act, 1936, $20,000. Vessels, purchase, construction, etc.Construction, and so forth, vessels: Not to exceed $550,000 of the unexpended balance of the sum of $2,860,000 appropriated in title Vol. 47, p. 717.III, section 301 (a), paragraph numbered 7, of the Act approved July 21, 1932 (47 Stat. 709), for establishing and improving aids to navigation and other works of the Lighthouse Service, and carried on the books of the Treasury under the appropriation title “Aids to Navigation, Lighthouse Service, Emergency Construction, Act of 1619July 21, 1932 (6x442)”, is hereby made available for the purchase, construction, equipping, and reconditioning of vessels for the Lighthouse Service. INTERIOR DEPARTMENTInterior Department. office of the secretarySecretary’s office. Furniture, furnishings, and equipment, new Interior Department Furniture, furnishings, etc., for new building.Building: The Secretary of the Interior is hereby authorized to expend, directly or through the Procurement Division of the Treasury Department, for furniture, furnishings, and office equipment necessary to the occupancy of the new Interior Department Building,Reassignment of space. and the reassignment of space in the present Interior Department Building, and for services, supplies, material, and equipment, including the reconditioning of old furniture, and necessary travel and subsistence in connection with the inspection of commodities to be contracted for or purchased, not to exceed $225,000 of the amount made available for the construction of the new Interior Department Building: *Provided*, That, in the procurement of such*Provisos.*Contracts. furniture, furnishings, and equipment, the Secretary of the Interior or the said Procurement Division is hereby authorized to make contracts, after advertising and competitive bidding, without regard to section 4 of the Act approved June 17, 1910 (36 Stat. 531): *And provided further*, Vol. 36, p. 531 [U. S. C., p. 1804](/us/usc/p1804).Cost basis.That the cost of furniture, furnishings, and equipment, exclusive of duplicating and filing equipment in areas devoted exclusively to such purposes, shall be based on the square-foot areas of the rooms to be furnished and equipped, and shall not exceed the rates herein set forth, as follows: For suites of the Secretary andSuites of Secretary, etc. the Under Secretary, $1.75 per square foot; for suites of the Assistant Secretaries and of executive officers of equivalent compensation grade, $1.50 per square foot; for all other space, $1 per square foot. War Minerals Relief Commission: For payment of awardsWar Minerals Relief Commission.Payment of awards.Vol. 40, p. 1275; Vol. 42, p. 322; Vol. 45, p. 1166.*Ante*, p. 1335. made by the Secretary of the Interior in accordance with the Act of Congress approved May 18, 1936 (Public, Numbered 602, Seventy-fourth Congress) amending section 5 of the War Minerals Relief Act of March 2, 1919, as amended, February 13, 1929, fiscal year 1936, to remain available during the fiscal year 1937, $500,000: *Provided*,*Proviso.*Certification of awards to General Accounting Office. That all awards made by the Secretary of the Interior for payment under this appropriation shall be certified to the General Accounting Office for settlement through that office. division of grazing controlGrazing Control Division. Salaries and expenses: The limitation of $5,000 on the amountVehicles.Amount for purchase increased. that may be expended for the purchase, exchange, operation, and maintenance of motor-propelled passenger-carrying vehicles from the appropriation for salaries and expenses of the Division of Grazing Control contained in the Department of the Interior Appropriation Act for the fiscal year 1936 is hereby increased to $7,500 general land officeGeneral Land Office. Payments to certain counties in Oregon in lieu of taxes on OregonOregon and California grant lands.Payment to certain counties in Oregon.Vol. 44, p. 915. and California grant lands (receipt limitation): For an additional amount for payment to the several counties in the State of Oregon, pursuant to the Act of July 13, 1926 (44 Stat. 915), amounts of money in lieu of the taxes that would have accrued against the revested Oregon and California Railroad Company grant lands if the lands had remained privately owned and taxable, fiscal year 1936, $66,010.25: *Provided*, That payments to the counties shall*Proviso.*Limitation.Vol. 48, p. 1227. not exceed the aggregate receipts covered into the Treasury in 1620accordance with section 4 of the Permanent Appropriation Repeal Act, 1934. Sales of public lands.Payments to States from proceeds of.Payments to States of 5 per centum of proceeds from sales of public lands: For an additional amount for payment to the several States of 5 per centum of the net proceeds of sales of public lands lying within their limits, for the purpose of education, or of making *Proviso.*Limitation.Vol. 48, p. 1227.public roads and improvements, fiscal year 1936, $1,291.39: *Provided*, That expenditures hereunder shall not exceed the aggregate receipts covered into the Treasury in accordance with section 4 of the Permanent Appropriation Repeal Act, 1934. Indian Affairs Bureau.bureau of indian affairs Agency buildings.*Post*, p. 1763.Indian Agency Buildings: For an additional amount for lease, purchase, repair and improvement of agency buildings, exclusive of hospital buildings, including the purchase of necessary lands and the installation, repair and improvement of heating, lighting, power, and sewerage and water systems in connection therewith, fiscal year 1937, $85,000. Adjustment of claims of certain Sioux Indians.Adjustment of claims of certain Sioux Indians: For additional amounts in the following appropriations to adjust errors in the disbursing accounts of James B. Kitch, former superintendent of the Standing Rock Indian Reservation in North Dakota: Purchase and transportation of Indian supplies, fiscal year 1917, $5.35; education, Sioux Nation, fiscal year 1918, $646.50; industrial work and care of timber, fiscal year 1918, $130; suppressing contagious diseases among livestock of Indians, fiscal year 1918, $20.69; Indian school and agency buildings, fiscal year 1918, $103.97; education, Sioux Nation, fiscal year 1919, $603.91; suppressing contagious diseases among livestock of Indians, fiscal year 1919, $4; increased compensation Indian Service, fiscal year 1920, $1,211.77; Indian school and agency buildings, fiscal year 1920, $234.28; in all, *Proviso*.Amounts placed to credit of Superintendent of Standing Rock Reservation.$2,960.47: *Provided*, That the foregoing amounts shall be placed to the credit of the Superintendent of the Standing Rock Reservation to restore a depleted balance in the fund “Special deposits, sale of reimbursable stock”, due to the use of said fund for the benefit of the above-listed appropriations, and for the purpose of making available a sufficient amount to permit payment of claims of individual Sioux Indians of the Standing Rock Reservation against said fund. Supervising mining operations.Transfer to Geological Survey.*Ante*, p. 184; *Post*, p. 1766.Supervising mining operations on leased Indian lands: For an additional amount for transfer to the Geological Survey for expenditures to be made in inspecting mines, examining mineral deposits on Indian lands and in supervising mineral operations on restricted tribal and allotted Indian lands, fiscal years 1936 and 1937, $7,500. Crow Reservation, Mont., irrigation systems.Maintenance and operation, irrigation systems, Crow Reservation, Montana (reimbursable): For an additional amount for maintenance and operation of irrigation systems on the Crow Reservation, Montana, fiscal year 1933, $8.08 (reimbursable). Indian irrigation systems, construction, operation, etc.Reappropriation.Construction, Operation and Maintenance, Indian Irrigation Systems: The unexpended balances of such appropriations for construction, operation and maintenance (including power revenues) of irrigation projects on Indian reservations as were repealed by Vol. 48, p. 1227.Section 4 of the Permanent Appropriation Repeal Act, 1934, are hereby made available for obligations incurred against such appropriations prior to July 1, 1935, and any remaining unobligated balances of such repealed appropriations shall be added to and become a part of the receipts accruing from each project during the fiscal year 1936. 1621 Indian schools, support: For an additional amount for the supportSupport of Indian schools.Indians in public schools.*Ante*, p. 189.*Proviso.*Formal contracts not required.[R. S., sec. 3744, p. 738](/us/rs/s3744/p738); [U. S. C., p. 1805](/us/usc/p1805). of Indian schools not otherwise provided for, including tuition for Indian pupils attending public schools, fiscal year 1936, $74,000: *Provided*, That formal contracts shall not be required for compliance with section 3744 of the Revised Statutes (U. S. C., title 41, sec. 16), for payment of tuition of Indian children attending public schools. Support of Indians and administration of Indian property: For an additionalGeneral support and administration. amount for general support of Indians and administration of Indian property, including pay of employees authorized by*Ante*, p. 194. continuing or permanent treaty provisions, fiscal year 1936, $75,000. Support of Indians and administration of Indian property: For*Post*, p. 1778. an additional amount for general support of Indians and administration of Indian property, including pay of employees authorized by continuing or permanent treaty provisions, fiscal year 1937, $11,500. Support of Indians and administration of Indian property (tribalMenominee Indians, Wis.Keshena Agency. funds): Appropriations from tribal funds of the Menominee Indians of Wisconsin, fiscal years 1935, 1936, and 1937, for general support of Indians and administration of Indian property (Keshena Agency), are hereby made available for hospitalization of Indians under contracts for such service for such fiscal years, and the Comptroller General of the United States is hereby authorized and directed to allow credit in the accounts of disbursing agents of the United States for payments heretofore made on this account.Indian boarding schools.Sequoyah Orphan Training School, Okla.Balance available.*Ante*, p. 191. Indian Boarding Schools (Sequoyah, Oklahoma): The unexpended balance of the appropriation of $24,000 contained in the Interior Department Appropriation Act, fiscal year 1936, for enlarging the hospital (including purchase of necessary equipment) at the Sequoyah Orphan Training School, near Tahlequah, Oklahoma, is hereby continued available for the same purpose until June 30, 1937. Indian boarding schools: For dairy barn, hay shed, and milkJones Academy, Okla. house, Jones Academy, Oklahoma, fiscal year 1937, $10,000. Expenses of attorneys, Wichita and affiliated bands of IndiansWichita, etc., Indians, Okla.Allowance to attorneys in claims.Sum reappropriated.Vol. 45, p. 1641.Further sum authorized. of Oklahoma (tribal funds): In addition to the $2,000 authorized to be used by the Second Deficiency Act, fiscal year 1929, approved March 4, 1929 (45 Stat., p. 1640), the Secretary of the Interior is authorized to expend the further sum of $500, or so much thereof as may be necessary, from the tribal funds of the Wichita and affiliated bands of Indians of Oklahoma in the Treasury of the United States, upon proper vouchers to be approved by him, for costs and expenses already incurred and those to be incurred by their duly authorized attorneys in the prosecution of the claims of said Indians now pending in the Court of Claims, including expenses of notDelegates’ expenses to Washington. exceeding two delegates from said bands of Indians, to be designated by the business committee representing all said bands, who may be called to Washington from time to time with the permission of the Commissioner of Indian Affairs on business connected with said claims, the additional amount herein authorized to remain available until expended. For pay of General Counsel, Confederated Bands of Ute IndiansConfederated Bands of Utes.Uintah and Ouray agency, general counsel. in the Uintah and Ouray agency, Utah (tribal funds): The Secretary of the Interior is authorized to expend the sum of $3,000 or so much thereof as may be necessary, from the tribal funds of the Confederated Bands of Ute Indians of the Uintah and Ouray agency, Utah, in the Treasury of the United States, upon proper vouchers approved by him, for services rendered by general counsel under a contract approved by the Commissioner of Indian Affairs and the Secretary of the Interior. 1622 Mrs. Earl H. Smith.Payment to.Payment to Mrs. Earl H. Smith: For payment to Mrs. Earl H. Smith, administratrix of the estate of Earl H. Smith, as authorized *Post*, p. 2246by the act of April 10, 1936 (Private, 448, 74th Cong.) fiscal year 1937, $504.41. Annette Islands Reserve, Alaska.Reappropriation.Expenses, Annette Islands Reserve, Alaska (Receipt Limitation): The unexpended balance of the appropriation “Annette Islands Reserve, Alaska, fund from leases”, which appropriation was repealed Vol. 48, p. 1227.by Section 4
(b6)of the Permanent Appropriation Repeal Act, 1934, is hereby made available for obligations incurred against such appropriation prior to July 1, 1935, and any unobligated balance of such repealed appropriation shall be added to and Become a part of the receipts accruing during the fiscal year 1936. Reclamation Bureau.bureau of reclamation North Platte project, Nebr., Wyo.Additional power circuit, Guernsey to Lingle.North Platte project, Nebraska-Wyoming: Not to exceed $50,000 from the power revenues shall be available during the fiscal years 1936 and 1937 for the construction of an additional power circuit between the Guernsey and Lingle power plants. Central Valley project, Calif.Friant Reservoir.Central Valley Project, California: For continuation, $6,900,000, to remain available until June 30, 1937, of which $6,000,000 shall be available for construction of Friant Reservoir and irrigation facilities therefrom in the San Joaquin Basin and $250,000 for administrative expenses (including personal services in the District of Columbia and elsewhere), to be available for the same purposes as *Post* p, 1781.those specified for projects included in the Interior Department Appropriation Act for the fiscal year 1937 under the caption “Bureau of Reclamation” and to be reimbursable under the Reclamation Law: *Proviso.*Services in the District.*Provided*, That not to exceed $25,000 may be expended for personal services in the District of Columbia. Geological Survey.geological survey Geologic surveys.Limitation on expenditure increased.Geologic surveys: The limitation of $270,000 on the amount that may be expended for the personal services in the District of Columbia from the appropriation for geologic surveys contained in the *Ante*, p. 200.Interior Department Appropriation Act for the fiscal year 1936 is hereby increased to $285,000. Alaska, mineral resources.Limitation for personal services increased.*Ante*, p. 201.Mineral resources of Alaska: The limitation of $20,000 on the amount that may be expended for personal services in the District of Columbia from the appropriation for investigation of the mineral resources of Alaska contained in the Interior Department Appropriation Act for the fiscal year 1936 is hereby increased to $25,000. Bureau of Mines.bureau of mines Traveling expenses.Station transfer.*Post*, p. 1788.Appropriations for the fiscal year 1937 available for expenses of travel of officers and employees of the Bureau of Mines shall be available for expenses of travel performed by them on transfer from one official station to another when authorized by the Secretary of the Interior, and for the expenses incurred in packing, crating, drayage, and transportation of household effects and other personal property of employees so transferred, under regulations to be prescribed by the Secretary of the Interior. National Park Service.national park service Mesa Verde, Colo.Water system.*Ante*, p. 207; *Post*, p.1793.Mesa Verde National Park, Colorado: For an additional amount for improvement of the water system, fiscal years 1936 and 1937, $10,000. 1623 Ackia National Memorial Commission and BattlegroundAckia National Memorial Commission and Battleground National Monument, Miss.Balance reappropriated.*Ante*, pp. 897, 1119. National Monument: The unexpended balance of the appropriation to carry out the provisions of the Act entitled “An Act to provide for the commemoration of the two-hundredth anniversary of the Battle of Ackia, Mississippi, and the establishment of the Ackia Battleground National Monument, and for other purposes”, approved August 27, 1935, contained in the Supplemental Appropriation Act, fiscal year 1936, is continued available for the fiscal year 1937 in order to provide for the commemoration during that year of the two-hundredth anniversary of the Battle of Ackia. Salaries and general expenses, public buildings and grounds in thePublic buildings and grounds., D. C.Maintenance, etc. District of Columbia: For an additional amount for administration, protection, maintenance, and improvement of public buildings, monuments, memorials, and grounds in the District of Columbia, under the jurisdiction of the National Park Service, including the same objects specified under this head in the Department of the Interior*Ante*, 210. Appropriation Act, 1936, $2,041,890, of which sum $1,150,000 shall remain available until June 30, 1937. office of educationOffice of Education. Promotion of vocational rehabilitation of persons disabled inVocational rehabilitation, Hawaii. industry in Hawaii: For extending to the Territory of Hawaii the benefits of the Act entitled “An Act to provide for the promotionVol. 21, p. 735; [U. S. C., p. 1320](/us/usc/p1320). of vocational rehabilitation of persons disabled in industry, and so forth”, approved June 2, 1920, as amended, in accordance with the provisions of the Act entitled “An Act to extend the provisions of Vol. 43, p. 18; [U. S. C., p. 910](/us/usc/p910).certain laws to the Territory of Hawaii”, approved March 10, 1924, $833. government in the territoriesGovernment In the Territories.Alaska.Care of insane. Insane of Alaska: For an additional amount for care and custody of persons legally adjudged insane in Alaska, including the same objects and for the same services specified in the Interior Department*Ante*, p. 213. Appropriation Act for the fiscal year 1936, $1,250. Construction and maintenance of roads, bridges, and trails, Alaska:Roads, bridges, trails, etc. For an additional amount for the repair and maintenance of roads, tramways, ferries, bridges, and trails, Territory of Alaska, in replacementEquipment lost at sea.Vol. 47, p. 446; [U. S. C., p. 2128](/us/usc/p2128). of equipment lost at sea, to be expended under the provisions of Public Resolution Numbered 218, approved June 30, 1932, $36,000. Territory of Hawaii: Not to exceed $125 of the amount specifiedHawaii.Stationery, etc. in the appropriation for contingent expenses, Territory of Hawaii, fiscal year 1936, for traveling expenses of the Governor while absent from the capital on official business, contained in the Department of Interior Appropriation Act for the fiscal year 1936, is hereby*Ante*, p. 214. made available for stationery, postage, and incidentals. Temporary Government for the Virgin Islands: For an additionalVirgin Islands.Saint Croix, defraying deficit.*Ante*, p. 214. amount for defraying the deficit in the treasury of the municipal government of Saint Croix because of the excess of current expenses over current revenues for the fiscal year 1936, $25,000. For household equipment and furnishings necessary for GovernmentGovernment House, furnishings, etc. House at Saint Croix, fiscal years 1936 and 1937, $5,000. howard universityHoward University Of the amounts provided for general expenses, Howard University,Salaries; funds transferred*Ante*, p. 216. in the Department of Interior Appropriation Acts, fiscal years 1936 and 1937, sums of not to exceed $52,000 for the fiscal year 1936 and not to exceed $65,000 for the fiscal year 1937, are hereby made available*Post*, p. 1803. for transfer to the appropriation for salaries, Howard University, fiscal years 1936 and 1937, respectively. 1624 Department of Justice.DEPARTMENT OF JUSTICE Attorney General’s Office.office of the attorney general Contingent expenses.Contingent expenses: For an additional amount for contingent *Ante*, p. 77.expenses, Department of Justice, including the same objects specified under this head in the Department of Justice Appropriation Act, 1936, $43,000. Newspapers.*Ante*, p. 1322.The appropriation “Contingent expenses, Department of Justice, 1937”, is amended by inserting the words “not exceeding $350” after the word “newspapers”. Printing and binding.Printing and binding: For an additional amount for printing and binding for the Department of Justice and the courts of the United States, for the fiscal years that follow: For 1932, $90; For 1936, $45,000. Bureau of Investigation.bureau of investigation Detection and prosecution of crimes.Vol. 48, p. 537.Detection and prosecution of crimes: For an additional amount for salaries and expenses, Division of Investigation, Department of Justice, including the same objects specified under this head in the Department of Justice Appropriation Act, 1935, $63,349.14. Private damage claims, payment.Claims for damages: For the payment of claims for damages to any person or damages to or loss of privately owned property caused by employees of the Federal Bureau of Investigation, acting within the scope of their employment, considered, adjusted, and determined *Ante*, p. 1184.by the Attorney General, under the provisions of the Act entitled “An Act to provide for the adjustment and settlement of certain claims arising out of the activities of the Federal Bureau of Investigation”, approved March 20, 1936 (Public, Numbered 481, Seventy-fourth Congress) as fully set forth in House Document Numbered 455, and Senate Document Numbered 218, of the Seventy-fourth Congress, $34.27. Miscellaneous.miscellaneous objects, department of justice Conduct of customs cases.Vol. 48, p. 537.Conduct of customs cases: For an additional amount for protecting interests of the United States in customs matters, including the same objects specified under this head in the Department of Justice Appropriation Act, 1935, $118.22. Taxes and Penalties Unit.*Ante*, p. 78.Taxes and Penalties Unit: For an additional amount for salaries and expenses, Taxes and Penalties Unit, Department of Justice, including the same objects specified under this head in the Department of Justice Appropriation Act, 1936, $19,800. Elinora Fareira.Payment to.Payment to Elinora Farcira: For payment to Elinora Farcira in full settlement of all claims against the United States for the; amount of the sale of her Buick car by the United States *Post*, p. 2199.Government on or about April 8, 1930, as authorized by the Act approved August 28, 1935, fiscal year 1936, $325. Northern Pacific Railway Company and others.Salaries and expenses, prosecuting case against.Vol. 43, p. 461.Case of United States against Northern Pacific Railway Company, and others: For salaries and expenses incident to prosecution of the case of United States against Northern Pacific Railway Company, and others, Equity, numbered 4389, United States District Court, Eastern District of Washington, including traveling and office expenses; law books; stenographic reporting services, by contract or otherwise, including notarial fees or like services, and stenographic work in taking depositions at such rates of compensation as Witnesses and appraisers.may be authorized or approved by the Attorney General; fees of witnesses and appraisers; compensation of special master in accord1625ance with order of the United States District Court; printing and binding; the employment of experts at such rates of compensation as may be authorized or approved by the Attorney General; and personal services in the District of Columbia and elsewhere, fiscal year 1936, $110,000, to remain available until June 30, 1937. judicialJudicial. Miscellaneous expenses, United States Supreme Court: For miscellaneousUnited States Supreme Court.Miscellaneous expenses.Preparation, etc., rules in actions at law. expenses of the Supreme Court of the United States to provide for expenses of the advisory committee appointed by the court to assist it in the preparation of a unified system of general rules for cases in equity and actions at law in the district courts of the United States and in the Supreme Court of the District of Columbia, pursuant to the Act entitled “An Act to give the Supreme Court of the United States authority to make and publish rules in actions at law”, approved June 19, 1934 (48 Stat. 1064), includingVol. 48, p. 1064; [U. S. C., p. 1304](/us/usc/p1304). personal services in the District of Columbia and elsewhere and printing and binding, to be expended as the Chief Justice in hisPrinting and binding. discretion may direct, including such per-diem allowances in lieu ofSubsistence. actual expenses for subsistence at rates to be fixed by him not to exceed $10 per day, fiscal year 1937, $17,500: *Provided*, That the*Proviso.*Transfer of appropriations.*Ante*, p. 686. transfer of $13,000 from the appropriation “Preparations of rules in actions at law, 1935 and 1936”, to the appropriation “Miscellaneous expenses, Supreme Court 1935 and 1936”, is hereby authorized, and the unexpended balances at the close of June 30, 1936, of both of said appropriations are continued available until June 30, 1937. Salaries of judges: For an additional amount for salaries of circuit,Judges.Salaries.*Ante*, p. 80. district, and retired judges, including the same objects specified under this head in the Department of Justice Appropriation Act, 1936, $65,000. Expenses of judges: For an additional amount for expenses ofExpenses. circuit and district judges of the United States and the judges of the district courts of the United States in Alaska, Puerto Rico, and Hawaii, as provided by law, fiscal year 1936, $7,500. United States Court for China: For an additional amount forUnited States Court for China.Salaries and expenses. salaries and expenses, United States Court for China, including the same objects specified under this head in the Department of Justice Appropriation Acts for the fiscal years that follow, respectively: For 1936, $7,025;*Ante*, p. 81. For 1937, $4,700.*Ante*, p. 1326. marshals, district attorneys, clerks, and other expenses of united states courtsUnited States courts. Salaries and expenses of marshals, and so forth: For an additionalMarshals, etc. amount for salaries, fees, and expenses of marshals, United States courts, including the same objects specified under this head in the Department of Justice Appropriation Acts for the fiscal years that follow, respectively: For 1935, $31,951.21;Vol. 48, p. 541. For 1936, $270,000.*Ante*, p. 81.District attorneys, etc. Salaries and expenses of district attorneys, and so forth: For an additional amount for salaries and expenses of district attorneys, United States courts, including the same objects specified under this head in the Department of Justice Appropriation Acts for the fiscal years that follow, respectively: For 1935, $6,439.09;Vol. 48, p. 541. For 1936, $60,000.*Ante*, p. 81. 1626 Clerks of courts.Salaries and expenses, clerks of courts: For an additional amount for salaries and expenses of clerks, United States courts, including the same objects specified under this head in the Department of Justice Appropriation Acts for the fiscal years that follow, respectively: Vol. 48, p. 542.For 1935, $12,735.32; *Ante*, p. 82.For 1936, $73,000. Commissioners.Fees of commissioners: For additional amounts for fees of United [R. S., sec. 1014, p. 189](/us/rs/s1014/p189); [U. S. C., p. 770](/us/usc/p770).States commissioners and other committing magistrates acting under section 1014, Revised Statutes (U. S. C., title 18, sec. 591), for the following fiscal years: Vol. 46, p. 190.For 1930, 60 cents; Vol. 46, p. 1324.For 1931, $56.60; Vol. 47, p. 492.For 1932, $714.72; Vol. 47. p. 1384.For 1933, $886.23. Jurors and witnesses.Fees of jurors and witnesses: For an additional amount for fees of jurors and witnesses, United States courts, including the same Vol. 48. p. 542.objects specified under this head in the Department of Justice Appropriation Act for the fiscal year 1935, $63,097.34. Bailiffs, etc.Salaries and expenses of bailiffs, and so forth: For an additional amount for pay of bailiffs, and so forth, United States courts, *Ante*, p. 82.including the same objects specified under this head in the Department of Justice Appropriation Act, 1936, $20,000. Miscellaneous.Miscellaneous expenses: For an additional amount for miscellaneous expenses, United States courts, including the same objects specified under this head in the Department of Justice Appropriation Acts for the fiscal years that follow, respectively: Vol. 46, p. 190.For 1930, $360; *Ante*, p. 82.For 1936, $36,500. Supplies.Supplies: For an additional amount for supplies for United States courts, including the same objects specified under this head in the Vol. 47, p. 1384.Act making appropriations for the Department of Justice for the fiscal year 1934, $153.60. Penal and correctional institutions.penal and correctional institutions National Training School for Boys, D. C.National Training School for Boys, Washington, District of Columbia, maintenance: For an additional amount for the National Training School for Boys, Washington, District of Columbia, *Ante*, p. 85.including the same objects specified under this head in the Department of Justice Appropriation Act, 1936, $21,300. Support of prisoners.Support of prisoners: For an additional amount for support of United States prisoners, including the same objects specified under Vol. 45, p. 83.this head in the Act making appropriations for the Department of Justice for the fiscal year 1929, $97.50. Department of Labor.DEPARTMENT OF LABOR Secretary’s office.office of the secretary Printing and binding.Printing and binding: For an additional amount for printing and binding for the Department of Labor, including the same objects *Ante*, p. 102.specified under this head in the Department of Labor Appropriation Act, 1936, $10,000. Immigration and Naturalization Service.immigration and naturalization service Overtime service of inspectors.The sum of $60,000 made available only for the payment of extra compensation for overtime services of inspectors and employees of the Immigration and Naturalization Service for which the United1627 States receives reimbursement in accordance with the provisions of the Act of March 2, 1931 (U. S. C., title 8, secs. 109a and 109b), inVol. 40, p. 1467; [U S. C., p. 184](/us/usc/p184).*Ante*, p. 103. the Department of Labor Appropriation Act, 1936, approved March 22, 1935, under the appropriation title “Salaries and expenses, Immigration and Naturalization Service”, is hereby increased to $110,000. bituminous coal labor boardBituminous Coal Labor Board. Salaries and expenses: For three Board members and other personalSalaries and expenses. services in the District of Columbia and elsewhere, and for all other necessary expenditures of the Bituminous Coal Labor Board in performing the duties imposed upon said Board by the Bituminous Coal Conservation Act of 1935, approved August 30,*Ante*, p. 1001. 1935, including supplies, stationery, telephone service, telegrams, furniture, office equipment, travel expenses, contract stenographic reporting services, and other contingent expenses, fiscal year 1936, $30,000, of which sum. such amounts as may be necessary shall be available for payment of salaries of the Board members from and including the respective dates upon which they officially assumed duty as such members and for all other expenses heretofore incurred by the Board. Printing and binding: For all printing and binding for thePrinting and binding. Bituminous Coal Labor Board, fiscal year 1936, $1,000. The appropriations for “Salaries and Expenses” and “PrintingAppropriations repealed.*Ante*, p. 1352. and Binding” for the Bituminous Coal Labor Board for the fiscal year ending June 30, 1937, contained in the “Department of Labor Appropriation Act, 1937”, are hereby repealed. NAVY DEPARTMENTNavy Department. secretary’s officeSecretary’s Office. Payment to Cecelia Callahan: For payment to Cecelia CallahanCecelia Callahan.Payment to.*Post*, p. 2230.of an amount equal to six months’ pay of her nephew, the late Joseph Francis O’Neil, United States Navy, as authorized by the Act approved March 2, 1936, $475.20. Claims for damages by collision with naval vessels: To payCollision damage claims.Vol. 42, p. 1060.[U. S. C., p. 1550](/us/usc/p1550). claims for damages adjusted and determined by the Secretary of the Navy under the provisions of the Act entitled “An Act to amend the Act authorizing the Secretary of the Navy to settle claims for damages to private property arising from collisions with naval vessels”, approved December 28, 1922, as fully set forth in House Document Numbered 454, Seventy-fourth Congress, $91,34. Navy and Marine Memorial Monument: The entire appropriationNavy and Marine Memorial Monument.Fabrication, transportation, and erection.*Ante*, p. 588. of $13,000 made in the Second Deficiency Appropriation Act, fiscal year 1935, for this purpose may, upon the approval of the Secretary of the Navy, notwithstanding any other provision of law, be expended for the fabrication, transportation, and erection of such monument. bureau of navigationBureau of Navigation. Transportation: For travel allowance, and so forth, includingTravel allowance, etc.Vol. 42, p. 790. the same objects specified under this head in the Act making appropriations for the Navy Department and the naval service for the fiscal year 1923, $28.95. Training, education, and welfare: There is hereby transferredTraining, education, and welfare.Transfer of funds. from the appropriation “Training, Education, and Welfare, Navy, 1936”, subhead “Instruction”, $5,450; subhead “Libraries”, $3,550, subhead “Naval Reserve Officers’ Training Corps”, $3,000; and from 1628Vol. 36, p. 1353.[U. S. C., p. 1578](/us/usc/p1578).the appropriation “State Marine Schools (Act March 4, 1911), 1936”, $12,000; in all, $24,000, to the appropriation “Training, Education, and Welfare, Navy, 1936”, subhead “Naval Training Station, Norfolk, Virginia”, to be available for the same objects specified *Ante*, p. 400.under this subhead in the Act making appropriations for the Navy Department and naval service for the fiscal year 1936, approved June 24, 1935. Henry H. Rogers, bequest.Expenses incident to acceptance.Acceptance of bequest of Henry H. Rogers: For crating, packing, transportation, and other necessary expenses in connection with the acceptance by the Secretary of the Navy, on behalf of the United States, of the collection of ship models bequeathed the United States Naval Academy by the late Henry H. Rogers, as authorized by the *Ante*, p. 1239.Act approved April 25, 1936 (Public, Numbered 533), to remain available until June 30, 1937, $5,000. Bureau of Engineering.bureau of engineering Engineering repairs, machinery, etc.Engineering: For repairs, preservation, and renewal of machinery, auxiliary machinery, and so forth, including the same objects specified under this head in the Act making appropriations for the *Ante*, p. 405.Navy Department and the naval service for the fiscal year 1936, $750,000, to remain available until June 30, 1937. Bureau of Construction and Repair.bureau of construction and repair Construction and repair of vessels.For designing naval vessels, including services, instruments, apparatus, and so forth, including the same objects specified under this head in the Act making appropriations for the Navy Department *Ante*, p. 406.and the naval service for the fiscal year 1936, $100,000, to remain available until June 30, 1937. Bureau of Supplies and Accounts.bureau of supplies and accounts Fuel and transportation.Fuel and transportation: For an additional amount for coal and other fuel for submarine bases and steamers’ and ships’ use, and so forth, including the same objects specified under this head in the *Ante*, p. 407.Act making appropriations for the Navy Department and the naval service for the fiscal year 1936, $750,000. Bureau of Yards and Docks.bureau of yards and docks Public works, etc.Public works, Bureau of Yards and Docks: For an additional amount for the prosecution of the public works and public utilities projects heretofore authorized and appropriated for under this head and in addition the following-named public works and public utilities projects at a limit of cost not to exceed the amount stated for each project enumerated, respectively: Mare Island, Calif., navy yard.Navy Yard, Mare Island, California: Dispensary building and accessories, $80,000; Norfolk, Va., operating base.Naval Operating Base, Norfolk, Virginia: Improvement of heating plant, $75,000; Newport, R. I., for pedo station.Naval Torpedo Station, Newport, Rhode Island: Improvement of station and government landing ferry slips, $47,000; Carpenter shop building and accessories, $80,000; Norfolk, Va., air station.Naval Air Station, Norfolk, Virginia: To replace assembly and repair shop facilities destroyed by fire, including building and accessories, $150,000; Dahlgren, Va., proving ground.Naval Proving Ground, Dahlgren, Virginia: Improvement of airplane landing field, $90,000;1629 Fleet Air Base, Pearl Harbor, Hawaii: Improvement of servicePearl Harbor, Hawaii, fleet air base. systems and extension of roads and walks, $184,000. In all, $706,000, which, together with unexpended balances ofAccounting. appropriations heretofore made under this head, shall be disbursed and accounted for in accordance with existing law and shall constitute one fund: *Provided*, That of the amount herein appropriated*Proviso.*Personal services. not to exceed 2½ per centum thereof shall be available for the employment of classified personal services in the Bureau of Yards and Docks and in the field service to be engaged upon such work and to be in addition to employees otherwise provided for. marine corpsMarine Corps. General expenses, Marine Corps: For an additional amount underProvisions, etc. the subhead “Provisions” of the appropriation “General expenses, Marine Corps, 1936”, including the same objects specified under this*Ante*, p. 416. subhead in the Act making appropriations for the Navy Department and the naval service for the fiscal year 1936, $95,000. Marine Band: To carry into effect the provisions of the ActMarine Band. entitled “An Act to authorize the attendance of the Marine Band*Ante*, p. 1395. at the Arkansas Centennial Celebration, at Little Rock, Arkansas, the Texas Centennial, at Dallas, Texas, and the National Confederate Reunion, at Shreveport, Louisiana, between the dates from June 6 to June 16, 1936, inclusive”, approved June 3, 1936, $11,500. increase of the navyIncrease of the Navy Construction and machinery: The limitation on expenditures forGroup IV
(b)employees.Limit on expenditure, field service, increased. employees in the field service assigned to group IV
(b)and those performing similar services carried under native and alien schedules in the Schedule of Wages for Civil Employees in the Field Service of the Navy Department under the appropriation “Increase*Ante*, p. 417. of the Navy, construction and machinery” for the fiscal year 1936 is hereby increased from $1,000,000 to $2,400,000. POST OFFICE DEPARTMENT (Out of the postal revenues)Post Office Department. office of the postmaster generalPostmaster General. Salaries: For an additional amount for salaries, Office of the FirstFirst Assistant Postmaster General’s office, salaries.Contingent expenses.Assistant Postmaster General, fiscal year 1936, $9,250. Contingent expenses: For an additional amount for contingent and miscellaneous expenses; stationery and blank books, and so forth, including the same objects specified under this head in the Post*Ante*, p. 236. Office Department Appropriation Act, 1936, $7,000. Printing and binding: For an additional amount for printing andPrinting and binding. binding for the Post Office Department, including the same objects specified under this head in the Post Office Department Appropriation*Ante*, p. 236. Act, 1936, $325,000. field service, post office departmentField Service. office of the chief inspectorChief Inspector’s office. Payment of rewards: For an additional amount for payment ofRewards for detecting law violations. rewards, and so forth, including the same objects specified under this head in the Post Office Department Appropriation Act, 1935,Vol. 48, p.444. $24,500: *Provided*, That the amounts appropriated under this head*Proviso*.Mailing bombs, etc. for the fiscal years 1936 and 1937 shall be available for the payment 1630of rewards for the detection, arrest, and conviction of persons mailing or causing to be mailed any bomb, infernal machine, or mechanical, chemical, or other device or composition which may ignite or explode. First Assistant Post-master General.office of the first assistant postmaster general Postmasters.Compensation to postmasters: For an additional amount for compensation to postmasters, and so forth, including the same objects *Ante*, p. 237.specified under this head in the Post Office Department Appropriation Act, 1936, $3,500,000. Clerks, first and second-class officesClerks, first- and second-class post offices: For an additional amount for compensation to clerks and employees at first- and second- class post offices, and so forth, including the same objects specified under this head in the Post Office Department Appropriation Act, 1936, $18,000,000. Village delivery service.Village delivery service: For an additional amount for village delivery service, and so forth, including the same objects specified under this head in the Post Office Department Appropriation Act, 1936, $90,000. City delivery carriers.City delivery carriers: For an additional amount for pay of letter carriers, City Delivery Service, fiscal year, 1936, $10,750,000. Special-delivery fees.Special-delivery fees: For an additional amount for fees to special-delivery messengers for the fiscal years that follow: Vol. 48, p. 445.*Ante*, p. 238.For 1935, $95,000; For 1936, $750,000. Second Assistant Postmaster Generaloffice of the second assistant postmaster general Railroad transportation, etc.Railroad transportation and mail messenger service: For an additional amount for inland transportation by railroad routes and for mail messenger service, and so forth, including the same objects *Ante*, p. 238.specified under this head in the Post Office Department Appropriation Act, 1936, $2,000,000. Railway Mail Service.Salaries.Railway Mail Service, salaries: For an additional amount for Railway Mail Service, salaries, including the same objects specified *Ante*, p. 238.under this head in the Post Office Department Act, 1936, $3,450,000. Travel allowance to clerks, etc.Railway postal clerks, travel allowance: For an additional amount for travel allowance to railway postal clerks and substitute railway postal clerks, fiscal year 1936, $125,000. Contract air-mail, service.Contract air-mail service: For an additional amount for the *Ante*, p. 239.in-land transportation of mail by aircraft, and so forth, including the same objects specified under this head in the Post Office Department Appropriation Act, 1936, $1,300,000. Fourth Assistant Postmaster General.office of the fourth assistant postmaster general Vehicle service.Vehicle service: For an additional amount for vehicle service, and *Ante*, p. 241.so forth, including the same objects specified under this head in the Post Office Department Appropriation Act, 1936, $200,000. Department of State.DEPARTMENT OF STATE Secretary’s office.office of the secretary of state Salaries. Salaries: For an additional amount for salaries, Department of *Ante*, p. 1309.State, including the same objects specified under this head in the Department of State Appropriation Act, 1937, $17,300. Contingent expenses.Contingent expenses: For an additional amount for contingent *Ante*, p. 68.expenses, Department of State, including the same objects specified under this head in the Department of State Appropriation Act, 1936, Typewriters, etc.$6,450, of which not to exceed $880 may be expended for typewriters, 1631adding machines, and other labor-saving devices, including their exchange. For an additional amount for contingent expenses, Department*Ante*, p. 1310. of State, including the same objects specified under this head in the Department of State Appropriation Act, 1937, $5,700. Printing and binding: For an additional amount for printing and binding, DepartmentPrinting and binding of State, including the same objects specified under this head in the Department of State Appropriation Acts for the fiscal years that follow, respectively: For 1936, $5,000;*Ante*, p. 68. For 1937, $2,000.*Ante*, p. 1311. foreign intercourseForeign intercourse. Transportation of Foreign Service officers: For an additionalTransportation. amount for transportation of Foreign Service officers, including the same objects specified under this head in the Department of State*Ante*, p. 70. Appropriation Act, 1936, $45,000. Contingent expenses, Foreign Service: For an additional amountContingent expenses for contingent expenses, Foreign Service, including the same objects specified under this head in the Department of State AppropriationSum from balance re appropriated.*Ante*, p. 72. Act, 1936, $40,000, together with not to exceed $140,000 of the unexpended balance of the appropriation for office and living quarters, Foreign Service, fiscal year 1936. Payment to Gladys Hinckley Werlich: For payment to GladysGladys Hinckley Werlich.Payment to. Hinckley Werlich, widow of McCeney Werlich, late a Foreign Service officer of the United States at Paris, France, of one years salary of her deceased husband who died while in the Foreign Service, as authorized by the Act approved May 18, 1936 (Private Act Numbered*Post*, p. 2296. 567, Seventy-fourth Congress), $4,100. international congresses, commissions, bureaus, and so forthInternational Congresses, etc. International Boundary Commission, United States and Mexico,International Boundary Commission, United States and Mexico.Rio Grande Diversion Dam. United States Section—Rio Grande Diversion Dam: For beginning the construction of a diversion dam in the Rio Grande wholly in the United States, with appurtenant connections to existing irrigation systems, as authorized by law, fiscal year 1937, $1,000,000, under a total estimated cost not to exceed $1,400,000, to be immediately availableAvailability. and to be available also for the same objects of expenditure and under the same authority specified for other projects of the Commission in the second paragraph under the caption “International*Ante*, p. 1317. Boundary Commission, United States and Mexico” contained in the Department of State Appropriation Act, 1937. International Joint Commission, United States and Great Britain:International Joint Commission, United States and Great Britain.Lake Champlain to Hudson River water-way investigation.*Ante*, p. 1048.[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). For the expense of the investigation and report requested by section 4 of the Act of August 30, 1935 (49 Stat. 1048), including personal services in the District of Columbia and elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting services by contract if deemed necessary, without regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5); rent; traveling expenses; stationery; printing and binding; hire, maintenance, and operation of motor-propelled passenger-carrying vehicles; and. such other expenses as may be authorized by the Secretary of State, fiscal year 1936, $5,500, to remain available until June 30, 1937. Mixed Claims Commission, United States and Germany: ForMixed Claims Commission, United States and Germany.Expenses, etc.Vol. 42. p. 2200; Vol. 45, p. 2698. expenses of determining the amounts of claims against Germany by the Mixed Claims Commission established under the agreement concluded between the United States and Germany on August 10, 1922, and subsequent agreement between those Governments, for the 1632determination of the amount to be paid by Germany in satisfaction Vol. 42, p. 1939of the financial obligations of Germany under the treaty concluded between the Governments of the United States and Germany on August 25, 1921, including the expenses which under the terms of such agreement of August 10, 1922, are chargeable in part to the Final report of American Commissioner.United States, and the preparation of a final report by the American Commissioner and the orderly arrangement for preservation and disposition of the records of the Commission; and the expenses of an agency of the United States to perform all necessary services in connection with the preparation of claims and the presentation thereof before said Mixed Claims Commission, and the preparation of a final report of the agent and the orderly arrangement for preservation of the records of the agency and the disposition of property jointly owned by the two Governments, including salaries of an agent and necessary counsel and other assistants and employees, rent Special counsel, etc.in the District of Columbia, employment of special counsel, translators, and other technical experts, by contract, without regard to the provisions of any statute relative to employment, and for [R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803).contract stenographic reporting services without regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5), law books and books of reference, printing and binding, contingent expenses, traveling expenses, press-clipping service, for all necessary and appropriate Vol. 46, p. 1005.[U. S. C., p. 966](/us/usc/p966).expenses in connection with proceedings under the Act entitled “An Act to amend the Act approved July 3, 1930 (U. S. C., title 22, sec. 270), authorizing Commissioners or members of international tribunals to administer oaths, and so forth”, approved June 7, 1933, including stenographic transcripts of the testimony of witnesses, and such other expenses in the United States and elsewhere as the President may deem proper, including payment for services rendered and reimbursement for expenditures incurred subsequent to December 1, 1935, fiscal year 1936, $35,000 to remain available until June 30, 1937. Aviation Conference, Lima, Peru.Participation expenses.Aviation Conference, Lima, Peru: For the expenses of participation by the United States in the Aviation Conference to be convened at Lima, Peru, in 1936, including personal services in the District of Columbia and elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting and translating services by contract if deemed necessary, without regard to section [R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803).3709 of the Revised Statutes (U. S. C., title 41, sec. 5); rent; traveling Reimbursement of other appropriations.expenses (and by indirect routes and by airplane if specifically authorized by the Secretary of State); purchase of necessary books, documents, newspapers, and periodicals; stationery; official cards; printing and binding; entertainment; hire, maintenance, and operation of motor-propelled passenger-carrying vehicles; and such other expenses as may be authorized by the Secretary of State, including the reimbursement of other appropriations from which payments may have been made for any of the purposes herein specified, fiscal year 1936, $25,000, to remain available until June 30, 1937. United States-Panamanian Claims Commission, payment of awards.Vol. 47, p. 1915.Awards of United States-Panamanian Claims Commission: For payment of claims of American nationals in accordance with awards of the United States-Panamanian Claims Commission, pursuant to the conventions concluded July 28, 1926, and December 17, 1932, between the Government of the United States and the Government of Panama, $3,150, to supplement the payment by the Republic of Panama, and to be established in the trust account covering said payment. Conference on oil pollution of navigable waters.Conference on oil pollution of navigable waters : For the expenses of the United States in participating in a conference on oil pollution of navigable waters, to be held in Geneva, Switzerland, during 1936, 1633including the preparation therefor and expenses in connection therewith, personal services in the District of Columbia or elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting services by contract if deemed necessary, without regard to section 3709 of the Revised Statutes (U. S. C.,[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). title 41, sec. 5); rent; traveling expenses; purchase of necessary books, documents, newspapers, periodicals, and maps; stationery; official cards; printing and binding; entertainment; and such otherPrinting and binding. expenses as may be authorized by the Secretary of State; to be expended under the supervision of the Secretary of State, fiscal year 1936, $3,000, to remain available until June 30, 1937. Payment to Government of Norway: For payment to the GovernmentPayment to Government of Norway.Steamer “Tampen.” of Norway in full and final settlement of all claims for reimbursement on account of losses sustained by the owner and crew of the Norwegian steamer Tampen by reason of the detention of the vessel by the United States Coast Guard during June 1925, as authorized*Ante*, p. 1104. by the Act approved January 27, 1936, fiscal year 1936, $8,765. Claims adjustment, United States and Turkey: The unexpendedClaims adjustment with Turkey.*Ante*, p. 76 balance of the appropriation “Claims adjustment, United States and Turkey, 1934–1936”, is continued available for the same purposes until June 30, 1937. International Exposition, Paris, France: For the purpose ofInternational Exposition, Paris.Participation expenses.*Ante*, p. 1200. carrying into effect the provisions of Public Resolution Numbered 80, entitled “Joint resolution accepting the invitation of the Government of France to the United States to participate in the International Exposition of Paris—Art and Technique in Modern Life, to be held at Paris, France, in 1937”, approved April 10, 1936, $50,000, to remain available until June 30, 1938. Third triennial meeting of the Associated Country Women of theAssociated Country Women of the World, triennial meeting.Expenses.*Ante*, p. 1167. World: To aid in defraying the expenses of the third Triennial Meeting of the Associated Country Women of the World to be held in the United States in June 1936, including personal services in the District of Columbia and elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting services by contract, if deemed necessary, without regard to section 3709 of[R. S., sec. 3709, p. 733](/us/rs/s3709/p733).[U. S. C., p. 1803](/us/usc/p1803). the Revised Statutes (U. S. C., title 41, sec. 5); rent; traveling expenses; local transportation; hire of motor-propelled passenger-carrying vehicles; purchase of necessary books, documents, newspapers, periodicals, and maps; stationery; membership badges; official cards; entertainment; printing and binding; and such other expenses as may be authorized by the Secretary of State, includingReimbursement of other appropriations. the reimbursement of other appropriations from which payments may have been made for any of the purposes herein specified, to be expended under the direction of the Secretary of State, fiscal year 1936, $10,000, to remain available until June 30, 1937. International Conferences: The unexpended balances of the appropriationsInternational conferences.Balances reappropriated.*Ante*, p. 56. “International Monetary and Economic Conference, 1933–36”, and “General Disarmament Conference, Geneva, Switzerland, 1933–36”, contained in the First Deficiency Act, fiscal year 1935, are continued available for the same purposes until June 30, 1937. Conference to Revise the Convention for the Protection of LiteraryConference to Revise the Convention for the Protection of Literary and Artistic Works, Brussels.Participation expenses.*Ante*, p. 1357. and Artistic Works, Brussels, Belgium: For the expenses of participation by the United States in the conference to convene at Brussels, Belgium, for the purpose of revising the Convention for the Protection of Literary and Artistic Works, concluded at Bern, September 9, 1886, and revised at Rome, June 2, 1928, including personal services in the District of Columbia and elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting and other services by contract if deemed necessary with1634out regard to section 3709 of the Revised Statutes (U. S. C., title 41, sec. 5); rent; traveling expenses; purchase of necessary books, documents, newspapers, periodicals, maps, stationery, and official cards; entertainment; printing and binding; and such other expenses as Reimbursement of other appropriations.may be authorized by the Secretary of State, including the reimbursement of other appropriations from which payments may have been made for any of the purposes herein specified; to be expended under the direction of the Secretary of State, fiscal year 1936, $6,500, to remain available until June 30, 1937. Ninth Congress of Military Medicine and Pharmacy.Participation expenses.*Ante*, p. 1355.Ninth International Congress of Military Medicine and Pharmacy: For the expenses of participation by the United States in the Ninth International Congress of Military Medicine and Pharmacy to be held in Rumania in 1937, including personal services in the District of Columbia or elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting and other services by contract if deemed necessary without regard to section Traveling expenses, etc.3709 of the Revised Statutes (U. S. C., title 41, sec. 5); rent; traveling expenses; purchase of necessary books, documents, newspapers, periodicals, maps, stationery, and official cards; entertainment; Association of Military Surgeons of the United States.Printing report of American Delegation.printing and binding, including the payment of not to exceed $500 to the Association of Military Surgeons of the United States toward the cost of printing the report of the American Delegation to the Ninth Congress; and such other expenses as may be authorized by Reimbursement of other appropriations.the Secretary of State, including the reimbursement of other appropriations from which payments may have been made for any of the Purposes herein specified; to be expended under the direction of the Secretary of State, fiscal year 1937, $11,500, to remain available until June 30, 1938. International Hydrographic Bureau, contribution.International Hydrographic Bureau: For the contribution of the United States to the International Hydrographic Bureau, together with such additional sums, due to increases in rates of exchange, as may be necessary to pay in foreign currencies the contribution required by the statutes of the Bureau, fiscal year 1936, $308.80. International Telegraph Consulting Committee.Participation expenses.International Telegraph Consulting Committee: For the expenses of participation by the United States in the meeting of the International Telegraph Consulting Committee to be held at Warsaw, Poland, in 1936, including personal services in the District of Columbia and elsewhere without regard to the Classification Act of 1923, as amended; stenographic reporting and other services by contract if deemed necessary without regard to section 3709 of the Revised Traveling expenses, etc.Statutes (U. S. C., title 41, sec. 5); rent; traveling expenses; local transportation; printing and binding; official cards; purchase of necessary books, documents, newspapers, and periodicals; stationery; Reimbursement of other appropriations.entertainment; and such other expenses as the Secretary of State may authorize, including the reimbursement of other appropriations from which payments have been made for any purposes herein specified, fiscal year 1937, $2,500. World’s Woman’s Christian Temperance Union.Sixteenth Triennial Convention.*Ante*, p. 1268.Sixteenth Triennial Convention of the World’s Woman’s Christian Temperance Union: To aid in defraying the expenses of the sixteenth Triennial Convention of the World’s Woman’s Christian Temperance Union, to be held in the United States in June 1937, including personal services in the District of Columbia and elsewhere without reference to the Classification Act of 1923, as amended; stenographic reporting and other services by contract if deemed necessary without regard to section 3709 of the Revised Statutes Traveling expenses, etc.(U. S. C., title 41, sec. 5); rent; traveling expenses; local transportation; hire of motor-propelled passenger-carrying vehicles; purchase of necessary books, documents, newspapers, periodicals, and 1635maps; stationery; membership badges; official cards; entertainment; printing and binding; and such other expenses as may be authorized by the Secretary of State, including the reimbursement of otherReimbursement of other appropriations. appropriations from which payments may have been made for any of the purposes herein specified, to be expended under the direction of the Secretary of State, fiscal year 1937, $10,000, to remain available until June 30, 1938. Commission to study the subject of Hernando De Soto’s Expedition:Hernando De Soto’s Expedition. Commission to study and report.Ante, p. 1124. The unexpended balance of the appropriation “Commission to study the subject of Hernando De Soto’s Expedition, Department of State, 1936”, is continued available for the same purposes until June 30, 1937, to enable the Commission to make its report to Congress as provided by the act entitled “An Act extending the time for making*Ante*, p. 1386. the report of the Commission to study the subject of Hernando De Soto’s Expedition”, approved May 27, 1936. TREASURY DEPARTMENTTreasury Department, office of the secretarySecretary’s office. Salaries: For an additional amount for salaries, office of the Secretary,Salaries.*Post*, p. 1827. including the same objects specified under this head in the Treasury Department Appropriation Act, 1937, $31,860. Old-age reserve account, Social Security Act: For an amountFederal old-age benefits.Old-age reserve account.*Ante*, p. 622.[U. S. C., Supp. I, p. 246](/us/usc/p246). sufficient as an annual premium for the payments required under title II of the Social Security Act, approved August 14, 1935 (U. S. C., title 42, sec. 401, 1934 edition, Supp. I), to be appropriated to the old-age reserve account established under section 201
(a)of the Act, fiscal year 1937, $265,000,000: *Provided*, That such amount*Proviso.*Available for making payments until expended. shall be available until expended for making payments required under the Act, and the amounts not required for current payments shall be invested from time to time in such amounts and in such manner as the Secretary of the Treasury may deem most expedient in accordance with the provisions of such Act. Subscriptions to paid-in surplus of Federal land banks: TheFederal land banks.Subscriptions to paid-in surplus. appropriation of $24,000,000 for subscriptions to paid-in surplus of Federal land banks as provided in the Treasury Department Appropriation Act, 1937, and the unexpended balance of the appropriation*Post*, p. 1829. of $20,000,000 made in the Second Deficiency Appropriation*Ante*, p. 592. Act, fiscal year 1935, and continued available until June 30, 1937, are hereby made one fund. Payments to Federal land banks on account of reductions in interestFederal land banks.Payments on account of interest rate reductions. rate on mortgages: The appropriation of $24,000,000 for payments to Federal land banks on account of reductions in interest rate on mortgages as provided in the Treasury Department Appropriation*Post*, p. 1828. Act, 1937, and the unexpended balance of the appropriation*Ante*, p. 592. of $36,000,000 made in the Second Deficiency Appropriation Act, fiscal year 1935, and continued available until June 30, 1937, are hereby made one fund: *Provided*, That this fund shall also beProviso.Use extended. available to the Secretary of the Treasury to pay each Federal land bank such amount as the Land Bank Commissioner certifies to the Secretary of the Treasury is equal to the amount by which interest payments on mortgages held by such bank have been reduced during the fiscal year beginning July 1, 1936, in accordance with the provisions of paragraph “Twelfth” of section 12 of the Federal Farm Loan Act, as amended. 1636 Division of Printing.division of printing Stationery.Stationery: For an additional amount for stationery for the Treasury Department, including the same objects specified under this head *Ante*, p. 220.in the Act making appropriations for the Treasury Department for the fiscal year 1936, $75,000. Printing and binding.Printing and binding: For an additional amount for printing and binding, Treasury Department, including the same objects specified *Ante, p.* 220.under this head in the Act mailing appropriations for the Treasury Department for the fiscal year 1936, $188,000. Customs Bureau.bureau of customs Collecting the revenue from customs: For an additional amount for collecting the revenue from customs, including the same objects specified under this head in the Treasury Department Appropriation *Provisos.* Overtime pay.Act for the fiscal year 1936, $71,000: *Provided*, That the appropriations for this purpose for the fiscal years 1936 and 1937, shall be available for the payment of extra compensation earned by Customs officers and employees, for overtime services, at the expense of the Vol. 41, p. 402; Vol. 46, p. 716.[U.S. C., pp. 814, 883](/us/usc/p814/883).parties in interest, in accordance with the provisions of section 5 of the Act approved February 13, 1911, as amended by the Act approved February 7, 1920, and section 451 of the Tariff Act, 1930 (U. S. C., 1934 edition, title 19, secs. 261, 267, and 1451): *Provided further*, Deposit of receipts.Vol. 46, p. 741.That the receipts from such parties in interest for such overtime services shall be deposited as a refund to the appropriation from which paid, in accordance with the provisions of section 524 of the Tariff Act of 1930. Fiscal year 1929.For an additional amount for collecting the revenue from customs, fiscal year 1929, including the same objects specified under this head Vol. 45, p. 167.in the Act making appropriations for the Treasury Department for the fiscal year ending June 30, 1929, $2.61. Refunds and drawbacks.Refunds and drawbacks: For an additional amount for refunds and drawbacks, Customs, including the same objects specified under *Ante*, p. 222.this head in the Act making appropriations for the Treasury Department for the fiscal year 1936, $2,800,000. Edgar M. Barber.Payment to.Refund to Edgar M. Barber: For refund to Edgar M. Barber of the amount of an unavailable item in his accounts as former special disbursing agent, Paris, France, paid by him, which unavailable item the Comptroller General of the United States was *Post*, p. 2291.subsequently directed to allow in his accounts by Private Law Numbered 548, Seventy-fourth Congress, approved May 7, 1936, $51.25. Bureau of the Budget.bureau of the budget Printing and binding.*Ante*, p. 222.Printing and binding: Not to exceed $2,000 of the appropriation for salaries and expenses, Bureau of the Budget, fiscal year 1936, may be transferred to the appropriation for printing and binding, Bureau of the Budget, fiscal year 1936. Internal Revenue Bureau.bureau of internal revenue Collecting the internal revenue.*Ante*, p. 223.Collecting the internal revenue: For an additional amount for collecting the internal revenue, including the same objects specified under this head in the Act making appropriations for the Treasury Department for the fiscal year 1936, $250,000. Salaries and expenses.Salaries and expenses: For an additional amount for expenses of assessing and collecting the internal revenue taxes, including the *Post*, p. 1833.same objects specified under this head in the Act making appropriations for the Treasury Department, fiscal year 1937, $5,801,550, of 1637which amount not to exceed $1,421,100 may be expended for personalServices in the District. services in the District of Columbia. Payment of judgments against internal-revenue collectors: ForPaying judgments against collectors.Rufus W. Fontenot. payment of judgments rendered against Rufus W. Fontenot, individually and as acting collector of internal revenue, in each of eleven separate equity suits in the District Court of the United States for the Eastern District of Louisiana, New Orleans Division, covering injunction proceedings for the prevention of collection of processing taxes under and pursuant to the Agricultural AdjustmentVol. 48, p. 31; *Ante*, p. 750. Act of May 12, 1933 (48 Stat. 31), as amended August 24, 1934 (49 Stat. 750), $2,782.45. coast guardCoast Guard. Pay and allowances: Not exceeding $30,000 of the amount appropriatedPay and allowances.*Ante*, p. 226. for “Civilian employees, Coast Guard”, and not exceeding $50,000 of the amount appropriated for “Fuel and Water, Coast Guard”, in the Act making appropriations for the Treasury DepartmentSums transferred. for the fiscal year 1936, may be transferred to the appropriation for “Pay and allowances, Coast Guard, 1936”. Outfits: For an additional amount for outfits, including the sameOutfits. objects specified under this head in the Treasury Department*Ante*, p. 226. Appropriation Act, 1936, $181,000, of which sum $70,000 shall remain available until June 30, 1937. Rebuilding and repairing stations: For an additional amount forStations, improvements.*Ante*, p. 226. rebuilding and repairing stations, including the same objects specified under this head in the Treasury Department Appropriation Act, 1936, $310,700, to remain available until June 30, 1937. Communication lines: For an additional amount for communicationCommunication lines.*Ante*, p. 226. lines, Coast Guard, including the same objects specified under this head in the Treasury Department Appropriation Act, 1936, $32,000. Contingent expenses: Not exceeding $10,000 of the amount appropriatedContingent expenses.Sum transferred. for “Fuel and Water, Coast Guard”, in the Act making appropriations for the Treasury Department for the fiscal year 1936,*Ante*, p. 226. may be transferred to the appropriation for “Contingent Expenses, Coast Guard, 1936.” Repairs to vessels: For an additional amount for repairs to CoastVessels, repair.*Ante*, p. 226. Guard vessels, including the same objects specified under this head in the Treasury Department Appropriation Act, 1936, $175,000, to remain available until June 30, 1937. public health servicePublic Health Service. Pay of personnel and maintenance of hospitals: For an additionalHospitals, maintenance, etc. amount for pay of personnel and maintenance of hospitals, Public Health Service, including the same objects specified under this head*Ante*, p. 229. in the Treasury Department Appropriation Act, 1936, $159,000. bureau of the mintBureau of the Mint. Salaries and expenses, mints and assay offices: For an additionalMints and assay offices.Salaries and expenses.*Ante*, p. 231. amount for salaries and expenses, mints and assay offices, including the same objects specified under this head in the Act making appropriations for the Treasury Department for the fiscal year 1936, $2,030,000, to remain available until June 30, 1937, of which not to exceed $1,475,000 shall be available for the Fort Knox BullionFort Knox, Ky., bullion depository.Transporting bullion and coin. Depository, Fort Knox, Kentucky, including transportation of bullion and coin from mints and assay offices to such depository; not 1638San Francisco, Calif.to exceed $340,000 shall be available for the coinage mint at San Francisco, California, including transportation of gold, silver, and equipment, repairs to old equipment and purchase of new equipment; Denver, Colo.and not to exceed $215,000 shall be available for the coinage mint at Denver, Colorado, including transportation of gold, silver, and equipment, repairs to old equipment and purchase of new equipment. Procurement Division; Public Buildings Branch.Sites and construction, public buildings.procurement division—public buildings branch Sites and construction, public buildings, Act of May 25, 1926, as amended: For continuation or completion of construction in connection with any or all projects authorized under the provisions of Vol. 44, p. 632; Vol. 45, p. 137.[U. S. C., p. 1793](/us/usc/p1793).sections 3 and 5 of the Public Buildings Act, approved May 25, 1926, and the Acts amendatory thereof approved February 24, 1928, and March 31, 1930 (U. S. C., title 40, secs. 341–349), within the respective limits of cost fixed for such projects, $3,350,000. Public buildings outside the District of Columbia, emergency construction.Public buildings outside the District of Columbia: For emergency construction of public-building projects outside of the District of Columbia (including the acquisition, where necessary, by purchase, condemnation, exchange, or otherwise of sites and additional land for such buildings; the demolition of old buildings where necessary and Temporary quarters, rent.construction, remodeling, or extension of buildings; rental of temporary quarters during construction, including moving expenses; Equipment, etc.purchase of necessary equipment for buildings and such additional administrative expenses and salaries as may be required solely for the purpose of carrying out the provisions of this paragraph, *Ante*, p. 599.including reimbursement to the appropriation “Emergency Construction of Public Buildings, Act August 12, 1935”, for expenditures made Sites.for advance planning of public buildings), $60,000,000; such projects, including the sites therefor, to be selected by the Secretary of the Treasury and the Postmaster General, acting jointly, from the public-building projects specified in Statement Numbered 1 contained in House Report Numbered 1879, Seventy-third Congress, second session, as revised February 29, 1936, and statement numbered 2 attached Projects to be within estimates, etc.thereto, and the projects so selected shall be carried out within the respective estimates of proposed limits of cost specified in such statement numbered 1 and those hereafter fixed by the Secretary of the Treasury and the Postmaster General for projects selected from statement Funds augmented.Vol. 48, p. 1061.numbered 2 and otherwise, except that the unobligated balance of the $2,500,000 fund established by the Emergency Appropriation Act, fiscal year 1935, approved June 19, 1934 (48 Stat. 1061), is Emergency construction.hereby increased in an amount not to exceed $500,000 from the funds heretofore appropriated for emergency construction of public buildings, and such fund shall be available for the augmentation of limits of cost of projects heretofore or hereafter selected under the provisions of the Emergency Appropriation Act, fiscal year 1935, approved June 19, 1934 (48 Stat. 1061) and under the provisions of the *Ante*, p. 599.Second Deficiency Appropriation Act, fiscal year 1935, approved August 12, 1935 (49 Stat. 571), in an amount hot exceeding 15 per centum for any project; and shall be available also for the Limits of cost increased.augmentation of limits of cost of projects selected under the provisions of this Act in an amount not exceeding 10 per centum for any project: *Provisos.*Equitable distribution of projects.*Provided*, That with a view to relieving country-wide unemployment the Secretary of the Treasury and the Postmaster General, in the selection of towns or cities in which buildings are to be constructed, shall endeavor to distribute the projects equitably throughout the country so far as may be consistent with the needs of the public service; and the Secretary of the Treasury and the Postmaster General may also select for prosecution under this appropriation 1639such projects not included in such revised report as in their judgmentOther projects economically sound. are economically sound and advantageous to the public service: *Provided further*, That the Secretary of the Treasury is authorizedPlans, specifications, etc. to direct the preparation of all sketches, estimates, plans, and specifications (including supervision and inspection thereof), and to enter into all contracts necessary for carrying out the purposesContracts. of this paragraph, and he is hereby authorized, when deemed by him desirable and advantageous, to employ, by contract or otherwise, the personal services of temporary professional, technical, or nontechnical employees to such extent as may be required to carry out the purposes of this paragraph, without reference to civil-service laws, rules, regulations, or to the Classification Act of 1923, as amended: *Provided further*, That in the acquisition of land or sites for theAcquisition of sites, etc. purposes of Federal public buildings and in the construction of such buildings provided for in this paragraph, the provisions of sectionsVol. 47, p. 722. 305 and 306 of the Emergency Relief and Construction Act of 1932, as amended, shall apply. Bremerton, Washington, post office, and so forth: The SecretarySites and construction.Bremerton, Wash., post office.Vol. 48, p. 1062. of the Treasury is authorized to carry out the provisions of the Emergency Appropriation Act, fiscal year 1935, for the purchase of a site and construction of a post-office building at Bremerton, Washington, in lieu of utilizing the Government property specified in the Treasury Department Appropriation Act, 1936, and said“Navy Yard Hotel Site”, transferred to Navy Department. *Ante*, p. 232. Government property, located on the south side of Fourth Street, opposite the terminus of Park Avenue in the city of Bremerton, known as the “Navy Yard Hotel Site”, is hereby transferred to the Navy Department. Bellefonte (Pennsylvania) Post Office, and so forth: The limitBellefonte, Pa.Limit of cost increased.Vol. 46, p. 1587. of cost fixed under the Second Deficiency Act, fiscal year 1931, approved March 4, 1931, for the acquisition of a site and construction of a building, is hereby increased from $115,100 to $116,956.53: *Provided*, That this increase, being the amount of balance owing*Proviso.*Provisions waived.Vol. 47, p. 412. on final judgment in excess of the amount deposited into the registry of the court with the declaration of taking in condemnation proceedings, plus interest on such balance from November 18, 1932, the date of the filing of the declaration of taking to the date of payment, at the rate of 6 per centum per annum, shall not be reduced by the operation of section 320 of the Legislative Appropriation Act, approved June 30, 1932 (47 Stat. 412). Government Printing Office, Annex Buildings: For continuationGovernment Printing Office, Annex Buildings. *Provisos.*Trackage facilities, etc.*Ante*, p. 600. of construction of annex buildings for the Government Printing Office, $200,000: *Provided*, That in order to permit the construction of suitable trackage facilities for the use of Government Printing Office as authorized in the Act of August 12, 1935, and the transportation of freight and express thereto, section 1 of the Act entitled “An Act to provide for a union railroad station in the District ofVol. 32, p. 909. Columbia, and for other purposes”, approved February 28, 1903, is hereby amended by striking out the proviso at the end of the first paragraph of section 1 and inserting in lieu thereof the following: “*Provided, however*, That the portion of said line of railroad lyingRestrictions modified. south of Florida Avenue within the limits of the city of Washington shall be used for passenger trains only, except in cases of temporary emergency, and then for a period not exceeding twenty-four hours, unless with the consent of the Commissioners of the District of Columbia, and except further, that the terminal company is authorized, on terms and conditions to be agreed upon by said company and the Public Printer, to permit the transportation of freight and express care to and from sidings which may be constructed by the United States at its cost for the exclusive use of the Government 1640Overpass for warehouse.Printing Office”: *Provided further*, That subject to the approval of the Commissioners of the District of Columbia, there may be constructed an overpass for railroad tracks for the warehouse of the Government Printing Office above First Street Northeast between Widening First Street Northeast.G and H Streets: *Provided further*, That any structure erected for the Government Printing Office fronting on First Street Northeast shall be so located as to permit the widening of said First Street to sixty feet. Engraving and Printing Bureau, additional building.Bureau of Engraving and Printing, additional building: For continuation of construction of an additional building for the *Proviso.*Limit of cost increased.*Ante*, p. 600.Bureau of Engraving and Printing and other Treasury Department activities, $2,000,000: *Provided*, That the limit of cost fixed for such project by the Second Deficiency Act, fiscal year 1935, is hereby increased from $5,500,000 to $6,325,000. War Department.WAR DEPARTMENT Military activities.military activities Adjutant General’s Department.the adjutant general’s department Field exercises.*Ante*, p. 123.Damage claims.Field exercises: The appropriation for special field exercises, contained in the War Department Appropriation Act for the fiscal year 1936, shall be construed as available for the settlement of claims (not exceeding $500 each) for damages to or loss of private property incident to such exercises, when payment thereof will be accepted by the owners of the property in full satisfaction of such damages and each claim is substantiated by a report of a board of officers appointed by the commanding officer of the troops engaged and approved by the Secretary of War, whose action thereon shall be conclusive. Quartermaster Corps.quartermaster corps Army subsistence.Subsistence of the Army: For an additional amount for subsistence of the Army, including the same objects specified under this head *Ante*, p. 127.in the War Department Appropriation Act for the fiscal year 1936, $3,740,000. Army transportation.Army transportation: For an additional amount for Army transportation, *Ante*, p. 129.including the same objects specified under this head in the War Department Appropriation Act for the fiscal year 1936, to remain available until June 30, 1937, $600,000. Sacramento, Calif., Air Corps depot.Buildings, appurtenances, etc.Air Corps depot, vicinity of Sacramento, California: For acquisition of land and construction and installation of buildings and appurtenances thereto, including interior facilities, fixed, movable and office equipment, necessary services, roads, connections to water, sewer, gas, and electric mains, purchase and installation of telephone and radio equipment, and similar improvements, and procurement [R. S., secs. 1136, 3734, pp. 206, 737](/us/rs/s1136/3734/p206/737).[U. S. C., pp. 293, 1787](/us/usc/p293/1787).of transportation incident thereto, without reference to sections 1136 and 3734, Revised Statutes (U. S. C., title 10, sec. 1339; title 40, sec. 267), including general overhead expenses of transportation, engineering, supplies, inspection and supervision travel connected therewith, and such services as may be necessary m the office of the Quartermaster General; all for the establishment of an Air Corps depot in the vicinity of Sacramento, California, as authorized by *Ante*, p. 610.the Act approved August 12, 1935 (49 Stat. 610, 611), $4,000,000, to remain available until June 30, 1938; and contracts are hereby authorized to be entered into and obligations otherwise incurred for the complete establishment of such depot at a total cost not exceeding $7,000,000. 1641 Langley Field, Virginia, runways, and so forth: For constructionLangley Field, Va., runways, etc. and installation of runways, grading, and drainage, at Langley Field, Virginia, including general overhead expenses of transportation, engineering, supplies, inspection, supervision, and travel connected therewith, as authorized by the Act approved August 12,*Ante*, p. 610. 1935 (49 Stat. 610, 611), $300,000, to remain available until June 30, 1937. ordnance departmentOrdnance Department. Repairs of arsenals: For an additional amount for repairs and improvementsArsenals, repairs. of ordnance establishments, including the same objects specified under this head in the War Department Appropriation Act*Ante*, p. 136. for the fiscal year 1936, $140,000, to remain available until June 30, 1937. united states military academyMilitary Academy. Pay: For an additional amount for “Pay of Military Academy,Pay.*Ante*, p. 138. 1936”, including the same objects specified under this head in the War Department Appropriation Act for the fiscal year 1936, $209,000. Maintenance: For an additional amount for “Maintenance, UnitedMaintenance. States Military Academy, 1936”, including the same objects specified under this head in the War Department Appropriation Act for the fiscal year 1936, $391,000, to remain available until December 31, 1936. national board for promotion of rifle practiceNational Board for Promotion of Rifle Practice.Range construction, etc.*Ante*, p. 1304. Promotion of Rifle Practice: For construction, equipment, and maintenance of rifle ranges, and so forth, including the same objects specified under this head in the War Department Appropriation Act for the fiscal year 1937, $100,000. nonmilitary activitiesNonmilitary activities. quartermaster corpsQuartermaster Corps. Cemeterial expenses: For maintaining and improving nationalNational cemeteries. cemeteries, including the same objects specified under this heading in the War Department Appropriation Act for the fiscal year 1936, and including also the acquisition by purchase, condemnation, or otherwise, at a cost not to exceed $250,000, of suitable lands forNew York City, enlargement.*Ante*, p. 1354. enlargement of existing national cemetery facilities as authorized by the Act entitled “An Act to authorize the acquisition of land for cemeterial purposes in the vicinity of New York City, New York”, approved May 18, 1936, $250,000, to remain available until June 30, 1937. the panama canalThe Panama Canal. Maintenance and operation of the Panama Canal: The sum ofMeasurement of vessels, etc.Funds available.*Ante*, p. 147. $30,000, or so much thereof as may be necessary, of the appropriation for “Maintenance and Operation, Panama Canal”, fiscal year 1936, is hereby made available, to remain available until June 30, 1937, for carrying out the provisions of the Act entitled “An Act to provide for the measurement of vessels using the Panama Canal, and for other purposes”, approved April 13, 1936, including compensation*Ante*, p. 1204. of the members of the committee appointed by the President authorized by said Act; the employment and compensation of other necessary personnel without regard to the provisions of civil-service laws and regulations, rental at the seat of government or elsewhere, traveling expenses, contract stenographic service, printing and binding, and all other necessary expenses. 1642 TITLE IV— Judgments and authorized claims.JUDGMENTS AND AUTHORIZED CLAIMS Damage claims.property damage claims Section 1. Payment of.
(a)For the payment of claims for damages to or losses of privately owned property, adjusted and determined by the following respective departments and independent offices, under the provisions of the Act entitled “An Act to provide a method for the settlement of claims arising against the Government of the United States in the sums not exceeding $1,000 in any one case”, approved December Vol. 42, p. 1066.[U. S. C., p. 1369](/us/usc/p1369).28, 1922 (U. S. C., title 31, secs. 215–217), as fully set forth in House Document No. 461 of the Seventy-fourth Congress, Offices designated.as follows: Federal Civil Works Administration, $286.08; Resettlement Administration, $501.54; Works Progress Administration, $1,124.49; Department of Agriculture, $4,185.62; Department of the Interior, $2,710.23; Department of Labor, $542.50; Navy Department, $1,116.60; Post Office Department (payable from postal revenues), $169.03; Treasury Department, $445.91; War Department, $6,116.69; In all, $17,198.69.
(b)Claims not in excess of $1,000. For the payment of claims for damages to or losses of privately owned property, adjusted and determined by the following respective departments and independent offices, under the provisions of the Act entitled “An Act to provide a method for the settlement of claims arising against the Government of the United States in the sums not exceeding $1,000 in any one case”, approved December [U. S. C., p. 1369](/us/usc/p1369).28, 1922 (U. S. C., title 31, secs. 215–217), as fully set forth in Senate Documents Numbered 219 and 240 of the Seventy-fourth Congress, as follows: Veterans’ Administration, $100.24; Works Progress Administration, $1,867.35; Department of Agriculture, $992.64; Department of the Interior, $1,565.49; Department of Labor, $102.80; Navy Department, $499.35; Post Office Department (payable from postal revenues), $102.85; Treasury Department, $307.37; War Department, $3,777.56; In all, $9,315.65. United States courts, judgments.judgments, united states courts Sec. 2. Payment of.
(a)For payment of the final judgments and decrees, including costs of suits, which have been rendered under the provisions of the Act of March 3, 1887, entitled “An Act to provide for the bringing of suits against the Government of the United States”, as Vol. 24, p. 506. [U. S. C., p. 1230](/us/usc/p1230).amended by the Judicial Code, approved March 3, 1911 (U. S. C., title 28, sec. 41, par. 20; sec. 258; secs. 761–765), certified to the Seventy-fourth Congress in House Document Numbered 456, and Senate Document Numbered 220, under the following departments and establishments, namely: Civil Works Administration, $2,847; Veterans’ Administration, $746.46; Department of Commerce, $5,400; Department of Labor, $1,000; War Department, $1,250; 1643 In all, $11,243.46, together with such additional sum as may be necessary to pay interest as specified in such judgments or as provided by law.
(b)For the payment of judgments, including costs of suits, renderedSuits in admiralty. against the Government of the United States by United States District Courts under the provisions of an Act entitled “An ActVol. 43, p. 1112. [U. S. C., p. 2054](/us/usc/p2054). authorizing suits against the United States in admiralty for damages caused by and salvage services rendered to public vessels belonging to the United States, and for other purposes”, approved March 3, 1925 (U. S. C., title 46, secs. 781–789), and Private Act Numbered 192,Vol. 47, p. 1719. approved February 14, 1933 (47 Stat., Pt. 2, p. 1719), certified to the Seventy-fourth Congress in House Document Numbered 456, and Senate Document Numbered 220, under the following department,1So in original. namely: Navy Department, $14,356.31; Treasury Department, $7,654; In all, $22,010.31.
(c)None of the judgments contained under this caption shall beTime of payments. paid until the right of appeal shall have expired except such as have become final and conclusive against the United States by failure of the parties to appeal or otherwise.
(d)Payment of interest wherever provided for judgments containedInterest. in this Act shall not in any case continue for more than thirty days after the date of approval of the Act. judgments, court of claimsJudgments, Court of Claims. Sec. 3.
(a)For payment of the judgments rendered by the CourtPayment of. of Claims and reported to the Seventy-fourth Congress in House Document Numbered 458, and Senate Document Numbered 221, under the following departments and establishments, namely: National Recovery Administration, $297.30; Veterans’ Administration, $95.37; Department of Labor, $903.50; Navy Department, $30,815.04; Treasury Department, $16,032.11; War Department, $622,576.62; In all, $670,719.94, together with such additional sum as may beInterest. necessary to pay interest as and where specified in such judgments.
(b)None of the judgments contained under this caption shall beTime of payment. paid until the right of appeal shall have expired except such as have become final and conclusive against the United States by failure of the parties to appeal or otherwise. audited claimsAudited claims. Sec. 4.
(a)For the payment of the following claims, certifiedPayment of. to be due by the General Accounting Office under appropriations the balances of which have been carried to the surplus fund under the provisions of section 5 of the Act of June 20, 1874 (U. S. C.,Vol. 18. p. 110.[U. S. C., p. 1410](/us/usc/p1410). title 31, sec. 713), and under appropriations heretofore treated as permanent, being for the service of the fiscal year 1933 and prior years, unless otherwise stated, and which have been certified to Congress under section 2 of the Act of July 7, 1884 (U. S. C.,Vol. 23, p. 254.[U. S. C., p. 59](/us/usc/p59). title 5, sec. 266), as fully set forth in House Document Numbered 466, Seventy-fourth Congress, there is appropriated as follows: **Independent Offices:** For Interstate Commerce Commission,Independent Offices. $11.77. For enforcement of wireless communication laws, Federal Radio Commission, $5.05.1644 For operations under mineral act of October 5, 1918 (including $3,120.84 certified in such document under the Department of the Interior), $19,800.68. For medical and hospital services, Veterans’ Bureau, $474.75. For military and naval compensation, Veterans’ Administration, $9.33. For salaries and expenses, Bureau of War Risk Insurance, $117.75. For salaries and expenses, Veterans’ Administration, $1,274.75. Department of Agriculture.**Department of Agriculture:** For salaries and expenses, Bureau of Animal Industry, $1,092.57. For general expenses, Weather Bureau, $8.25. For salaries and expenses, Bureau of Plant Industry, $3.30. For salaries and expenses, Forest Service, $21.12. For salaries and expenses, Forest Service, emergency construction (Act July 21, 1932) $32.63. For cooperative distribution of forest planting stock, $187.50. For salaries and expenses, Bureau of Agricultural Economics, 43 cents. For salaries and expenses, Bureau of Entomology, $30.83. For enforcement of the United States Grain Standards Act, $9.35. For administration of the United States Warehouse Act, $25.34. For migratory bird conservation refuges, 13 cents. For salaries and expenses, Bureau of Biological Survey, 40 cents. Department of Commerce.**Department of Commerce:** For air-navigation facilities, $16.45. For allowance for quarters, Foreign Commerce Service, $16.30. For promoting commerce in Europe and other areas, $2.32. For expenses of the Fifteenth Census, $4. For enforcement of wireless communication laws, $25,993.74. For salaries, Bureau of Standards, $9.25. For party expenses, Coast and Geodetic Survey, emergency construction (Act July 21, 1932), $123.26. Department of the Interior.**Department of the Interior:** For general expenses, Indian Service, $30. For purchase and transportation of Indian supplies, $49.51. For Coolidge Dam across canyon of Gila River, near San Carlos, Arizona (reimbursable), $25. For agriculture and stock raising among Indians, $75.26. For conservation of health among Indians, $76. For pay of judges, Indian courts, $10.66. Department of Justice.**Department of Justice:** For salaries and expenses, Bureau of Prohibition, $66.04 (in lieu of $56.04 as certified in such document). For salaries, fees, and expenses of marshals, United States courts, $546.23 (in lieu of $556.23 as certified in such document). For salaries and expenses of district attorneys, United States courts, $10.56. For salaries and expenses of clerks, United States courts, $12.45. For fees of witnesses, United States courts, $3. For fees of jurors and witnesses, United States courts, $82.60. For miscellaneous expenses. United States courts, $124.05. For fees of commissioners, United States courts, $3,754.10. For support of United States prisoners, $60. For salaries and expenses, Bureau of Prisons, $3.05. Department of Labor.**Department of Labor:** For salaries and expenses, Bureau of Immigration, $87.70. For salaries and expenses, Bureau of Naturalization, $8.52. Navy Department.**Navy Department:** For organizing the Naval Reserve, $126.44. For transportation, Bureau of Navigation, $28.60. For maintenance and repairs, Naval Academy, $44. For engineering, Bureau of Engineering, $10,941.28.1645 For pay, subsistence, and transportation, Navy, $2,597.12. For pay of the Navy, $103.25. For maintenance, Pureau of Supplies and Accounts, $1.35. For maintenance, Bureau of Yards and Docks, $89.06. For aviation, Navy, $42,629.89. For pay, Marine Corps, $111.94. For general expenses, Marine Corps, $73.82. For judgments, bounty for destruction of enemy’s vessels, $53.52. For prize money to captors, Spanish War, trust fund, $138.52. **Treasury Department:** For collecting the revenue from customs,Treasury Department. $331.72. For Coast Guard, $76.75. For fuel and water, Coast Guard, $75. For outfits, Coast Guard, $176. For pay and allowances, Coast Guard, $4,075.99. For rebuilding and repairing stations, and so forth, Coast Guard, $1,000. For repairs to Coast Guard vessels, $462.33. For collecting the internal revenue, $109.70. For refunding taxes illegally collected, $128.69. For pay of other employees, Public Health Service, $20.62. For general expenses of public buildings, $6.25. For operating supplies for public buildings, $89.35. For contingent expenses, Office of Director of the Mint, $1.98. For pay of personnel and maintenance of hospitals, Public Health Service, $6.11. **War Department:** For pay, and so forth, of the Army, $5,141.52.War Department. For pay of the Army, $2,797.39. For general appropriations, Quartermaster Corps, $877.02. For Army transportation, $479.76. For barracks and quarters, $132.57. For Ordnance service and supplies, Army, $251.33. For supplies, services, and transportation, Quartermaster Corps, $29.43. For clothing and equipage, $60.45. For increase of compensation, Military Establishment, $810.47. For incidental expenses of the Army, $4.72. For replacing clothing and equipage, $115.54. For replacing ordnance and ordnance stores, $3.56. For subsistence of the Army, $69.13. For acquisition of land, Fort Monmouth, New Jersey, $100. For Air Corps, Army, $75. For Organized Reserves, $11.12. For Reserve Officers’ Training Corps, $412.22. For arming, equipping, and training the National Guard, $72.75. For pay ofNational Guard for armory drills, $30. For arms, uniforms, equipment, and so forth, for field service, National Guard, $221.06. For recreation fund, Army, trust fund, $302.21. For seacoast defenses, Panama Canal, $72,473.52. **Post Office Department—Postal Service** (out of the postal revenues):Post Office Department. For city-delivery carriers, $509.08. For clerks, first- and second-class post offices, $469.97. For compensation to postmasters, $1,406.92. For indemnities, domestic mail, $10.14. For indemnities, international mail, $116.58. For post-office equipment and supplies, $44.70. For railroad transportation and mail messenger service, $249.95. For Railway Mail Service, salaries, $114.60.1646 For railway postal clerks, travel allowances, $20.15. For rent, light, and fuel, $1,274.57. For Rural Delivery Service, $1.14. For separating mails, $15. For special-delivery fees, $15.92. For stationery, $26.65. For vehicle service, $161.02. For Village Delivery Service, $33.40. Total; additional sum, increases in rates of exchange.Total, audited claims, section 4 (a), $206,735.82, together with such additional sum due to increases in rates of exchange as may be necessary to pay claims in the foreign currency as specified in certain of the settlements of the General Accounting Office.
(b)Additional audited claims.Payment of. For the payment of the following claims, certified to be due by the General Accounting Office under appropriations the balances of which have been carried to the surplus fund under the provisions Vol. 18. p. 110. [U. S. C., p. 1410](/us/usc/p1410).of section 5 of the Act of June 20, 1874 (U. S. C., title 31, sec. 713), and under appropriations heretofore treated as permanent, being for the service of the fiscal year 1933 and prior years, unless otherwise stated, and which have been certified to Congress under section 2 of the [U. S. C., p. 59](/us/usc/p59).Act of July 7, 1884 (U. S. C., title 5, sec. 266), as fully set forth in Senate Document Numbered 222, Seventy-fourth Congress, there is appropriated as follows: Independent Offices.**Independent Offices:** For investigation of enforcement of prohibition and other laws, $33.33. For Interstate Commerce Commission, $5.35. For Federal Trade Commission, $70.27. For Army pensions, $13.33. For Navy pensions, $80. For medical and hospital services, Veterans’ Bureau, $415.12. For salaries and expenses, Veterans’ Administration, $529.03. For national home for disabled volunteer1So in original. soldiers, Mountain Branch, $2.72. Department of Agriculture.**Department of Agriculture:** For salaries and expenses, Plant Quarantine and Control Administration, $72.84. For salaries and expenses, Bureau of Animal Industry, $30.41. Department of Commerce.**Department of Commerce:** For air-navigation facilities, $310. Department of the Interior.**Department of the Interior:** For purchase and transportation of Indian supplies, $5.40. For suppressing liquor traffic among Indians, $146.48. For reclaiming lands, Lummi Reservation, Washington (reimbursable), $15.72. Department of Justice.**Department of Justice:** For printing and binding, Department of Justice and courts, $9. For salaries, fees, and expenses of marshals, United States courts, $1,805.13. For salaries and expenses, Bureau of Prohibition, $517.44. For fees of jurors and witnesses, United States courts, $7.80. For fees of commissioners, United States courts, $160.75. For probation system, United States courts, $3.88. For support of United States prisoners, $51.30. Navy Department.**Navy Department:** For aviation, Navy, $2,612.92. For organizing the Naval Reserve, $119.20. For maintenance, Bureau of Supplies and Accounts, $25.80. For pay, subsistence, and transportation, Navy, $2,746.59. For pay of the Navy, $56.70. For pay, Marine Corps, $116.85.1647 **Department of State:** For transportation of Foreign ServiceDepartment of State. officers, $9.29. **Treasury Department:** For Coast Guard, $22.50.Treasury Department. For fuel and water, Coast Guard, $140. For pay and allowances, Coast Guard, $641.63. For collecting the internal revenue, $1.80. For preventing the spread of epidemic diseases, $1.50. For enforcement of Narcotic and National Prohibition Acts, $59.07. For salaries and expenses, Bureau of Narcotics, $2. For general expenses of public buildings, $2.85. For operating supplies for public buildings, $11.60. **War Department:** For pay, and so forth, of the Army, $3,653.67.War Department. For pay of the Army, $1,202.08. For general appropriations, Quartermaster Corps, $435.43. For Army transportation, $394.42. For barracks and quarters, $33.53. For mileage to officers and contract surgeons, $14. For mileage of the Army, $15. For clothing and equipage, $184.91. For ordnance service and supplies, Army, $1.70. For replacing ordnance and ordnance stores, $1.43. For arming, equipping, and training the National Guard, $5.38. For National Guard, $882.30. For pay of National Guard for armory drills, $568. For Reserve Officers’ Training Corps, $108.50. For cemeterial expenses, War Department, $2.05. **Post Office Department—Postal Service** (out of the postal revenues):Post Office Department. For city-delivery carriers, $662.64. For compensation to postmasters, $705.89. For mail messenger service, $24. For miscellaneous items, first- and second-class post offices, $2.50. For post-office equipment and supplies, $5.25. For railroad transportation and mail messenger service, $35.62. For rent, light, and fuel, $467.80. For rural delivery service, $74.08. For separating mail, $90.75. For vehicle service, $376.15. For indemnities, domestic mail, $42.09. For indemnities, international mail, $9.65. Total, audited claims, section 4 (b), $20,854.42, together with suchTotal; additional sum, increases in rates of exchange. additional sum due to increases in rates of exchange as may be necessary to pay claims in the foreign currency as specified in certain of the settlements of the General Accounting Office. Sec. 5. Judgments against collectors of customs: For the paymentJudgments against collectors of customs. of claims allowed by the General Accounting Office covering judgments rendered by United States District Courts against collectors of customs, where certificates of probable cause have been issued as provided for under section 989, Revised Statutes (U. S. C., title 28,[R. S., sec. 989, p. 185](/us/rs/s989/p185).[U. S. C., p. 1314](/us/usc/p1314). sec. 842). and certified to the Seventy-fourth Congress in House Document Numbered 459, and Senate Document Numbered 223, under the Department of Labor, $42,951.29. Sec. 6. For the payment or a claim allowed by the GeneralWalter S. Bramble.Payment to.*Post*, p. 2116. Accounting Office pursuant to Private Act Numbered 172 of the Seventy-fourth Congress, which has been certified to Congress under section 2 of the Act of July 7, 1884 (U. S. C., title 5, sec.[U. S. C., p. 59](/us/usc/p59). 266), in House Document Numbered 460, Seventy-fourth Congress, $1,174.19. Sec. 7.
(a)Notwithstanding any other provision of law, none Designated agencies; restriction against incurring obligations after June 30, 1937. the establishments or agencies named in subsection
(b)of this section shall, after June 30, 1937, incur any obligations for admin1648istrative expenses, except pursuant to an annual appropriation specifically therefor, nor shall any such establishment or agency continue to function after said date unless established by or pursuant to law: *Proviso.* Duration not extended.*Provided*, That nothing contained herein shall be construed to extend the period during which any such establishment or agency heretofore has been authorized by law to function.
(b)1. Federal Home Loan Bank Board; 2. Home Owners’ Loan Corporation; 3. Federal Housing Administration; 4. Federal Farm Mortgage Corporation; 5. Federal Surplus Commodities Corporation; 6. Export-Import Bank of Washington; 7. Second Export-Import Bank of Washington, District of Columbia; 8. Reconstruction Finance Corporation; 9. Electric Home and Farm Authority; 10. Commodity Credit Corporation; 11. Federal Emergency Administration of Public Works; 12. Federal Savings and Loan Insurance Corporation; 13. Reconstruction Finance Mortgage Company.
(c)Soil Conservation and Domestic Allotment Act. Appropriation for, available for production of gum turpentine and gum rosin. *Ante*, p. 1183. The appropriation made by section 2 of the Independent Offices Appropriation Act, 1937, for carrying out sections 7 to 17, inclusive, of the Soil Conservation and Domestic Allotment Act is hereby made available to the Department of Agriculture for the purposes of carrying out such Act with respect to land devoted to growing trees for the production of gum turpentine and gum rosin. Sec. 8. Availability of advance payments.Vol. 47, p. 418. After June 30, 1936, advance payments under the provisions of Title VI, Part II, of the Legislative Appropriation Act for the fiscal year 1933, shall have no longer period of availability for obligation than the appropriation from which such advance payments are made. Sec. 9. Citation of Act. This Act may be cited as the First Deficiency Appropriation Act, fiscal year 1936. Approved, June 22, 1936. To provide revenue, equalize taxation, and for other purposes. 1936-06-22 690 Chapter 49 Stat. 1648 74 2 United States Government Publishing Office text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. Digitization Vendor 2025-01-07 public [CHAPTER 690.] AN ACT To provide revenue, equalize taxation, and for other purposes. June 22, 1936.[[H. R. 12395](/us/bill/74/hr/12395).][[Public, No. 740](/us/pl/74/740).] *Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled*, Revenue Act of 1936. That this Act divided into titles and sections according to the following Table of Contents, may be cited as the “Revenue Act of 1936”: TABLE OF CONTENTS Table of Contents. Title I— Title I—Income Tax, p. 1652. Income Tax subtitle a— introductory provisions Introductory provisions. p. 1652. Sec. 1. Application of title. Sec. 2. Cross references. Sec. 3. Classification of provisions. Sec. 4. Special classes of taxpayers. subtitle b— general provisions General provisions, p. 1653. Part I— Rates of Tax Rates of tax. p. 1653. Sec. 11. Normal tax on individuals. Sec. 12. Surtax on individuals. Sec. 13. Normal tax on corporations. Sec. 14. Surtax on undistributed profits. 1649 Part II— Computation of Net Income Computation of net income, p. 1657. Sec. 21. Net income. Sec. 22. Gross income. Sec. 23. Deductions from gross income. Sec. 24. Items not deductible. Sec. 25. Credits of individual against net income. Sec. 26. Credits of corporations. Sec. 27. Corporation credit for dividends paid. Part III— Credits Against Tax Credits against tax, p. 1666. Sec. 31. Taxes of foreign countries and possessions of United States. Sec. 32. Taxes withheld at source. Sec. 33. Credit for overpayments. Part IV— Accounting Periods and Methods of Accounting Accounting, p. 1666. Sec. 41. General rule. Sec. 42. Period in which items of gross income included. Sec. 43. Period for which deductions and credits taken. Sec. 44. Installment basis. Sec. 45. Allocation of income and deductions. Sec. 46. Change of accounting period. Sec. 47. Returns for a period of less than twelve months. Sec. 48. Definitions. Part V— Returns and Payment of Tax Returns and payment, p. 1670. Sec. 51. Individual returns. Sec. 52. Corporation returns. Sec. 53. Time and place for filing returns. Sec. 54. Records and special returns. Sec. 55. Publicity of returns. Sec. 56. Payment of tax. Sec. 57. Examination of return and determination of tax. Sec. 58. Additions to tax and penalties. Sec. 59. Administrative proceedings. Part VI— Miscellaneous Provisions Miscellaneous provisions, p. 1673. Sec. 61. Laws made applicable. Sec. 62. Rules and regulations. Sec. 63. Taxes in lieu of taxes under 1934 Act. Sec. 64. Short title. subtitle c— supplemental provisions Supplemental provisions, p. 1673. Supplement A— Rates of Tax Rates of tax, p. 1673. Sec. 101. Exemptions from tax on corporations. Sec. 102. Surtax on corporations improperly accumulating surplus. Sec. 103. Rates of tax on citizens and corporations of certain foreign countries. Sec. 104. Banks and trust companies. Sec. 105. Sale of oil or gas properties. Supplement B— Computation of Net Income Computation of net income, p. 1678. Sec. 111. Determination of amount of, and recognition of, gain or loss. Sec. 112. Recognition of gain or loss. Sec. 113. Adjusted basis for determining gain or loss. Sec. 114. Basis for depreciation and depletion. Sec. 115. Distributions by corporations. Sec. 116. Exclusions from gross income. Sec. 117. Capital gains and losses. Sec. 118. Loss from wash sales of stock or securities. Sec. 119. Income from sources within United States. Sec. 120. Unlimited deduction for charitable and other contributions. Sec. 121. Deduction of dividends paid on certain preferred stock of certain corporations. 1650 Supplement C— Credits Against Tax Credits against tax, p. 1696. Sec. 131. Taxes of foreign countries and possessions of United States. Supplement D— Returns and Payment of Tax Returns and payment, p. 1698. Sec. 141. Consolidated returns of railroad corporations. Sec. 142. Fiduciary returns. Sec. 143. Withholding of tax at source. Sec. 144. Payment of corporation income tax at source. Sec. 145. Penalties. Sec. 146. Closing by Commissioner of taxable year. Sec. 147. Information at source. Sec. 148. Information by corporations. Sec. 149. Returns of brokers. Sec. 150. Collection of foreign items. Supplement E— Estates and Trusts Estates and trusts, p. 1706. Sec. 161. Imposition of tax. Sec. 162. Net income. Sec. 163. Credits against net income. Sec. 164. Different taxable years. Sec. 165. Employees’ trusts. Sec. 166. Revocable trusts. Sec. 167. Income for benefit of grantor. Sec. 168. Taxes of foreign countries and possessions of United States. Sec. 169. Common trust funds. Supplement F— Partnerships Partnerships, p. 1709. Sec. 181. Partnership not taxable. Sec. 182. Tax of partners. Sec. 183. Computation of partnership income. Sec. 184. Credits against net income. Sec. 185. Earned income. Sec. 186. Taxes of foreign countries and possessions of United States. Sec. 187. Partnership returns. Sec. 188. Different taxable years of partner and partnership. Supplement G— Insurance Companies Insurance companies, p. 1710. Sec. 201. Tax on life insurance companies. Sec. 202. Gross income of life insurance companies. Sec. 203. Net income of life insurance companies. Sec. 204. Insurance companies other than life or mutual. Sec. 205. Taxes of foreign countries and possessions of United States. Sec. 206. Computation of gross income. Sec. 207. Mutual Insurance companies other than life. Supplement H— Nonresident Alien Individuals Nonresident alien individuals, p. 1714. Sec. 211. Tax on nonresident alien individuals. Sec. 212. Gross income. Sec. 213. Deductions. Sec. 214. Credits against net income. Sec. 215. Allowance of deductions and credits. Sec. 216. Credits against tax. Sec. 217. Returns. Sec. 218. Payment of tax. Sec. 219. Partnerships. Supplement I— Foreign Corporations Foreign corporations, p. 1717. Sec. 231. Tax on foreign corporations. Sec. 232. Deductions. Sec. 233. Allowance of deductions and credits. Sec. 234. Credits against tax. Sec. 235. Returns. Sec. 236. Payment of tax. Sec. 237. Foreign insurance companies. Sec. 238. Affiliation. Supplement J— Possessions of the United States Possessions of the United States, p. 1718. Sec. 251. Income from sources within possessions of United States. Sec. 252. Citizens of possessions of United States. 1651 Supplement K— China Trade Act Corporations China Trade Act corporations, p. 1720. Sec. 261. Taxation in general. Sec. 262. Credit against net income. Sec. 263. Credits against the tax. Sec. 264. Affiliation. Sec. 265. Income of shareholders. Supplement L— Assessment and Collection of Deficiencies Deficiencies, p. 1721. Sec. 271. Definition of deficiency. Sec. 272. Procedure in general. Sec. 273. Jeopardy assessments. Sec. 274. Bankruptcy and receiverships. Sec. 275. Period of limitation upon assessment and collection. Sec. 276. Same—Exceptions. Sec. 277. Suspension of running of statute. Supplement M— Interest and Additions to the Tax Interest and additions to tax, p. 1727. Sec. 291. Failure to file return. Sec. 292. Interest on deficiencies. Sec. 293. Additions to the tax in case of deficiency. Sec. 294. Additions to the tax in case of nonpayment. Sec. 295. Time extended for payment of tax shown on return. Sec. 296. Time extended for payment of deficiency. Sec. 297. Interest in case of jeopardy assessments. Sec. 298. Bankruptcy and receiverships. Sec. 299. Removal of property or departure from United States. Supplement N— Claims Against Transferees and Fiduciaries Transferees and fiduciaries, p. 1729. Sec. 311. Transferred assets. Sec. 312. Notice of fiduciary relationship. Supplement O— Overpayments Overpayments, p. 1730. Sec. 321. Overpayment of installment. Sec. 322. Refunds and credits. Title IA— Additional Income Taxes Title IA—Additional Income Taxes, p. 1732. Sec. 351. Surtax on personal holding companies. Title II— Capital Stock and Excess-Profits Tax Title II—Capital Stock and Excess-Profits Tax, p. 1733. Sec. 401. Capital stock tax. Sec. 402. Excess-profits tax. Title III— Tax on Unjust Enrichment Title III—Tax on Unjust Enrichment, p. 1734. Sec. 501. Tax on net income from certain sources. Sec. 502. Credit for other taxes on income. Sec. 503. Administrative provisions. Sec. 504. Taxable years to which title is applicable. Sec. 505. Application of title to possessions. Sec. 506. Closing agreements. Title IV— Export, Charitable, etc., Refunds and Floor Stocks Adjustment Under Agricultural Adjustment Act Title IV—Export etc., Refunds and Floor Stocks Adjustment under Agricultural Adjustment Act, p. 1739. Sec. 601. Refunds under Agricultural Adjustment Act on exports, deliveries for charitable distribution or use, etc. Sec. 602. Floor stocks as of January 6, 1936. Sec. 603. Proclamations, etc., made applicable. Sec. 604. Repeals. Title V— Amendments to Taxes on Certain Oils Title V—Amendments to Taxes on Certain Oils, p. 1742. Sec. 701. Tax on certain oils. Sec. 702. Processing tax on certain oils. Sec. 703. Miscellaneous provisions. Sec. 704. Effective date. 1652 Title VI— Miscellaneous Provisions Title VI—Miscellaneous Provisions, p. 1743. Sec. 801. Exemption from admissions tax of certain concerts. Sec. 802. Suits to enforce liens for taxes. Sec. 803. Interest on erroneous refunds. Sec. 804. Interest on overpayments. Sec. 805. Estate taxes—Revocable transfers. Sec. 806. Registration under the narcotic laws. Sec. 807. Reconsideration of refund claims. Sec. 808. Interest on judgments. Sec. 809. Termination of jewelry tax. Sec. 810. Tax on furs. Sec. 811. Importation of shingles. Title VII— Refunds of Amounts Collected Under the Agricultural Adjustment Act Title VII—Refunds of Amounts Collected under Agricultural Adjustment Act, p. 1747. Sec. 901. Repeals. Sec. 902. Conditions on allowance of refunds. Sec. 903. Filing of claims. Sec. 904. Statute of limitations. Sec. 905. Jurisdiction of courts. Sec. 906. Procedure on claims for refunds of processing taxes. Sec. 907. Evidence and presumptions. Sec. 908. Interest on claims. Sec. 909. Limitations on review. Sec. 910. Liability of collectors. Sec. 911. Inapplicability to certain refunds. Sec. 912. Period not extended. Sec. 913. Definitions. Sec. 914. Authority of Commissioner. Sec. 915. Salaries and administrative expenses. Sec. 916. Personnel. Title VIII— General Provisions Title VIII—General Provisions, p. 1758. Sec. 1001. Definitions. Sec. 1002. Separability clause. Sec. 1003. Effective date of Act. TITLE I— INCOME TAX Title I—Income Tax. SUBTITLE A— INTRODUCTORY PROVISIONS Introductory provisions. SEC. 1. Application of title. APPLICATION OF TITLE. To 1936, and succeeding years.Prior years not affected.The provisions of this title shall apply only to taxable years beginning after December 31, 1935. Income, war-profits, and excess-profits taxes for taxable years beginning prior to January 1, 1936, shall not be affected by the provisions of this title, but shall remain Exceptions.subject to the applicable provisions of prior revenue Acts, except as such provisions are modified by legislation enacted subsequent to this Act. SEC. 2. CROSS REFERENCES. Cross references. The cross references in this title to other portions of the title, where the word “see” is used, are made only for convenience, and shall be given no legal effect. SEC. 3. Classification of provisions. CLASSIFICATION OF PROVISIONS. Designations. The provisions of this title are herein classified and designated as— Subtitle A—Introductory provisions, Subtitle B—General provisions, divided into Parts and sections, Subtitle C—Supplemental provisions, divided into Supplements and sections. 1653 SEC. 4. SPECIAL CLASSES OF TAXPAYERS. Special classes of taxpayers. The application of the General Provisions and of Supplements AApplication of General Provisions and of Supplements. to D, inclusive, to each of the following special classes of taxpayers, shall be subject to the exceptions and additional provisions found in the Supplement applicable to such class, as follows:
(a)Estates and trusts and the beneficiaries thereof,—SupplementEstates and trusts, etc., p. 1706. E.
(b)Members of partnerships,—Supplement F.Partnerships, p. 1709.
(c)Insurance companies,—Supplement G.Insurance companies, p. 1710.
(d)Nonresident alien individuals,—Supplement H.Nonresident aliens, p. 1714.
(e)Foreign corporations,—Supplement I.Foreign corporations, p. 1717.
(f)Individual citizens of any possession of the United States whoCitizens of possessions of United States, p. 1718. are not otherwise citizens of the United States and who are not residents of the United States,—Supplement J.
(g)Individual citizens of the United States or domestic corporations,Citizens deriving large portion of income from United States possessions, p. 1718. satisfying the conditions of section 251 by reason of deriving a large portion of their gross income from sources within a possession of the United States,—Supplement J.
(h)China Trade Act corporations,—Supplement K.China Trade Act corporations, p. 1720. SUBTITLE B— GENERAL PROVISIONS General provisions. **Part I—** **Rates of Tax** Rates of tax. SEC. 11. NORMAL TAX ON INDIVIDUALS. Normal tax on individuals, p. 1662. There shall be levied, collected, and paid for each taxable yearRates upon net income. upon the net income of every individual a normal tax of 4 per centum of the amount of the net income in excess of the credits against net*Post*, p. 1662. income provided in section 25. SEC. 12. SURTAX ON INDIVIDUALS. Surtax on individuals.
(a)Definition of “Subtax Net Income”.— As used in this sectionDefinition. the term “surtax net income” means the amount of the net income in excess of the credits against net income provided in section 25 (b).
(b)Rates of Surtax.— There shall be levied, collected, and paidRates. for each taxable year upon the surtax net income of every individual a surtax as follows: Upon a surtax net income of $4,000 there shall be no surtax; upon surtax net incomes in excess of $4,000 and not in excess of $6,000, 4 per centum of such excess. $80 upon surtax net incomes of $6,000; and upon surtax net incomes in excess of $6,000 and not in excess of $8,000, 5 per centum in addition of such excess. $180 upon surtax net incomes of $8,000; and upon surtax net incomes in excess of $8,000 and not in excess of $10,000, 6 per centum in addition of such excess. $300 upon surtax net incomes of $10,000; and upon surtax net incomes in excess of $10,000 and not in excess of $12,000, 7 per centum in addition of such excess. $440 upon surtax net incomes of $12,000; and upon surtax net incomes m excess of $12,000 and not in excess of $14,000, 8 per centum in addition of such excess. $600 upon surtax net incomes of $14,000; and upon surtax net incomes in excess of $14,000 and not in excess of $16,000, 9 per centum in addition of such excess. $780 upon surtax net incomes of $16,000; and upon surtax net incomes m excess of $16,000 and not in excess of $18,000, 11 per centum in addition of such excess.1654 Surtax on individuals—Continued.Rates—Continued.$1,000 upon surtax net incomes of $18,000; and upon surtax net incomes in excess of $18,000 and not in excess of $20,000, 13 per centum in addition of such excess. $1,260 upon surtax net incomes of $20,000; and upon surtax net incomes in excess of $20,000 and not in excess of $22,000, 15 per centum in addition of such excess. $1,560 upon surtax net incomes of $22,000; and upon surtax net incomes in excess of $22,000 and not in excess of $26,000, 17 per centum in addition of such excess. $2,240 upon surtax net incomes of $26,000; and upon surtax net incomes in excess of $26,000 and not in excess of $32,000, 19 per centum in addition of such excess. $3,380 upon surtax net incomes of $32,000; and upon surtax net incomes in excess of $32,000 and not in excess of $38,000, 21 per centum in addition of such excess. $4,640 upon surtax net incomes of $38,000; and upon surtax net incomes in excess of $38,000 and not in excess of $44,000, 24 per centum in addition of such excess. $6,080 upon surtax net incomes of $44,000; and upon surtax net incomes in excess of $44,000 and not in excess of $50,000, 27 per centum in addition of such excess. $7,700 upon surtax net incomes of $50,000; and upon surtax net incomes in excess of $50,000 and not in excess of $56,000, 31 per centum in addition of such excess. $9,560 upon surtax net incomes of $56,000; and upon surtax net incomes in excess of $56,000 and not in excess of $62,000, 35 per centum in addition of such excess. $11,660 upon surtax net incomes of $62,000; and upon surtax net incomes in excess of $62,000 and not in excess of $68,000, 39 per centum in addition of such excess. $14000 upon surtax net incomes of $68,000; and upon surtax net incomes in excess of $68,000 and not in excess of $74,000, 43 per centum in addition of such excess. $16,580 upon surtax net incomes of $74,000; and upon surtax net incomes in excess of $74,000 and not in excess of $80,000, 47 per centum in addition of such excess. $19,400 upon surtax net incomes of $80,000; and upon surtax net incomes in excess of $80,000 and not in excess of $90,000, 51 per centum in addition of such excess. $24,500 upon surtax net incomes of $90,000; and upon surtax net incomes in excess of $90,000 and not in excess of $100,000, 55 per centum in addition of such excess. $30,000 upon surtax net incomes of $100,000; and upon surtax net incomes in excess of $100,000 and not in excess of $150,000, 58 per centum in addition of such excess. $59,000 upon surtax net incomes of $150,000; and upon surtax net incomes in excess of $150,000 and not in excess of $200,000, 60 per centum in addition of such excess. $89,000 upon surtax net incomes of $200,000; and upon surtax net incomes in excess of $200,000 and not in excess of $250,000, 62 per centum in addition of such excess. $120,000 upon surtax net incomes of $250,000; and upon surtax net incomes in excess of $250,000 and not in excess of $300,000, 64 per centum in addition of such excess. $152,000 upon surtax net incomes of $300,000; and upon surtax net incomes in excess of $300,000 and not in excess of $400,000, 66 per centum in addition of such excess. $218,000 upon surtax net incomes of $400,000; and upon surtax net incomes in excess of $400,000 and not in excess of $500,000, 68 per centum in addition of such excess.1655 $286,000 upon surtax net incomes of $500,000; and upon surtaxSurtax on individuals—Continued.Rates—Continued. net incomes in excess of $500,000 and not in excess of $750,000, 70 per centum in addition of such excess. $461,000 upon surtax net incomes of $750,000; and upon surtax net incomes in excess of $750,000 and not in excess of $1,000,000, 72 per centum in addition of such excess. $641,000 upon surtax net incomes of $1,000,000; and upon surtax net incomes in excess of $1,000,000 and not in excess of $2,000,000, 73 per centum in addition to 11 So in original. such excess. $1,371,000 upon surtax net incomes of $2,000,000; and upon surtax net incomes in excess of $2,000,000 and not in excess of $5,000,000, 74 per centum in addition of such excess. $3,591,000 upon surtax net incomes of $5,000,000; and upon surtax net incomes in excess of $5,000,000, 75 per centum in addition of such excess.
(c)Tax on Personal Holding Companies.— For surtax onPersonal holding companies.*Post*, p. 1732. personal holding companies, sec. section 351.
(d)Avoidance of Surtaxes by Incorporation.— For surtax onEvasion by corporations.*Post*, p. 1676. corporations which accumulate surplus to avoid surtax on stockholders, see section 102. SEC. 13. NORMAL TAX ON CORPORATIONS. Normal tax on corporations.
(a)Definition.— As used in this title the term “normal-tax netDefinition. income” means the net income minus the sum of—
(1)Interest on obligations of the United States and itsInterest on U. S. obligations, etc.*Post*, p. 1664. instrumentalities.— The credit provided in section 26 (a).
(2)Dividends received.— The credit provided in section 26 (b).Dividends received.*Post*, pp. 1664, 1660. Such credit shall not be allowed in the case of a mutual investment company, as defined in section 48.
(3)Dividends paid.— In the case of a mutual investment companyDividends paid.*Post*, p. 1665. the credit provided in section 27, computed without the benefit of subsection
(b)thereof (relating to dividend carry-over).
(b)Imposition of Tax.— There shall be levied, collected, and paidImposition of tax. for each taxable year upon the normal-tax net income of every corporation, a normal tax as follows: Upon normal-tax net incomes not in excess of $2,000, 8 per centum. Rates. $160 upon normal-tax net incomes of $2,000; and upon normal-tax net incomes in excess of $2,000 and not in excess of $15,000, 11 per centum in addition of such excess. $1,590 upon normal-tax net incomes of $15,000; and upon normal-tax net incomes in excess of $15,000 and not in excess of $40,000, 13 per centum in addition of such excess. $4,840 upon normal-tax net incomes of $40,000; and upon normal-tax net incomes in excess of $40,000, 15 per centum in addition of such excess.
(c)Exempt Corporations.— For corporations exempt from taxationExempt corporations.*Post*, p. 1673. under this title, see section 101.
(d)Banks and Trust Companies.— For rate of tax on certainBanks and trust companies.*Post*, p. 1677. banks and trust companies, see section 104. SEC. 14. SURTAX ON UNDISTRIBUTED PROFITS. Surtax on undistributed profits.
(a)Definitions.— As used in this title—Definitions.
(1)The term “adjusted net income” means the net income minus“Adjusted net income.” the sum of—
(A)The normal tax imposed by section 13.Normal tax.
(B)The credit provided in section 26 (a), relating to interestCredit allowed.*Post*, p. 1664. on certain obligations of the United States and Government corporations. 1656
(C)Holding company affiliate, allowance.Vol. 48, p. 162.*Post*, p. 1664. In the case of a holding company affiliate (as defined in section 2 of the Banking Act of 1933), the amount allowed as a credit under section 26 (d).
(D)National mortgage association.Vol. 48, p. 1252.*Post*, p. 1664. In the case of a national mortgage association created under Title III of the National Housing Act, the amount allowed as a credit under section 26 (e).
(2)“Undistributed net income.”*Post*, pp. 1665, 1664. The term “undistributed net income” means the adjusted net income minus the sum of the dividends paid credit provided in section 27 and the credit provided in section 26 (c), relating to contracts restricting dividends.
(b)Imposition of tax. Imposition of Tax.— There shall be levied, collected, and paid for each taxable year upon the net income of every corporation a surtax equal to the sum of the following, subject to the application of the specific credit as provided in subsection (c): Rates.7 per centum of the portion of the undistributed net income which is not in excess of 10 per centum of the adjusted net income. 12 per centum of the portion of the undistributed net income which is in excess of 10 per centum and not in excess of 20 per centum of the adjusted net income. 17 per centum of the portion of the undistributed net income which is in excess of 20 per centum and not in excess of 40 per centum of the adjusted net income. 22 per centum of the portion of the undistributed net income which is in excess of 40 per centum and not in excess of 60 per centum of the adjusted net income. 27 per centum of the portion of the undistributed net income which is in excess of 60 per centum of the adjusted net income.
(c)Adjusted net income less than $50,000.Specific credit allowed. Adjusted Net Income Less Than $50,000.—
(1)Specific credit.— If the adjusted net income is less than $50,000, there shall be allowed a specific credit equal to the portion of the undistributed net income which is in excess of 10 per centum of the adjusted net income and not in excess of $5,000, such credit to be applied as provided in paragraph (2).
(2)Application of specific credit. Application of specific credit.— If the corporation is entitled to a specific credit, the tax shall be equal to the sum of the following:
(A)A tax computed under subsection
(b)upon the amount of the undistributed net income reduced by the amount of the specific credit, plus
(B)7 per centum of the amount of the specific credit.
(d)Exempt corporations. Exemption From Surtax.— The following corporations shall not be subject to the surtax imposed by this section:
(1)Banks. Banks as defined in section 104.
(2)*Post*, p. 1677.Bankrupt, etc., corporations. Domestic corporations which for any portion of the taxable year are in bankruptcy under the laws of the United States, or are insolvent and in receivership in any court of the United States or of any State, Territory, or the District of Columbia.
(3)Insurance companies.*Post*, pp. 1710, 1711, 1713. Insurance companies subject to the tax imposed under section 201, 204, or 207.
(4)Foreign corporations. Foreign corporations.
(5)Deriving income from United States possession.*Post*, p. 1718. Corporations which, by reason of deriving a large portion of their gross income from sources within a possession of the United States, are entitled to the benefits of section 251.
(6)China Trade Act corporations. Corporations organized under the China Trade Act, 1922.
(7)Joint Stock Land Banks.Vol. 48, p. 46. Joint Stock Land Banks organized under the Federal Farm Loan Act, as amended.
(e)Exempt corporations.*Post*, p. 1673. Exempt Corporations.— For corporations exempt from taxation under this title, see section 101.
(f)Personal bolding companies.*Post*, p. 1732. Tax on Personal Holding Companies.— For surtax on personal holding companies, see section 351. 1657
(g)Improper Accumulation of Surplus.— For surtax on corporationsImproper accumulation of surplus.*Post*, p. 1876. which accumulate surplus to avoid surtax on stockholders, see section 102. **Part II—** **Computation of Net Income** Computation of net income. SEC. 21. NET INCOME. Net Income. “Net income” means the gross income computed under section 22,Definition. less the deductions allowed by section 23. SEC. 22. GROSS INCOME. Gross Income.
(a)General Definition.— “Gross income” includes gains, profits,General definition. and income derived from salaries, wages, or compensation for personal service, of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, or sales, or dealings in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever. In the case of Presidents of the United States Compensation of President, United States judges.and judges of courts of the United States taking office after June 6, 1932, the compensation received as such shall be included in gross income; and all Acts fixing the compensation of such Presidents and judges are hereby amended accordingly.
(b)Exclusions from Gross Income.— The following items shallItems exempt. not be included in gross income and shall be exempt from taxation under this title:
(1)Life insurance.— Amounts received under a life insuranceLife insurance. contract paid by reason of the death of the insured, whether in a single sum or otherwise (but if such amounts are held by the insurer under an agreement to pay interest thereon, the interest payments shall be included in gross income);
(2)Annuities, etc.— Amounts received (other than amountsAnnuities, etc. paid by reason of the death of the insured and interest payments on such amounts and other than amounts received as annuities) under a life insurance or endowment contract, but if such amounts (when added to amounts received before the taxable year under such contract) exceed the aggregate premiums or consideration paid (whether or not paid during the taxable year) then the excess shall be included in gross income. Amounts received as anPortion to be included in gross income. annuity under an annuity or endowment contract shall be included in gross income; except that there shall be excluded from gross income the excess of the amount received in the taxable year over an amount equal to 3 per centum of the aggregate premiums or consideration paid for such annuity (whether or not paid during such year), until the aggregate amount excluded from gross income under this title or prior income tax laws in respect of such annuity equals the aggregate premiums or consideration paid for such annuity. In the case of a transfer for a valuable consideration,Transfers for value. by assignment or otherwise, of a life insurance, endowment, or annuity contract, or any interest therein, only the actual value of such consideration and the amount of the premiums and other sums subsequently paid by the transferee shall be exempt from taxation under paragraph
(1)or this paragraph;
(3)Gifts, bequests, and devises.— The value of propertyGifts, bequests, etc. acquired by gift, bequest, devise, or inheritance (but the income from such property shall be included in gross income);
(4)Tax-free interest.— Interest upon
(A)the obligations ofTax-free interest.State, etc., bonds. a State, Territory, or any political subdivision thereof, or the 1658 Federal Instrumentalities.District of Columbia; or
(B)obligations of a corporation organized under Act of Congress, if such corporation is an Federal obligations, etc.Statement required in returns.instrumentality of the United States; or
(C)the obligations of the United States or its possessions. Every person owning any of the obligations enumerated in clause (A), (B), or
(C)shall, in the return required by this title, submit a statement showing the number and amount of such obligations owned by him and the income received therefrom, in such form and with such Federal obligations issued after September 1, 1917.information as the Commissioner may require. In the case of obligations of the United States issued after September 1, 1917 (other than postal savings certificates of deposit) and in the case of obligations of a corporation organized under Act of Congress, the interest shall be exempt only if and to the extent provided in the respective Acts authorizing the issue thereof as amended and supplemented, and shall be excluded from gross income only if and to the extent it is wholly exempt from the taxes imposed by this title;
(5)Payment for personal injuries or sickness. Compensation for injuries or sickness.— Amounts received, through accident or health insurance or under work-men’s compensation acts, as compensation for personal injuries or sickness, plus the amount of any damages received whether by suit or agreement on account of such injuries or sickness;
(6)Minister’s dwelling. Ministers.— The rental value of a dwelling house and appurtenances thereof furnished to a minister of the gospel as part of his compensation;
(7)Income exempt under treaty. Income exempt under treaty.— Income of any kind, to the extent required by any treaty obligation of the United States;
(8)Miscellaneous items.*Post*, p. 1689. Miscellaneous items.— The following items, to the extent provided in section 116: Earned income from sources without the United States; Salaries of certain Territorial employees; The income of foreign governments; Income of States, municipalities, and other political subdivisions; Receipts of shipowners’ mutual protection and indemnity associations; Dividends from China Trade Act corporations; Compensation of employees of foreign governments.
(c)Inventories, to determine income. Inventories.— Whenever in the opinion of the Commissioner the use of inventories is necessary in order clearly to determine the income of any taxpayer, inventories shall be taken by such taxpayer upon such basis as the Commissioner, with the approval of the Secretary, may prescribe as conforming as nearly as may be to the best accounting practice in the trade or business and as most clearly reflecting the income.
(d)Distributions by corporations.*Post*, p. 1687. Distributions by Corporations.— Distributions by corporations shall be taxable to the shareholders as provided in section 115.
(e)Determination of gain or loss in sale, etc., of property.*Post*, p. 1678. Determination of Gain or Loss.— In the case of a sale or other disposition of property, the gain or loss shall be computed as provided in section 111.
(f)Sources within and without United States.*Post*, p. 1693. Gross Income from Sources Within and Without United States.— For computation of gross income from sources within and without the United States, see section 119. SEC. 23. Deductions from gross income.DEDUCTIONS FROM GROSS INCOME. In computing net income there shall be allowed as deductions:
(a)Business expenses. Expenses.— All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including a reasonable allowance for salaries or other com-1659pensation for personal services actually rendered ; traveling expenses (including the entire amount expended for meals and lodging) while away from home in the pursuit of a trade or business; and rentals or other payments required to be made as a condition to the continued use or possession, for purposes of the trade or business, of property to which the taxpayer has not taken or is not taking title or in which he has no equity.
(b)Interest.— All interest paid or accrued within the taxableInterest on debts; exceptions. year on indebtedness, except on indebtedness incurred or continued to purchase or carry obligations (other than obligations of the United States issued after September 24, 1917, and originally subscribed for by the taxpayer) the interest upon which is wholly exempt from the taxes imposed by this title.
(c)Taxes Generally.— Taxes paid or accrued within the taxableTaxes generally.Exceptions. year, except—
(1)Federal income, war-profits, and excess-profits taxes (other*Ante*, p. 1019. than the excess-profits tax imposed by section 106 of the Revenue Act of 1935);
(2)income, war-profits, and excess-profits taxes imposed by the authority of any foreign country or possession of the United States; but this deduction shall be allowed in the case of a taxpayerDeduction for foreign taxes.*Post*, p. 1696. who does not signify in his return his desire to have to any extent the benefits of section 131 (relating to credit for taxes of foreign countries and possessions of the United States);
(3)estate, inheritance, legacy, succession, and gift taxes; and
(4)taxes assessed against local benefits of a Kind tending to increase the value of the property assessed; but this paragraph shall not exclude the allowance as a deduction of so much of such taxes as is properly allocable to maintenance or interest charges.
(d)Taxes of Shareholder Paid by Corporation.— The deductionTaxes of shareholder paid by corporation. for taxes allowed by subsection
(c)shall be allowed to a corporation in the case of taxes imposed upon a shareholder of the corporation upon his interest as shareholder which are paid by the corporation without reimbursement from the shareholder, but in such cases no deduction shall be allowed the shareholder for the amount of such taxes.
(e)Losses by Individuals.— In the case of an individual, lossesLosses by individuals. sustained during the taxable year and not compensated for by insurance or otherwise—
(1)if incurred in trade or business; orIncurred in business, etc.
(2)if incurred in any transaction entered into for profit,Not connected with trade or business. though not connected with the trade or business; or
(3)of property not connected with the trade or business, if theCasualty losses not connected with business.Disallowed, If deducted for estate tax purposes. loss arises from fires, storms, shipwreck, or other casualty, or from theft. No loss shall be allowed as a deduction under this paragraph if at the time of the filing of the return such loss has been claimed as a deduction for estate tax purposes in the estate tax return.
(f)Losses by Corporations.— In the case of a corporation, lossesLosses by corporations. sustained during the taxable year and not compensated for by insurance or otherwise.
(g)Wagering Losses.— Losses from wagering transactions shallWagering losses. be allowed only to the extent of the gains from such transactions.
(h)Basis for Determining Loss.— The basis for determining theBasis for determining loss. amount of deduction for losses sustained, to be allowed under subsection
(e)or (f), shall be the adjusted basis provided in section*Post*, p. 1685. 113
(b)for determining the loss from the sale or other disposition of property. 1660
(i)Disallowance of loss on wash sales of stock, etc. Loss on Wash Sales of Stock or Securities.— For disallowance of loss deduction in the case of sales of stock or securities where within thirty days before or after the date of the sale the *Post*, p. 1662.taxpayer has acquired substantially identical property, see section 118.
(j)Capital losses.*Post*, p. 1692. Capital Losses.— Losses from sales or exchanges of capital assets shall be allowed only to the extent provided in section 117 (d).
(k)Bad debts. Bad Debts.— Debts ascertained to be worthless and charged off within the taxable year (or, in the discretion of the Commissioner, a reasonable addition to a reserve for bad debts); and when satisfied that a debt is recoverable only in part, the Commissioner may allow such debt, in an amount not in excess of the part charged off within the taxable year, as a deduction.
(l)Depreciation, etc., of business property. Depreciation.— A reasonable allowance for the exhaustion, wear and tear of property used in the trade or business, including Life estates.a reasonable allowance for obsolescence. In the case of property held by one person for life with remainder to another person, the deduction shall be computed as if the life tenant were the absolute Property in trust.owner of the property and shall be allowed to the life tenant. In the case of property held in trust the allowable deduction shall be apportioned between the income beneficiaries and the trustee in accordance with the pertinent provisions of the instrument creating the trust, or, in the absence of such provisions, on the basis of the trust income allocable to each.
(m)Mines, oil and gas wells, timber, etc.Allowance for depletion, etc. Depletion.— In the case of mines, oil and gas wells, other natural deposits, and timber, a reasonable allowance for depletion and for depreciation of improvements, according to the peculiar conditions in each case; such reasonable allowance in all cases to be made under rules and regulations to be prescribed by the Revision of estimates allowed.Commissioner, with the approval of the Secretary. In any case in which it is ascertained as a result of operations or of development work that the recoverable units are greater or less than the prior estimate thereof, then such prior estimate (but not the basis for depletion) shall be revised and the allowance under this subsection for subsequent taxable years shall be based upon such revised estimate. Leases.In the case of leases the deductions shall be equitably apportioned Life estates.between the lessor and lessee. In the case of property held by one person for life with remainder to another person, the deduction shall be computed as if the life tenant were the absolute owner of Property in trust.the property and shall be allowed to the life tenant. In the case of property held in trust the allowable deduction shall be apportioned between the income beneficiaries and the trustee in accordance with the pertinent provisions of the instrument creating the *Post*, p. 1686.trust, or, in the absence of such provisions, on the basis of the trust income allocable to each. (For percentage depletion allowable under this subsection, see section 114 (b),
(3)and (4).)
(n)Basis for depreciation, etc. Basis for Depreciation and Depletion.— The basis upon which depletion, exhaustion, wear and tear, and obsolescence are to be allowed in respect of any property shall be as provided in section 114.
(o)Charitable, etc., contributions.Gifts. Charitable and Other Contributions.— In the case of an individual, contributions or gifts made within the taxable year to or for the use of:
(1)Public uses. the United States, any State, Territory, or any political subdivision thereof, or the District of Columbia, for exclusively public purposes;
(2)Religious, scientific, etc., organizations. a corporation, or trust, or community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, or for the 1661prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, and no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation;
(3)the special fund for vocational rehabilitation authorized byVocational rehabilitation.Vol. 43, p. 611. section 12 of the World War Veterans’ Act, 1924;
(4)posts or organizations of war veterans, or auxiliary unitsWar veterans’ organizations, etc. or societies of any such posts or organizations, if such posts, organizations, units, or societies are organized in the United States or any of its possessions, and if no part of their net earnings inures to the benefit of any private shareholder or individual; or
(5)a fraternal society, order, or association, operating underFraternal societies, etc. the lodge system, but only if such contributions or gifts are to be used exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals; to an amount which in all the above cases combined does not exceed Limit.15 per centum of the taxpayer’s net income as computed without the benefit of this subsection. Such contributions or gifts shall be allowable as deductions only if verified under rules and regulations prescribed by the Commissioner, with the approval of the Secretary. (For unlimited deduction if contributions and gifts exceed 90 perUnlimited deductions.*Post*, p. 1695. centum of the net income, see section 120.)
(p)Pension Trusts.— An employer establishing or maintaining aMaintenance of pension trusts. pension trust to provide for the payment of reasonable pensions to his employees (if such trust is exempt from tax under section 165,*Post*, p. 1707. relating to trusts created for the exclusive benefit of employees) shall be allowed as a deduction (in addition to the contributions to such trust during the taxable year to cover the pension liability accruing during the year, allowed as a deduction under subsection
(a)of this section) a reasonable amount transferred or paid into such trust during the taxable year in excess of such contributions, but only if such amount
(1)has not theretofore been allowable as a deduction, and
(2)is apportioned in equal parts over a period of ten consecutive years beginning with the year in which the transfer or payment is made. Any deduction allowable under section 23
(q)of theAllowances under previous laws.Vol. 45. p. 802; Vol. 47, p. 182; Vol. 48, p. 691. Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934 which under such section was apportioned to any taxable year beginning after December 31, 1935, shall be allowed as a deduction in the years to which so apportioned to the extent allowable under such section if it had remained in force with respect to such year.
(q)Charitable and Other Contributions by Corporations.— Charitable, etc., contributions by corporations. In the case of a corporation, contributions or gifts made within the taxable year to or for the use of a domestic corporation, or domestic trust, or domestic community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes or the prevention of cruelty to children (but in the case of contributions or gifts to a trust, chest, fund, or foundation, only if such contributions or gifts are to be used within the United States exclusively for such purposes), no part, of the net earnings of which inures to the benefit of any private shareholder or individual, and no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation; to an amount which does not exceed 5 per centum of the taxpayer’s net income as computed without the benefit of this subsection. Such contributions or gifts shall be allowable as deductions only if verified under rules and regulations prescribed by the Commissioner, with the approval of the Secretary. 1662
(r)Dividends of certain banking corporations.*Post*, p. 1696. For deduction of dividends paid by certain banking corporations, see section 121. SEC. 24. Items not deductible. ITEMS NOT DEDUCTIBLE.
(a)General Rule.— In computing net income no deduction shall in any case be allowed in respect of—
(1)Personal, etc., expenses. Personal, living, or family expenses;
(2)Property improvements, etc. Any amount paid out for new buildings or for permanent improvements or betterments made to increase the value of any property or estate;
(3)Restoring property. Any amount expended in restoring property or in making good the exhaustion thereof for which an allowance is or has been made;
(4)Life insurance premiums for employees. Premiums paid on any life insurance policy covering the life of any officer or employee, or of any person financially interested in any trade or business carried on by the taxpayer, when the taxpayer is directly or indirectly a beneficiary under such policy;
(5)Deductions allocable to tax-exempt incomes. Any amount otherwise allowable as a deduction which is allocable to one or more classes of income other than interest (whether or not any amount of income of that class or classes is received or accrued) wholly exempt from the taxes imposed by this title; or
(6)Property losses from sales, etc., between members of family; shareholder and corporation Loss from sales or exchanges of property, directly or indirectly,
(A)between members of a family, or
(B)except in the case of distributions in liquidation, between an individual and a corporation in which such individual owns, directly or indirectly, more than 50 per centum in value of the outstanding stock. For Definitions.the purpose of this paragraph—(C) an individual shall be considered as owning the stock owned, directly or indirectly, by his family; and
(D)the family of an individual shall include only his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants.
(b)Holders of life or terminable interest.Deductions on income acquired by gift, etc. Holders of Life or Terminable Interest.— Amounts paid under the laws of any State, Territory, District of Columbia, possession of the United States, or foreign country as income to the holder of a life or terminable interest acquired by gift, bequest, or inheritance shall not be reduced or diminished by any deduction for shrinkage (by whatever name called) in the value of such interest *Ante*, p. 1660.due to the lapse of time, nor by any deduction allowed by this Act (except the deductions provided for in subsections
(1)and
(m)of section 23) for the purpose of computing the net income of an estate or trust but not allowed under the laws of such State, Territory, District of Columbia, possession of the United States, or foreign country for the purpose of computing the income to which such holder is entitled.
(c)Tax withheld on tax-free covenant bonds.*Post*, p. 1701. Tax Withheld on Tax-free Covenant Bonds.— For nondeductibility of tax withheld on tax-free covenant bonds, see section 143
(a)(3). SEC. 25. CREDITS OF INDIVIDUAL AGAINST NET INCOME. Credits allowed individuals.
(a)Normal tax only. Credits for Normal Tax Only.— There shall be allowed for the purpose of the normal tax, but not for the surtax, the following credits against the net income:
(1)Interest on Federal obligations.*Ante*, p. 1657. Interest on United States obligations.— The amount received as interest upon obligations of the United States which is included in gross income under section 22.
(2)Interest on obligations of Federal instrumentalities. Interest on obligations of instrumentalities of the United States.— The amount received as interest on obligations of a corporation organized under Act of Congress, if
(A)such 1663corporation is an instrumentality of the United States; and
(B)such interest is included in gross income under section 22; and (C)*Ante*, p. 1657. under the Act authorizing the issue thereof, as amended and supplemented, such interest is exempt from normal tax.
(3)Earned income credit.— 10 per centum of the amount ofEarned income credit. the earned net income, but not in excess of 10 per centum of the amount of the net income.
(4)Earned income definitions.— For the purposes of thisEarned income definitions. section—
(A)“Earned income” means wages, salaries, professional“Earned income.” fees, and other amounts received as compensation for personal services actually rendered, but does not include any amount not included in gross income, nor that part of the compensation derived by the taxpayer for personal services rendered by him to a corporation which represents a distribution of earnings or profits rather than a reasonable allowance as compensation for the personal services actually rendered. In the case of a taxpayer engaged in a trade or business in which both personal services and capital are material income producing factors, a reasonable allowance as compensation for the personal services actually rendered by the taxpayer, not in excess of 20 per centum of his share of the net profits of such trade or business, shall be considered as earned income.
(B)“Earned income deductions” means such deductions as“Earned income deductions.” are allowed by section 23 for the purpose of computing net income, and are properly allocable to or chargeable against earned income.
(C)“Earned net income” means the excess of the amount of“Earned net income.” the earned income over the sum of the earned income deductions. If the taxpayer’s net income is not more than $3,000, his entire net income shall be considered to be earned net income, and if his net income is more than $3,000. his earned net income shall not be considered to be less than $3,000. In no case shall the earned net income be considered to be more than $14,000.
(b)Credits for Both Normal Tax and Surtax.— There shall beCredits for both normal tax and surtax. allowed for the purposes of the normal tax and the surtax the following credits against net income:
(1)Personal exemption.— In the case of a single person, aPersonal exemption.Single person. personal exemption of $1,000 ; or in the case of the head of a family or a married person living with husband or wife, a personal exemption of $2,500. A husband and wife living together shallHusband and wife living together. receive but one personal exemption. The amount of such personal exemption shall be $2,500. If such husband and wife make separateSeparate returns. returns, the personal exemption may be taken by either or divided between them.
(2)Credit for dependents.— $400 for each person (other thanCredit for dependents. husband or wife) dependent upon and receiving his chief support from the taxpayer if such dependent person is under eighteen years of age or is incapable of self-support because mentally or physically defective.
(3)Change of status.— If the status of the taxpayer, insofarChange of status during taxable year. as it affects the personal exemption or credit for dependents, changes during the taxable year, the personal exemption and credit shall be apportioned, under rules and regulations prescribed by the Commissioner with the approval of the Secretary, in accordance with the number of months before and after such change. For the purpose of such apportionment a fractional partApportionment. of a month shall be disregarded unless it amounts to more than half a month in which case it shall be considered as a month. 1664 SEC. 26. CREDITS OF CORPORATIONS. Credits allowed corporations. In the case of a corporation the following credits shall be allowed to the extent provided in the various sections imposing tax—
(a)Interest on Federal obligations. Interest on Obligations of the United States and Its Instrumentalities.— The amount received as interest upon obligations of the United States or of corporations organized under Act *Ante*, p. 1662.of Congress which is allowed to an individual as a credit for purposes of normal tax by section 25(a)
(1)or (2).
(b)Dividends received. Dividends Received.— 85 per centum of the amount received as dividends from a domestic corporation which is subject to taxation under this title. The credit allowed by this subsection shall not be allowed in respect of dividends received from a corporation *Post*, p. 1718.organized under the China Trade Act, 1922, or from a corporation which under section 251 is taxable only on its gross income from sources within the United States by reason of its receiving a large percentage of its gross income from sources within a possession of the United States.
(c)Contracts restricting payment of dividends. Contracts Restricting Payment of Dividends.—
(1)Prohibition on payment of dividends.— An amount equal to the excess of the adjusted net income over the aggregate of the amounts which can be distributed within the taxable year as dividends without violating a provision of a written contract executed by the corporation prior to May 1, 1936, which provision Credit allowed.expressly deals with the payment of dividends. If a corporation would be entitled to a credit under this paragraph because of a contract provision and also to one or more credits because of other contract provisions, only the largest of such credits shall be allowed, and for such purpose if two or more credits are equal in amount only one shall be taken into account.
(2)Disposition of profits of taxable year. Disposition of profits of taxable year.— An amount equal to the portion of the earnings and profits of the taxable year which is required (by a provision of a written contract executed by the corporation prior to May 1, 1936, which provision expressly deals with the disposition of earnings and profits of the taxable year) to be paid within the taxable year in discharge of a debt, or to be Amount set aside for discharge of a debt.irrevocably set aside within the taxable year for the discharge of a debt; to the extent that such amount has been so paid or set aside. Requirement to pay construed.For the purposes of this paragraph, a requirement to pay or set aside an amount equal to a percentage of earnings and profits shall be considered a requirement to pay or set aside such percentage “Debt” construed.of earnings and profits. As used in this paragraph, the word “debt” does not include a debt incurred after April 30, 1936.
(3)Double credit not allowed. Double credit not allowed.— If both paragraph
(1)and paragraph
(2)apply, the one of such paragraphs which allows the greater credit shall be applied; and, if the credit allowable under each paragraph is the same, only one of such paragraphs shall be applied.
(d)Bank affiliates.Vol. 48, p. 163. Bank Affiliates.— In the case of a holding company affiliate (as defined in section 2 of the Banking Act of 1933), the amount of the earnings or profits which the Board of Governors of the Federal Reserve System certifies to the Commissioner has been devoted by such affiliate during the taxable year to the acquisition of readily [R. S., sec. 5144, p. 994](/us/rs/s5144/p994); Vol. 48, p. 186.[U. S. C., p. 357](/us/usc/p357).marketable assets other than bank stock in compliance with section 5144 of the Revised Statutes. The aggregate of the credits allowable under this subsection for all taxable years shall not exceed the amount required to be devoted under such section 5144 to such purposes.
(e)National mortgage associations.Vol. 48, p. 1252. National Mortgage Associations.— In the case of a national mortgage association created under Title III of the National Housing 1665Act, the amount of the earnings or profits which the Federal HousingAcquisition of reserves. Administrator certifies to the Commissioner has been devoted by such association during the taxable year to the acquisition of such reserves as the Administrator may require under the provisions ofVol. 48. p. 1254. section 303 of that Act. SEC. 27. CORPORATION CREDIT FOR DIVIDENDS PAID. Corporation credit for dividends paid.
(a)Dividends Paid Credit in General.— For the purposes ofDividends paid credit in general. this title, the dividends paid credit shall be the amount of dividends paid during the taxable year.
(b)Dividend Carry-Over.— In computing the dividends paidDividend carry-over. credit for any taxable year, if the dividends paid during the taxable year are less than the adjusted net income there shall be allowed as part of the dividends paid credit, and in the following order:
(1)Dividends paid during the second preceding taxable year in excess of the adjusted net income for such year, to the extent not needed as a dividends paid credit for the taxable year preceding the taxable year the tax for which is being computed ; and
(2)Dividends paid during the first preceding taxable year in excess of the adjusted net income for such year. No credit shall be allowed for dividends paid by a corporation priorDividends paid prior to first taxable year. to its first taxable year under this title.
(c)Dividends in Kind.— If a dividend is paid in property otherDividends in kind. than money (including stock of the corporation if held by the corporation as an investment) the dividends paid credit with respect thereto shall be the adjusted basis of the property in the hands of the corporation at the time of the payment, or the fair market value of the property at the time of the payment, whichever is the lower.
(d)Dividends in Obligations of the Corporation.— If a dividendDividends paid in obligations of corporation. is paid in obligations of the corporation, the amount of the dividends paid credit with respect thereto shall be the face value of the obligations, or their fair market value at the time of the payment, whichever is the lower. If the fair market value is lower than the face value, then when the obligation is redeemed by the corporation, the excess of the amount for which redeemed over the fair market value at the time of the dividend payment (to the extent not allowable as a deduction in computing net income for any taxable year) shall be treated as a dividend paid in the taxable year in which the redemption occurs.
(e)Taxable Stock Dividends.— In case of a stock dividend orTaxable stock dividends. stock right which is a taxable dividend in the hands of shareholders under section 115 (f), the dividends paid credit with respect thereto*Post*, p. 1688. shall be the fair market value of the stock or the stock right at the time of the payment.
(f)Distributions in Liquidation.— In the case of amounts distributedDistributions in liquidation. in liquidation the part of such distribution which is properly chargeable to the earnings or profits accumulated after February 28, 1913, shall, for the purposes of computing the dividends paid credit under this section, be treated as a taxable dividend paid.
(g)Preferential Dividends.— No dividends paid credit shall bePreferential dividends. allowed with respect to any distribution unless the distribution is pro rata, equal in amount, and with no preference to any share of stock as compared with other shares of the same class.
(h)Nontaxable Distributions.— If any part of a distributionNontaxable distributions. (including stock dividends and stock rights) is not a taxable dividend in the hands of such of the shareholders as are subject to taxation under this title for the period in which the distribution is made, no dividends paid credit shall be allowed with respect to such part. 1666 **Part III—** **Credits Against Tax** Credits against tax. SEC. 31. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OF UNITED STATES. Taxes of foreign countries and U. S. possessions. Extent of credit for.*Post*, p. 1696.The amount of income, war-profits, and excess-profits taxes imposed by foreign countries or possessions of the United States shall be allowed as a credit against the tax, to the extent provided in section 131. SEC. 32. Taxes withheld at source.*Post*, pp. 1700, 1702.TAXES WITHHELD AT SOURCE. The amount of tax withheld at the source under section 143 or 144 shall be allowed as a credit against the tax. SEC. 33. Overpayments.*Post*, p. 1731.CREDIT FOR OVERPAYMENTS. For credit against the tax of overpayments of taxes imposed by this title for other taxable years, see section 322. **Part IV—** Accounting periods and methods. **Accounting Periods and Methods of Accounting** SEC. 41. General rule. GENERAL RULE. Net income computed on basis of annual accounting period.The net income shall be computed upon the basis of the taxpayer’s annual accounting period (fiscal year or calendar year, as the case may be) in accordance with the method of accounting regularly employed in keeping the books of such taxpayer; but if no such method of accounting has been so employed, or if the method employed does not clearly reflect the income, the computation shall be made in accordance with such method as in the opinion of the If accounting period is other than fiscal year.Commissioner does clearly reflect the income. If the taxpayer’s annual accounting period is other than a fiscal year as defined in section 48 or if the taxpayer has no annual accounting period or does not keep books, the net income shall be computed on the basis Inventories.*Ante*, p. 1658.of the calendar year. (For use of inventories, see section 22 (c).) SEC. 42. Gross income. PERIOD IN WHICH ITEMS OF GROSS INCOME INCLUDED. Items for taxable year In which received.The amount of all items of gross income shall be included in the gross income for the taxable year in which received by the taxpayer, unless, under methods of accounting permitted under section 41, any such amounts are to be properly accounted for as of a different Portion, in case of death.period. In the case of the death of a taxpayer there shall be included in computing net income for the taxable period in which falls the date of his death, amounts accrued up to the date of his death if not otherwise properly includible in respect of such period or a prior period. SEC. 43. Deductions and credits. PERIOD FOR WHICH DEDUCTIONS AND CREDITS TAKEN. For taxable year in which “paid or accrued”, or “paid or incurred.”The deductions and credits (other than the dividends paid credit provided in section 27) provided for in this title shall be taken for the taxable year in which “paid or accrued” or “paid or incurred”, dependent upon the method of accounting upon the basis of which the net income is computed, unless in order to clearly reflect the income the deductions or credits should be taken as of Allowances on death of taxpayer.a different period. In the case of the death of a taxpayer there shall be allowed as deductions and credits for the taxable period in which falls the date of his death, amounts accrued up to the date of his death if not otherwise properly allowable in respect of such period or a prior period. 1667 SEC. 44. INSTALLMENT BASIS. Installment basis.
(a)Dealers in Personal Property. — Under regulations prescribedDealers in personal property. by the Commissioner with the approval of the Secretary, a person who regularly sells or otherwise disposes of personal property on the installment plan may return as income therefrom in any taxable year that proportion of the installment payments actually received in that year which the gross profit realized or to be realized when payment is completed, bears to the total contract price.
(b)Sales of Realty and Casual Sales of Personalty.— In theSales of realty and casual sales of personalty. case
(1)of a casual sale or other casual disposition of personal property (other than property of a kind which would properly be included in the inventory or the taxpayer if on hand at the close of the taxable year), for a price exceeding $1,000, or
(2)of a sale or other disposition of real property, if in either case the initial payments do not exceed 30 per centum of the selling price (or, in case the sale or other disposition was in a taxable year beginning prior to January 1, 1934, the percentage of the selling price prescribed in the law applicable to such year), the income may, under regulations prescribed by the Commissioner with the approval of the Secretary, be returned on the basis and in the manner above prescribed in this section. As used in this section the term “initial“Initial payments” defined. payments” means the payments received in cash or property other than evidences of indebtedness of the purchaser during the taxable period in which the sale or other disposition is made.
(c)Change from Accrual to Installment Basis.— If a taxpayerComputation on change to installment basis. entitled to the benefits of subsection
(a)elects for any taxable year to report his net income on the installment basis, then in computing his income for the year of change or any subsequent year, amounts actually received during any such year on account of sales or other dispositions of property made in any prior year shall not be excluded.
(d)Gain or Loss upon Disposition of Installment Obligations.Gain or loss upon disposition of installment obligations.— If an installment obligation is satisfied at other than its face value or distributed, transmitted, sold, or otherwise disposed of, gain or loss shall result to the extent of the difference between the basis of the obligation and
(1)in the case of satisfaction at other than face value or a sale or exchange—the amount realized, or
(2)in case of a distribution, transmission, or disposition otherwise than by sale or exchange—the fair market value of the obligation at the time of such distribution, transmission, or disposition. Any gain or loss so resulting shall be considered as resulting from the sale or exchange of the property in respect of which the installment obligation was received. The basis of the obligation shall beBasis. the excess of the face value of the obligation over an amount equal to the income which would be returnable were the obligation satisfied in full. This subsection shall not apply to the transmission atTransmission at death of installment obligations. death of installment obligations if there is filed with the Commissioner, at such time as he may by regulation prescribe, a bond in such amount and with such sureties as he may deem necessary, conditioned upon the return as income, by the person receiving any payment on such obligations, of the same proportion of such payment as would be returnable as income by the decedent if he had lived and had received such payment. SEC. 45. ALLOCATION OF INCOME AND DEDUCTIONS. Allocation of income and deductions. In any case of two or more organizations, trades, or businessesProvisions if same interests control two or more businesses. (whether or not incorporated, whether or not organized in the United States, and whether or not affiliated) owned or controlled directly or indirectly by the same interests, the Commissioner is 1668authorized to distribute, apportion, or allocate gross income or deductions between or among such organizations, trades, or businesses, if he determines that such distribution, apportionment, or allocation is necessary in order to prevent evasion of taxes or clearly to reflect the income of any of such organizations, trades, or businesses. SEC. 46. Change of accounting period. CHANGE OF ACCOUNTING PERIOD. Net Income computed on basis of new period.If a taxpayer changes his accounting period from fiscal year to calendar year, from calendar year to fiscal year, or from one fiscal year to another, the net income shall, with the approval of the Commissioner, be computed on the basis of such new accounting period, subject to the provisions of section 47. SEC. 47. Returns for less than a year. RETURNS FOR A PERIOD OF LESS THAN TWELVE MONTHS.
(a)Basis of computing when accounting period changes. Returns for Short Period Resulting from Change of Accounting Period.— If a taxpayer, with the approval of the Commissioner, changes the basis of computing net income from fiscal year to calendar year a separate return shall be made for the period between the close of the last fiscal year for which return was made and the following December 31. If the change is from calendar year to fiscal year, a separate return shall be made for the period between the close of the last calendar year for which return was made and the date designated as the close of the fiscal year. If the change is from one fiscal year to another fiscal year a separate return shall be made for the period between the close of the former fiscal year and the date designated as the close of the new fiscal year.
(b)Income computed on basis of short period where separate return made. Income Computed on Basis of Short Period.— Where a separate return is made under subsection
(a)on account of a change in the accounting period, and in all other cases where a separate return is required or permitted, by regulations prescribed by the Commissioner with the approval of the Secretary, to be made for a fractional part of a year, then the income shall be computed on the basis of the period for which separate return is made.
(c)Income placed on annual basis. Income Placed on Annual Basis.— If a separate return is made (except returns of the income of a corporation) under subsection
(a)on account of a change in the accounting period, the net income, computed on the basis of the period for which separate return is made, shall be placed on an annual basis by multiplying the amount thereof by twelve and dividing by the number of months included in the period for which the separate return is made. The tax shall be such part of the tax computed on such annual basis as the number of months in such period is of twelve months.
(d)Computation of earned income. Earned Income.— The Commissioner with the approval of the Secretary shall by regulations prescribe the method of applying the provisions of subsections
(b)and
(c)(relating to computing income on the basis of a short period, and placing such income on an annual basis) to cases where the taxpayer makes a separate return under subsection
(a)on account of a change in the accounting period, and it appears that for the period for which the return is so made he has received earned income.
(e)Reduction of personal credits for fractions of a year. Reduction of Credits Against Net Income.— In the case of a return made for a fractional part of a year, except a return made under subsection (a), on account of a change in the accounting period, the personal exemption and credit for dependents shall be reduced respectively to amounts which bear the same ratio to the full credits provided as the number of months in the period for which return is made bears to twelve months.
(f)Taxable year in case of jeopardy.*Post*, p. 1703. Closing of Taxable Year in Case of Jeopardy.— For closing of taxable year in case of jeopardy, see section 146. 1669 SEC. 48. DEFINITIONS. Definitions. When used in this title—
(a)Taxable Year.— “Taxable year” means the calendar year, or“Taxable year.” the fiscal year ending during such calendar year, upon the basis of which the net income is computed under this Part. “Taxable year” includes, in the case of a return made for a fractional part of a year under the provisions of this title or under regulations prescribed by the Commissioner with the approval of the Secretary, the period for which such return is made.
(b)Fiscal Year.— “Fiscal year” means an accounting period of“Fiscal year.” twelve months ending on the last day of any month other than December.
(c)Paid, Incurred, Accrued.— The terms “paid or incurred”“Paid or incurred”; “paid or accrued.” and “paid or accrued” shall be construed according to the method of accounting upon the basis of which the net income is computed under this Part.
(d)Trade or Business.— The term “trade or business” includes“Trade or business.” the performance of the functions of a public office.
(e)Mutual Investment Companies.— Mutual investment companies.
(1)General definition.— The term “mutual investment company”General definition. means any corporation (whether chartered or created as an investment trust, or otherwise), other than a personal holding*Post*, p. 1732. company as defined in section 351, if—
(A)It is organized for the purpose of, and substantially all its business consists of, holding, investing, or reinvesting in stock or securities; and
(B)At least 95 per centum of its gross income is derived from dividends, interest, and gains from sales or other disposition of stock or securities; and
(C)Less than 30 per centum of its gross income is derived from the sale or other disposition of stock or securities held for less than six months; and
(D)An amount not less than 90 per centum of its net income is distributed to its shareholders as taxable dividends during the taxable year; and
(E)Its shareholders are, upon reasonable notice, entitled to redemption of their stock for their proportionate interests in the corporation’s properties, or the cash equivalent thereof less a discount not in excess of 3 per centum thereof.
(2)Limitations.— Despite the provisions of paragraph
(1)aLimitations. corporation shall not be considered as a mutual investment company if, subsequent to a date thirty days after the date of the enactment of this Act, at any time during the taxable year—
(A)More than 5 per centum of the gross assets of the corporation, taken at cost, was invested in stock or securities, or both, of any one corporation government, or political subdivision thereof, but this limitation shall not apply to investments in obligations of the United States or in obligations of any corporation organized under general Act of Congress if such corporation is an instrumentality of the United States; or
(B)It owned more than 10 per centum of the outstanding stock or securities, or both, of any one corporation; or
(C)It had any outstanding bonds or indebtedness in excess of 10 per centum of its gross assets taken at cost; or
(D)It fails to comply with any rule or regulation prescribed by the Commissioner, with the approval of the Secretary, for the purpose of ascertaining the actual ownership of its outstanding stock. 1670 **Part V—** **Returns and Payment of Tax** Returns and payment. SEC. 51. Individual returns. INDIVIDUAL RETURNS.
(a)Requirement. Requirement.— The following individuals shall each make under oath a return stating specifically the items of his gross income and the deductions and credits allowed under this title and such other information for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regulations prescribe—
(1)Net income $1,000 or over, if single, etc. Every individual having a net income for the taxable year of $1,000 or over, if single, or if married and not living with husband or wife;
(2)Net income $2,500 or over, if married end living with husband or wife. Every individual having a net income for the taxable year of $2,500 or over, if married and living with husband or wife; and
(3)Gross income $5,000 or over. Every individual having a gross income for the taxable year of $5,000 or over, regardless of the amount of his net income.
(b)Husband and wife living together. Husband and Wife.— If a husband and wife living together have an aggregate net income for the taxable year of $2,500 or over, or an aggregate gross income for such year of $5.000 or over—
(1)Separate return. Each shall make such a return, or
(2)Joint. The income of each shall be included in a single joint return, in which case the tax shall be computed on the aggregate income.
(c)Persons under disability; by agent, etc. Persons Under Disability.— If the taxpayer is unable to maire his own return, the return shall be made by a duly authorized agent or by the guardian or other person charged with the care of the person or property of such taxpayer.
(d)Fiduciaries.*Post*, p. 1700. Fiduciaries.— For returns to be made by fiduciaries, see section 142. SEC. 52. Corporation returns. CORPORATION RETURNS. Requirement tor making.Every corporation subject to taxation under this title shall make a return, stating specifically the items of its gross income and the deductions and credits allowed by this title and such other information for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regulations prescribe. The return shall be sworn to by the president, vice president, or other principal officer and by the treasurer, By receivers, trustees, or assignees.assistant treasurer, or chief accounting officer. In cases where receivers, trustees in bankruptcy, or assignees are operating the property or business of corporations, such receivers, trustees, or assignees shall make returns for such corporations in the same Collection.manner and form as corporations are required to make returns. Any tax due on the basis of such returns made by receivers, trustees, or assignees shall be collected in the same manner as if collected from the corporations of whose business or property they have custody and control. SEC. 53. Filing returns. TIME AND PLACE FOR FILING RETURNS.
(a)Time designated. Time for Filing.—
(1)General rule. General rule.— Returns made on the basis of the calendar year shall be made on or before the 15th day of March following the close of the calendar year. Returns made on the basis of a fiscal year shall be made on or before the 15th day of the third month following the close of the fiscal year.
(2)Extension at time. Extension of time.— The Commissioner may grant a reasonable extension of time for filing returns, under such rules and regulations as he shall prescribe with the approval of the Limitation.Secretary. Except in the case of taxpayers who are abroad, no such extension shall be for more than six months. 1671
(b)To Whom Return Made.— To whom made.
(1)Individuals.— Returns (other than corporation returns)Individuals. shall be made to the collector for the district in which is located the legal residence or principal place of business of the person making the return, or, if he has no legal residence or principal place of business in the United States, then to the collector at Baltimore, Maryland.
(2)Corporations.— Returns of corporations shall be made toCorporations. the collector of the district in which is located the principal place of business or principal office or agency of the corporation, or, if it has no principal place of business or principal office or agency in the United States, then to the collector at Baltimore, Maryland. SEC. 54. RECORDS AND SPECIAL RETURNS. Records and special returns.
(a)By Taxpayer.— Every person liable to any tax imposed byRequired of taxpayer. this title or for the collection thereof, shall keep such records, render under oath such statements, make such returns, and comply with such rules and regulations, as the Commissioner, with the approval of the Secretary, may from time to time prescribe.
(b)To Determine Liability to Tax.— Whenever in the judgmentStatement to determine tax liability. of the Commissioner necessary he may require any person, by notice served upon him, to make a return, render under oath such statements, or keep such records, as the Commissioner deems sufficient to show whether or not such person is liable to tax under this title.
(c)Information at the Source.— For requirement of statementsInformation at source.*Post*, pp. 1704, 1705. and returns by one person to assist in determining the tax liability of another person, see sections 147 to 150.
(d)Copies of Returns.— If any person, required by law or regulationsCopies of returns.Assessment for failure to file. made pursuant to law to file a copy of any income return for any taxable year, fails to file such copy at the time required, there shall be due and assessed against such person $5 in the case of an individual return or $10 in the case of a fiduciary, partnership, or corporation return, and the collector with whom the return is filed shall prepare such copy. Such amount shall be collected andCollection of. paid, without interest, in the same manner as the amount of tax due in excess of that shown by the taxpayer upon a return in the case of a mathematical error appearing on the face of the return. Copies of returns filed or prepared pursuant to this subsection shall remain on file for a period of not less than two years from the date they are required to be filed, and may be destroyed at any time thereafter under the direction of the Commissioner. SEC. 55. PUBLICITY OF RETURNS. Publicity of returns.
(a)Returns made under this title shall be open to inspection inProvisions governing. the same manner, to the same extent, and subject to the same provisions of law, including penalties, as returns made under Title IIVol. 44, p. 51. of the Revenue Act of 1926; and all returns made under this Act shall constitute public records and shall be open to public examinationTo constitute public records. and inspection to such extent as shall be authorized in rules and regulations promulgated by the President.
(1)All income returns filed under this title (or copiesInspection by officials, etc., in administration of State laws. thereof, if so prescribed by regulations made under this subsection), shall be open to inspection by any official, body, or commission, lawfully charged with the administration of any State tax law, if the inspection is for the purpose of such administration or for the purpose of obtaining information to be furnished to local taxing authorities as provided in paragraph (2). The inspection shall be permittedRequest by Governor. only upon written request of the governor of such State, designating the representative of such official, body, or commission 1672to make the inspection on behalf of such official, body, or Manner, time, and place of inspection.commission. The inspection shall be made in such manner, and at such times and places, as shall be prescribed by regulations made by the Commissioner with the approval of the Secretary.
(2)Use of information secured. Any information thus secured by any official, body, or commission of any State may be used only for the administration of the tax laws of such State, except that upon written request of the Governor of such State any such information may be furnished to any official, body, or commission of any political subdivision of such State, lawfully charged with the administration of the tax laws of such political subdivision, but may be furnished only for the purpose of, and may be used only for, the administration of such tax laws. Unlawful disclosure.Any officer, employee, or agent of any State or political subdivision, who divulges (except as authorized in this subsection, or when called upon to testify in any judicial or administrative proceeding to which the State or political subdivision, or such State or local official, body, or commission, as such, is a party) any information acquired by him through an inspection permitted him or another under this Penalty.subsection shall be guilty of a misdemeanor and shall upon conviction be punished by a fine of not more than $1,000, or by imprisonment for not more than one year, or both. SEC. 56. Payment of tax. PAYMENT OF TAX.
(a)Time designated. Time of Payment.— The total amount of tax imposed by this title shall be paid on the fifteenth day of March following the close of the calendar year, or, if the return should be made on the basis of a fiscal year, then on the fifteenth day of the third month following the close of the fiscal year.
(b)Installment payments. Installment Payments.— The taxpayer may elect to pay the tax in four equal installments, in which case the first installment shall be paid on the date prescribed for the payment of the tax by the taxpayer, the second installment shall be paid on the fifteenth day of the third month, the third installment on the fifteenth day of the sixth month, and the fourth installment on the fifteenth day of Whole amount, on default.the ninth month, after such date. If any installment is not paid on or before the date fixed for its payment, the whole amount of the tax unpaid shall be paid upon notice and demand from the collector.
(c)Extension of time for payment. Extension of Time for Payment.— At the request of the taxpayer, the Commissioner may extend the time for payment of the amount determined as the tax by the taxpayer, or any installment thereof, for a period not to exceed six months from the date Payment on expiration.prescribed for the payment of the tax or an installment thereof. In such case the amount in respect of which the extension is granted shall be paid on or before the date of the expiration of the period of the extension.
(d)Voluntary advance payment. Voluntary Advance Payment.— A tax imposed by this title, or any installment thereof, may be paid, at the election of the taxpayer, prior to the date prescribed for its payment.
(e)Jeopardy payment.*Post*, p. 1703. Advance Payment in Case of Jeopardy.— For advance payment in case of jeopardy, see section 146.
(f)Tax withheld at source.*Post*, pp. 1700, 1702. Tax Withheld at Source.— For requirement of withholding tax at the source in the case of nonresident aliens and foreign corporations, and in the case of so-called “tax-free covenant bonds”, see sections 143 and 144.
(g)Fractional parts of cent. Fractional Parts of Cent.— In the payment of any tax under this title a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to 1 cent. 1673
(h)Receipts.— Every collector to whom any payment of anyReceipt on request. income tax is made shall upon request give to the person making such payment a full written or printed receipt therefor. SEC. 57. EXAMINATION OF RETURN AND DETERMINATION OF TAX. Return and determination of tax.Examination of. As soon as practicable after the return is filed the Commissioner shall examine it and shall determine the correct amount of the tax. SEC. 58. ADDITIONS TO TAX AND PENALTIES. Additions to tax and penalties.
(a)For additions to the tax in case of negligence or fraud inNegligence or fraud. the nonpayment of tax or failure to file return therefor, see*Post*, p. 1727. Supplement M.
(b)For criminal penalties for nonpayment of tax or failure toCriminal penalties.*Post*, p. 1703. file return therefor, see section 145. SEC. 59. ADMINISTRATIVE PROCEEDINGS. Administrative proceedings. For administrative proceedings in respect of the nonpayment orNonpayments or overpayments. overpayment of a tax imposed by this title, see as follows:
(a)Supplement L, relating to assessment and collection ofDeficiencies.*Post*, p. 1721. deficiencies.
(b)Supplement M, relating to interest and additions to tax.Interest and additions. *Post*, p. 1727.
(c)Supplement N, relating to claims against transferees andTransferees and fiduciaries. *Post*, p, 1729. fiduciaries.
(d)Supplement O, relating to overpayments.Overpayments.*Post*, p. 1730. **Part VI—** **Miscellaneous Provisions** Miscellaneous provisions. SEC. 61. LAWS MADE APPLICABLE. Laws made applicable. All administrative, special, or stamp provisions of law, includingAdministrative, etc., provisions extended to. the law relating to the assessment of taxes, so far as applicable, are hereby extended to and made a part of this title. SEC. 62. RULES AND REGULATIONS. Rules and regulations. The Commissioner, with the approval of the Secretary, shall prescribePublication of. and publish all needful rules and regulations for the enforcement of this title. SEC. 63. TAXES IN LIEU OF TAXES UNDER 1934 ACT. Taxes in lieu of 1934 Act. The taxes imposed by this title and Title IA shall be in lieu of theVol. 48, p. 683; *Ante*, p. 1011. taxes imposed by Titles I and IA of the Revenue Act of 1934, as amended. SEC. 64. SHORT TITLE. Short title. This title may be cited as the “Income Tax Act of 1936 ”.“Income Tax Act of 1936.” SUBTITLE C— SUPPLEMENTAL PROVISIONS Supplemental provisions. **Supplement A—**Rates of tax. **Rates of Tax** [Supplementary to Subtitle B, Part I] SEC. 101. EXEMPTIONS FROM TAX ON CORPORATIONS. Exemptions from tax on corporations. The following organizations shall be exempt from taxation under this title—
(1)Labor, agricultural, or horticultural organizations;Labor, agricultural, etc., organisations.
(2)Mutual savings banks not having a capital stock representedMutual savings banks. by shares;
(3)Fraternal beneficiary societies, orders, or associations, (A)Fraternal beneficiary societies, lodges, etc. operating under the lodge system or for the exclusive benefit of 1674the members of a fraternity itself operating under the lodge system; and
(B)providing for the payment of life, sick, accident, or other benefits to the members of such society, order, or association or their dependents;
(4)Domestic building and loan associations, etc. Domestic building and loan associations substantially all the business of which is confined to making loans to members; and cooperative banks without capital stock organized and operated for mutual purposes and without profit;
(5)Mutual cemetery companies. Cemetery companies owned and operated exclusively for the benefit of their members or which are not operated for profit; and any corporation chartered solely for burial purposes as a cemetery corporation and not permitted by its charter to engage in any business not necessarily incident to that purpose, no part of the net earnings of which inures to the benefit of any private shareholder or individual;
(6)Corporations, community chests, etc., for religious, scientific, etc., purposes. Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, and no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation;
(7)Business leagues, etc. Business leagues, chambers of commerce, real-estate boards, or boards of trade, not organized for profit and no part of the net earnings of which inures to the benefit of any private shareholder or individual;
(8)Civic leagues, employees’ associations, etc. Civic leagues or organizations not organized for profit but operated exclusively for the promotion of social welfare, or local associations of employees, the membership of which is limited to the employees of a designated person or persons in a particular municipality, and the net earnings of which are devoted exclusively to charitable, educational, or recreational purposes;
(9)Pleasure, etc., clubs. Clubs organized and operated exclusively for pleasure, recreation, and other nonprofitable purposes, no part of the net earnings of which inures to the benefit of any private shareholder;
(10)Local life insurance, mutual ditch, etc., companies. Benevolent life insurance associations of a purely local character, mutual ditch or irrigation companies, mutual or cooperative telephone, companies, or like organizations; but only if 85 per centum or more of the income consists of amounts collected from members for the sole purpose of meeting losses and expenses;
(11)Farmers’ mutual casualty insurance companies. Farmers’ or other mutual hail, cyclone, casualty, or fire insurance companies or associations (including interinsurers and reciprocal underwriters) the income of which is used or held for the purpose of paying losses or expenses;
(12)Farmers’ cooperative associations. Farmers’, fruit growers’, or like associations organized and operated on a cooperative basis
(a)for the purpose of marketing the products of members or other producers, and turning back to them the proceeds of sales, less the necessary marketing expenses, on the basis of either the quantity or the value of the products furnished by them, or
(b)for the purpose of purchasing supplies and equipment for the use of members or other persons, and turning over such supplies and equipment to them at actual cost, plus necessary expenses. Exemption shall not be denied any such association because it has capital stock, if the dividend rate of such stock is fixed at not to exceed the legal rate of interest in the State of incorporation or 8 per centum per annum, whichever is greater, on the value of the consideration for which the stock was issued, and if substantially all such stock (other than nonvoting preferred stock, the owners of which are not entitled or permitted to partici-1675pate, directly or indirectly, in the profits of the association, upon dissolution or otherwise, beyond the fixed dividends) is owned by producers who market their products or purchase their supplies and equipment through the association; nor shall exemption be denied any such association because there is accumulated and maintained by it a reserve required by State law or a reasonable reserve for any necessary purpose. Such an association may market theMarketing products of nonmembers and making purchases for. products of nonmembers in an amount the value of which does not exceed the value of the products marketed for members, and may purchase supplies and equipment for nonmembers in an amount the value of which does not exceed the value of the supplies and equipment purchased for members, provided the value of the purchasesLimit. made for persons who are neither members nor producers does not exceed 15 per centum of the value of all its purchases. Business done for the United States or any of its agencies shall beFederal business disregarded. disregarded in determining the right to exemption under this paragraph;
(13)Corporations organized by an association exempt underExempt corporations financing crop operations of members. the provisions of paragraph (12), or members thereof, for the purpose of financing the ordinary crop operations of such members or other producers, and operated in conjunction with such association. Exemption shall not be denied any such corporation because it has capital stock, if the dividend rate of such stock is fixed at not to exceed the legal rate of interest in the State of incorporation or 8 per centum per annum, whichever is greater, on the value of the consideration for which the stock was issued, and if substantially all such stock (other than non-voting preferred stock, the owners of which are not entitled or permitted to participate, directly or indirectly, in the profits of the corporation, upon dissolution or otherwise, beyond the fixed dividends) is owned by such association, or members thereof; nor shall exemption be denied any such corporation because there is accumulated and maintained by it a reserve required by State law or a reasonable reserve for any necessary purpose;
(14)Corporations organized for the exclusive purpose of holdingCorporations as trustees for exempted organizations. title to property, collecting income therefrom, and turning over the entire amount thereof, less expenses, to an organization which itself is exempt from the tax imposed by this title;
(15)Corporations organized under Act of Congress, if suchInstrumentalities of the United States. corporations are instrumentalities of the United States and if, under such Act, as amended and supplemented, such corporations are exempt from Federal income taxes;
(16)Voluntary employees’ beneficiary associations providingVoluntary employees’ beneficiary associations. for the payment of life, sick, accident, or other benefits to the members of such association or their dependents, if
(A)no part of their net earnings inures (other than through such payments! to the benefit of any private shareholder or individual, and
(B)85 per centum or more of the income consists of amounts collected from members for the sole purpose of making such payments and meeting expenses;
(17)Teachers’ retirement fund associations of a purely localTeachers’ retirement fund associations. character, if
(A)no part of their net earnings inures (other than through payment of retirement benefits) to the benefit of any private shareholder or individual, and
(B)the income consists solely of amounts received from public taxation, amounts received from assessments upon the teaching salaries of members, and income in respect of investments.
(18)Religious or apostolic associations or corporations, if suchReligious, etc., associations, having a common treasury, etc. associations or corporations have a common treasury or community treasury, even if such associations or corporations engage in busi-1676ness for the common benefit of the members, but only if the members thereof include (at the time of filing their returns) in their gross income their entire pro-rata shares, whether distributed or not, of the net income of the association or corporation for such year. Any amount so included in the gross income of a member shall be treated as a dividend received. 102. Surtax on corporations improperly accumulating surplus. SURTAX ON CORPORATIONS IMPROPERLY ACCUMULATING SURPLUS.
(a)Tax imposed. Imposition of Tax.— There shall be levied, collected, and paid for each taxable year (in addition to other taxes imposed by this title) upon the net income of every corporation (other than a *Post*, p. 1732.personal holding company as defined in section 351) if such corporation, however created or organized, is formed or availed of for the purpose of preventing the imposition of the surtax upon its shareholders or the shareholders of any other corporation, through the medium of permitting earnings or profits to accumulate instead of being divided or distributed—
(1)Rates. In the case of corporations not subject to the surtax on undistributed profits imposed by section 14, a surtax equal to the sum of the following: 25 per centum of the amount of the retained net income not in excess of $100,000, plus 35 per centum of the amount of the retained net income in excess of $100,000.
(2)In the case of corporations subject to the surtax on undistributed profits imposed by section 14, a surtax equal to the sum of the following: 15 per centum of the amount of the retained net income not in excess of $100,000, plus 25 per centum of the amount of the retained net income in excess of $100,000.
(b)Evidence of purpose of evasion. Prima Facie Evidence.— The fact that any corporation is a mere holding or investment company, or that the earnings or profits are permitted to accumulate beyond the reasonable needs of the business, shall be prima facie evidence of a purpose to avoid surtax upon shareholders.
(c)Definitions. Definitions.— As used in this title—
(1)“Special adjusted net income.” Special adjusted net income.— The term “special adjusted net income” means the net income minus the sum of—
(A)Taxes. Taxes.— Federal income, war-profits, and excess-profits taxes paid or accrued during the taxable year, to the extent *Ante*, p. 1658.not allowed as a deduction by section 23, but not including the tax imposed by this section or a corresponding section of a prior income-tax law.
(B)Disallowed charitable, etc., contributions. Disallowed charitable, etc., contributions.— Contributions or gifts, not otherwise allowed as a deduction, to or *Ante*, p. 1660.for the use of donees described in section 23 (o), for the purposes therein specified.
(C)Disallowed losses.*Post*, p. 1602. Disallowed losses.— Losses from sales or exchanges of capital assets which are disallowed as a deduction by section 117 (d).
(D)Bank affiliates.Vol. 48, p. 162.*Ante*, p. 1664. Bank affiliates.— In the case of a holding company affiliate (as defined in section 2 of the Banking Act of 1933), the amount allowed as a credit under section 26 (d).
(E)National mortgage associations.Vol. 48, p. 1252. National mortgage associations.— In the case of a national mortgage association created under Title III of the National Housing Act, the amount allowed as a credit under section 26 (e). 1677
(2)Retained net income.— “Retained net income.” The term “retained net income” means the special adjusted net income minus the sum of the dividends paid credit provided in section 27 and the credit provided*Ante*, pp. 1664, 1665. in section 26 (c), relating to contracts restricting dividends. For the purposes of this subsection, such credits shall be computed by substituting in section 26
(c)and in section 27 for the words “adjusted net income” wherever appearing in such sections the words “special adjusted net income”.
(d)Payment of Surtax on Pro Rata Shares.— The tax imposedPayment of surtax on pro rata shares. by this section shall not apply if
(1)all the shareholders of the corporation include (at the time of filing their returns) in their gross income their entire pro rata shares, whether distributed or not, of the retained net income of the corporation for such year, and
(2)90 per centum or more of such retained net income is so included in the gross income of shareholders other than corporations. Any amount so included in the gross income of a shareholder shall be treated as a dividend received. Any subsequentSubsequent distribution. distribution made by the corporation out of earnings or profits for such taxable year shall, if distributed to any shareholder who has so included in his gross income his pro rata, share, be exempt from tax in the amount of the share so included.
(e)Tax on Personal Holding Companies.— For surtax on personalPersonal holding companies.*Post*, p. 1732. holding companies, see section 351. SEC. 103. RATES OF TAX ON CITIZENS AND CORPORATIONS OF CERTAIN FOREIGN COUNTRIES. Discriminatory or extraterritorial taxes. Whenever the President finds that, under the laws of any foreignRates when citizens are subjected by foreign countries to. country, citizens or corporations of the United States are being subjected to discriminatory or extraterritorial taxes, the President shall so proclaim and the rates of tax imposed by sections 11, 12, 13, 201*Ante*, pp. 1653, 1655; *Post*, pp. 1710, 1711, 1714, 1717. (b), 204 (a), 211 (a), and 231
(a)shall, for the taxable year during which such proclamation is made and tor each taxable year thereafter, be doubled in the case of each citizen and corporation of such foreign country; but the tax at such doubled rate shall be considered as imposed by sections 11, 12, 13, 201
(b)204 (a), 211 (a),or 231 (a), as the case may be. In no case shall this section operate to increaseLimitation. the taxes imposed by such sections (computed without regard to this section) to an amount in excess of 80 per centum of the net income of the taxpayer. Whenever the President finds that the laws of anyIf foreign laws modified. foreign country with respect to which the President has made a proclamation under the preceding provisions of this section have been modified so that discriminatory and extraterritorial taxes applicable to citizens and corporations of the United States have been removed, he shall so proclaim, and the provisions of this section providing for doubled rates of tax shall not apply to any citizen or corporation of such foreign country with respect to any taxable year beginning after such proclamation is made. SEC. 104. BANKS AND TRUST COMPANIES. Banks and trust companies.
(a)Definition.— As used in this section the term “bank” meansDefinition. a bank or trust company incorporated and doing business under the laws of the United States (including laws relating to the District of Columbia), of any State, or of any Territory, a substantial part of the business of which consists of receiving deposits and making loans and discounts, or of exercising fiduciary powers similar to those permitted to national banks under section 11
(k)of the FederalVol. 38, p, 262. Reserve Act, as amended, and which is subject by law to supervision and examination by State or Federal authority having supervision over banking institutions. 1678
(b)Rate of tax. Rate of Tax.— Banks shall be taxable in the same manner as other corporations, except that they shall not be subject to the *Ante*, p. 1655.surtax imposed by section 14, and except that the normal tax imposed by section 13 shall be at the rate of 15 per centum instead of at the rates provided in such section. SEC. 105. Oil or gas properties. SALE OF OIL OR GAS PROPERTIES. Tax on sales.In the case of a bona fide sale of any oil or gas property, or any interest therein, where the principal value of the property has been demonstrated by prospecting or exploration or discovery work done *Ante*, p. 1653.by the taxpayer, the portion of the tax imposed by section 12 attributable to such sale shall not exceed 30 per centum of the selling price of such, property or interest. **Supplement B—**Computation of net income. **Computation of Net Income** [Supplementary to Subtitle B, Part II] SEC. 111. Gain or loss. DETERMINATION OF AMOUNT OF, AND RECOGNITION OF, GAIN OR LOSS.
(a)Computation of. Computation of Gain or Loss.— The gain from the sale or other disposition of property shall be the excess of the amount *Post*, p. 1685.realized therefrom over the adjusted basis provided in section 113
(b)Adjusted basis.for determining gain, and the loss shall be the excess of the adjusted basis provided in such section for determining loss over the amount realized.
(b)Amount realized. Amount Realized.— The amount realized from the sale or other disposition of property shall be the sum of any money received plus the fair market value of the property (other than money) received.
(c)Recognition of gain or loss. Recognition of Gain or Loss.— In the case of a sale or exchange, the extent to which the gain or loss determined under this section shall be recognized for the purposes of this title, shall be determined under the provisions of section 112.
(d)Installment sales. Installment Sales.— Nothing in this section shall be construed to prevent (in the case of property sold under contract providing for payment in installments) the taxation of that portion of any installment payment representing gain or profit in the year in which such payment is received. SEC. 112. Gain or loss from sales or exchanges. RECOGNITION OF GAIN OR LOSS.
(a)Entire amount recognized; exceptions. General Rule.— Upon the sale or exchange of property the entire amount of the gain or loss, determined under section 111, shall be recognized, except as hereinafter provided in this section.
(b)Exchanges solely in kind. Exchanges Solely in Kind.—
(1)Property held for productive use or investment. Property held for productive use or investment.— No gain or loss shall be recognized if property held for productive use in trade or business or for investment (not including stock in trade or other property held primarily for sale, nor stocks, bonds, notes, choses in action, certificates of trust or beneficial interest, or other securities or evidences of indebtedness or interest) is exchanged solely for property of a like kind to be held either for productive use in trade or business or for investment.
(2)Stock for stock of same corporation. Stock for stock of same corporation.— No gain or loss shall be recognized if common stock in a corporation is exchanged solely for common stock in the same corporation, or if preferred stock in a corporation is exchanged solely for preferred stock in the same corporation. 1679
(3)Stock for stock on reorganization.— No gain or loss shallStock for stock on reorganization. be recognized if stock or securities in a corporation a party to a reorganization are, in pursuance of the plan of reorganization, exchanged solely for stock or securities in such corporation or in another corporation a party to the reorganization.
(4)Same—Gain of corporation.— No gain or loss shall beProperty for stock of party to reorganization. recognized if a corporation a party to a reorganization exchanges property, in pursuance of the plan of reorganization, solely for stock or securities in another corporation a party to the reorganization.
(5)Transfer to corporation controlled by transferor.— NoTransfers for stock of corporation under same control. gain or loss shall be recognized if property is transferred to a corporation by one or more persons solely in exchange for stock or securities in such corporation, and immediately after the exchange such person or persons are in control of the corporation; but inLimitation. the case of an exchange by two or more persons this paragraph shall apply only if the amount of the stock and securities received by each is substantially in proportion to his interest in the property prior to the exchange.
(6)Property received by corporation on complete liquidationProperty received by corporation on complete liquidation of another. of another.— No gain or loss shall be recognized upon the receipt by a corporation of property distributed in complete liquidation of another corporation. For the purposes of this paragraph a distribution shall be considered to be in complete liquidation only if—
(A)the corporation receiving such property was, on the dateConditions prescribed. of the adoption of the plan of liquidation, and has continued to be at all times until the receipt of the property, the owner of stock (in such other corporation) possessing at least 80 per centum of the total combined voting power of all classes of stock entitled to vote and the owner of at least 80 per centum of the total number of shares of all other classes of stock (except non-voting stock which is limited and preferred as to dividends), and was at no time on or after the date of the adoption of the plan of liquidation and until the receipt of the property the owner of a greater percentage of any class of stock than the percentage of such class owned at the time of the receipt of the property; and
(B)no distribution under the liquidation was made before theNo distribution before 1936. first day of the first taxable year of the corporation beginning after December 31, 1935; and either
(C)the distribution is by such other corporation in completeDistribution a complete stock cancelation, etc. cancellation or redemption of all its stock, and the transfer of all the property occurs within the taxable year; in such case the adoption by the stockholders of the resolution under which is authorized the distribution of all the assets of such corporation in complete cancellation or redemption of all its stock, shall be considered an adoption of a plan of liquidation, even though no time for the completion of the transfer of the property is specified in such resolution; or
(D)such distribution is one of a series of distributions byDistribution one of series of distributions, etc.; period for completion. such other corporation in complete cancellation or redemption of all its stock in accordance with a plan of liquidation under which the transfer of all the property under the liquidation is to be completed within three years from the close or the taxable year during which is made the first of the series of distributions under the plan, except that if such transfer is not completed within such period, or if the taxpayer does not continue qualified under subparagraph
(A)until the completion of such transfer, no1680Bond to insure income, etc., taxes.distribution under the plan shall be considered a distribution in complete liquidation. If such transfer of all the property does not occur within the taxable year the Commissioner may require of the taxpayer such bond, or waiver of the statute of limitations on assessment and collection, or both, as he may deem necessary to insure, if the transfer of the property is not completed within such three-year period, or if the taxpayer does not continue qualified under subparagraph
(A)until the completion of such transfer, the assessment and collection of all income, war-profits, and excess-profits taxes then imposed by law for such taxable year or subsequent taxable years, to the extent Distribution in complete liquidation but not within meaning of corporate law.attributable to property so received. A distribution otherwise constituting a distribution in complete liquidation within the meaning of this paragraph shall not be considered as not constituting such a distribution merely because it does not constitute a distribution or liquidation within the meaning of the corporate law under which the distribution is made; and for the purposes of this paragraph a transfer of property of such other corporation to the taxpayer shall not be considered as not constituting a distribution (or one of a series of distributions) in complete cancellation or redemption of all the stock of such other corporation, merely because the carrying out of the plan involves
(i)the transfer under the plan to the taxpayer by such other corporation of property, not attributable to shares owned by the taxpayer, upon an exchange described in paragraph
(4)of this subsection, and
(ii)the complete cancellation or redemption under the plan, as a result of exchanges described in paragraph
(3)of this subsection, of the shares not owned by the taxpayer.
(c)Gain from exchanges not solely in kind. Gain from Exchanges not Solely in Kind.—
(1)Recognition of. If an exchange would be within the provisions of subsection
(b)(1), (2), (3), or
(5)of this section if it were not for the fact that the property received in exchange consists not only of property permitted by such paragraph to be received without the recognition of gain, but also of other property or money, then the gain, if any, to the recipient shall be recognized, but in an amount not in excess of the sum of such money and the fair market value of such other property.
(2)Reorganization distribution construed as taxable dividend. If a distribution made in pursuance of a plan of reorganization is within the provisions of paragraph
(1)of this subsection but has the effect of the distribution of a taxable dividend, then there shall be taxed as a dividend to each distributee such an Accumulations after February 1913.amount of the gain recognized under paragraph
(1)as is not in excess of his ratable share of the undistributed earnings and profits Tax on gain from property exchange.of the corporation accumulated after February 28, 1913. The remainder, if any, of the gain recognized under paragraph
(1)shall be taxed as a gain from the exchange of property.
(d)Gain of corporation. Same—Gain of Corporation.— If an exchange would be within the provisions of subsection
(4)of this section if it were not for the fact that the property received in exchange consists not only of stock or securities permitted by such paragraph to be received without the recognition of gain, but also of other property or money, then—
(1)If distributed on reorganization. If the corporation receiving such other property or money distributes it in pursuance of the plan of reorganization, no gain to the corporation shall be recognized from the exchange, but
(2)If not distributed. If the corporation receiving such other property or money does not distribute it in pursuance of the plan of reorganization, the gain, if any, to the corporation shall be recognized, but in an 1681 amount not in excess of the sum of such money and the fair market value of such other property so received, which is not so distributed.
(e)Loss from Exchanges Not Solely in Kind.— If an exchangeLoss from exchanges not solely in kind. would be within the provisions of subsection
(1)to (5), inclusive, of this section if it were not for the fact that the property received in exchange consists not only of property permitted by such paragraph to be received without the recognition of gain or loss, but also of other property or money, then no loss from the exchange shall be recognized.
(f)Involuntary Conversions.— If property (as a result of itsInvoluntary conversions.No gain or loss, if involuntarily converted into similar property, etc. destruction in whole or in part, theft or seizure, or an exercise of the power of requisition or condemnation, or the threat or imminence thereof) is compulsorily or involuntarily converted into property similar or related in service or use to the property so converted, or into money which is forthwith in good faith, under regulations prescribed by the Commissioner with the approval of the Secretary, expended in the acquisition of other property similar or related in service or use to the property so converted, or in the acquisition of control of a corporation owning such other property, or in the establishment of a replacement fund, no gain or loss shall be recognized. If any part of the money is not so expended, the gain, ifGain recognized on part not expended. any, shall be recognized, but in an amount not in excess of the money which is not so expended.
(g)Definition of Reorganization.— As used in this section andReorganization. section 113—
(1)The term “reorganization” means
(A)a statutory mergerDefinitions. or consolidation, or
(B)the acquisition by one corporation in exchange solely for all or a part of its voting stock: of at least 80 per centum of the voting stock and at least 80 per centum of the total number of shares of all other classes of stock of another corporation; or of substantially all the properties of another corporation, or
(C)a transfer by a corporation of all or a part of its assets to another corporation if immediately after the transfer the transferor or its stockholders or both are in control of the corporation to which the assets are transferred, or
(D)a recapitalization, or
(E)a mere change in identity, form, or place of organization, however effected.
(2)The term “a party to a reorganization” includes a corporation“A party to a reorganization. resulting from a reorganization and includes both corporations in the case of a reorganization resulting from the acquisition by one corporation of stock or properties of another.
(h)Definition of Control.— As used in this section the term“Control” defined. “control” means the ownership of stock possessing at least 80 per centum of the total combined voting power of all classes of stock entitled to vote and at least 80 per centum of the total number of shares of all other classes of stock of the corporation.
(i)Foreign Corporations.— In determining the extent to whichForeign corporations.Not so considered if purpose is to evade income taxes. gain shall be recognized in the case of any of the exchanges (made after the date of the enactment of this Act) described in subsection
(b)(3), (4), (5), or (6), or described in so much of subsection
(c)as refers to subsection
(3)or (5), or described in subsection (d), a foreign corporation shall not be considered as a corporation unless, prior to such exchange, it has been established to the satisfaction of the Commissioner that such exchange is not in pursuance of a plan having as one of its principal purposes the avoidance of Federal income taxes. 1682 SEC. 113. Adjusted basis for determining gain or loss. ADJUSTED BASIS FOR DETERMINING GAIN OR LOSS.
(a)Cost value; exceptions. Basis (Unadjusted) of Property.— The basis of property shall be the cost of such property; except that—
(1)Inventory value. Inventory value.— If the property should have been included in the last inventory, the basis shall be the last inventory value thereof.
(2)Gifts after December 31, 1920. Gifts after December 31, 1920.— If the property was acquired by gift after December 31, 1920, the basis shall be the same as it would be in the hands of the donor or the last preceding Determination of loss.owner by whom it was not acquired by gift, except that for the purpose of determining loss the basis shall be the basis so determined or the fair market value of the property at the time of the gift, whichever is lower. If the facts necessary to determine the basis in the hands of the donor or the last preceding owner are unknown to the donee, the Commissioner shall, if possible, obtain such facts from such donor or last preceding owner, or any other Fair market value.person cognizant thereof. If the Commissioner finds it impossible to obtain such facts, the basis in the hands of such donor or last preceding owner shall be the fair market value of such property as found by the Commissioner as of the date or approximate date at which, according to the best information that the Commissioner is able to obtain, such property was acquired by such donor or last preceding owner.
(3)Transfer in trust after December 31, 1920. Transfer in trust after December 31, 1920.— If the property was acquired after December 31, 1920, by a transfer in trust (other than by a transfer in trust by a bequest or devise) the basis shall be the same as it would be in the bands of the grantor, increased in the amount of gain or decreased in the amount of loss recognized to the grantor upon such transfer under the law applicable to the year in which the transfer was made.
(4)Gift or transfer in trust before January 1, 1921. Gift or transfer in trust before January 1, 1921.— If the property was acquired by gift or transfer in trust on or before December 31, 1920, the basis shall be the fair market value of such property at the time of such acquisition.
(5)Property transmitted at death. Property transmuted at death.— If the property was acquired by bequest, devise, or inheritance, or by the decedent’s estate from the decedent, the basis shall be the fair market value Transfer in trust with right to revoke.of such property at the time of such acquisition. In the case of property transferred in trust to pay the income for life to or upon the order or direction of the grantor, with the right reserved to the grantor at all times prior to his death to revoke the trust, the basis of such property in the hands of the persons entitled under the terms of the trust instrument to the property after the grantor’s death shall, after such death, be the same as if the trust instrument had been a will executed on the day of the grantor’s Without full consideration under general power of appointment.death. For the purpose of this paragraph property passing without full and adequate consideration under a general power of appointment exercised by will shall be deemed to be property passing from the individual exercising such power by bequest or devise.
(6)Acquired on exchange, etc. Tax-free exchanges generally.— If the property was acquired, after February 28, 1913, upon an exchange described *Ante*, pp. 1678–1681; *Post*, p. 1684.in section 112
(b)to (e), inclusive, the basis (except as provided in paragraph
(15)of this subsection) shall be the same as in the case of the property exchanged, decreased in the amount of any money received by the taxpayer and increased in the amount of gain or decreased in the amount of loss to the taxpayer that was recognized upon such exchange under the law applicable to the 1683year in which the exchange was made. If the property soPartly by exchange and partly by other property. acquired, consisted in part of the type of property permitted by section 112
(b)to be received without the recognition of gain or loss, and in part of other property, the basis provided in this paragraph shall be allocated between the properties (other than money) received, and for the purpose of the allocation there shall be assigned to such other property an amount equivalent to its fair market value at the date of the exchange. This paragraphStock issued as consideration excepted. shall not apply to property acquired by a corporation by the issuance of its stock or securities as the consideration in whole or in part for the transfer of the property to it.
(7)Transfers to corporation.— If the property was acquiredTransfers to corporation. after December 31, 1917, by a corporation in connection with a reorganization, then the basis shall be the same as it would be in the hands of the transferor, increased in the amount of gain or decreased in the amount of loss recognized to the transferor upon such transfer under the law applicable to the year in which the transfer was made. This paragraph shall not apply if the propertyIf property consists of stock, etc. acquired consists of stock or securities in a corporation a party to the reorganization, unless acquired by the issuance of stock or securities of the transferee as the consideration in whole or in part for the transfer.
(8)Property acquired by issuance of stock or as paid-in surplus by a corporation after 1920. Property acquired by issuance of stock or as paid-in surplus.— If the property was acquired after December 31, 1920, by a corporation—
(A)by the issuance of its stock or securities in connection withIssuance of stock controlled by transferor. *Ante*, p. 1679. a transaction described in section 112
(5)(including, also, cases where part of the consideration for the transfer of such property to the corporation was property or money, in addition to such stock or securities), or
(B)as paid-in surplus or as a contribution to capital,Paid-in surplus, etc. then the basis shall be the same as it would be in the hands ofBasis. the transferor, increased in the amount of gain or decreased in the amount of loss recognized to the transferor upon such transfer under the law applicable to the year in which the transfer was made.
(9)Involuntary conversion.— If the property was acquired,Acquired by involuntary conversion. after February 28, 1913, as the result of a compulsory or involuntary conversion described in section 112 (f), the basis shall be*Ante*, p. 1681, the same as in the case of the property so converted, decreased in the amount of any money received by the taxpayer which was not expended in accordance with the provisions of law (applicable to the year in which such conversion was made) determining the taxable status of the gain or loss upon such conversion, and increased in the amount of gain or decreased in the amount of loss to the taxpayer recognized upon such conversion under the law applicable to the year in which such conversion was made.
(10)Wash sales of stock.— If the property consists of stockWash sales of stock, etc., on which loss not allowed. *Post*, p. 1692. or securities the acquisition of which (or the contract or option to acquire which) resulted in the nondeductibility (under section 118 of this Act or corresponding provisions of prior income tax laws, relating to wash sales) of the loss from the sale or other disposition of substantially identical stock or securities, then the basis shallBasis. be the basis of the stock or securities so sold or disposed of, increased or decreased, as the case may be, by the difference, if any, between the price at which the property was acquired and the price at which such substantially identical stock or securities were sold or otherwise disposed of. 1684
(11)Property acquired during affiliation. Determination of basis. Property acquired during affiliation.— In the case of property acquired by a corporation, during a period of affiliation, from a corporation with which it was affiliated, the basis of such property, after such period of affiliation, shall be determined, in accordance with regulations prescribed by the Commissioner with the approval of the Secretary, without regard to inter-company transactions in respect of which gain or loss was not recognized. “Period of affiliation” defined.For the purposes of this paragraph, the term “period of affiliation” means the period during which such corporations were affiliated (determined in accordance with the law applicable thereto) but does not include any taxable year beginning on or after January 1, 1922, unless a consolidated return was made, nor any taxable year Basis In 1929 and subsequent years.after the taxable year 1928. The basis in case of property acquired by a corporation during any period, in the taxable year 1929 or any subsequent taxable year, in respect of which a consolidated *Post*, p. 1698. Vol. 45, p. 831. Vol. 47, p. 213. Vol. 48, p. 721.return is made by such corporation under section 141 of this Act or the Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934, shall be determined in accordance with regulations prescribed under section 141
(b)of this Act or the Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934. The basis in the case of property held by a corporation during any period, in the taxable year 1929 or any subsequent taxable year, in respect of which a consolidated return is made by such corporation under section 141 of this Act or the Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934, shall be adjusted in respect of any items relating to such period, in accordance with regulations prescribed under section 141
(b)of this Act or the Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934, applicable to such period.
(12)Basis established by Revenue Act of 1932. Basis established by Revenue Act of 1932.— If the property was acquired, after February 28, 1913, in any taxable year beginning prior to January 1, 1934, and the basis thereof, for the purposes of the Revenue Act of 1932 was prescribed by section 113
(a)(6), (7), or
(9)of such Act, then for the purposes of this Act the basis shall be the same as the basis therein prescribed in the Revenue Act of 1932.
(13)Basis for partnership property, acquired after February 28, 1913. Partnerships.— If the property was acquired, after February 28, 1913, by a partnership and the basis is not otherwise determined under any of the paragraphs
(1)to (12), inclusive, of this subsection, then the basis shall be the same as it would be in the hands of the transferor, increased in the amount of gain or decreased in the amount of loss recognized to the transferor upon such transfer under the law applicable to the year in which the Distribution by partnership to partner.transfer was made. If the property was distributed in kind by a partnership to any partner, the basis of such property in the hands of the partner shall be such part of the basis in his hands of his partnership interest as is properly allocable to such property.
(14)Property acquired before March 1, 1913. Property acquired before March 1, 1913.— In the case of property acquired before March 1, 1913, if the basis otherwise determined under this subsection, adjusted (for the period prior to March 1, 1913) as provided in subsection (b), is less than the fair market value of the property as of March 1, 1913, then the Fair market value of assets.basis for determining gain shall be such fair market value. In determining the fair market value of stock in a corporation as of March 1, 1913, due regard shall be given to the fair market value of the assets of the corporation as of that date.
(15)Property received by a corporation on complete liquidation of another. Property received by a corporation on complete liquidation of another.— If the property was received by a corporation upon a distribution in complete liquidation of another corporation 1685within the meaning of section 112
(b)(6), then the basis shall be*Ante*, p. 1679. the same as it would be in the hands of the transferor.
(16)Basis established by revenue act of 1934.— If the propertyBasis established by Revenue Act of 1934. Vol. 48, p. 706. was acquired, after February 28, 1913, in any taxable year beginning prior to January 1, 1936, and the basis thereof, for the purposes of the Revenue Act of 1934 was prescribed by section 113
(a)(6), (7), or
(8)of such Act, then for the purposes of this Act the basis shall be the same as the basis therein prescribed in the Revenue Act of 1934.
(b)Adjusted Basis.— The adjusted basis for determining theAdjusted basis for determining gain or loss. gain or loss from the sale or other disposition of property, whenever acquired, shall be the basis determined under subsection (a), adjusted as hereinafter provided.
(1)General rule.— Proper adjustment in respect of the propertyGeneral rule. shall in all cases be made—
(A)for expenditures, receipts, losses, or other items, properlyExpenditures, etc., chargeable to capital account. Restriction. chargeable to capital account, including taxes and other carrying charges on unimproved and unproductive real property, but no such adjustment shall be made for taxes or other carrying charges for which deductions have been taken by the taxpayer in determining net income for the taxable year or prior taxable years;
(B)in respect of any period since February 28, 1913, forDepletion, etc., since February 28, 1913. exhaustion, wear and tear, obsolescence, amortization, and depletion, to the extent allowed (but not less than the amount allowable) under this Act or prior income tax laws. Where for anyBased on discovery value or percentage of income. taxable year prior to the taxable year 1932 the depletion allowance was based on discovery value or a percentage of income, then the adjustment for depletion for such year shall be based on the depletion which would have been allowable for such year if computed without reference to discovery value or a percentage of income;
(C)in respect of any period prior to March 1, 1913, forAny period prior to March 1, 1913. exhaustion, wear and tear, obsolescence, amortization, and depletion, to the extent sustained;
(D)in the case of stock (to the extent not provided for inBasis reduced by tax-free, etc., distributions. the foregoing subparagraphs) for the amount of distributions previously made which, under the law applicable to the year in which the distribution was made, either were tax-free or were applicable in reduction of basis (not including distributions made by a corporation, which was classified as a personal service corporation under the provisions of the Revenue Act of 1918 orVol. 40, p. 1070; Vol. 42, p. 245. 1921, out of its earnings or profits which were taxable in accordance with the provisions of section 218 of the Revenue Act of 1918 or 1921).
(2)Substituted basis.— The term “substituted basis” as usedSubstituted basis. Determination of. in this subsection means a basis determined under any provision of subsection
(a)of this section or under any corresponding provision of a prior income tax law, providing that the basis shall be determined—
(A)by reference to the basis in the hands of a transferor, donor, or grantor, or
(B)by reference to other property held at any time by the person for whom the basis is to be determined. Whenever it appears that the basis of property in the hands ofAdjustments. the taxpayer is a substituted basis, then the adjustments provided in paragraph
(1)of this subsection shall be made after first making in respect of such substituted basis proper adjustments of a similar nature in respect of the period during which the property 1686was held by the transferor, donor, or grantor, or during which the other property was held by the person for whom the basis is to be determined. A similar rule shall be applied in the case of a senes of substituted bases. SEC. 114. Depreciation antd depletion. BASIS FOR DEPRECIATION AND DEPLETION.
(a)Basis for. Basis for Depreciation,— The basis upon which exhaustion, wear and tear, and obsolescence are to be allowed in respect of any *Ante*, p. 1685.property shall be the adjusted basis provided in section 113
(b)for the purpose of determining the gain upon the sale or other disposition of such property.
(b)Basis for Depletion.—
(1)General rule. General rule.— The basis upon which depletion is to be allowed in respect of any property shall be the adjusted basis provided in section 113
(b)for the purpose of determining the gain upon the sale or other disposition of such property, except as provided in paragraphs (2), (3), and
(4)of this subsection.
(2)Discovery value in case of mines. Discovery value in case of mines.— In the case of mines (other than metal, coal, or sulphur mines) discovered by the taxpayer after February 28, 1913, the basis for depletion shall be the fair market value of the property at the date of discovery or within thirty days thereafter, if such mines were not acquired as the result of purchase of a proven tract or lease, and if the fair market value of the property is materially disproportionate Maximum allowance. *Ante*, p. 1660.to the cost. The depletion allowance under section 23
(m)based on discovery value provided in this paragraph shall not exceed 50 per centum of the net income of the taxpayer (computed without allowance for depletion) from the property upon which the discovery was made, except that in no case shall the depletion allowance under section 23
(m)be less than it would be if computed Minerals included.without reference to discovery value. Discoveries shall include minerals in commercial quantities contained within a vein or deposit discovered in an existing mine or mining tract by the taxpayer after February 28, 1913, if the vein or deposit thus discovered was not merely the uninterrupted extension of a continuing commercial vein or deposit already known to exist, and if the discovered minerals are of sufficient value and quantity that they could be separately mined and marketed at a profit.
(3)Percentage depletion for oil and gas wells. Percentage depletion for oil and gas wells.— In the case of oil and gas wells the allowance for depletion under section 23
(m)shall be 27½ per centum of the gross income from the property during the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred Maximum allowance.by the taxpayer in respect of the property. Such allowance shall not exceed 50 per centum of the net income of the taxpayer (computed without allowance for depletion) from the property, except that in no case shall the depletion allowance under section 23
(m)be less than it would be if computed without reference to this paragraph.
(4)Percentage depletion for coal and metal mines and sulphur. Percentage depletion for coal and metal mines and sulphur.— The allowance for depletion under section 23
(m)shall be, in the case of coal mines, 5 per centum, in the case of metal mines, 15 per centum, and, in the case of sulphur mines or deposits, 23 per centum, of the gross income from the property during the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred by the taxpayer in respect Maximum allowance.of the property. Such allowance shall not exceed 50 per centum of the net income of the taxpayer (computed without allowance Election by taxpayer as to computation.for depletion) from the property. A taxpayer making his first return under this title in respect of a property shall state whether 1687he elects to have the depletion allowance for such property for the taxable year for which the return is made computed with or without regard to percentage depletion, and the depletion allowance in respect of such property for such year shall be computed according to the election thus made. If the taxpayer fails toComputation if no statement made. make such statement in the return, the depletion allowance for such property for such year shall be computed without reference to percentage depletion. The method, determined as above, of computing the depletion allowance shall be applied in the case of the property for all taxable veal’s in which it is in the hands of such taxpayer, or of any other person if the basis of the*Ante*, p. 1682. property (for determining gain) in his hands is, under section 113, determined by reference to the basis in the hands of such taxpayer, either directly or through one or more substituted bases, as defined in that section. The above right of election shall be subject toQualification. the qualification that this paragraph shall, for the purpose of determining whether the method of computing the depletion allowance follows the property, be considered a continuation of section 114
(4)of the Revenue Act of 1934, and as giving noVol. 48, p. 710. new election in cases where such section would, if applied, give no new election. SEC. 115. Distributions by corporations. DISTRIBUTIONS BY CORPORATIONS.
(a)Definition of Dividend.— The term “dividend” when used“Dividend” defined. in this title (except in section 203
(3)and section 207
(c)(1),*Post*, pp. 1711, 1714. relating to insurance companies) means any distribution made by a corporation to its shareholders, whether in money or in other property,
(1)out of its earnings or profits accumulated after February 28, 1913, or
(2)out of the earnings or profits of the taxable year (computed as of the close of the taxable year without diminution by reason of any distributions made during the taxable year), without regard to the amount of the earnings and profits at the time the distribution was made.
(b)Source of Distributions.— For the purposes of this Act everySource. distribution is made out of earnings or profits to the extent thereof, and from the most recently accumulated earnings or profits. AnyAccumulations, etc., before March 1, 1913, tax-free. earnings or profits accumulated, or increase in value of property accrued, before March 1, 1913, may be distributed exempt from tax, after the earnings and profits accumulated after February 28, 1913, have been distributed, but any such tax-free distribution shall be applied against and reduce the adjusted basis of the stock provided*Ante*, p. 1682. in section 113.
(c)Distributions in Liquidation.— Amounts distributed in completeDistributions in liquidation. liquidation of a corporation shall be treated as in full payment in exchange for the stock, and amounts distributed in partial liquidation of a corporation shall be treated as in part or full payment in exchange for the stock. The gain or loss to the distributee resultingGain or loss to distributee. *Ante*, p. 1678. from such exchange shall be determined under section 111, but shall be recognized only to the extent provided in section 112. Despite the provisions of section 117 (a), 100 per centum of the gain so*Post*, p. 1691. recognized shall be taken into account in computing net income, except in the case of amounts distributed in complete liquidation or a corporation. For the purpose of the preceding sentence, “complete“Complete liquidation” construed. liquidation” includes any one of a series of distributions made by a corporation in complete cancellation or redemption of all of its stock in accordance with a bona fide plan of liquidation and under which the transfer of the property under the liquidation is to be completed within a time specified in the plan, not exceeding two years from the close of the taxable year during which is made the 1688Amounts distributed in partial liquidation.first of the series of distributions under the plan. In the ease of amounts distributed (whether before January 1, 1934, or on or after such date) in partial liquidation (other than a distribution within the provisions of subsection
(h)of this section of stock or securities in connection with a reorganization) the part of such distribution which is properly chargeable to capital account shall not be considered a distribution of earnings or profits.
(d)Other distributions from capital. Not out of increase in value before March 1, 1913, nor a dividend. Other Distributions from Capital.— If any distribution (not in partial or complete liquidation) made by a corporation to its shareholders is not out of increase in value of property accrued before March 1, 1913, and is not a dividend, then the amount of such distribution shall be applied against and reduce the adjusted basis of *Ante*, p. 1682.the stock provided in section 113, and if in excess of such basis, such excess shall be taxable in the same manner as a gain from the sale or exchange of property.
(e)Distributions by personal service corporations. Exemptions. Vol. 40, p. 1070; Vol. 42, p. 245. Distributions by Personal Service Corporations.— Any distribution made by a corporation, which was classified as a personal service corporation under the provisions of the Revenue Act of 1918 or the Revenue Act of 1921, out of its earnings or profits which were taxable in accordance with the provisions of section 218 of the Revenue Act of 1918 or section 218 of the Revenue Act of 1921, shall be exempt from tax to the distributees.
(f)Stock dividends. Stock Dividends.—
(1)General rule. General rule.— A distribution made by a corporation to its shareholders in its stock or in rights to acquire its stock shall not be treated as a dividend to the extent that it does not constitute income to the shareholder within the meaning of the Sixteenth Amendment to the Constitution.
(2)Election of shareholders as to medium of payment. Election of shareholders as to medium of payment.— Whenever a distribution by a corporation is, at the election of any of the shareholders (whether exercised before or after the declaration thereof), payable either
(A)in its stock or in rights to acquire its stock, of a class which if distributed without election would be exempt from tax under paragraph (1), or
(B)in money or any other property (including its stock or in rights to acquire its stock, of a class which if distributed without election would not be exempt from tax under paragraph (1)), then the distribution shall constitute a taxable dividend in the hands of all shareholders, regardless of the medium in which paid.
(g)Redemption of stock. Redemption of Stock.— If a corporation cancels or redeems its stock (whether or not such stock was issued as a stock dividend) at such time and in such manner as to make the distribution and cancellation or redemption in whole or in part essentially equivalent to the distribution of a taxable dividend, the amount so distributed in redemption or cancellation of the stock, to the extent that it represents a distribution of earnings or profits accumulated after February 28, 1913, shall be treated as a taxable dividend.
(h)Effect on earnings and profits of distributions of stock. Effect on Earnings and Profits of Distributions of Stock.— The distribution (whether before January 1, 1936, or on or after such date) to a distributee by or on behalf of a corporation of its stock or securities or stock or securities in another corporation shall not be considered a distribution of earnings or profits of any corporation—
(1)if no gain to such distributee from the receipt of such stock or securities was recognized by law, or
(2)if the distribution was not subject to tax in the hands of such distributee because it did not constitute income to him within the meaning of the Sixteenth Amendment to the Constitution or 1689because exempt to him under section 115
(f)of the Revenue Act of 1934 or a corresponding provision of a prior Revenue Act. As used in this subsection the term “stock or securities” includes“Stock or securities” construed. rights to acquire stock or securities.
(i)Definition of Partial Liquidation.— As used in this section“Amounts distributed in partial liquidation” defined. the term “amounts distributed in partial liquidation” means a distribution by a corporation in complete cancellation or redemption of a part of its stock, or one of a series of distributions in complete cancellation or redemption of all or a portion of its stock.
(j)Valuation of Dividend.— If the whole or any part of a dividendValuation of dividend. is paid to a shareholder in any medium other than money the property received other than money shall be included in gross income at its fair market value at the time as of which it becomes income to the shareholder. SEC. 116. EXCLUSIONS FROM GROSS INCOME. Exclusions from gross income. In addition to the items specified in section 22 (b), the followingAdditional items tax exempt. *Ante*, p. 1657. items shall not be included in gross income and shall be exempt from taxation under this title:
(a)Earned Income from Sources Without United States.— InEarned income from sources without United States. the case of an individual citizen of the United States, a bona fide nonresident of the United States for more than six months during the taxable year, amounts received from sources without the United States (except amounts paid by the United States or any agency thereof) if such amounts would constitute earned income as defined in section 25
(a)if received from sources within the United States;*Ante*, p. 1662. but such individual shall not be allowed as a deduction from his gross income any deductions properly allocable to or chargeable against amounts excluded from gross income under this subsection.
(b)Teachers in Alaska and Hawaii.— In the case of an individualTeachers in Alaska and Hawaii. employed by Alaska or Hawaii or any political subdivision thereof as a teacher in any educational institution, the compensation received as such. This subsection shall not exempt compensationFederal compensation. paid directly or indirectly by the Government of the United States.
(c)Income of Foreign Governments.— The income of foreignIncome of foreign governments from investments in United States, etc. governments received from investments in the United States in stocks, bonds, or other domestic securities, owned by such foreign governments, or from interest on deposits in banks in the United States of moneys belonging to such foreign governments, or from any other source within the United States.
(d)Income of States, Municipalities, Etc.— Income derivedIncome of States, etc., from public utilities. from any public utility or the exercise of any essential governmental function and accruing to any State, Territory, or the District of Columbia, or any political subdivision of a State or Territory, or income accruing to the government of any possession of the United States, or any political subdivision thereof. Whenever any State, Territory, orIf under prior contracts for operation thereof. the District of Columbia, or any political subdivision of a State or Territory, prior to September 8, 1916, entered in good faith into a contract with any person, the object and purpose of which is to acquire, construct, operate, or maintain a public utility—
(1)If by the terms of such contract the tax imposed by thisLevy on proceeds prior to division thereof with State, etc. title is to be paid out of the proceeds from the operation of such public utility, prior to any division of such proceeds between the person and the State, Territory, political subdivision, or the District of Columbia, and if, but for the imposition of the tax imposed by this title, a part of such proceeds for the taxable year would accrue directly to or for the use of such State, Territory, political subdivision, or the District of Columbia, then a tax upon the net income from the operation of such public utility 1690shall be levied, assessed, collected, and paid in the manner and Refund.at the rates prescribed in this title, but there shall be refunded to such State, Territory, political subdivision, or the District of Columbia (under rules and regulations to be prescribed by the Commissioner with the approval of the Secretary) an amount which bears the same relation to the amount of the tax as the amount which (but for the imposition of the tax imposed by this title) would have accrued directly to or for the use of such State, Territory, political subdivision, or the District of Columbia, bears to the amount of the net income from the operation of such public utility for such taxable year.
(2)If no part accruing to State, etc. If by the terms of such contract no part of the proceeds from the operation of the public utility for the taxable year would, irrespective of the tax imposed by this title, accrue directly to or for the use of such State, Territory, political subdivision, or the District of Columbia, then the tax upon the net income of such person from the operation of such public utility shall be levied, assessed, collected, and paid in the manner and at the rates prescribed in this title.
(e)Bridges to be acquired by State, etc. Bridges to be Acquired by State or Political Subdivision.— Whenever any State or political subdivision thereof, in pursuance of a contract to which it is not a party entered into before the enactment of the Revenue Act of 1928, is to acquire a bridge—
(1)Levy on operation proceeds before division made. If by the terms of such contract the tax imposed by this title is to be paid out of the proceeds from the operation of such bridge prior to any division of such proceeds, and if, but for the imposition of the tax imposed by this title, a part of such proceeds for the taxable year would accrue directly to or for the use of or would be applied for the benefit of such State or political subdivision, then a tax upon the net income from the operation of such bridge shall be levied, assessed, collected, and paid in the manner Refunds.and at the rates prescribed in this title, but there shall be refunded to such State or political subdivision (under rules and regulations to be prescribed by the Commissioner with the approval of the Secretary) an amount which bears the same relation to the amount of the tax as the amount which (but for the imposition of the tax imposed by this title) would have accrued directly to or for the use of or would be applied for the benefit of such State or political subdivision, bears to the amount of the net income from Restriction.the operation of such bridge for such taxable year. No such refund shall be made unless the entire amount of the refund is to be applied in part payment for the acquisition of such bridge.
(2)If no part accruing to State, etc. If by the terms of such contract no part of the proceeds from the operation of the bridge for the taxable year would, irrespective of the tax imposed by this title, accrue directly to or for the use of or be applied for the benefit of such State or political subdivision, then the tax upon the net income from the operation of such bridge shall be levied, assessed, collected, and paid in the manner and at the rates prescribed in this title.
(f)Dividends from “China Trade Act” corporations. Dividend from “China Trade Act” Corporation.— In the case of a person, amounts distributed as dividends to or for his benefit by a corporation organized under the China Trade Act, 1922, if, at the time of such distribution, he is a resident of China, and the equitable right to the income of the shares of stock of the corporation is in good faith vested in him.
(g)Shipowners’ mutual associations, receipts. Shipowners’ Protection and Indemnity Associations.— The receipts of shipowners’ mutual protection and indemnity associations not organized for profit, and no part of the net earnings of which inures to the benefit of any private shareholder; but such1691corporations shall be subject as other persons to the tax upon their net income from interest, dividends, and rents.
(h)Employees of foreign governments, pay. Compensation of Employees of Foreign Governments.—
(1)Rule for exclusion.— Wages, fees, or salary of an employeeExemptions. of a foreign government (including a consular or other officer, or a nondiplomatic representative) received as compensation for official services to such government—
(A)If such employee is not a citizen of the United States;Employee not a citizen of United States. and
(B)If the services are of a character similar to those performedServices similar to American foreign service. by employees of the Government of the United States in foreign countries; and
(C)If the foreign government whose employee is claimingEquivalent exemption granted by foreign government exemption grants an equivalent exemption to employees of the Government of the United States performing similar services in such foreign country.
(2)Certificate by Secretary of State.— The Secretary ofCertification by Secretary of State. State shall certify to the Secretary of the Treasury the names of the foreign countries which grant an equivalent exemption to the employees of the Government of the United States performing services in such foreign countries, and the character of the services performed by employees of the Government of the United States in foreign countries. SEC. 117. Capital gains and losses. CAPITAL GAINS AND LOSSES.
(a)General Rule.— In the case of a taxpayer, other than a corporation,Tax computation. only the following percentages of the gain or loss recognized upon the sale or exchange of a capital asset shall be taken into account in computing net income: 100 per centum if the capital asset has been held for not more than 1 year; 80 per centum if the capital asset has been held for more than 1 year but not for more than 2 years; 60 per centum if the capital asset has been held for more than 2 years but not for more than 5 years; 40 per centum if the capital asset has been held for more than 5 years but not for more than 10 years; 30 per centum if the capital asset has been held for more than 10 years.
(b)Definition of Capital Assets.— For the purposes of thisDefinition of “capital assets.” title, “capital assets” means property held by the taxpayer (whether or not connected with his trade or business), but does not include stock in trade of the taxpayer or other property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year, or property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business.
(c)Determination of Period for which Held.— For the purposeDetermination of period for which held. of subsection (a)—
(1)In determining the period for which the taxpayer has heldProperty received on an exchange. *Ante*, p. 1682. property received on an exchange there shall be included the period for which he held the property exchanged, if under the provisions of section 113, the property received has, for the purpose of determining gain or loss from a sale or exchange, the same basis in whole or in part in his hands as the property exchanged.
(2)In determining the period for which the taxpayer has heldPeriod of property holding. property however acquired there shall be included the period for which such property was held by any other person, if under the provisions of section 113, such property has, for the purpose of 1692determining gain or loss from a sale or exchange, the same basis in whole or in part in his hands as it would have in the hands of such other person.
(3)Stock, etc., received on a distribution. Vol. 45, p. 818. In determining the period for which the taxpayer has held stock or securities received upon a distribution where no gain was recognized to the distributee under the provisions of section 112
(g)of the Revenue Act of 1928 or the Revenue Act of 1932, there shall be included the period for which he held the stock or securities in the distributing corporation prior to the receipt of the stock or securities upon such distribution.
(4)Computing period stock has been held.Vol. 45, p. 826; Vol. 48, p. 715. In determining the period for which the taxpayer has held stock or securities the acquisition of which (or the contract or option to acquire which) resulted in the nondeductibility (under section 118 of this Act or section 118 of the Revenue Act of 1928 or the Revenue Act of 1932 or the Revenue Act of 1934, relating to wash sales) of the loss from the sale or other disposition of substantially identical stock or securities, there shall be included the period for which he held the stock or securities the loss from the sale or other disposition of which was not deductible.
(d)Limitation on capital losses. Limitation on Capital Losses.— Losses from sales or exchanges of capital assets shall be allowed only to the extent of $2,000 plus the gains from such sales or exchanges. If a bank or trust company incorporated under the laws of the United States or of any State or Territory, a substantial part of whose business is the receipt of deposits, sells any bond, debenture, note, or certificate or other evidence of indebtedness issued by any corporation (including one issued by a government or political subdivision thereof), with interest coupons or in registered form, any loss resulting from such sale (except such portion of the loss as does not exceed the amount, if any, by which the adjusted basis of such instrument exceeds the par or face value thereof) shall not be subject to the foregoing limitation and shall not be included in determining the applicability of such limitation to other losses.
(e)Gains and losses from short sales, etc. Gains and Losses from Short Sales, Etc.— For the purpose of this title—
(1)gains or losses from short sales of property shall be considered as gains or losses from sales or exchanges of capital assets; and
(2)gains or losses attributable to the failure to exercise privileges or options to buy or sell property shall be considered as gams or losses from sales or exchanges of capital assets held for one year or less.
(f)Retirement of bonds, etc. Retirement of Bonds, Etc.— For the purposes of this title, amounts received by the holder upon the retirement of bonds, debentures, notes, or certificates or other evidences of indebtedness issued by any corporation (including those issued by a government or political subdivision thereof), with interest coupons or in registered form, shall be considered as amounts received in exchange therefor. SEC. 118. Loss from wash sales of stock, etc. LOSS FROM WASH SALES OF STOCK OR SECURITIES.
(a)Restriction on claim for, if taxpayer has acquired substantially identical stock within 30 days. In the case of any loss claimed to have been sustained from any sale or other disposition of shares of stock or securities where it appears that, within a period beginning 30 days before the date of such sale or disposition and ending 30 days after such date, the taxpayer has acquired (by purchase or by an exchange upon which the entire amount of gain or loss was recognized by law), or has entered into a contract or option so to acquire, substantially *Ante*, p. 1659. Allowance to a corporation.identical stock or securities, then no deduction for the loss shall be allowed under section 23
(e)(2); nor shall such deduction be allowed under section 23
(f)unless the claim is made by a corporation, a 1693dealer in stocks or securities, and with respect to a transaction made in the ordinary course of its business.
(b)If the amount of stock or securities acquired (or covered byComputation where property acquired la less than sold, etc. the contract or option to acquire) is less than the amount of stock or securities sold or otherwise disposed of, then the particular shares of stock or securities the loss from the sale or other disposition of which is not deductible shall be determined under rules and regulations prescribed by the Commissioner with the approval of the Secretary.
(c)If the amount of stock or securities acquired (or covered byComputation where property acquired is not less than sold. the contract or option to acquire) is not less than the amount of stock or securities sold or otherwise disposed of, then the particular shares of stock or securities the acquisition of which (or the contract or option to acquire which) resulted in the nondeductibility of the loss shall be determined under rules and regulations prescribed by the Commissioner with the approval of the Secretary. SEC. 119. Income from sources within United States. INCOME FROM SOURCES WITHIN UNITED STATES.
(a)Gross Income from Sources in United States.— The followingGross income. items of gross income shall be treated as income from sources within the United States:
(1)Interest.— Interest from the United States, any Territory,Interest on bonds, etc., of residents. any political subdivision of a Territory, or the District of Columbia, and interest on bonds, notes, or other interest-bearing obligations of residents, corporate or otherwise, not including—Exceptions.
(A)interest on deposits with persons carrying on the bankingPaid to persons not In business in United States. business paid to persons not engaged in business within the United States and not having an office or place of business therein, or
(B)interest received from a resident alien individual, a residentIf less than 20 percent from United States sources. foreign corporation, or a domestic corporation, when it is shown to the satisfaction of the Commissioner that less than 20 per centum of the gross income of such resident payor or domestic corporation has been derived from sources within the United States, as determined under the provisions of this section, for the three-year period ending with the close of the taxable year of such payor preceding the payment of such interest, or for such part of such period as may be applicable, or
(C)income derived by a foreign central bank of issue fromFrom bankers’ acceptances. bankers’ acceptances;
(2)Dividends.— The amount received as dividends—Dividends.
(A)from a domestic corporation other than a corporationFrom domestic corporations; exceptions. entitled to the benefits of section 251, and other than a corporation less than 20 per centum of whose gross income is shown to the satisfaction of the Commissioner to have been derived from sources within the United States, as determined under the provisions of this section, for the three-year period ending with the close of the taxable year of such corporation preceding the declaration of such dividends (or for such part of such period as the corporation has been in existence), or
(B)from a foreign corporation unless less than 50 per centumForeign corporations. of the gross income of such foreign corporation for the three-year Seriod ending with the close of its taxable year preceding the eclaration of such dividends (or for such part of such period as the corporation has been in existence) was derived from sources within the United States as determined under the provisions of this section; but only in an amount which bears the same ratio to such dividends as the gross income of the corporation for such period derived from sources within the United 1694Dividends. *Post*, p. 1696.States bears to its gross income from all sources; but dividends from a foreign corporation shall, for the purposes of section 131 (relating to foreign tax credit), be treated as income from sources without the United States;
(3)Personal services in United States. Personal services.— Compensation for labor or personal services performed in the United States, but in the case of a non-resident alien individual temporarily present in the United States for a period or periods not exceeding a total of ninety days during the taxable year, compensation received by such an individual (if such compensation does not exceed $3,000 in the aggregate) for labor or services performed as an employee of or under a contract with a nonresident alien, foreign partnership, or foreign corporation, not engaged in trade or business within the United States, shall not be deemed to be income from sources within the United States;
(4)Rentals, royalties, etc., from United States sources. Rentals and royalties.— Rentals or royalties from property located in the United States or from any interest in such property, including rentals or royalties for the use of or for the privilege of using in the United States, patents, copyrights, secret processes and formulas, good will, trade-marks, trade brands, franchises, and other like property; and
(5)Real property sales. Sale of real property.— Gains, profits, and income from the sale of real property located in the United States.
(6)Sale of personal property. Sale of personal property.— For gains, profits, and income from the sale of personal property, see subsection (e).
(b)Net income from sources in United States. Net Income from Sources in United States.— From the items of gross income specified in subsection
(a)of this section there shall be deducted the expenses, losses, and other deductions properly apportioned or allocated thereto and a ratable part of any expenses, losses, or other deductions which can not definitely be allocated to some item or class of gross income. The remainder, if any, shall be included in full as net income from sources within the United States.
(c)Gross income from sources without the United States. Gross Income from Sources Without United States.— The following items of gross income shall be treated as income from sources without the United States:
(1)Interest. Interest other than that derived from sources within the United States as provided in subsection
(1)of this section;
(2)Dividends. Dividends other than those derived from sources within the United States as provided in subsection
(2)of this section;
(3)Labor, etc. Compensation for labor or personal services performed without the United States;
(4)Rentals, royalties, etc. Rentals or royalties from property located without the United States or from any interest in such property, including rentals or royalties for the use of or for the privilege of using without the United States, patents, copyrights, secret processes and formulas, good will, trade-marks, trade brands, franchises, and other like properties; and
(5)Real property sales. Gains, profits, and income from the sale of real property located without the United States.
(d)Net income from sources without the United States. Net Income from Sources Without United States.— From the items of gross income specified in subsection
(c)of this section there shall be deducted the expenses, losses, and other deductions properly apportioned or allocated thereto, and a ratable part of any expenses, losses, or other deductions which can not definitely be allocated to some item or class of gross income. The remainder, if any, shall be treated in full as net income from sources without the United States. 1695
(e)Income from Sources Partly Within and Partly WithoutIncome partly within and partly without United States. United States.— Items of gross income, expenses, losses and deductions, other than those specified in subsections
(a)and
(c)of this section, shall be allocated or apportioned to sources within or withoutApportionment. the United States, under rules and regulations prescribed by the Commissioner with the approval of the Secretary. Where items ofFrom United States sources. gross income are separately allocated to sources within the United States, there shall be deducted (for the purpose of computing the net income therefrom) the expenses, losses, and other deductions properly apportioned or allocated thereto and a ratable part of other expenses, losses or other deductions which can not definitely be allocated to some item or class of gross income. The remainder, if any, shall be included in full as net income from sources within the United States. In the case of gross income derived from sourcesGross income derived from sources partly within and partly without. partly within and partly without the United States, the net income may first be computed by deducting the expenses, losses, or other deductions apportioned or allocated thereto and a ratable part of any expenses, losses, or other deductions which can not definitely be allocated to some items or class of gross income; and the portionDetermination. of such net income attributable to sources within the United States may be determined by processes or formulas of general apportionment prescribed by the Commissioner with the approval of the Secretary. Gains, profits, and income from—
(1)transportation or other services rendered partly withinTransportation or other services. and partly without the United States, or
(2)from the sale of personal property produced (in whole orSale of personal property. in part) by the taxpayer within and sold without the United States, or produced (in whole or in part) by the taxpayer without and sold within the United States, shall be treated as derived partly from sources within and partly from sources without the United States. Gains, profits and incomePurchase, sale, etc., of personal property. derived from the purchase of personal property within and its sale without the United States or from the purchase ofExceptions. personal property without and its sale within the United States, shall be treated as derived entirely from sources within the country in which sold, except that gains, profits, and income derived from the purchase of personal property within the United States and its sale within a possession of the United States or from the purchase of personal property within a possession of the United States and its sale within the United States shall be treated as derived partly from sources within and partly from sources without the United States.
(f)Definitions.— As used in this section the words “sale” orDefinitions. “sold” include “exchange” or “exchanged” ; and the word “produced” includes “created”, “fabricated”, “manufactured”, “extracted”, “processed”, “cured”, or “aged”. SEC. 120. Charitable, etc., contributions. UNLIMITED DEDUCTION FOR CHARITABLE AND OTHER CONTRIBUTIONS. In the case of an individual if in the taxable year and in each ofUnlimited deduction. the ten preceding taxable years the amount of the contributions or gifts described in section 23
(o)plus the amount of income, war-profits,*Ante*, p. 1660. or excess-profits taxes paid during such year in respect of preceding taxable years, exceeds 90 per centum of the taxpayer’s net income for each such year, as computed without the benefit of section 23 (o), then the 15 per centum limit imposed by such section shall not be applicable. 1696 SEC. 121. Preferred stock of certain corporations. DEDUCTION OF DIVIDENDS PAID ON CERTAIN PREFERRED STOCK OF CERTAIN CORPORATIONS. Deduction of dividends paid on certain, in computing net income.In computing the net income of any national banking association, or of any bank or trust company organized under the laws of any State, Territory, possession of the United States, or the Canal Zone, or of any other banking corporation engaged in the business of industrial banking and under the supervision of a State banking department or of the Comptroller of the Currency, or of any incorporated domestic insurance company, there shall be allowed as a deduction from gross income, in addition to deductions otherwise Dividends paid to United States.provided for in this title, any dividend (not including any distribution in liquidation) paid, within such taxable year, to the United States or to any instrumentality thereof exempt from Federal income taxes, on the preferred stock of the corporation owned by the United States or such instrumentality. The amount allowable as a deduction under this section shall be deducted from the dividends paid *Ante*, p. 1665.credit otherwise computed under section 27. **Supplement C—**Credits against tax. **Credits Against Tax** [Supplementary to Subtitle B, Part III] SEC. 131. Taxes of foreign countries and U. S. possessions. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OF UNITED STATES.
(a)Allowances. Allowance of Credit.— If the taxpayer signifies in his return his desire to have the benefits of this section, the tax imposed by this title shall be credited with:
(1)Citizens and domestic corporations; taxes to foreign countries, etc. Citizen and domestic corporation.— In the case of a citizen of the United States and of a domestic corporation, the amount of any income, war-profits, and excess-profits taxes paid or accrued during the taxable year to any foreign country or to any possession of the United States; and
(2)Residents; to United States possessions. Resident of United States.— In the case of a resident of the United States, the amount of any such taxes paid or accrued during the taxable year to any possession of the United States; and
(3)Alien resident to foreign country allowing similar credit. Alien resident of United States.— In the case of an alien resident of the United States, the amount of any such taxes paid or accrued during the taxable year to any foreign country, in the foreign country of which such alien resident is a citizen or subject, in imposing such taxes, allows a similar credit to citizens of the United States residing in such country; and
(4)Partnerships and estates; to foreign countries, etc. Partnerships and estates.— In the case of any such individual who is a member of a partnership or a beneficiary of an estate or trust, his proportionate share of such taxes of the partnership or the estate or trust paid or accrued during the taxable year to a foreign country or to any possession of the United States, as the case may be.
(b)Limit on credit. Limit on Credit.— The amount of the credit taken under this section shall be subject to each of the following limitations:
(1)Proportionate credit for taxes paid to foreign country. The amount of the credit in respect of the tax paid or accrued to any country shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer’s net income from sources within such country bears to his entire net income for the same taxable year; and
(2)Limitation on total amount. The total amount of the credit shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer’s net income from sources without the United States bears to his entire net income for the same taxable year. 1697
(c)Adjustments on Payment of Accrued Taxes.— If accruedAdjustment on payment of accrued taxes. taxes when paid differ from the amounts claimed as credits by the taxpayer, or if any tax paid is refunded in whole or in part, the taxpayer shall notify the Commissioner, who shall redetermineRedetermination. the amount of the tax for the year or years affected, and the amount of tax due upon such redetermination, if any, shall be paid by the taxpayer upon notice and demand by the collector, or the amount of tax overpaid, if any, shall be credited or refunded to the taxpayer in*Post*, p. 1731. accordance with the provisions of section 322. In the case of such aTax accrued but unpaid. tax accrued but not paid, the Commissioner as a condition precedent to the allowance of this credit may require the taxpayer to give aBond. bond with sureties satisfactory to and to be approved by the Commissioner in such sum as the Commissioner may require, conditioned upon the payment by the taxpayer of any amount of tax found due upon any such redetermination; and the bond herein prescribed shall contain such further conditions as the Commissioner may require.
(d)Year in Which Credit Taken.— The credits provided for inCredits for foreign taxes may be taken in year accrued. this section may, at the option of the taxpayer and irrespective of the method of accounting employed in keeping his books, be taken in the year in which the taxes of the foreign country or the possession of the United States accrued, subject, however, to the conditions prescribed in subsection
(c)of this section. If the taxpayer elects toCredits on some basis for subsequent years. take such credits in the year in which the taxes of the foreign country or the possession of the United States accrued, the credits for all subsequent years shall be taken upon the same basis, and no portion of any such taxes shall be allowed as a deduction in the same or any succeeding year.
(e)Proof of Credits.— The credits provided in this section shallProof of credits. Evidence of foreign income. be allowed only if the taxpayer establishes to the satisfaction of the Commissioner
(1)the total amount of income derived from sources without the United States, determined as provided in section 119,
(2)the amount of income derived from each country, the tax*Ante*, p. 1693. Segregation of amounts. paid or accrued to which is claimed as a credit under this section, such amount to be determined under rules and regulations prescribed by the Commissioner with the approval of the Secretary, and (3)Other information. all other information necessary for the verification and computation of such credits.
(f)Taxes of Foreign Subsidiary.— For the purposes of thisTaxes of foreign subsidiary. Proportion of foreign tax on dividends received deemed to have been paid. section a domestic corporation which owns a majority of the voting stock of a foreign corporation from which it receives dividends in any taxable year shall be deemed to have paid the same proportion of any income, war-profits, or excess-profits taxes paid by such foreign corporation to any foreign country or to any possession of the United States, upon or with respect to the accumulated profits of such foreign corporation from which such dividends were paid, which the amount of such dividends bears to the amount of such accumulated profits: *Provided*, That the amount of tax deemed to*Proviso*. Limit on credit allowed. have been paid under this subsection shall in no case exceed the same proportion of the tax against which credit is taken which the amount of such dividends bears to the amount of the entire net income of the domestic corporation in which such dividends are included. The term “accumulated profits” when used in this subsection“Accumulated profits” defined. in reference to a foreign corporation, means the amount of its gains, profits, or income in excess of the income, war-profits, and excess-profits taxes imposed upon or with respect to such profits or income; and the Commissioner with the approval of the SecretaryDetermination of, by Commissioner. shall have full power to determine from the accumulated profits of what year or years such dividends were paid; treating dividends paid in the first sixty days of any year as having been paid from 1698the accumulated profits of the preceding year or years (unless to his satisfaction shown otherwise), and in other respects treating dividends as having been paid from the most recently accumulated Accounting period for foreign corporation.gains, profits, or earnings. In the case of a foreign corporation, the income, war-profits, and excess-profits taxes of which are determined on the basis of an accounting period of less than one year, “Year” construed.the word “year” as used in this subsection shall be construed to mean such accounting period.
(g)Corporations treated as foreign. Corporations Treated as Foreign.— For the purposes of this section the following corporations shall be treated as foreign corporations:
(1)Corporations receiving income from U. S. possessions. *Post*, p. 1718. A corporation entitled to the benefits of section 251, by reason of receiving a large percentage of its gross income from sources within a possession of the United States;
(2)China Trade Act corporations. *Post*, p. 1720. A corporation organized under the China Trade Act, 1922, and entitled to the credit provided for in section 262. **Supplement D—**Returns and payment of tax. **Returns and Payment of Tax** [Supplementary to Subtitle B, Part V] SEC. 141. Consolidated returns of railroad corporations. CONSOLIDATED RETURNS OF RAILROAD CORPORATIONS.
(a)By affiliated group in lieu of separate returns. Privilege to File Consolidated Returns.— An affiliated Sroup of corporations shall, subject to the provisions of this section, have the privilege of making a consolidated return for the taxable Condition.year in lieu of separate returns. The making of a consolidated return shall be upon the condition that all the corporations which have been members of the affiliated group at any time during the taxable year for which the return is made consent to all the regulations under subsection
(b)(or, in case such regulations are not prescribed prior to the making of the return, then the regulations Vol 48, p. 721.prescribed under section 141
(b)of the Revenue Act of 1934 insofar as not inconsistent with this Act) prescribed prior to the making of such return; and the making of a consolidated return shall be Fractional part of year.considered as such consent. In the case of a corporation which is a member of the affiliated group for a fractional part of the year the consolidated return shall include the income of such corporation for such part of the year as it is a member of the affiliated group.
(b)Regulations. Regulations.— The Commissioner, with the approval of the Secretary shall prescribe such regulations as he may deem necessary in order that the tax liability of any affiliated group of corporations making a consolidated return and of each corporation in the group, both during and after the period of affiliation, may be determined, computed, assessed, collected, and adjusted in such manner as clearly to reflect the income and to prevent avoidance of tax liability.
(c)Computation and payment of tax. Computation and Payment of Tax.— In any case in which a consolidated return is made the tax shall be determined, computed, assessed, collected, and adjusted in accordance with the regulations Returns filed prior to making regulations.under subsection
(b)(or, in case such regulations are not prescribed prior to the making of the return, then the regulations prescribed Vol. 48, p. 721.under section 141
(b)of the Revenue Act of 1934 insofar as not inconsistent with this Act) prescribed prior to the date on which such return is made.
(d)“Affiliated group” defined. Definition of “Affiliated Group”.— As used in this section an “affiliated group’’ means one or more chains of corporations connected through stock ownership with a common parent corporation if—
(1)Stock ownership of members. At least 95 per centum of the stock of each of the corporations (except the common parent corporation) is owned directly by one or more of the other corporations; and 1699
(2)The common parent corporation owns directly at least 95Of parent corporation. per centum of the stock of at least one of the other corporations; and
(3)Each of the corporations is either
(A)a corporation whoseCorporations included. principal business is that of a common carrier by railroad or
(B)a corporation the assets of which consist principally of stock in such corporations and which does not itself operate a business other than that of a common carrier by railroad. For the purpose of determining whether the principal business of a corporation is that of a common carrier by railroad, if a common carrier by railroad has leased its railroad properties and such properties are operated as such by another common carrier by railroad, the business of receiving rents for such railroad properties shall be considered as the business of a common carrier by railroad. As“Railroad” defined. used in this paragraph, the term “railroad” includes a street, suburban, or interurban electric railway. As used in this subsection (except in paragraph (3)) the term “stock”“Stock” defined. does not include nonvoting stock which is limited and preferred as to dividends.
(e)Foreign Corporations.— A foreign corporation shall not beForeign corporations. deemed to be affiliated with any other corporation within the meaning of this section.
(f)China Trade Act Corporations.— A corporation organizedChina Trade Act corporations. under the China Trade Act, 1922, shall not be deemed to be affiliated with any other corporation within the meaning of this section.
(g)Corporations deriving income from United States possessions. Corporations Deriving Income From Possessions of United States.— For the purposes of this section a corporation entitled to the benefits of section 251, by reason of receiving a large percentage of its income from possessions of the United States, shall be treated*Post*, p. 1718. as a foreign corporation.
(h)Subsidiary Formed to Comply With Foreign Law.— In theSubsidiary of domestic corporation formed to comply with foreign law. case of a domestic corporation owning or controlling, directly or indirectly, 100 per centum of the capital stock (exclusive of directors’ qualifying shares) of a corporation organized under the laws of a contiguous foreign country and maintained solely for the purpose of complying with the laws of such country as to title and operation of property, such foreign corporation may, at the option of the domestic corporation, be treated for the purpose of this title as a domestic corporation.
(i)Suspension of Running of Statute of Limitations.— If aSuspension of running of statute of limitations. notice under section 272
(a)in respect of a deficiency for any taxable year is mailed to a corporation, the suspension of the running*Post*, p. 1726. of the statute of limitations, provided in section 277, shall apply in the case of corporations with which such corporation made a consolidated return for such taxable year.
(j)Receivership Cases.— If the common parent corporation ofReceivership cases. an affiliated group making a consolidated return would, if filing a separate return, be exempt under section 14
(2)from the surtax*Ante*, p. 1656. on undistributed profits imposed by section 14, the affiliated group shall be exempt from such surtax imposed by section 14. In all other cases the affiliated group making a consolidated return shall be subject to the surtax imposed by section 14, regardless of the fact that one or more of the corporations in the group are in bankruptcy or in receivership.
(k)Allocation of Income and Deductions.— For allocation ofAllocation of income and deductions. *Ante*, p. 1667. income and deductions of related trades or businesses, see section 45. 1700 SEC. 142. FIDUCIARY RETURNS. Fiduciary returns.
(a)Sworn statements of income, etc., of beneficiaries. Requirement of Return.— Every fiduciary (except a receiver appointed by authority of law in possession of part only of the property of an individual) shall make under oath a return for any of the following individuals, estates, or trusts for which he acts, stating specifically the items of gross income thereof and the deductions and credits allowed under this title and such other information for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regulations prescribe—
(1)Net income of $1,000 or over, if single, etc. Every individual having a net income for the taxable year of $1,000 or over, if single, or if married and not living with husband or wife;
(2)Married, etc., with $2,500 or over. Every individual having a net income for the taxable year of $2,500 or over, if married and living with husband or wife;
(3)Gross, of $5,000 or over. Every individual having a gross income for the taxable year of $5,000 or over, regardless of the amount of his net income;
(4)Estates or trusts of $1,000 net income or over. Every estate or trust the net income of which for the taxable year is $1,000 or over;
(5)Gross income of $5,000 or over. Every estate of trust the gross income of which for the taxable year is $5,000 or over, regardless of the amount of the net income; and
(6)Nonresident alien beneficiaries. Every estate or trust of which any beneficiary is a nonresident alien.
(b)Joint fiduciaries. Joint Fiduciaries.— Under such regulations as the Commissioner with the approval of the Secretary may prescribe a return made by one of two or more joint fiduciaries and filed in the office of the collector of the district where such fiduciary resides shall be Oath required.sufficient compliance with the above requirement. Such fiduciary shall make oath
(1)that he has sufficient knowledge of the affairs of the individual, estate, or trust for which the return is made, to enable him to make the return, and
(2)that the return is, to the best of his knowledge and belief, true and correct.
(c)Laws applicable to flduciaries. Law Applicable to Fiduciaries.— Any fiduciary required to make a return under this title shall be subject to all the provisions of law which apply to individuals. SEC. 143. WITHHOLDING OF TAX AT SOURCE. Withholding of tax at source.
(a)Tax-free covenant bonds. Tax-Free Covenant Bonds.—
(1)By corporations agreeing to pay interest, free from tax, etc. Requirement of withholding.— In any case where bonds, mortgages, or deeds of trust, or other similar obligations of a corporation, issued before January 1, 1934, contain a contract or provision by which the obligor agrees to pay any portion of the tax imposed by this title upon the obligee, or to reimburse the obligee for any portion of the tax, or to pay the interest without deduction for any tax which the obligor may be required or permitted to pay thereon, or to retain therefrom under any law of Tax withhold.the United States, the obligor shall deduct and withhold a tax equal to 2 per centum of the interest upon such bonds, mortgages, deeds of trust, or other obligations, whether such interest is payable annually or at shorter or longer periods, if payable to an individual, a partnership, or a foreign corporation not engaged in trade or business within the United States and not having any *Proviso*. Rates.office or place of business therein: *Provided*, That if the liability assumed by the obligor does not exceed 2 per centum of the interest, then the deduction and withholding shall be at the following rates: Nonresident alien individuate, etc.(A) 10 per centum in the case of a nonresident alien individual (except that such rate shall be reduced, in the case of a resident of a contiguous country, to such rate, not less than 5 per centum, 1701as may be provided by treaty with such country), or of any partnership not engaged in trade or business within the United States and not having any office or place of business therein and composed in whole or in part of nonresident aliens,
(B)in the case of suchForeign corporations. a foreign corporation, 15 per centum, and
(C)2 per centum in theOther individuals, etc. Unknown owners. case of other individuals and partnerships: *Provided further*, That if the owners of such obligations are not known to the withholding agent the Commissioner may authorize such deduction and withholding to be at the rate of 2 per centum, or, if the liability assumed by the obligor does not exceed 2 per centum of the interest, then at the rate of 10 per centum.
(2)Benefit of credits against net income.— Such deductionBenefit of credits against net income. and withholding shall not be required in the case of a citizen or resident entitled to receive such interest, if he files with the withholding agent on or before February 1 a signed notice in writing claiming the benefit of the credits provided in section 25 (b); nor*Ante*, p. 1663. Nonresident alien. in the case of a nonresident alien individual if so provided for in regulations prescribed by the Commissioner under section 215.*Post*, p. 1716.
(3)Income of obligor and obligee.— The obligor shall not beRestriction on obllgor and obligee. allowed a deduction for the payment of the tax imposed by this title, or any other tax paid pursuant to the tax-free covenant clause, nor shall such tax be included in the gross income of the obligee.
(b)Nonresident Aliens.— All persons, in whatever capacity acting,Nonresident aliens. Normal tax payable at source. including lessees or mortgagors of real or personal property, fiduciaries, employers, and all officers and employees of the United States, having the control, receipt, custody, disposal, or payment of interest (except interest on deposits with persons carrying on the banking business paid to persons not engaged in business in the United States and not having an office or place of business therein), dividends, rent, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable annual or periodical gains, profits, and income (but only to the extent that any of the above items constitutes gross income from sources within the United States), of any nonresident alien individual, or of any partnership not engaged in trade or business within the United States and not having any office or place of business therein and composed in whole or in part of nonresident aliens, shall (except inException. *Ante*, p. 1700. the cases provided for in subsection
(a)of this section and except as otherwise provided in regulations prescribed by the Commissioner under section 215) deduct and withhold from such annual or periodical gains, profits, and income a tax equal to 10 per centum thereof, except that such rate shall be reduced, in the case of a nonresident alien individual a resident of a contiguous country, to such rate (not less than 5 per centum) as may be provided by treaty with such country: *Provided*, That no such deduction or withholding shall be required*Proviso*. Foreign corporation dividends. in the case of dividends paid by a foreign corporation unless
(1)such corporation is engaged in trade or business within the United States or has an office or place of business therein, and
(2)more than 85 per centum of the gross income of such corporation for the three-year period ending with the close of its taxable year preceding the declaration of such dividends (or for such part of such period as the corporation has been in existence) was derived from sources within the United States as determined under the provisions of section 119:*Ante*, p. 1693. Interest of unknown owners. *Provided further*, That the Commissioner may authorize such tax to be deducted and withheld from the interest upon any securities the owners of which are not known to the withholding agent. Under regulations prescribed by the Commissioner, with the approval of the Secretary, there may be exempted from such deduction and withholding the compensation for personal services of nonresident 1702alien individuals who enter and leave the United States at frequent intervals.
(c)Returns, etc., by withholding agent. Return and Payment.— Every person required to deduct and withhold any tax under this section shall make return thereof on or before March 15 of each year and shall on or before June 15, *Ante*, p. 1672.in lieu of the time prescribed in sect ion 56, pay the tax to the official of the United States Government authorized to receive it. Every such person is hereby made liable for such tax and is hereby indemnified against the claims and demands of any person for the amount of any payments made in accordance with the provisions of this section.
(d)Return of recipient of income on which tax withheld. Income of Recipient.— Income upon which any tax is required to be withheld at the source under this section shall be included in the return of the recipient of such income, but any amount of tax so withheld shall be credited against the amount of income tax as computed in such return.
(e)Tax paid by recipient. Tax Paid by Recipient.— If any tax required under this section to be deducted and withheld is paid by the recipient of the income, it shall not be recollected from the withholding agent; nor in cases in which the tax is so paid shall any penalty be imposed upon or collected from the recipient of the income or the withholding agent for failure to return or pay the same, unless such failure was fraudulent and for the purpose of evading payment.
(f)Refunds and credits to withholding agent. Refunds and Credits.— Where there has been an overpayment of tax under this section any refund or credit made under the *Post*, p. 1731.provisions of section 322 shall be made to the withholding agent unless the amount of such tax was actually withheld by the withholding agent.
(g)Withholding before enactment of Act. Withholding Before Enactment of Act.— Notwithstanding the provisions of subsections
(a)and (b), the deduction and withholding for any period prior to the tenth day after the date of the enactment of this Act shall be upon the items of income and at the Vol. 48, p. 723.rates prescribed in section 143
(a)and
(b)of the Revenue Act of 1934, as amended, in lieu of the items and rates prescribed in such subsections. SEC. 144. Payment at source. PAYMENT OF CORPORATION INCOME TAX AT SOURCE.
(a)By foreign corporations not in business in United States. General Rule.— In the case of foreign corporations subject to taxation under this title not engaged in trade or business within the United States and not having any office or place of business therein, there shall be deducted and withheld at the source in the *Ante*, p. 1700.same manner and upon the same items of income as is provided in Rates.section 143 a tax equal to 15 per centum thereof, except that in the case of dividends the rate shall be 10 per centum, and except that in the case of corporations organized under the laws of a contiguous country such rate of 10 per centum with respect to dividends shall be reduced to such rate (not less than 5 per centum) as may be provided by treaty with such country; and such tax shall be returned and paid in the same manner and subject to the same conditions *Proviso*. Rate when interest granted free of tax.as provided in that section: *Provided*, That in the case of interest granted free of tax. described in subsection
(a)of that section (relating to tax-free covenant bonds) the deduction and withholding shall be at the rate specified in such subsection.
(b)Withholding before enactment of Act. Withholding Before Enactment of Act.— Notwithstanding the provisions of subsection (a), the deduction and withholding for any period prior to the tenth day after the date of the enactment of this Act shall be upon the items of income and at the rates prescribed in Vol. 48, p. 724.section 144 of the Revenue Act of 1934, as amended, in lieu of the items and rates prescribed in such subsection. 1703 SEC. 145. Penalties. PENALTIES.
(a)Any person required under this title to pay any tax, orWillful failure to pay tax, make returns, etc. required by law or regulations made under authority thereof to make a return, keep any records, or supply any information, for the purposes of the computation, assessment, or collection of any tax imposed by this title, who willfully fails to pay such tax, make such return, keep such records, or supply such information, at the time or times required by law or regulations, shall, in addition to other penalties provided by law, be guilty of a misdemeanor and, uponPenalty. conviction thereof, be fined not more than $10,000, or imprisoned for not more than one year, or both, together with the costs of prosecution.
(b)Any person required under this title to collect, account for,Willful failure to collect. etc., tax; evading payment, etc. and pay over any tax imposed by this title, who willfully fails to collect or truthfully account for and pay over such tax, and any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof, shall, in addition to other penalties provided by law, be guilty of a felony and, uponPenalty. conviction thereof, be fined not more than $10,000, or imprisoned for not more than five years, or both, together with the costs of prosecution.
(c)The term “person” as used in this section includes an officer“Person” defined. or employee of a corporation or a member or employee of a partnership, who as such officer, employee, or member is under a duty to perform the act in respect of which the violation occurs. SEC. 146. Closing of taxable year. CLOSING BY COMMISSIONER OF TAXABLE YEAR.
(a)Tax in Jeopardy.— If the Commissioner finds that a taxpayerTax in jeopardy. Immediate payment demanded if Commissioner finds taxpayer’s acts prejudice collection. designs quickly to depart from the United States or to remove his property therefrom, or to conceal himself or his property therein, or to do any other act tending to prejudice or to render wholly or partly ineffectual proceedings to collect the tax for the taxable year then last past or the taxable year then current unless such proceedings be brought without delay, the Commissioner shall declare the taxable period for such taxpayer immediately terminated and shall cause notice of such finding and declaration to be given the taxpayer,Notice of finding, demand, etc. together with a demand for immediate payment of the tax for the taxable period so declared terminated and of the tax for the preceding taxable year or so much of such tax as is unpaid, whether or not the time otherwise allowed by law for filing return and paying the tax has expired; and such taxes shall thereupon become immediately due and payable. In any proceeding in court brought toFinding presumption of design. enforce payment of taxes made due and payable by virtue of the provisions of this section the finding of the Commissioner, made as herein provided, whether made after notice to the taxpayer or not, shall be for all purposes presumptive evidence of the taxpayer’s design.
(b)Security for Payment.— A taxpayer who is not in default inSecurity for payment. making any return or paying income, war-profits, or excess-profits tax under any Act of Congress may furnish to the United States, under regulations to he prescribed by the Commissioner, with the approval of the Secretary, security approved by the Commissioner that he will duly make the return next thereafter required to be filed and pay the tax next thereafter required to be paid. The CommissionerCondition of acceptance. may approve and accept in like manner security for return and payment of taxes made due and payable by virtue of the provisions of this section, provided the taxpayer has paid in full all other income, war-profits, or excess-profits taxes due from him under any Act of Congress. 1704
(c)Suspension of enforcement on approval of security. Same—Exemption from Section.— If security is approved and accepted pursuant to the provisions of this section and such further or other security with respect to the tax or taxes covered thereby is given as the Commissioner shall from time to time find necessary and require, payment of such taxes shall not be enforced by any proceedings under the provisions of this section prior to the expiration of the time otherwise allowed for paying such respective taxes.
(d)Discretionary waiver of requirements as to citizens. Citizens.— In the case of a citizen of the United States or of a possession of the United States about to depart from the United States the Commissioner may, at his discretion, waive any or all of the requirements placed on the taxpayer by this section.
(e)Aliens to furnish tax-paid certificate before going abroad. Departure of Alien.— No alien shall depart from the United States unless he first procures from the collector or agent in charge a certificate that he has complied with all the obligations imposed upon him by the income, war-profits, and excess-profits tax laws.
(f)Additions to tax for violations. Addition to Tax.— If a taxpayer violates or attempts to violate this section there shall, in addition to all other penalties, be added as part of the tax 25 per centum of the total amount of the tax or deficiency in the tax, together with interest at the rate of 6 per centum per annum from the time the tax became due. SEC. 147. Information at source. INFORMATION AT SOURCE.
(a)Returns by persons making fixed payments to others of $1,000 or more. Payments of $1,000 or More.— All persons, in whatever capacity acting, including lessees or mortgagors of real or personal property, fiduciaries, and employers, making payment to another person of interest, rent, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or Exceptions.*Post*, p. 1705.determinable gains, profits, and income (other than payments described in section 148
(a)or 149), of $1,000 or more in any taxable year, or, in the case of such payments made by the United States, the officers or employees of the United States having information as to such payments and required to make returns in regard thereto by the regulations hereinafter provided for, shall render a true and accurate return to the Commissioner, under such regulations and in such form and manner and to such extent as may be prescribed by him with the approval of the Secretary, setting forth the amount of such gains, profits, and income, and the name and address of the recipient of such payment.
(b)Returns regardless of amount of payment. Interest on corporation bonds, etc. Returns Regardless of Amount of Payment.— Such returns may be required, regardless of amounts,
(1)in the case of payments of interest upon bonds, mortgages, deeds of trust, or other similar Collections of foreign coupons, etc.obligations of corporations, and
(2)in the case of collections of items (not payable in the United States) of interest upon the bonds of foreign countries and interest upon the bonds of and dividends from foreign corporations by persons undertaking as a matter of business or for profit the collection of foreign payments of such interest or dividends by means of coupons, checks, or bills of exchange.
(c)Name and address of recipient. Recipient to Furnish Name and Address.— When necessary to make effective the provisions of this section the name and address of the recipient of income shall be furnished upon demand of the person paying the income.
(d)Interest on Federal obligations. Obligations of United States.— The provisions of this section shall not apply to the payment of interest on obligations of the United States. 1705 SEC. 148. Information by corporations. INFORMATION BY CORPORATIONS.
(a)Dividend Payments.— Every corporation shall, when requiredSworn return of dividend payments, etc. by the Commissioner, render a correct return, duly verified under oath, of its payments of dividends, stating the name and address of each shareholder, the number of shares owned by him, and the amount of dividends paid to him.
(b)Profits Declared as Dividends.— Every corporation shall,Statement of profits, etc., declared as dividends. when required by the Commissioner, furnish him a statement of such facts as will enable him to determine the portion of the earnings or profits of the corporation (including gains, profits, and income not taxed) accumulated during such periods as the Commissioner may specify, which have been distributed or ordered to be distributee!, respectively, to its shareholders during such taxable years as the Commissioner may specify.
(c)Accumulated Earnings and Profits.— When requested by theStatement of accumulated earnings and profits, etc. Commissioner, or any collector, every corporation shall forward to him a correct statement of accumulated earnings and profits and the names and addresses of the individuals or shareholders who would be entitled to the same if divided or distributed, and of the amount s that would be payable to each.
(d)Compensation of Officers and Employees.— Under regulationsNames of officers, etc., receiving more than $15,000 during taxable year. prescribed by the Commissioner with the approval of the Secretary, every corporation subject to taxation under this title shall, in its return, submit a list of the names of all officers and employees of such corporation and the respective amounts paid to them during the taxable year of the corporation by the corporation as salary, commission, bonus, or other compensation for personal services rendered, if the aggregate amount so paid to the individual is in excess of $15,000. The Secretary of the Treasury shall submit an annual reportReport to Congress. to Congress compiled from the returns made containing the names of, and amounts paid to, each such officer and employee and the name of the paying corporation. SEC. 149. Returns of brokers. RETURNS OF BROKERS. Every person doing business as a broker shall, when required bySworn returns of all business transactions. the Commissioner, render a correct return duly verified under oath, under such rules and regulations as the Commissioner, with the approval of the Secretary, may prescribe, showing the names of customers for whom such person has transacted any business, with such details as to the profits, losses, or other information which the Commissioner may require, as to each of such customers, as will enable the Commissioner to determine whether all income tax due on profits or gains of such customers has been paid. SEC. 150. Collection of foreign items. COLLECTION OF FOREIGN ITEMS. All persons undertaking as a matter of business or for profit theLicense for collecting foreign coupons, etc. collection of foreign payments of interest or dividends by means of coupons, checks, or bills of exchange shall obtain a license from the Commissioner and shall be subject to such regulations enabling the Government to obtain the information required under this title as the Commissioner, with the approval of the Secretary, shall prescribe; and whoever knowingly undertakes to collect such payments without having obtained a license therefor, or without complying with such regulations, shall be guilty of a misdemeanor and shall be fined not more than $5,000 or imprisoned for not more than one year, or both. 1706 **Supplement E—**Estates and trusts. **Estates and Trusts** SEC. 161. Imposition of tax. IMPOSITION OF TAX.
(a)Application of tax. Application of Tax.— The taxes imposed by this title upon individuals shall apply to the income of estates or of any kind of property held in trust, including—
(1)Trust accumulations. Income accumulated in trust for the benefit of unborn or unascertained persons or persons with contingent interests, and income accumulated or held for future distribution under the terms of the will or trust;
(2)Income for current distribution, etc. Income which is to be distributed currently by the fiduciary to the beneficiaries, and income collected by a guardian of an infant which is to be held or distributed as the court may direct;
(3)Received during administration. Income received by estates of deceased persons during the period of administration or settlement of the estate; and
(4)For discretionary distribution. Income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated.
(b)Computation; payments by fiduciary. Computation and Payment.— The tax shall be computed upon the net income of the estate or trust, and shall be paid by the Exception. *Post*, p. 1707. *Ante*, p. 1700.fiduciary, except as provided in section 166 (relating to revocable trusts) and section 167 (relating to income for benefit of the grantor). For return made by beneficiary, see section 142. SEC. 162. Net Income. NET INCOME. Computation.The net income of the estate or trust shall be computed in the same manner and on the same basis as in the case of an individual, except that—
(a)Deduction without limitation of gifts, etc., under will or trust. *Ante*, p. 1660. There shall be allowed as a deduction (in lieu of the deduction for charitable, etc., contributions authorized by section 23 (o)) any part of the gross income, without limitation, which pursuant to the terms of the. will or deed creating the trust, is during the taxable year paid or permanently set aside for the purposes and in the manner specified in section 23 (o), or is to be used exclusively for religious, charitable, scientific, literary, or educational puiposes, or for the prevention of cruelty to children or animals, or for the establishment, acquisition, maintenance or operation of a public cemetery not operated for profit;
(b)Additional deductions for current distributions by fiduciary. There shall be allowed as an additional deduction in computing the. net income of the estate or trust the amount of the income of the estate or trust for its taxable year which is to be distributed currently by the fiduciary to the beneficiaries, and the amount of the income collected by a guardian of an infant, which is to be held or distributed as the court may direct, but the amount so allowed as a deduction shall be included in computing the net income Limitation.of the beneficiaries whether distributed to them or not. Any amount allowed as a deduction under this paragraph shall not be allowed as a deduction under subsection
(c)of this section in the same or any succeeding taxable year;
(c)Additional deduction for payment made or credited to beneficiary. In the case of income received by estates of deceased persons during the period of administration or settlement of the estate, and in the case of income which, in the discretion of the fiduciary, may be either distributed to the beneficiary or accumulated, there shall be allowed as an additional deduction in computing the net income of the estate or trust the amount of the income of the estate or trust for its taxable year, which is properly paid or credited during such year to any legatee, heir, or beneficiary, but the amount so allowed Included in net income of beneficiary, etc.as a deduction shall be included in computing the net income of the legatee, heir, or beneficiary. 1707 SEC. 163. Credits against net income. CREDITS AGAINST NET INCOME.
(a)Credits of Estate or Trust.— For the purpose of the normalEstates or trusts, credits of. tax and the surtax the estate or trust shall be allowed the same personal exemption as is allowed to a single person under section 25
(b)(1), and, if no part of the income of the estate or trust is*Ante*, p. 1662. included in computing the net income of any legatee, heir, or beneficiary, then in addition the same credits against net income for interest as are allowed by section 25 (a).
(b)Credits of Beneficiary.— If any part of the income of anCredits of beneficiary in computing income. estate or trust is included in computing the net income of any legatee, heir, or beneficiary, such legatee, heir, or beneficiary shall, for the purpose of the normal tax, be allowed as credits against net income, in addition to the credits allowed to him under section 25, his proportionate share of such amounts of interest specified in section 25 (a)*Ante*, p. 1662. as are, under this Supplement, required to be included in computing his net income. Any remaining portion of suchAllowance as credits. amounts specified in section 25
(a)shall, for the purpose of the normal tax, be allowed as credits to the estate or trust. SEC. 164. Different taxable years. DIFFERENT TAXABLE YEARS. If the taxable year of a beneficiary is different from that of theComputation, if taxable year of estate or trust and beneficiary differ. estate or trust, the amount which he is required, under section 162 (b), to include in computing his net income, shall be based upon the income of the estate or trust for any taxable year of the estate or trust (whether beginning on, before, or after January 1, 1936) ending within his taxable year. SEC. 165. Employees’ trusts. EMPLOYEES’ TRUSTS. A trust created by an employer as a part of a stock bonus, pension,Profit-sharing trusts, etc., for employees not taxed. or profit-sharing plan for the exclusive benefit of some or all of his employees, to which contributions are made by such employer, or employees, or both, for the purpose of distributing to such employees the earnings and principal of the fund accumulated by the trust in accordance with such plan, shall not be taxable under section 161, but the amount actually distributed or made availableDistributees taxed on amount received. to any distributee shall be taxable to him in the year in which so distributed or made available to the extent that it exceeds the amounts paid in by him. Such distributees shall for the purposeCredits allowed. of the normal tax be allowed as credits against net income such part of the amount so distributed or made available as represents the items of interest specified in section 25 (a).*Ante*, p. 1662. SEC. 166. Revocable trusts. REVOCABLE TRUSTS. Where at any time the power to revest in the grantor title to anyComputation of income with grantor’s net income. part of the corpus of the trust is vested—
(1)in the grantor, either alone or in conjunction with any person not having a substantial adverse interest in the disposition of such part of the corpus or the income therefrom, or
(2)in any person not having a substantial adverse interest in the disposition of such part of the corpus or the income therefrom, then the income of such part of the trust shall be included in computing the net income of the grantor. SEC. 167. Income for benefit of grantor. INCOME FOR BENEFIT OF GRANTOR.
(a)Where any part of the income of a trust—
(1)is, or in the discretion of the grantor or of any person notWhen held for future distribution. having a substantial adverse interest in the disposition of such part 1708of the income may be, held or accumulated for future distribution to the grantor; or
(2)When distributed to grantor. may, in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income, be distributed to the grantor; or
(3)Application to life insurance premiums. is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be, applied to the payment of premiums upon policies of insurance on the life of the grantor (except policies of insurance irrevocably payable for the purposes and in the *Ante*, p. 1660.manner specified in section 23 (o), relating to the so-called “charitable contribution” deduction); then such part of the income of the trust shall be included in computing the net income of the grantor.
(b)“In the discretion of the grantor” defined. As used in this section, the term “in the discretion of the grantor” means “in the discretion of the grantor, either alone or in conjunction with any person not having a substantial adverse interest in the disposition of the part of the income in question”. SEC. 168. Taxes of foreign countries, etc. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OF UNITED STATES. Credit for.The amount of income, war-profits, and excess-profits taxes imposed by foreign countries or possessions of the United States shall be allowed as credit against the tax of the beneficiary of an estate or *Ante*, p. 1696.trust to the extent provided in. section 131. SEC. 169. Common trust funds. COMMON TRUST FUNDS.
(a)Definition. Definitions.— The term “common trust fund” means a fund *Ante*, p. 1677.maintained by a bank (as defined in section 104)—
(1)exclusively for the collective investment and reinvestment of moneys contributed thereto by the bank in its capacity as a trustee, executor, administrator, or guardian; and
(2)in conformity with the rules and regulations, prevailing from time to time, of the Board of Governors of the Federal Reserve System pertaining to the collective investment of trust funds by national banks.
(b)Taxation of common trust funds. Taxation of Common Trust Funds.— A common trust fund shall not be subject to taxation under this title, Title IA, or section *Ante*, p. 1017.105 or 106 of the Revenue Act of 1935, and for the purposes of such titles and sections shall not be considered a corporation.
(c)Income of participants in fund. Income of Participants in Fund.— Each participant in the common trust fund shall include in computing its net income its proportionate share, whether or not distributed and whether or not Basis of computation.distributable, of the net income of the common trust fund. The net income of the common trust fund shall be computed in the same manner and on the same basis as in the case of an individual. The proportionate share of each participant in the amount of interest *Ante*, p. 1662.specified in section 25
(a)received by the common trust fund shall for the purposes of this Supplement be considered as having been received by such participant as such interest.
(d)Admission and withdrawal. Admission and Withdrawal.— No gain or loss shall be realized by the common trust fund by the admission or withdrawal of a participant. The withdrawal of any participating interest by a participant shall be treated as a sale or excliange of such interest by the participant.
(e)Sworn returns by banks. *Ante*, p. 1677. Returns by Bank.— Every bank (as defined in section 104) maintaining a common trust fund shall make a return under oath for each taxable year, stating specifically, with respect to such fund, the items of gross income and the deductions allowed by this title, and 1709shall include in the return the names and addresses of the participants who would be entitled to share in the net income if distributed and the amount of the proportionate share of each participant. The return shall be sworn to as in the case of a return filed by the bank*Ante*, p. 1670. under section 52.
(f)Where taxable year differs from participant’s. Different Taxable Years of Common Trust Fund and Participant.— If the taxable year of the common trust fund is different from that of a participant, the proportionate share of the net income of the common trust fund to be included in computing the net income of the participant for its taxable year shall be based upon the net income of the common trust fund for any taxable year of the common trust fund (whether beginning on, before, or after January 1, 1936) ending within the taxable year of the participant. **Supplement F—**Partnerships. **Partnerships** SEC. 181. Partnership not taxable. PARTNERSHIP NOT TAXABLE. Individuals carrying on business in partnership shall be liable forIndividual liability. income tax only in their individual capacity. SEC. 182. Tax of partners. TAX OF PARTNERS. There shall be included in computing the net income of each partnerDistributive share included in net income. his distributive share, whether distributed or not, of the net income of the partnership for the taxable year. SEC. 183. Partnership income. COMPUTATION OF PARTNERSHIP INCOME. The net income of the partnership shall be computed in the sameComputation of. manner and on the same basis as in the case of an individual. SEC. 184. Credits against net income. CREDITS AGAINST NET INCOME. The partner shall, for the purpose of the normal tax, be allowedAdditional, from partnership exemptions. as a credit against his net income, in addition to the credits allowed to him under section 25, his proportionate share of such amounts (not in excess of the net income of the partnership) of interest*Ante*, p. 1662.specified in section 25
(a)as are received by the partnership. SEC. 185. Earned income. EARNED INCOME. In the case of the members of a partnership the proper part ofDetermination of. each share of the net income which consists of earned income shall be determined under rules and regulations to be prescribed by the Commissioner with the approval of the Secretary and shall be separately shown in the return of the partnership. SEC. 186. Foreign, etc., taxes. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OF UNITED STATES. The amount of income, war-profits, and excess-profits taxes imposedCredit for, allowed partners. by foreign countries or possessions of the United States shall be allowed as a credit against the tax of the member of a partnership*Ante*, p. 1696. to the extent provided in section 131. SEC. 187. Partnership returns. PARTNERSHIP RETURNS. Every partnership shall make a return for each taxable year, statingSworn statement of gross income, etc. specifically the items of its gross income and the deductions allowed by this title and such other information for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regulations prescribe, and shall include in the return the names and addresses of the individuals who would be entitled to share in the net income if distributed and the 1710amount of the distributive share of each individual. The return shall be sworn to by any one of the partners. SEC. 188. Different taxable years of partner and partnership. DIFFERENT TAXABLE YEARS OF PARTNER AND PARTNERSHIP. Basis of computation.If the taxable year of a partner is different from that of the partnership, the distributive share of the net income of the partnership to be included in computing the net income of the partner for his taxable year shall be based upon the net income of the partnership for any taxable year of the partnership (whether beginning on, before, or after January 1, 1936) ending within the taxable year of the partner. **Supplement G—**Insurance companies. **Insurance Companies** SEC. 201. Tax on life insurance companies. TAX ON LIFE INSURANCE COMPANIES.
(a)“Life Insurance company” defined. Definition.— When used in this title the term “life insurance company” means an insurance company engaged in the business of issuing life insurance and annuity contracts (including contracts of combined life, health, and accident insurance), the reserve funds of which held for the fulfillment of such contracts comprise more than 50 per centum of its total reserve funds.
(b)Imposition of tax. Imposition of Tax.—
(1)Rate on net income. *Ante*, p. 1665. In general.— In lieu of the tax imposed by sections 13 and 14, there shall be levied, collected, and paid for each taxable year upon the normal-tax net income of every life insurance company a tax of 15 per centum of the amount thereof.
(2)Normal-tax net income of foreign companies. Normal-tax net income of foreign life insurance companies.— In the case of a foreign life insurance company, the normal-tax net income shall be an amount which bears the same ratio to the normal-tax net income, computed without regard to this paragraph, as the reserve funds required by law and held by it at the end of the taxable year upon business transacted within the United States bear to the reserve funds held by it at the end of the taxable year upon all business transacted.
(3)No United States business. No United States insurance business.— Foreign life insurance companies not carrying on an insurance business within, the United States and holding no reserve funds upon business transacted within the United States, shall not be taxable under this section but shall be taxable as other foreign corporations. SEC. 202. GROSS INCOME OF LIFE INSURANCE COMPANIES.
(a)“Gross income” defined. Gross income, life insurance companies. In the case of a life insurance company the term “gross income” means the gross amount of income received during the taxable year from interest, dividends, and rents.
(b)“Reserve funds required by law.” The term “reserve funds required by law” includes, in the case of assessment insurance, sums actually deposited by any company or association with State or Territorial officers pursuant to law as guaranty or reserve funds, and any funds maintained under the charter or articles of incorporation of the company or association exclusively for the payment of claims arising under certificates of membership or policies issued upon the assessment plan and not subject to any other use. SEC. 203. Net Income, life insurance companies. NET INCOME OF LIFE INSURANCE COMPANIES.
(a)Deductions. General Rule.— In the case of a life insurance company the term “net income” means the gross income less—
(1)Tax-free interest. *Ante*, p. 1657. Tax-free interest.— The amount of interest received during the taxable year which under section 22
(4)is excluded from gross income; 1711
(2)Reserve funds.— An amount equal to 4 per centum of the mean of theReserve funds required by law. reserve funds required by law and held at the beginning and end of the taxable year, except that in the case of any such reserve fund which is computed at a lower interest assumption rate, the rate of 3¾ per centum shall be substituted for 4 per centum. Life insurance companies issuing policiesPolicies of combined insurance. covering life, health, and accident insurance combined in one policy issued on the weekly premium payment plan, continuingWeekly payment plan. for life and not subject to cancellation, shall be allowed, in addition to the above, a deduction of 3¾ per centum of the mean of suchReserves not required by law. reserve funds (not required by law) held at. the beginning and end of the taxable year, as the Commissioner finds to be necessary for the protection of the holders of such policies only;
(3)Reserve for dividends.— An amount equal to 2 per centumReserve for deferred dividends. of any sums held at the end of the taxable year as a reserve for dividends (other than dividends payable during the year following the taxable year) the payment of which is deterred for a period of not less than five years from the date of the policy contract;
(4)Investment expenses.— Investment expenses paid duringInvestment expenses. the taxable year: *Provided*, That if any general expenses are in*Proviso*.Limitation on deduction. part assigned to or included in the investment expenses, the total deduction under this paragraph shall not exceed one-fourth of 1 per centum of the book value of the mean of the invested assets held at the beginning and end of the taxable year;
(5)Real estate expenses.— Taxes and other expenses paidReal estate expenses. during the taxable year exclusively upon or with respect to the real estate owned by the company, not including taxes assessed against local benefits of a kind tending to increase the value of the property assessed, and not including any amount paid out for new buildings, or for permanent improvements or betterments made to increase the value of any property. The deduction allowed by thisIf tax paid on shareholder’s interest. paragraph shall be allowed in the case of taxes imposed upon a shareholder of a company upon his interest as shareholder, which are paid by the company without reimbursement from the shareholder, but in such cases no deduction shall be allowed the shareholder for the amount of such taxes;
(6)Depreciation.— A reasonable allowance, as provided inProperty depreciation. section 23 (1), for the exhaustion, wear and tear of property, including a reasonable allowance for obsolescence; and
(7)Interest.— All interest paid within the taxable year on itsInterest on indebtedness: exception. indebtedness, except on indebtedness incurred or continued to purchase or carry obligations (other than obligations of the United States issued after September 24, 1917, and originally subscribed for by the taxpayer) the interest upon which is wholly exempt from taxation under this title.
(b)Rental Value of Real Estate.— The deduction under subsectionRental value of real estate.Deduction of proportionate part of depreciation, etc., expenses.
(5)or
(6)of this section on account of any real estate owned and occupied in whole or in part by a life insurance company, shall be limited to an amount which bears the same ratio to such deduction (computed without regard to this subsection) as the rental value of the space not so occupied bears to the rental value of the entire property. SEC. 204. Insurance companies other than life or mutual.Tax imposed.*Ante*, 1655. INSURANCE COMPANIES OTHER THAN LIFE OR MUTUAL.
(a)Imposition of Tax.—
(1)In general.— In lieu of the tax imposed by sections 13 and 14, there shall be levied, collected, and paid for each taxable year upon the normal-tax net income of every insurance com1712pany (other than a life or mutual insurance company) a tax of 15 per centum of the amount thereof.
(2)Foreign companies. Normal-tax net income of foreign companies.— In the case of a foreign insurance company (other than a life or mutual insurance company), the normal-tax net income shall be the net income from sources within the United States minus the sum of—
(A)Deductions. *Ante*, p. 1664.Interest on Obligations of the United States and Its Instrumentalities.— The credit provided in section 26 (a).
(B)Dividends Received.—The credit provided in section 26 (b).
(3)No United States business. No United States insurance business.— Foreign insurance companies not carrying on an insurance business within the United States shall not be taxable under this section but shall be taxable as other foreign corporations.
(b)Definitions. Definition of Income, Etc.— In the case of an insurance company subject to the tax imposed by this section—
(1)“Gross income.” Gross income.— “Gross income” means the sum of
(A)the combined gross amount earned during the taxable year, from investment income and from underwriting income as provided in this subsection, computed on the basis of the underwriting and investment exhibit of the annual statement approved by the National Convention of Insurance Commissioners, and
(B)gain during the taxable year from the sale or other disposition of property, and
(C)all other items constituting gross income under *Ante*, p. 1657.section 22;
(2)“Net income.” Net income.— “Net income” means the gross income as denned in paragraph
(1)of this subsection less the deductions allowed by subsection
(c)of this section;
(3)“Investment income.” Investment income.— “Investment income” means the gross amount of income earned during the taxable year from interest dividends, and rents, computed as follows: To all interest, dividends and rents received during the taxable year, add interest, dividends and rents due and accrued at the end of the taxable year, and deduct all interest, dividends and rents due and accrued at the end of the preceding taxable year;
(4)“Underwriting income.” Underwriting income.— “Underwriting income” means the premiums earned on insurance contracts during the taxable year less losses incurred and expenses incurred;
(5)“Premiums earned on insurance contracts during the taxable year.” Premiums earned.— “Premiums earned on insurance contracts during the taxable year” means an amount computed as follows: From the amount of gross premiums written on insurance contracts during the taxable year, deduct return premiums and premiums paid for reinsurance. To the result so obtained add unearned premiums on outstanding business at the end of the preceding taxable year and deduct unearned premiums on outstanding business at the end of the taxable year;
(6)“Losses incurred.” Losses incurred.— “Losses incurred” means losses incurred during the taxable year on insurance contracts, computed as follows: To losses paid during the taxable year, add salvage and reinsurance recoverable outstanding at the end of the preceding taxable year, and deduct salvage and reinsurance recoverable outstanding at the end of the taxable year. To the result so obtained add all unpaid losses outstanding at the end of the taxable year and deduct unpaid losses outstanding at the end of the preceding taxableyear;
(7)“Expenses incurred.” Expenses incurred.— “Expenses incurred” means all expenses shown on the annual statement approved by the National 1713Convention of Insurance Commissioners, and shall be computed as follows: To all expenses paid during the taxable year add expenses unpaid at the end of the taxable year and deduct expenses unpaid at the end of the preceding taxable year. For the purpose of computing the net income subject to the tax imposed by this section there shall be deducted from expenses incurred as defined in this paragraph all expenses incurred which are not allowed as deductions by subsection
(c)of this section.
(c)Deductions Allowed.— In computing the net income of anNet income, deductions allowed. insurance company subject to the tax imposed by this section there shall be allowed as deductions:
(1)All ordinary and necessary expenses incurred, as providedBusiness expenses. *Ante*, p. 1658. in section 23 (a);
(2)All interest as provided in section 23 (b);Interest.
(3)Taxes as provided in section 23 (c);Taxes.
(4)Losses incurred as defined in subsection
(6)of thisLosses. section;
(5)Subject to the limitation contained in section 117 (d),Losses from sales; limitation. *Ante*, p. 1692. losses sustained during the taxable year from the sale or other disposition of property;
(6)Bad debts in the nature of agency balances and bills receivableBad debts, etc. ascertained to be worthless and charged off within the taxable year;
(7)The amount of interest earned during the taxable yearExempt interest. *Ante*, p. 1657. which under section 22
(4)is excluded from gross income;
(8)A reasonable allowance for the exhaustion, wear and tearExhaustion, etc., of property. of property, as provided in section 23 (1);
(9)Charitable, and so forth, contributions, as provided inCharitable, etc., contributions. *Ante,* p. 1661. section 23 (q);
(10)Deductions (other than those specified in this subsection)Other deductions. *Ante*, p. 1658. as provided in section 23, but not in excess of the amount of the gross income included under subsection
(C)of this section.
(d)Deductions of Foreign Corporations.— In the case of aDeductions allowed foreign corporations for United States business. *Post*, p. 1717. foreign corporation the deductions allowed in this section shall be allowed to the extent provided in Supplement I in the case of a foreign corporation engaged in trade or business within the United States or having an office or place of business therein.
(e)Double Deductions.— Nothing in this section shall be construedDuplication prohibited. to permit the same item to be twice deducted. SEC. 205. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OFForeign taxes. UNITED STATES. The amount of income war-profits, and excess-profits taxesCredit for, allowed domestic insurance companies. *Ante*, pp. 1710, 1711, 1696. imposed by foreign countries or possessions of the United States shall be allowed as a credit against the tax of a domestic insurance company subject to the tax imposed by section 201 or 204, to the extent provided in the case of a domestic corporation in section 131, and in such cases “net income” as used in that section means the net“Net Income” construed. income as defined in this Supplement. SEC. 206. Gross Income. COMPUTATION OF GROSS INCOME. The gross income of insurance companies subject to the taxComputation. *Ante*, p. 1693. imposed by section 201 or 204 shall not be determined in the manner provided in section 119. SEC. 207. Mutual insurance companies other than life. MUTUAL INSURANCE COMPANIES OTHER THAN LIFE.
(a)Application of Title.— Mutual insurance companies, otherTaxable as other corporations. than life insurance companies, shall be taxable in the same manner 1714as other corporations, except as hereinafter provided in this section, and except that they shall not be subject to the surtax imposed by *Ante*, p. 1655.section 14, and except that the normal tax imposed by section 13 shall be at the rate of 15 per centum instead of at the rates provided in such section, and such normal tax shall be applicable to foreign Foreign companies not carrying on business within United States.corporations as well as domestic corporations; but foreign insurance companies not carrying on an insurance business within the United States shall be taxable as other foreign corporations.
(b)Gross income; mutual marine-insurance companies. Gross Income.— Mutual marine-insurance companies shall include in gross income the gross premiums collected and received by them less amounts paid for reinsurance.
(c)Deductions. *Ante*, p. 1658. Deductions.— In addition to the deductions allowed to corporations by section 23 the following deductions to insurance companies shall also be allowed, unless otherwise allowed—
(1)Mutual insurance companies. Mutual insurance companies other than life insurance.— In the case of mutual insurance companies other than life insurance companies—
(A)Addition to reserve funds. the net addition required by law to be made within the taxable year to reserve funds (including in the case of assessment insurance companies the actual deposit of sums with State or Territorial officers pursuant to law as additions to guarantee or reserve funds); and
(B)Policy and annuity contracts. the sums other than dividends paid within the taxable year on policy and annuity contracts.
(2)Mutual marine insurance companies. Repayment to policy holders. Mutual marine insurance companies.— In the case of mutual marine insurance companies, in addition to the deductions allowed in paragraph
(1)of this subsection, unless otherwise allowed, amounts repaid to policyholders on account of premiums previously paid by them, and interest paid upon such amounts between the ascertainment and the payment thereof;
(3)Companies other than life and marine. Premium deposits returned, etc. Mutual insurance companies other than life and marine.— In the case of mutual insurance companies (including interinsurers and reciprocal underwriters, but not including mutual life or mutual marine insurance companies) requiring their members to make premium deposits to provide for losses and expenses, the amount of premium deposits returned to their policyholders and the amount of premium deposits retained for the payment of losses, expenses, and reinsurance reserves. **Supplement H—**Nonresident alien individuals. **Nonresident Alien Individuals** SEC. 211. Tax on. TAX ON NONRESIDENT ALIEN INDIVIDUALS.
(a)No United States business or office. No United States Business or Office.— There shall be levied, collected, and paid for each taxable year, in lieu of the *Ante*, p. 1653.tax imposed by sections 11 and 12, upon the amount received, by every nonresident alien individual not engaged in trade or business within the United States and not having an office or place of business therein, from sources within the United States as interest (except interest on deposits with persons carrying on the banking business), dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable annual or periodical gains, profits, and income, a tax of 10 Residents of contiguous countries.per centum of such amount, except that such rate shall be reduced, in the case of a resident of a contiguous country, to such rate (not less than 5 per centum) as may be provided by treaty with such country.
(b)Having business or office in United States. United States Business or Office.— A nonresident alien individual engaged in trade or business in the United States or having an office or place of business therein shall be taxable without 1715regard to the provisions of subsection (a). As used in this section,Term construed. *Ante*, pp. 1693, 1700, 1702; *Post*, p. 1717. section 119, section 143, section 144, and section 231, the phrase “engaged in trade or business within the United States” includes the performance of personal services within the United States at any time within the taxable year, but does not include the performance of personal services for a nonresident alien individual, foreign partnership, or foreign corporation, not engaged in trade or business within the United States, by a nonresident alien individual temporarily present in the United States for a period or periods not exceeding a total of ninety days during the taxable year and whose compensation for such services does not exceed in the aggregate $3,000. Such phrase does not include the effecting of transactionsTransactions through broker, etc. in the United States in stocks, securities, or commodities through a resident broker, commission agent, or custodian. SEC. 212. Gross income. GROSS INCOME.
(a)General Rule.— In the case of a nonresident alien individualFrom United States sources. fross income includes only the gross income from sources within the United States.
(b)Ships Under Foreign Flag.— The income of a nonresidentEarnings from foreign ship operation exempt from taxation. alien individual which consists exclusively of earnings derived from the operation of a ship or ships documented under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States shall not be included in gross income and shall be exempt from taxation under this title. SEC. 213. Deductions. DEDUCTIONS.
(a)General Rule.— In the case of a nonresident alien individualIf connected with income from United States sources. the deductions shall be allowed only if and to the extent that they are connected with income from sources within the United States; and the proper apportionment and allocation of the deductions with respect to sources of income within and without the United States shall be determined as provided in section 119, under rules and regulations*Ante*, p. 1693. prescribed by the Commissioner with the approval of the Secretary.
(b)Losses. Losses.—
(1)The deduction, for losses not connected with the trade orNot connected with trade or business. business if incurred in transactions entered into for profit, allowed by section 23
(2)shall be allowed whether or not connected*Ante*, p. 1659. with income from sources within the United States, but only if the profit, if such transaction had resulted in a profit, would be taxable under this title.
(2)The deduction for losses of property not connected withCasualty, etc., not connected with business. the trade or business if arising from certain casualties or theft, allowed by section 23
(e)(3), shall be allowed whether or not connected with income from sources within the United States, but only if the loss is of property within the United States.
(c)Charitable, Etc., Contributions.— The so-called “charitableCharitable, etc., contributions. *Ante*, p. 1660. contribution” deduction allowed by section 23
(o)shall be allowed whether or not connected with income from sources within the United States, but only as to contributions or gifts made to domestic corporations, or to community chests, funds, or foundations, created in the United States, or to the vocational rehabilitation fund. SEC. 214. Credits against net income. CREDITS AGAINST NET INCOME. In the case of a nonresident alien individual the personal exemptionPersonal exemption. allowed by section 25
(1)of this title shall be only $1,000.*Ante*, p. 1663. 1716 Dependents, if residents of contiguous country.The credit for dependents allowed by section 25
(2)shall not be allowed in the case of a nonresident alien individual unless he is a resident of a contiguous country. SEC. 215. Allowance of deductions and credits. ALLOWANCE OF DEDUCTIONS AND CREDITS.
(a)Filing return of total income from United States sources. Return to Contain Information.— A nonresident alien individual shall receive the benefit of the deductions and credits allowed to him in this title only by filing or causing to be filed with the collector a true and accurate return of his total income received from all sources in the United States, in the manner prescribed in this title; including therein all the information which the Commissioner may deem necessary for the calculation of such deductions and credits.
(b)Personal exemption credits, etc., by filing claim with withholding agent. Tax Withheld at Source.— The benefit of the personal exemption and credit for dependents may, in the discretion of the Commissioner and under regulations prescribed by him with the approval of the Secretary, be received by a nonresident alien individual entitled thereto, by filing a claim therefore with the withholding agent. SEC. 216. Credits against tax. CREDITS AGAINST TAX. No allowance for, of foreign governments.A nonresident alien individual shall not be allowed the credits against the tax for taxes of foreign countries and possessions of the *Ante*, p. 1696.United States allowed by section 131. SEC. 217. Returns. RETURNS.
(a)Time for filing. Requirement.— In the case of a nonresident alien individual *Ante,* p. 1670.the return, in lieu of the time prescribed in section 53
(a)(1), shall be made on or before the fifteenth day of the sixth month following the close of the fiscal year, or, if the return is made on the basis of the calendar year, then on or before the fifteenth day of June.
(b)Exemption. Exemption From Requirement.— Subject to such conditions, limitations, and exceptions and under such regulations as may be prescribed by the Commissioner, with the approval of the Secretary, nonresident alien individuals subject to the tax imposed by section *Ante*, p. 1714.211
(a)may be exempted from the requirement of filing returns of such tax. SEC. 218. Payment of tax. PAYMENT OF TAX.
(a)Time designated. Time of Payment.— In the case of a nonresident alien individual the total amount of tax imposed by this title shall be paid, *Ante*, p. 1672.in lieu of the time prescribed in section 56 (a), on the fifteenth day of June following the close of the calendar year, or, if the return should be made on the basis of a fiscal year, then on the fifteenth day of the sixth month following the close of the fiscal year.
(b)Withholding tax at source. *Ante*, p. 1700. Withholding at Source.— For withholding at source of tax on income of nonresident aliens, see section 143. SEC. 219. Partnerships. PARTNERSHIPS. Nonresident members of, considered as being engaged in business, etc., within United States.For the purpose of this title, a nonresident alien individual shall be considered as being engaged in a trade or business within the United States if the partnership of which he is a member is so engaged and as having an office or place of business within the United States if the partnership of which he is a member has such an office or place of business. 1717 **Supplement I—**Foreign corporations. **Foreign Corporations** SEC. 231. Tax on foreign corporations. TAX ON FOREIGN CORPORATIONS.
(a)Nonresident Corporations.— There shall be levied, collected,Nonresident corporations. *Ante*, p. 1655. and paid for each taxable year, in lieu of the tax imposed by sections 13 and 14, upon the amount received by every foreign corporation not engaged in trade or business within the United States and not having an office or place of business therein, from sources within the United States as interest (except interest on deposits with persons carrying on the banking business), dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable annual or periodical gains, profits, and income, a tax of 15 per centum of such amount, except that in the case of dividends the rate shall be 10 per centum, and except that in the case of corporations organized under the laws of a contiguous country such rate of 10 per centum with respect to dividends shall be reduced to such rate (not less than 5 per centum) as may be provided by treaty with such country.
(b)Resident Corporations.— A foreign corporation engaged inResident corporations. trade or business within the United States or having an office or place of business therein shall be taxable without regard to the provisions of subsection (a), but the normal tax imposed by section 13 shall be at the rate of 22 per centum instead of at the rates provided in such section.
(c)Undistributed Profits Surtax.— A foreign corporation shallNot subject to undistributed profits tax. *Ante*, p. 1655. not be subject to the surtax imposed by section 14.
(d)Gross Income.— In the case of a foreign corporation grossGross income, from United States sources. income includes only the gross income from sources within the United States.
(e)Ships Under Foreign Flag.— The income of a foreign corporation,Ships under foreign flag. Conditional exemptions. which consists exclusively of earnings derived from the operation of a ship or ships documented under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States, shall not be included in gross income and shall be exempt from taxation under this title. SEC. 232. Deductions. DEDUCTIONS.
(a)In General.— In the case of a foreign corporation the deductionsOn income from United States sources. shall be allowed only if and to the extent that they are connected with income from sources within the United States; and the proper apportionment and allocation of the deductions with respect to sourcesApportionment, etc. *Ante*, p. 1693. within and without the United States shall be determined as provided in section 119, under rules and regulations prescribed by the Commissioner with the approval of the Secretary.
(b)Charitable, and so forth, Contributions.— The so-calledCharitable, etc., contributions. *Ante*, p. 1661. “charitable contribution” deduction allowed by section 23
(q)shall be allowed whether or not connected with income from sources within the United States. SEC. 233. Allowance of deductions and credits. ALLOWANCE OF DEDUCTIONS AND CREDITS. A foreign corporation shall receive the benefit of the deductionsBenefit of, by filing return of all Income from United States sources. and credits allowed to it in this title only by filing or causing to be filed with the collector a true and accurate return of its total income received from all sources in the United States, in the manner prescribed in this title; including therein all the information which the Commissioner may deem necessary for the calculation of such deductions and credits. 1718 SEC. 234. Credits against tax. CREDITS AGAINST TAX. No allowance for, of foreign governments.Foreign corporations shall not be allowed the credits against the tax for taxes of foreign countries and possessions of the United *Ante*, p. 1696.States allowed by section 131. SEC. 235. Returns. RETURNS.
(a)Time for filing. *Ante*, p. 1670. Time of Filing.— In the case of a foreign corporation not having any office or place of business in the United States the return, in lieu of the time prescribed in section 53
(a)(1), shall be made on or before the fifteenth day of the sixth month following the close of the fiscal year, or, if the return is made on the basis of the Returns by agent.calendar year then on or before the fifteenth day of June. If any foreign corporation has no office or place of business in the United States but has an agent in the United States, the return shall be made by the agent.
(b)Exemption from requirement. Exemption From Requirement.— Subject to such conditions, limitations, and exceptions and under such regulations as may be prescribed by the Commissioner, with the approval of the Secretary, *Ante*, p. 1717.corporations subject to the tax imposed by section 231
(a)may be exempted from the requirement of filing returns of such tax. SEC. 236. Payment of tax. PAYMENT OF TAX.
(a)Time specified. Time of Payment.— In the case of a foreign corporation not having any office or place of business in the United States the total amount of tax imposed by this title shall be paid, in lieu of the *Ante*, p. 1672.time prescribed in section 56 (a), on the fifteenth day of June following the close of the calendar year, or, if the return should be made on the basis of a fiscal year, then on the fifteenth day of the sixth month following the close of the fiscal year.
(b)Withholding tax at source. Withholding at Source.— For withholding at source of tax *Ante*, p. 1702.on income of foreign corporations, see section 144. SEC. 237. Foreign insurance companies. FOREIGN INSURANCE COMPANIES. Special provisions. *Ante*, p. 1710.For special provisions relating to foreign insurance companies, see Supplement G. SEC. 238. Affiliation. AFFILIATION. Not applicable to foreign corporations.*Ante*, p. 1698.A foreign corporation shall not be deemed to be affiliated with any other corporation within the meaning of section 141. **Supplement J—**Possessions of the United States. **Possessions of the United States** SEC. 251. Income from sources within. INCOME FROM SOURCES WITHIN POSSESSIONS OF UNITED STATES.
(a)Gross income of citizens, etc. General Rule.— In the case of citizens of the United States or domestic corporations, satisfying the following conditions, gross income means only gross income from sources within the United States—
(1)If 80 percent derived from United States possession sources. If 80 per centum or more of the gross income of such citizen or domestic corporation (computed without the benefit of this section), for the three-year period immediately preceding the close of the taxable year (or for such part of such period immediately preceding the close of such taxable year as may be applicable) was derived from sources within a possession of the United States; and 1719
(2)If, in the case of such corporation, 50 per centum or more If corporation derived 56 percent from business therein. of its gross income (computed without the benefit of this section) for such period or such part thereof was derived from the active conduct of a trade or business within a possession of the United States; or
(3)If, in case of such citizen, 50 per centum or more of hisIf citizen derived 50 percent from active business therein. gross income (computed without the benefit of this section) for such period or such part thereof was derived from the active conduct of a trade or business within a possession of the United States either on his own account or as an employee or agent of another.
(b)Amounts Received in United States.— Notwithstanding theAmounts received In United States. Included in gross income. provisions of subsection
(a)there shall be included in gross income all amounts received by such citizens or corporations within the United States, whether derived from sources within or without the United States.
(c)Tax in Case of Corporations.— In the case of a domesticDomestic corporations, normal tax. corporation entitled to the benefits of this section the normal tax imposed by section 13 shall be at the rate of 15 per centum*Ante*, p. 1655. Not subject to surtax. *Ante*, p. 1655. instead of at the rates provided in such section, and such a corporation shall not be subject to the surtax imposed by section 14.
(d)Definition.— As used in this section the term “possession ofStatus of Virgin Islands. the United States” does not include the Virgin Islands of the United States.
(e)Deductions. Deductions.—
(1)Citizens of the United States entitled to the benefits of thisCitizens allowed same benefits as non-residents. section shall have the same deductions as are allowed by Supplement H in the case of a nonresident alien individual engaged in*Ante*, p. 1714. trade or business within the United States or having an office or place of business therein.
(2)Domestic corporations entitled to the benefits of this sectionDomestic corporations. *Ante*, p. 1717. shall have the same deductions as are allowed by Supplement I in the case of a foreign corporation engaged in trade or business within the United States or having an office or place of business therein.
(f)Credits Against Net Income.— A citizen of the United StatesCredits against net income; personal exemption. entitled to the benefits of this section shall be allowed a personal exemption of only $1,000 and shall not be allowed the credit for*Ante*, p. 1663. dependents provided in section 25
(b)(2).
(g)Allowance of Deductions and Credits.— Citizens of theAllowance of deductions and credits. United States and domestic corporations entitled to the benefits of this section shall receive the benefit of the deductions and credits allowed to them in this title only by filing or causing to be filed with the collector a true and accurate return of their total income received from all sources in the United States, in the manner prescribed in this title; including therein all the information which the Commissioner may deem necessary for the calculation of such deductions and credits.
(h)Credits Against Tax.— Persons entitled to the benefits of thisCredits against tax. No allowance for, of foreign countries. section shall not be allowed the credits against the tax for taxes of foreign countries and possessions of the United States allowed by section 131.
(i)Affiliation.— A corporation entitled to the benefits of thisAffiliation. Applicability to corporations. *Ante*, p. 1698. section shall not be deemed to be affiliated with any other corporation within the meaning of section 141. SEC. 252. Citizens of possessions of United States. CITIZENS OF POSSESSIONS OF UNITED STATES.
(a)Any individual who is a citizen of any possession of the UnitedIncome subject to taxation. States (but not otherwise, a citizen of the United States) and who is not a resident of the United States, shall be subject to taxation under 1720this title only as to income derived from sources within the United States, and in such case the tax shall be computed and paid in the same maimer and subject to the same conditions as in the case of other persons who are taxable only as to income derived from such sources.
(b)Virgin Islands. Payment of taxes in, not affected. Vol. 42, p. 123. Nothing in this section shall be construed to alter or amend the provisions of the Act entitled “An Act making appropriations for the naval service for the fiscal year ending June 30, 1922, and for other purposes”, approved July 12, 1921, relating to the imposition of income taxes in the Virgin Islands of the United States. **Supplement K—**China Trade Act corporations. **China Trade Act Corporations** SEC. 261. TAXATION IN GENERAL. Normal tax.In the ease of a corporation organized under the China Trade *Ante*, p. 1655.Act, 1922, the normal tax imposed by section 13 shall be at the rate of 15 per centum instead of at the rates provided in such section, and such a corporation shall not be subject to the surtax imposed by section 14. SEC. 262. Credit against net income. CREDIT AGAINST NET INCOME.
(a)*Ante*, pp. 1019, 1655. Allowance of Credit.— For the purpose only of the taxes imposed by section 13 of this Act and section 106 of the Revenue Act of 1935 there shall be allowed, in the case of a corporation organized under the China Trade Act, 1922, in addition to the credits against net income otherwise allowed such corporation, a credit against the net income of an amount equal to the proportion of the net income derived from sources within China (determined in a *Ante*, p. 1693.similar manner to that provided in section 119) which the par value of the shares of stock of the corporation owned on the last day of the taxable year by
(1)persons resident in China, the United States, or possessions of the United States, and
(2)individual citizens of the United States or China wherever resident, bears to the par value of the whole number of shares of stock of the corporation outstanding *Proviso*.Limitation.*Ante*, p. 1655.on such date: *Provided*, That in no case shall the diminution, by reason of such credit, of the tax imposed by such section 13 (computed without regard to this section) exceed the amount of the special dividend certified under subsection
(b)of this section; and in no case shall the diminution, by reason or such credit, of the tax imposed by such section 106 (computed without regard to this section) exceed the amount by which such special dividend exceeds the diminution permitted by this section in the tax imposed by such section 13.
(b)Special dividend. Condition. Special Dividend.— Such credit shall not be allowed unless the Secretary of Commerce has certified to the Commissioner—
(1)Credit subject to special dividend to residents of China, etc. The amount which, during the year ending on the date fixed by law for filing the return, the corporation has distributed as a special dividend to or for the benefit of such persons as on the last day of the taxable year were resident in China, the United States, or possessions of the United States, or were individual citizens of the United States or China, and owned shares of stock of the corporation;
(2)Additional to all other payments. That such special dividend was in addition to all other amounts, payable or to be payable to such persons or for their benefit, by reason of their interest in the corporation; and
(3)Distribution proportionate to stock owned. That such distribution has been made to or for the benefit of such persons in proportion to the par value of the shares of Exception.stock of the corporation owned by each; except that if the corporation has more than one class of stock, the certificates shall contain a statement that the articles of incorporation provide a 1721method for the apportionment of such special dividend among such persons, and that the amount certified has been distributed in accordance with the method so provided.
(c)Ownership of Stock.— For the purposes of this section sharesStock ownership construed. of stock of a corporation shall be considered to be owned by the person in whom the equitable right to the income from such shares is in good faith vested.
(d)Definition of China.— As used in this section the term“China” defined. Vol. 42, p. 849. “China” shall have the same meaning as when used in the China Trade Act, 1922. SEC. 263. Credits against tax. CREDITS AGAINST THE TAX. A corporation organized under the China Trade Act, 1922, shallNo allowance for, of foreign countries. *Ante*, p. 1696. not be allowed the credits against the tax for taxes of foreign countries and possessions of the United States allowed by section 131. SEC. 264. AFFILIATION. A corporation organized under the China Trade Act, 1922, shallAffiliation. not be deemed to be affiliated with any other corporation within the meaning of section 141. SEC. 265. Income of shareholders. INCOME OF SHAREHOLDERS. For exclusion of dividends from gross income, see section 116.Exclusion from gross income, p. 1689. **Supplement L—**Assessment and collection of deficiencies. **Assessment and Collection of Deficiencies** SEC. 271. DEFINITION OF DEFICIENCY. As used in this title in respect of a tax imposed by this title“Deficiency” defined. “deficiency” means—
(a)The amount, by which the tax imposed by this title exceeds the amount shown as the tax by the taxpayer upon his return; but the amount so shown on the return shall first be increased by the amounts previously assessed (or collected without assessment) as a deficiency, and decreased by the amounts previously abated, credited, refunded, or otherwise repaid in respect of such tax; or
(b)If no amount is shown as the tax by the taxpayer upon his return, or if no return is made by the taxpayer, then the amount by which the tax exceeds the amounts previously assessed (or collected without assessment) as a deficiency; but such amounts previously assessed, or collected without assessment, shall first be decreased by the amounts previously abated, credited, refunded, or otherwise repaid in respect of such tax. SEC. 272. Procedure in general. PROCEDURE IN GENERAL.
(a)Petition to Board of Tax Appeals.— If in the case of anyNotice of deficiency to taxpayer. taxpayer, the Commissioner determines that there is a deficiency in respect of the tax imposed by this title, the Commissioner is authorized to send notice of such deficiency to the taxpayer by registered mail. Within ninety days after such notice is mailed (not countingPetition to Board of Tax Appeals for redetermination. Sunday or a legal holiday in the District of Columbia as the ninetieth day), the taxpayer may file a petition with the Board of Tax Appeals for a redetermination of the deficiency. No assessment ofNo assessment until notice mailed to taxpayer. a deficiency in respect of the tax imposed by this title and no distraint or proceeding in court for its collection shall be made, begun, or prosecuted until such notice has been mailed to the taxpayer, nor until the the expiration of such ninety-day period, nor, if a petitionIf petition filed. has been filed with the Board, until the decision of the Board has 1722Injunction to restrain assessment. [R. S., sec. 3224, p. 619](/us/rs/s3224/p619). [U. S. C., p. 1193](/us/usc/p1193). become final. Notwithstanding the provisions of section 3224 of the Revised Statutes the making of such assessment or the beginning of such proceeding or distraint during the time such prohibition is in force may be enjoined by a proceeding in the proper court. Exceptions to restrictions. Waivers.For exceptions to the restrictions imposed by this subsection, see—
(1)Subsection
(d)of this section, relating to waivers by the taxpayer;
(2)Errors. Subsection
(f)of this section, relating to notifications of mathematical errors appearing upon the face of the return;
(3)Jeopardy assessments, p. 1723. Section 273, relating to jeopardy assessments;
(4)Bankruptcy, etc., p. 1725. Section 274, relating to bankruptcy and receiverships; and
(5)Assessment, etc., of deficiency. Section 1001 of the Revenue Act of 1926, as amended, Vol. 44, p. 109.relating to assessment or collection of the amount of the deficiency determined by the Board pending court review.
(b)Collection of deficiency found by Board. Collection of Deficiency Found by Board.— If the taxpayer files a petition with the Board, the entire amount redetermined as the deficiency by the decision of the Board which has become final shall be assessed and shall be paid upon notice and demand from the collector. No part of the amount determined as a deficiency by the Commissioner but disallowed as such by the decision of the Board which has become final shall be assessed or be collected by distraint or by proceeding in court with or without assessment.
(c)Payment on demand if petition not filed. Failure to File Petition.— If the taxpayer does not file a petition with the Board within the time prescribed in subsection
(a)of this section, the deficiency, notice of which has been mailed to the taxpayer, shall be assessed, and shall be paid upon notice and demand from the collector.
(d)Waiver of restrictions by taxpayer. Waiver of Restrictions.—The taxpayer shall at any time have the right, by a signed notice in writing filed with the Commissioner, to waive the restrictions provided in subsection
(a)of this section on the assessment and collection of the whole or any part of the deficiency.
(e)Increase of deficiency after notice mailed. Increase of Deficiency After Notice Mailed.— The Board shall have jurisdiction to redetermine the correct amount of the deficiency even if the amount so redetermined is greater than the amount of the deficiency, notice of which has been mailed to the taxpayer, and to determine whether any penalty, additional amount Condition.or addition to the tax should be assessed—if claim therefor is asserted by the Commissioner at or before the hearing or a rehearing.
(f)Restriction on determining deficiency after notice. Further Deficiency Letters Restricted.— If the Commissioner has mailed to the taxpayer notice of a deficiency as provided in subsection
(a)of this section, and the taxpayer files a petition with the Board within the time prescribed in such subsection, the Commissioner shall have no right to determine any additional deficiency Exceptions.in respect of the same taxable year, except in the case of fraud, and except as provided in subsection
(e)of this section, relating to *Post*, p. 1723.assertion of greater deficiencies before the Board, or in section 273 Mathematical error, not a notice of deficiency.(c), relating to the making of jeopardy assessments. If the taxpayer is notified that, on account of a mathematical error appearing upon the face of the return, an amount of tax in excess of that shown upon the return is due, and that an assessment of the tax has been or will be made on the basis of what would have been the correct amount of tax but for the mathematical error, such notice shall not be considered (for the purposes of this subsection, or of subsection Credits or refunds. *Post*, p. 1731.(a) of this section, prohibiting assessment and collection until notice of deficiency has been mailed, or of section 322 (c), prohibiting credits or refunds after petition to the Board of Tax Appeals) as a notice of a deficiency, and the taxpayer shall have no right to file a petition with the Board based on such notice, nor shall such assess1723ment or collection be prohibited by the provisions of subsection
(a)of this section.
(g)Jurisdiction Over Other Taxable Years.— The Board inJurisdiction over other taxable years. redetermining a deficiency in respect of any taxable year shall consider such facts with relation to the taxes for other taxable years as may be necessary correctly to redetermine the amount of such deficiency, but in so doing shall have no jurisdiction to determine whether or not the tax for any other taxable year has been overpaid or underpaid.
(h)Final Decisions of Board.— For the purposes of this titleFinal decisions of Board. Vol. 44, p. 110. the date on which a decision of the Board becomes final shall be determined according to the provisions of section 1005 of the Revenue Act of 1926.
(i)Prorating of Deficiency to Installments.— If the taxpayerProrating of deficiency to installments. has elected to pay the tax in installments and a deficiency has been assessed, the deficiency shall be prorated to the four installments. Except as provided in section 273 (relating to jeopardy assessments), that part of the deficiency so prorated to any installment the date for payment of which has not arrived, shall be collected at the same time as and as part of such installment. That part of the deficiency so prorated to any installment the date for payment of which has arrived, shall be paid upon notice and demand from the collector.
(j)Extension of Time for Payment of Deficiencies.— WhereExtension for payments allowed, to avoid undue hardship. it is shown to the satisfaction of the Commissioner that the payment of a deficiency upon the date prescribed for the payment thereof will result in undue hardship to the taxpayer the Commissioner, with the approval of the Secretary (except where the deficiency is due to negligence, to intentional disregard of rules and regulations, or to fraud with intent to evade tax), may grant an extension for the payment of such deficiency or any part thereof for a period not in excess of eighteen months, and, in exceptional cases, for a further period not in excess of twelve months. If anBond required. extension is granted, the Commissioner may require the taxpayer to furnish a bond in such amount, not exceeding double the amount of the deficiency, and with such sureties, as the Commissioner deems necessary, conditioned upon the payment of the deficiency in accordance with the terms of the extension.
(k)Address for Notice of Deficiency.— In the absence of noticeAddress for notice of deficiency. *Post*, p. 1730. to the Commissioner under section 312
(a)of the existence of a fiduciary relationship, notice of a deficiency in respect of a tax imposed by this title, if mailed to the taxpayer at his last known address, shall be sufficient for the purposes of this title even if such taxpayer is deceased, or is under a legal disability, or, in the case of a corporation, has terminated its existence. SEC. 273. Jeopardy assessments. JEOPARDY ASSESSMENTS.
(a)Authority for Making.— If the Commissioner believes thatImmediate assessment of deficiency if jeopardized by delay. the assessment or collection of a deficiency will be jeopardized by delay, he shall immediately assess such deficiency (together with all interest, additional amounts, or additions to the tax provided for by law) and notice and demand shall be made by the collector for the payment thereof.
(b)Deficiency Letters.— If the jeopardy assessment is made beforeDeficiency letters. Notice to be mailed. any notice in respect of the tax to which the jeopardy assessment relates has been mailed under section 272 (a), then the Commissioner*Ante*, p. 1721. shall mail a notice under such subsection within sixty days after the making of the assessment. 1724
(c)Amount assessable before Board’s decision. Amount Assessable Before Decision of Board.— The jeopardy assessment may be made in respect of a deficiency greater or *Ante*, p. 1722.less than that notice of which has been mailed to the taxpayer, despite the provisions of section 272
(f)prohibiting the determination of additional deficiencies, and whether or not the taxpayer has Board to redetermine on notice.theretofore filed a petition with the Board of Tax Appeals. The Commissioner shall notify the Board of the amount of such assessment, if the petition is filed with the Board before the making of the assessment or is subsequently filed, and the Board shall have jurisdiction to redetermine the entire amount of the deficiency and of all amounts assessed at the same time in connection therewith.
(d)Amount assessable after decision of Board. Amount Assessable After Decision of Board.— If the jeopardy assessment is made after the decisison of the Board is rendered such assessment may be made only in respect of the deficiency determined by the Board in its decision.
(e)Expiration of right to assess. Expiration of Right to Assess.— A jeopardy assessment may not be made after the decision of the Board has become final or after the taxpayer has filed a petition for review of the decision of the Board.
(f)Bond to stay collection. Bond to Stay Collection.— When a jeopardy assessment has been made the taxpayer, within 10 days after notice and demand from the collector for the payment of the amount of the assessment, may obtain a stay of collection of the whole or any part of the amount of the assessment by filing with the collector a bond in such amount, not exceeding double the amount as to which the stay is Conditions.desired, and with such sureties, as the collector deems necessary, conditioned upon the payment of so much of the amount, the collection of which is stayed by the bond, as is not abated by a decision of the *Post*, p. 1728.Board which has become final, together with interest thereon as provided in section 297.
(g)Further conditions, if bond given before filing petition. Same—Further Conditions.— If the bond is given before the taxpayer has filed his petition with the Board under section 272 (a), *Ante*, p. 1721. the bond shall contain a further condition that if a petition is not filed within the period provided in such subsection, then the amount the collection of which is stayed by the bond will be paid on notice and demand at any time after the expiration of such period, together with interest thereon at the rate of 6 per centum per annum from the date of the jeopardy notice and demand to the date of notice and demand under this subsection.
(h)Stay of collection of part covered by bond. Waiver of Stay.— Upon the filing of the bond the collection of so much of the amount assessed as is covered by the bond shall Effect of waiver of stay, etc.be stayed. The taxpayer shall have the right to waive such stay at any time in respect of the whole or any part of the amount covered by the bond, and if as a result of such waiver any part of the amount covered by the bond is paid, then the bond shall, at the request of the taxpayer, be proportionately reduced. If the Board determines that the amount assessed is greater than the amount which should have been assessed, then when the decision of the Board is rendered the bond shall, at the request of the taxpayer, be proportionately reduced.
(i)Collection of unpaid amounts when decision of Board final. Collection of Unpaid Amounts.— When the petition has been filed with the Board and when the amount which should have been assessed has been determined by a decision of the Board which has become final, then any unpaid portion, the collection of which has been stayed by the bond, shall be collected as part of the tax upon notice and demand from the collector, and any remaining Credit or refund.portion of the assessment shall be abated. If the amount already collected exceeds the amount determined as the amount, which should have been assessed, such excess shall be credited or refunded to the 1725taxpayer as provided in section 322, without the filing of claim*Post*, p. 1731. therefor. If the amount determined as the amount which shouldCollection of greater assessment. have been assessed is greater than the amount actually assessed, then the difference shall be assessed and shall be collected as part of the tax upon notice and demand from the collector.
(j)Claims in Abatement.— No claim in abatement shall be filedNo claim in abatement to be filed. in respect of any assessment in respect of any tax imposed by this title. SEC. 274. Bankruptcy and receiverships. BANKRUPTCY AND RECEIVERSHIPS.
(a)Immediate Assessment.— Upon the adjudication of bankruptcy of any taxpayer in any bankruptcyImmediate assessment of tax deficiency in. proceeding or the appointment of a receiver for any taxpayer in any receivership proceeding before any court of the United States or of any State or Territory or of the District of Columbia, any deficiency (together with all interest, additional amounts, or additions to the tax provided for by law) determined by the Commissioner in respect of a tax imposed by this title upon such taxpayer shall, despite the restrictions imposed by section 272
(a)upon assessments be immediately assessed if such deficiency has not theretofore been assessed in accordance with law. In such cases the trustee in bankruptcy or receiver shall give noticeNotice of adjudication. in writing to the Commissioner of the adjudication of bankruptcy or the appointment of the receiver, and the running of the statute of limitations on the malting of assessments shall be suspended for the period from the date of adjudication in bankruptcy or the appointment of the receiver to a date 30 days after the date upon which the notice from the trustee or receiver is received by the Commissioner; but the suspension under this sentence shall in no case be for a period in excess of two years. Claims for the deficiencyPresentation of claim. and such interest, additional amounts and additions to the tax may be presented, for adjudication in accordance with law, to the court before which the bankruptcy or receivership proceeding is pending, despite the pendency of proceedings for the redetermination of the deficiency in pursuance of a petition to the Board; but no petition for any such redetermination shall be filed with the Board after the adjudication of bankruptcy or the appointment of the receiver.
(b)Unpaid Claims.— Any portion of the claim allowed in suchUnpaid claims.Collection of. bankruptcy or receivership proceeding which is unpaid shall be paid by the taxpayer upon notice and demand from the collector after the termination of such proceeding, and may be collected by distraint or proceeding in court within six years after termination of such proceeding. Extensions of time for such payment may beTime extensions. had in the same manner and subject to the same provisions and limitations as are provided in section 272
(j)and section 296 in the case*Ante*, p. 1723; *Post*, p. 1728. of a deficiency in a tax imposed by this title. SEC. 275. Period of limitation upon assessment and collection.*Post*, p. 1726.Assessment within three years. PERIOD OF LIMITATION UPON ASSESSMENT AND COLLECTION. Except as provided in section 276—
(a)General Rule.— The amount of income taxes imposed by this title shall be assessed within three years after the return was filed, and no proceeding in court without assessment for the collection of such taxes shall be begun after the expiration of such period.
(b)Request for Prompt Assessment.— In the case of incomeRequest for prompt assessment by fiduciary representatives, etc. received during the lifetime of a decedent, or by his estate during the period of administration, or by a corporation, the tax shall be assessed, and any proceeding in court without assessment for the collection of such tax shall be begun, within eighteen months after written request therefor (filed after the return is made) by the 1726executor, administrator, or other fiduciary representing the estate of Corporations.such decedent, or by the corporation, but not after the expiration of three years after the return was filed. This subsection shall not Exceptions.apply in the case of a corporation unless—
(1)Dissolution contemplated. Such written request notifies the Commissioner that the corporation contemplates dissolution at or before the expiration of such 18 months’ period; and
(2)Dissolution begun before expiration of 18 months’ period.Dissolution completed.Omission of amount in excess of 25 percent of gross income. The dissolution is in good faith begun before the expiration of such 18 months’ period; and
(3)The dissolution is completed.
(c)Omission from Gross Income.— If the taxpayer omits from gross income an amount properly includible therein which is in excess of 25 per centum of the amount of gross income stated in the return, Assessment in five years, after return filed.the tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, at any time within 5 years after the return was filed.
(d)Time prescribed for filing. For the purposes of subsections (a), (b), and (c), a return filed before the last day prescribed by law for the filing thereof shall be considered as filed on such last day.
(e)Corporation and shareholder. Corporation and Shareholder.— If a corporation makes no return of the tax imposed by this title, but each of the shareholders includes in his return his distributive share of the net income of the corporation, then the tax of the corporation shall be assessed within four years after the last date on which any such shareholder’s return was filed. SEC. 276. Exceptions. SAME—EXCEPTIONS.
(a)False return or no return.Assessment in case of. False Return or No Return.— In the case of a false or fraudulent return with intent to evade tax or of a failure to file a return the tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, at any time.
(b)Waiver. Waiver.— Where before the expiration of the time prescribed in section 275 for the assessment of the tax, both the Commissioner and the taxpayer have consented in writing to its assessment after such time, the tax may be assessed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.
(c)Collection after assessment. Collection After Assessment.— Where the assessment of any income tax imposed by this title has been made within the By distraint, etc.; time limit.period of limitation properly applicable thereto, such tax may be collected by distraint or by a proceeding in court, but only if begun
(1)within six years after the assessment of the tax, or
(2)prior to the expiration of any period for collection agreed upon in writing by the Commissioner and the taxpayer before the expiration of such Extension.six-year period. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon. SEC. 277. Statute of limitations.Suspension of running of.*Ante*, p. 1725. SUSPENSION OF RUNNING OF STATUTE. The running of the statute of limitations provided in section 275 or 276 on the making of assessments and the beginning of distraint or a proceeding in court for collection, in respect of any deficiency, shall (after the mailing of a notice under section 272 (a)) be suspended for the period during which the Commissioner is prohibited from making the assessment or beginning distraint or a proceeding in court (and in any event, if a proceeding in respect of the deficiency is placed on the docket of the Board, until the decision of the Board becomes final), and for sixty days thereafter. 1727 **Supplement M—**Interest and additions to tax. **Interest and Additions to the Tax** SEC. 291. Failure to file return.Additional tax imposed. FAILURE TO FILE RETURN. In case of any failure to make and file return required by this title, within the time prescribed by law or prescribed by the Commissioner in pursuance of law, unless it is shown that such failure is due to Exception.If failure not willful neglect.reasonable cause and not due to willful neglect, there shall be added to the tax: 5 per centum if the failure is for not more than thirty days with an additional 5 per centum for each additional thirty days or fraction thereof during which such failure continues, not exceeding 25 per centum in the aggregate. The amount so addedCollection. to any tax shall be collected at the same time and in the same manner and as a part of the tax unless the tax has been paid before the discovery of the neglect, in which case the amount so added shall be collected in the same manner as the tax. The amount added to theIn lieu of former levy.[R. S., sec. 3176, p. 610](/us/rs/s3176/p610).[U. S. C., p. 1190](/us/usc/p1190). tax under this section shall be in lieu of the 25 per centum addition to the tax provided in section 3176 of the Revised Statutes, as amended. SEC. 292. Interest on deficiencies.Assessment and rate. INTEREST ON DEFICIENCIES. Interest upon the amount determined as a deficiency shall be assessed at the same time as the deficiency, shall be paid upon notice and demand from the collector, and shall be collected as a part of the tax, at the rate of 6 per centum per annum from the date prescribed for the payment of the tax (or, if the tax is paid in installments, from the date prescribed for the payment of the firstIn case of waiver. installment) to the date the deficiency is assessed, or, in the case of*Ante*, p. 1722. a waiver under section 272 (d), to the thirtieth day after the filing of such waiver or to the date the deficiency is assessed whichever is the earlier. SEC. 293. Additions to tax in case of deficiency.If due to negligence. ADDITIONS TO THE TAX IN CASE OF DEFICIENCY.
(a)Negligence.— If any part of any deficiency is due to negligence, or intentional disregard of rules and regulations but without intent to defraud, 5 per centum of the total amount of the deficiency (in addition to such deficiency) shall be assessed, collected, and paid in the same manner as if it were a deficiency, except that the provisions of section 272 (i), relating to the prorating of a deficiency,*Ante*, p. 1723. and of section 292, relating to interest on deficiencies, shall not be applicable.
(b)Fraud.— If any part of any deficiency is due to fraud withFraud. intent to evade tax, then 50 per centum of the total amount of the deficiency (in addition to such deficiency) shall be so assessed, collected, and paid, in lieu of the 50 per centum addition to the tax provided in section 3176 of the Revised Statutes, as amended. SEC. 294. Additions to tax in ease of nonpayment. ADDITIONS TO THE TAX IN CASE OF NONPAYMENT.
(a)Tax Shown on Return.—
(1)General rule.— Where the amount determined by the taxpayerInterest. as the tax imposed by this title, or any installment thereof, or any part of such amount or installment, is not paid on or before the date prescribed for its payment, there shall De collected as a part of the tax, interest upon such unpaid amount at the rate of 6 per centum per annum from the date prescribed for its payment until it is paid.
(2)If extension granted.— Where an extension of time forIf tax and interest not paid in full when extension granted. payment of the amount so determined as the tax by the taxpayer, or any installment thereof, has been granted, and the amount the 1728time for payment of which has been extended, and the interest thereon determined under section 295, is not paid in full prior to the expiration of the period of the extension, then, in lieu of the interest provided for in paragraph
(1)of this subsection, interest at the rate of 6 per centum per annum shall be collected on such unpaid amount from the date of the expiration of the period of the extension until it is paid.
(b)Interest, if deficiency, etc., not paid on notice and demand.*Ante*, p. 1727. Deficiency.— Where a deficiency, or any interest or additional amounts assessed in connection therewith under section 292, or under section 293, or any addition to the tax in case of delinquency provided for in section 291, is not paid in full within ten days from the date of notice and demand from the collector, there shall be collected as part of the tax, interest upon the unpaid amount at the rate of 6 per centum per annum from the date of such notice and Nonpayment of prorated installment.*Ante*, p. 1723.demand until it is paid. If any part of a deficiency prorated to any unpaid installment under section 272
(i)is not paid in full on or before the date prescribed for the payment of such installment, there shall be collected as part of the tax interest upon the unpaid amount at the rate of 6 per centum per annum from such date until it is paid.
(c)Interest rate payable by fiduciaries. Fiduciaries.— For any period an estate is held by a fiduciary appointed by order of any court of competent jurisdiction or by will, there shall be collected interest at the rate of 6 per centum per annum in lieu of the interest provided in subsections
(a)and
(b)of this section.
(d)Not applicable to amount covered by jeopardy bond.*Ante*, p. 1723. Filing of Jeopardy Bond.— If a bond is filed, as provided in section 273, the provisions of subsections
(b)and
(c)of this section shall not apply to the amount covered by the bond. SEC. 295. Time extended for payment of tax shown on return.Interest. TIME EXTENDED FOR PAYMENT OF TAX SHOWN ON RETURN. If the time for payment of the amount determined as the tax by the taxpayer, or any installment thereof, is extended under the *Ante*, p. 1672.authority of section 56 (c), there shall be collected as a part of such amount, interest thereon at the rate of 6 per centum per annum from the date when such payment should have been made if no extension had been granted, until the expiration of the period of the extension. SEC. 296. Time extended for paying deficiency.Interest for period of extension. TIME EXTENDED FOR PAYMENT OF DEFICIENCY. If the time for the payment of any part of a deficiency is extended, there shall be collected, as a part of the tax, interest on the part of the deficiency the time for payment of which is so extended, at the rate of 6 per centum per annum for the period of the extension, and no other interest shall be collected on such part of the deficiency Additional, if not paid.for such period. If the part of the deficiency the time for payment of which is so extended is not paid in accordance with the terms of the extension, there shall be collected, as a part of the tax, interest on such unpaid amount at the rate of 6 per centum per annum for the period from the time fixed by the terms of the extension for its payment until it is paid, and no other interest shall be collected on such unpaid amount for such period. SEC. 297. Interest on jeopardy assessments.Rate of, on amount collected.*Ante*, p. 1724. INTEREST IN CASE OF JEOPARDY ASSESSMENTS. In the case of the amount collected under section 273
(i)there shall be collected at the same time as such amount, and as a part of the tax, interest at the rate of 6 per centum per annum upon such amount from the date of the jeopardy notice and demand to the date of notice and demand under section 273 (i), or, in the case 1729of the amount collected in excess of the amount of the jeopardy assessment, interest as provided in section 292. If the amountAdditional, if amount of deficiency not paid in full. included in the notice and demand from the collector under section 273
(i)is not paid in full within ten days after such notice and demand, then there shall be collected, as part of the tax, interest upon the unpaid amount at the rate of 6 per centum per annum (or, for any period the estate of the taxpayer is held by a fiduciary appointed by any court of competent jurisdiction or by will, at the rate of 6 per centum per annum) from the date of such notice and demand until it is paid. SEC. 298. Bankruptcy and receiverships.Interest, if not paid on demand.*Ante*, p. 1725. BANKRUPTCY AND RECEIVERSHIPS. If the unpaid portion of the daim allowed in a bankruptcy or receivership proceeding, as provided in section 274, is not paid in full within ten days from the date of notice and demand from the collector, then there shall be collected as a part of such amount interest upon the unpaid portion thereof at the rate of 6 per centum per annum from the date of such notice and demand until payment. SEC. 299. Removal of property, etc. REMOVAL OF PROPERTY OR DEPARTURE FROM UNITED STATES. For additions to tax in case of leaving the United States orAdditions to tax for, etc.*Ante*, p. 1703. concealing property in such manner as to hinder collection of the tax, see section 146. **Supplement N—**Claims against transferees and fiduciaries. **Claims against Transferees and Fiduciaries** SEC. 311. Transferred assets. TRANSFERRED ASSETS.
(a)Method of Collection.— The amounts of the following liabilitiesMethod of collection. shall, except as hereinafter in this section provided, be assessed, collected, and paid in the same manner and subject to the same provisions and limitations as in the case of a deficiency in a tax imposed by this title (including the provisions in case of delinquency in payment after notice and demand, the provisions authorizing distraint and proceedings in court for collection, and the provisions prohibiting claims and suits for refunds):
(1)Transferees.— The liability, at law or in equity, of a transfereeTransferees. of property of a taxpayer, in respect of the tax (including interest, additional amounts, and additions to the tax provided by law) imposed upon the taxpayer by this title.
(2)Fiduciaries.— The liability of a fiduciary under sectionFiduciaries.[R. S., sec. 3467, p. 687](/us/rs/s3467/p687).[U. S. C., p. 1367](/us/usc/p1367). 3467 of the Revised Statutes in respect of the payment of any such tax from the estate of the taxpayer. Any such liability may be either as to the amount of tax shown onDetermination of amount. the return or as to any deficiency in tax.
(b)Period of Limitation.— The period of limitation for assessmentPeriod of limitation. of any such liability of a transferee or fiduciary shall be as follows:
(1)In the case of the liability of an initial transferee of theWhen Initial transferee liable. property of the taxpayer,—within one year after the expiration of the period of limitation for assessment against the taxpayer;
(2)In the case of the liability of a transferee of a transfereeTransferee of a transferee liable. of the property of the taxpayer,—within one year after the expiration of the period of limitation for assessment against the preceding transferee, but only if within three years after the expiration of the period of limitation for assessment against the taxpayer;— except that if before the expiration of the period of limitation forException. the assessment of the liability of the transferee, a court proceeding for the collection of the tax or liability in respect thereof has been 1730begun against the taxpayer or last preceding transferee, respectively,—then the period of limitation for assessment of the liability of the transferee shall expire one year after the return of execution in the court proceeding.
(3)Where fiduciary liable. In the case of the liability of a fiduciary,—not later than one year after the liability arises or not later than the expiration of the period for collection of the tax in respect of which such liability arises, whichever is the later.
(c)Provisions on death of taxpayer or terminated corporation. Period for Assessment Against Taxpayer.— For the purposes of this section, if the taxpayer is deceased, or in the case of a corporation, has terminated its existence, the period of limitation for assessment against the taxpayer shall be the period that would be in effect had death or termination of existence not occurred.
(d)Suspension of running of statute of limitations, after notice mailed, etc. Suspension of Running of Statute of Limitations.— The running of the statute of limitations upon the assessment of the liability of a transferee or fiduciary shall, after the mailing to the *Ante*, p. 1721.transferee or fiduciary of the notice provided for in section 272 (a), be suspended for the period during which the Commissioner is prohibited from making the assessment in respect of the liability of the transferee or fiduciary (and in any event, if a proceeding in respect of the liability is placed on the docket of the Board, until the decision of the Board becomes final), and for sixty days thereafter.
(e)Address for notice of liability. Address for Notice of Liability.— In the absence of notice to the Commissioner under section 312
(b)of the existence of a fiduciary relationship, notice of liability enforceable under this section in respect of a tax imposed by this title, if mailed to the person subject to the liability at his last known address, shall be sufficient for the purposes of this title even if such person is deceased, or is under a legal disability, or, in the case of a corporation, has terminated its existence.
(f)“Transferee” defined. Definition of “Transferee”.— As used in this section, the term “transferee” includes heir, legatee, devisee, and distributee. SEC. 312. Fiduciary relationship.Liability of fiduciary until termination of. NOTICE OF FIDUCIARY RELATIONSHIP.
(a)Fiduciary of Taxpayer.— Upon notice to the Commissioner that any person is acting in a fiduciary capacity such fiduciary shall assume the powers, rights, duties, and privileges of the taxpayer in respect of a tax imposed by this title (except as otherwise specifically provided and except that the tax shall be collected from the estate of the taxpayer), until notice is given that the fiduciary capacity has terminated.
(b)Powers assumed by fiduciary of transferee. Fiduciary of Transferee.— Upon notice to the Commissioner that any person is acting in a fiduciary capacity for a person subject to the liability specified in section 311, the fiduciary shall assume, on behalf of such person, the powers, rights, duties, and privileges of such person under such section (except that the liability shall be collected from the estate of such person), until notice is given that the fiduciary capacity has terminated.
(c)Manner of notice. Manner of Notice.— Notice under subsection
(a)or
(b)shall be given in accordance with regulations prescribed by the Commissioner with the approval of the Secretary. **Supplement O—**Overpayments. **Overpayments** SEC. 321. Of Installment. OVERPAYMENT OF INSTALLMENT. Credit, if installment payment exceeds correct amount.If the taxpayer has paid as an installment of the tax more than the amount determined to be the correct amount of such installment, the overpayment shall be credited against the unpaid installments, 1731if any. If the amount already paid, whether or not on the basisCredit or refund for amount already paid. of installments, exceeds the amount determined to be the correct amount of the tax, the overpayment shall be credited or refunded as provided in section 322. SEC. 322. Refunds and credits. REFUNDS AND CREDITS.
(a)Authorization.— Where there has been an overpayment ofCredit against tax then due. any tax imposed by this title, the amount of such overpayment shall be credited against any income, war-profits, or excess-profits tax or installment thereof then due from the taxpayer, and any balanceRefund of balance. shall be refunded immediately to the taxpayer.
(b)Limitation on allowance.Period of. Limitation on Allowance.—
(1)Period of limitation.— Unless a claim for credit or refund is filed by the taxpayer within three years from the time the return was filed by the taxpayer or within two years from the time the tax was paid, no credit or refund shall be allowed or made after the expiration of whichever of such periods expires the later. If no return is filed by the taxpayer, then no credit or refund shall be allowed or made after two years from the time the tax was paid, unless before the expiration of such period a claim therefor is filed by the taxpayer.
(2)Limit on amount of credit or refund.— The amount ofCredit or refund limited. the credit or refund shall not exceed the portion of the tax paid during the three years immediately preceding the filing of the claim, or, if no claim was filed, then during the three years immediately preceding the allowance of the credit or refund.
(c)Effect of Petition to Board.— If the Commissioner hasPetition to Board of Tax Appeals; effect of.*Ante*, p. 1721. mailed to the taxpayer a notice of deficiency under section 272
(a)and if the taxpayer files a petition with the Board of Tax Appeals within the time prescribed in such subsection, no credit or refund in respect of the tax for the taxable year in respect of which the Commissioner has determined the deficiency shall be allowed or made and no suit by the taxpayer for the recovery of any part of such tax shall be instituted in any court except—Exceptions.
(1)As to overpayments determined by a decision of the BoardOverpayments. which has become final; and
(2)As to any amount collected in excess of an amount computedExcess collections. in accordance with the decision of the Board which has become final; and
(3)As to any amount collected after the period of limitationCollections after period of limitations. upon the beginning of distraint or a proceeding in court for collection has expired; but in any such claim for credit or refund or in any such suit for refund the decision of the Board which has become final, as to whether such period has expired before the notice of deficiency was mailed, shall be conclusive.
(d)Overpayment Found by Board.— If the Board finds thatOverpayment found by Board. there is no deficiency and further finds that the taxpayer has made an overpayment of tax in respect of the taxable year in respect of which the Commissioner determined the deficiency, the Board shall have jurisdiction to determine the amount of such overpayment, and such amount shall, when the decision of the Board has become final, be credited or refunded to the taxpayer. No such credit or refundCredit or refund. shall be made of any portion of the tax unless the Board determines as part of its decision that it was paid within three years before the filing of the claim or the filing of the petition, whichever is earlier.
(e)Tax Withheld at Source.— For refund or credit in case ofTax withheld at source. *Ante*, p. 1702. excessive withholding at the source, see section 143 (f). 1732 TITLE IA—Title IA—Additional income Taxes. ADDITIONAL INCOME TAXES SEC. 351. Surtax on personal holding companies.Rates imposed. SURTAX ON PERSONAL HOLDING COMPANIES.
(a)Imposition of Tax.— There shall be levied, collected, and paid, for each taxable year (in addition to the taxes imposed by Title I), upon the undistributed adjusted net income of every personal holding company a surtax equal to the sum of the following:
(1)8 per centum of the amount thereof not in excess of $2,000; plus
(2)18 per centum of the amount thereof in excess of $2,000 and not in excess of $100,000; plus
(3)28 per centum of the amount thereof in excess of $100,000 and not in excess of $500,000; plus
(4)38 per centum of the amount thereof in excess of $500,000 and not in excess of $1,000,000; plus
(5)48 per centum of the amount thereof in excess of $1,000,000.
(b)Definitions. Definitions.— As used in this title—
(1)“Personal holding company.”*Ante*, pp. 1673, 1677. The term “personal holding company” means any corporation (other than a corporation exempt from taxation under section 101, and other than a bank, as defined in section 104, and other than a life-insurance company or surety company) if—(A) at least 80 per centum of its gross income for the taxable year is derived from royalties, dividends, interest, annuities, and (except in the case of regular dealers in stock or securities) gains from the sale of stock or securities, and
(B)at any time during the last half of the taxable year more than 50 per centum in value of its outstanding stock is owned, directly or indirectly, by or for not more than five Determining stock ownership.Corporation, etc.individuals. For the purpose of determining the ownership of stock in a personal holding company—(C) stock owned, directly or indirectly, by a corporation, partnership, estate, or trust shall be considered as being owned proportionately by its shareholders, Individual.partners, or beneficiaries;
(D)an individual shall be considered as owning, to the exclusion of any other individual, the stock owned, directly or indirectly, by his family, and this rule shall be applied in such manner as to produce the smallest possible number of individuals owning, directly or indirectly, more than 50 per centum Family of individual.in value of the outstanding stock; and
(E)the family of an individual shall include only his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants.
(2)“Undistributed adjusted net income.” The term “undistributed adjusted net income” means the adjusted net income minus the sum of:
(A)Computation.*Ante*, pp. 1655, 1711. 20 per centum of the excess of the adjusted net income over the amount of dividends received from personal holding companies which are allowable as a credit for the purposes of the tax imposed by section 13 or 204;
(B)Amounts used or set aside to retire indebtedness incurred prior to January 1, 1934, if such amounts are reasonable with reference to the size and terms of such indebtedness; and
(C)The amount of the dividends paid credit provided in section 27, computed without the benefit of subsection
(b)thereof (relating to the dividend carry-over).
(3)“Adjusted net income.” The term “adjusted net income” means the net income minus the sum of:
(A)Computation. Federal income, war-profits, and excess-profits taxes paid or accrued during the taxable year to the extent not allowed as *Ante*, p. 1658.a deduction by section 23, but not including the tax imposed by this section or a corresponding section of a prior income-tax law; 1733
(B)Contributions or gifts, not otherwise allowed as a deduction, to or for the use of donees described in section 23
(o)for the purposes therein specified, including, in the case of a corporation organized prior to January 1, 1936, to take over the assets and liabilities of the estate of a decedent, amounts paid in liquidation of any liability of the corporation based on the liability of the decedent to make any such contribution or gift, to the extent such liability of the decedent existed prior to January 1, 1934; and
(C)Losses from sales or exchanges of capital assets which are*Ante*, p. 1692. disallowed as a deduction by section 117 (d).
(4)The terms used in this section shall have the same meaningMeaning of terms. as when used in Title I.
(c)Administrative Provisions.— All provisions of law (includingAdministrative provisions.*Ante*, p. 1652. penalties) applicable in respect of the taxes imposed by Title I of this Act, shall insofar as not inconsistent with this section, be applicable in respect of the tax imposed by this section, except that*Ante*, p. 1696. the provisions of section 131 of that title shall not be applicable.
(d)Payment of Surtax on Pro Rata Shares.— The tax imposedPayment of surtax on pro rata shares. by this section shall not apply if
(1)all the shareholders of the corporation include (at the time of filing their returns) in their gross income their entire pro rata shares, whether distributed or not, of the adjusted net income of the corporation for such year, and
(2)90 per centum or more of such adjusted net income is so included in the gross income of shareholders other than corporations. Any amount so included in the gross income of a shareholder shall be treated as a dividend received. Any subsequent distribution made by the corporation out of earnings or profits for such taxable year shall, if distributed to any shareholder who has so included in his gross income his pro rata share, be exempt from tax in the amount of the share so included.
(e)Improper Accumulation of Surplus.— For surtax on corporationsImproper accumulation of surplus.*Ante*, p. 1676. which accumulate surplus to avoid surtax on stockholders, see section 102. TITLE II—Title II—Capital Stock And Excess-Profits Tax. CAPITAL STOCK AND EXCESS-PROFITS TAX SEC. 401. Capital stock tax. CAPITAL STOCK TAX.
(a)Section 105 of the Revenue Act of 1935 is amended by strikingImposition of excise tax; rate.*Ante*, p. 1017. out “$1.40” wherever appearing therein and inserting in lieu thereof “$1”.
(b)Subsection
(c)of such section is amended by striking outExemptions.*Ante*, p. 1017. “1934” and inserting in lieu thereof “1936”, and by striking out “, as amended” wherever appearing in such subsection.
(c)Subsection
(4)of such section is amended to read asDetermination of adjusted declared value.*Ante*, p. 1018. follows: “(4) the excess of its income wholly exempt from the taxes imposed by the applicable income-tax law over the amount disallowed as a deduction by section 24
(5)of the Revenue Act of 1934 or a corresponding provision of a later Revenue Act, and”. SEC. 402. Excess-profits tax. EXCESS-PROFITS TAX.
(a)Section 106
(b)of the Revenue Act of 1935 is amended byDetermination of adjusted declared value.*Ante*, p. 1010. striking out “except that there shall be deducted the amount of income tax imposed for such year by section 13 of the Revenue Act of 1934, as amended” and inserting in lieu thereof “computed without the deduction of the tax imposed by this section, but with a credit 1734against net income equal to the credit for dividends received provided in section 26
(b)of the Revenue Act of 1936”.
(b)Effective date. The amendment made by subsection
(a)shall not apply to an income-tax taxable year beginning before January 1, 1936. TITLE III—Title III—Tax on Unjust Enrichment. TAX ON UNJUST ENRICHMENT SEC 501. Tax on net income from certain sources. TAX ON NET INCOME FROM CERTAIN SOURCES.
(a)The following taxes shall be levied, collected, and paid for each taxable year (in addition to any other tax on net income), upon the net income of every person which arises from the sources specified below:
(1)Income from sale of articles on which excise tax shifted to others. A tax equal to 80 per centum of that portion of the net income from the sale of articles with respect to which a Federal excise tax was imposed on such person but not paid which is attributable to shifting to others to any extent the burden of such Federal excise tax and which does not exceed such person’s net income for the entire taxable year from the sale of articles with respect to which such Federal excise tax was imposed.
(2)Income from reimbursement from vendors of excise tax burdens included in prices paid such vendors. A tax equal to 80 per centum of the net income from reimbursement received by such person from his vendors of amounts representing Federal excise-tax burdens included in prices paid by such person to such vendors, to the extent that such net income does not exceed the amount of such Federal excise-tax burden which such person in turn shifted to his vendees.
(3)Income from refunds, etc., from United States of excise taxes erroneously, etc., collected. A tax equal to 80 per centum of the net income from refunds or credits to such person from the United States of Federal excise taxes erroneously or illegally collected with respect to any articles, to the extent that such net income does not exceed the amount of the burden of such Federal excise taxes with respect to such articles which such person shifted to others.
(b)Computation; exclusions. The net income (specified in subsection
(a)(1)) from the sale of articles with respect to which the Federal excise tax was not paid, and the net income specified in subsection
(2)or (3), shall not include the net income from the sale of any article, from reimbursement with respect to any article, or from refund or credit of Articles in taxpayer’s stocks not sold before termination of federal excise tax.Federal excise tax with respect to any article
(1)if such article (or the articles processed therefrom) were not sold by the taxpayer on or before the date of the termination of the Federal excise tax; Tax adjustment made with vendee.(2) if the taxpayer made a tax adjustment with respect to such article (or the articles processed therefrom) with his vendee; or
(3)Taxpayer entitled to refund under existing law.if under the terms of any statute the taxpayer would have been entitled to a refund from the United States of the Federal excise tax with respect to the article otherwise than as an erroneous or illegal collection (assuming, in case the tax was not paid, that it had been paid).
(c)Net income from sales.Computation. The net income from the sales specified in subsection
(1)shall be computed as follows:
(1)From the gross income from such sales there shall be deducted the allocable portion of the deductions from gross income for the taxable year which are allowable under the applicable Revenue Act; or
(2)If the taxpayer so elects by filing his return on such basis, the total net income for the taxable year from the sale of all articles with respect to which each Federal excise tax was imposed (computed by deducting from the gross income from such sales the allocable portion of the deductions from gross income which are allowable under the applicable Revenue Act, but without 1735deduction of the amount of such Federal excise tax which was paid or of the amount of reimbursement to purchasers with respect to such Federal excise tax) shall be divided by the total quantity of such articles sold during the taxable year and the quotient shall be multiplied by the quantity of such articles involved in the sales specified in subsection
(a)(1). Such quantities shall be expressed in terms of the unit on the basis of which the Federal excise tax was imposed. For the purposes of this section the proper apportionment and allocationDetermination of apportionment and allocation of deductions. of deductions with respect to gross income shall be determined under rules and regulations prescribed by the Commissioner with the approval of the Secretary.
(d)The net income from reimbursement or refunds specified inNet income from reimbursement or refunds; computation. subsection
(2)or
(3)shall be computed as follows: From the total payment or accrual
(1)of reimbursement to the taxpayer from vendors for amounts representing Federal excise tax burdens included in prices paid by the taxpayer to such vendors or
(2)of refunds or credits to the taxpayer of Federal excise taxes erroneously or illegally collected, there shall be deducted the expenses and fees reasonably incurred in obtaining such reimbursement or refunds.
(e)For the purposes of subsection
(a)(1), (2), and (3),the extentExtent of shifting of tax burden.Computation. to which the taxpayer shifted to others the burden of a Federal excise tax shall be presumed to be an amount computed as follows:
(1)From the selling price of the articles there shall be deducted the sum of
(A)the cost of such articles plus
(B)the average margin with respect to the quantity involved; or
(2)If the taxpayer so elects by filing his return on such basis, from the aggregate selling price of all articles with respect to which such Federal excise tax was imposed and which were sold by him during the taxable year (computed without deduction of reimbursement to purchasers with respect to such Federal excise tax) there shall be deducted the aggregate cost of such articles, and the difference shall be reduced to a margin per unit in terms of the basis on which the Federal excise tax was imposed. The excess of such margin per unit over the average margin (computed for the same unit) shall be multiplied by the number of such units represented by the articles with respect to which the computation is being made; but
(3)In no case shall the extent to which the taxpayer shifted toDetermining extent to which burden of excise tax was shifted. others the burden of the Federal excise tax with respect to the articles be deemed to exceed the amount of such tax with respect to such articles minus
(A)the portion of the amount of the Federal excise tax (or of the reimbursement specified in subsection
(a)(2)) with respect to the articles which is paid or credited by the taxpayer to any purchasers as specified in subsection
(3)and minus
(B)the amount of any increase in the tax under section 602Vol. 47, p. 261. of the Revenue Act of 1932 for which the taxpayer under this section became liable as the result of the nonpayment or refund of the Federal excise tax with respect to the articles.
(f)As used in this section—Definitions.
(1)The term “margin” means the difference between the selling“Margin.” price of articles and the cost thereof, and the term “average“Average margin.” margin” means the average difference between the selling price and the cost of similar articles sold by the taxpayer during his six taxable years preceding the initial imposition of the Federal excise tax in question, except that if during any part of such six-year period the taxpayer was not in business, or if his records for any part of such period are so inadequate as not to furnish satisfactory data, the average margin of the taxpayer for such part of such 1736period shall, when necessary for a fair comparison, be deemed to be the average margin, as determined by the Commissioner, of representative concerns engaged in a similar business and similarly circumstanced.
(2)“Cost.” The term “cost” means, in the case of articles manufactured or produced by the taxpayer, the cost to the taxpayer of materials entering into the articles; or, in the case of articles purchased by the taxpayer for resale, the price paid by him for such articles (reduced in both cases by the amount for which he is reimbursed by his vendor).
(3)“Selling price.” The term “selling price” means selling price minus
(A)amounts subsequently paid or credited to the purchaser on or before June 1, 1936, or thereafter in the bona fide settlement of a written agreement entered into on or before March 3, 1936, as reimbursement for the amount included in such price on account of a Federal excise tax; and minus
(B)the allocable portion of any professional fees and expenses of litigation incurred in securing the refund or preventing the collection of the Federal excise tax, not to exceed 10 per centum of the amount of such tax.
(g)Determination of costs, selling prices, etc. In determining costs, selling prices, and net income, the taxpayer shall, unless otherwise shown, be deemed to have sold articles in the order in which they were manufactured, produced, or acquired. Use of conversion factors in computing quantity of taxable commodity.Where the taxpayer’s records do not adequately establish the quantity of a commodity taxable under the Agricultural Adjustment Act, as amended, entering into articles sold by him, such quantities shall be computed by the use of the conversion factors prescribed in regulations under such Act, as amended.
(h)Purchase or sale otherwise than through arm’s-length transaction. If the taxpayer made any purchase or sale otherwise than through an arm’s-length transaction, and at a price other than the fair market price, the Commissioner may determine the purchase or sale price to be that for which such purchases or sales were at that time made in the ordinary course of trade.
(i)Rebuttal of presumption of tax shifting. Either the taxpayer or the Commissioner may rebut the presumption established by subsection
(e)by proof of the actual extent to which the taxpayer shifted to others’ the burden of the Federal Proof.excise tax. Such proof may include, but shall not be limited to:
(1)Proof that the change or lack of change in the margin was due to changes in factors other than the tax. Such factors shall include any clearly shown change
(A)in the type or grade of article or materials, or
(B)in costs of production. If the taxpayer asserts that the burden of the tax was borne by him while the burden of any other increased cost was shifted to others, the Commissioner shall determine, from the respective effective dates of the tax and of the other increase in cost as compared with the date of the change in margin, and from the general experience of the industry, whether the tax or the increase in other cost was shifted to others. If the Commissioner determines that the change in margin was due in part to the tax and in part to the increase in other cost, he shall apportion the change in margin between them.
(2)Proof that the taxpayer modified contracts of sale, or adopted a new contract of sale, to reflect the initiation, termination, or change in amount of the Federal excise tax, or at any such time changed the sale price of the article (including the effect of a change in size, package, discount terms, or any other merchandising practice) by substantially the amount of the tax or change therein, or at any time billed the tax as a separate item to any vendee or indicated by any writing that the sale 1737price included the amount of the tax, or contracted to refund any part of the sale price in the event of recovery of the tax or decision of its invalidity; but the taxpayer may establish that such acts were caused by factors other than the tax, or that they do not represent his practice during the period in which the articles in question were sold.
(j)As used in this section—
(1)The term “Federal excise tax” means a tax or exactionDefinitions.“Federal excise tax.” with respect to the sale, lease, manufacture, production, processing, ginning, importation, transportation, refining, recovery, or holding for sale or other disposition, of commodities or articles, provided for by any Federal statute, whether valid or invalid, if denominated a “tax” by such statute. A Federal excise tax shall be deemed to have been imposed with respect to an article if it was imposed with respect to (or with respect to the processing of) any commodity or other article, from which such article was processed.
(2)The term “date of the termination of the Federal excise“Date of the termination of the Federal excise tax.” tax” means, in the case of a Federal excise tax held invalid by a decision of the Supreme Court, the date of such decision.
(3)The term “refund or“Refund or credit.’ credit” does not include a refund or credit made in accordance with the provisions and limitations set*Post*, p. 1747.Vol. 47, p. 268. forth in Title VII of this Act, or in section 621
(d)of the Revenue Act of 1932.
(4)The term “tax adjustment” means a repayment or credit“Taxpayer adjustment.” by the taxpayer to his vendee of an amount equal to the Federal excise tax with respect to an article (less reasonable expense to the vendor in connection with the nonpayment or recovery by him of the amount of such tax and in connection with the making of such repayment or credit) if such repayment or credit is made on or before June 1, 1936, or thereafter in the bona fide settlement of a written agreement entered into on or before March 3, 1936.
(5)The term “taxpayer” means a person subject to a tax“Taxpayer.” imposed by this section.
(k)All references in this section to the purchase or sale (or to“Purchase or sale of taxed articles” to include services, etc. parties to the sale) of articles with respect to which a Federal excise tax was imposed shall be deemed to include the purchase or sale (or parties to the sale) of services with respect to which a Federal excise tax was imposed, and for the purposes of subsection
(a)the extent to which the taxpayer shifted to others the burdenExtent to which taxpayer shifted tax burden to others; computation. of such Federal excise tax with respect to such services shall be presumed to be an amount computed as follows: From the selling price of the services there shall be deducted the average price received by the taxpayer for performing similar services during the six taxable years preceding the initial imposition of the Federal excise tax in question. The balance (to the extent that it does not exceed the amount of such Federal excise tax with respect to such services minus any payments or credits with respect to the services made to purchasers as specified in subsection
(f)(3)) shall be the extent to which the taxpayer shifted the burden of such Federal excise tax to others. If during any part of such six-year period the taxpayer was not in business, or if his records for any part of such period are so inadequate as not to furnish satisfactory data, the average price of the taxpayer for such part of such period shall, when necessary for a fair comparison, be deemed to be the average price, as determined by the Commissioner, of representative concerns engaged in a similar business and similarly circumstanced. TheRebuttal of presumption. presumption established by this subsection may be rebutted by proof of the character described in subsection (i). 1738
(l)Administrative provision. The taxes imposed by subsection
(a)shall be imposed on the net income from the sources specified therein, regardless of any loss arising from the other transactions of the taxpayer, and regardless of whether the taxpayer had a taxable net income (under the income-tax provisions of the applicable Revenue Act) for the taxable year as a whole; except that if such application of the tax imposed by subsection
(a)is held invalid, the tax under subsection
(a)shall apply to that portion of the taxpayer’s entire net income for the taxable year which is attributable to the net income from the sources specified in such subsection. SEC. 502. Credit for other taxes on income. CREDIT FOR OTHER TAXES ON INCOME. There shall be credited against the total amount of the taxes imposed by this title an amount equivalent to the excess of—
(a)The amount of the other Federal income and excess-profits taxes payable by the taxpayer for the taxable year, over
(b)The amount of the other Federal income and excess-profits taxes which would have been payable by the taxpayer for the taxable year if his net income were decreased by the amount of net income taxable under this title. SEC. 503. Administrative provisions.Provisions made applicable to this title. ADMINISTRATIVE PROVISIONS.
(a)All provisions of law (including penalties) applicable with respect to taxes imposed by Title I of this Act, shall, insofar as not inconsistent with this title, be applicable with respect to the taxes *Ante*, pp. 1673, 1696, 1718, 1719.imposed by this title, except that the provisions of sections 101, 131, 251, and 252 shall not be applicable.
(b)Excise taxes imposed but not paid; reimbursements; refunds, etc.Returns, filing of. Every person
(1)upon whom a Federal excise tax was imposed but not paid, or
(2)who received any reimbursement specified in subsection
(a)(2), or
(3)who received a refund or credit of Federal excise tax, shall make a return under this title, which return shall contain such information and be made in such manner as the Commissioner, with the approval of the Secretary, shall prescribe. For any taxable year ended prior to the date of the Time prescribed for payment.enactment of this Act the return shall be filed, and the total amount of the taxes shall be paid, not later than the fifteenth day of the third month after the date of the enactment of this Act, in lieu of the time otherwise prescribed by law.
(c)Discretionary time extensions. If the Commissioner finds that the payment, on the date prescribed for the payment thereof, of any part of the amount determined by the taxpayer as the tax under this title, or of any deficiency with respect thereto, would impose undue hardship upon the taxpayer, the Commissioner may grant an extension for the payment of Time prescribed for payment.any such part for a period not in excess of three years. In such case the amount with respect to which the extension is granted shall be paid on or before the date of the expiration of the period of the extension, and the running of the statute of limitations for assessment and collection shall be suspended for the period of any such extension. If an extension is granted, the Commissioner may require Bond.the taxpayer to furnish a bond in such amount, not exceeding double the amount with respect to which the extension is granted, and with such sureties as the Commissioner deems necessary, conditioned upon the payment of the amount with respect to which the extension is Interest on extension.granted in accordance with the terms of the extension. There shall be collected, as a part of any amount with respect to which an extension is granted, interest thereon at the rate of 6 per centum per annum from the expiration of six months after the due date thereof to the expiration of the period of the extension. 1739 SEC. 504. TAXABLE YEARS TO WHICH TITLE IS APPLICABLE. The taxes imposed by this title shall apply only with respect toTaxable years to which title applicable. taxable years ending during the calendar year 1935 and to subsequent taxable years. SEC. 505. Application of title to possessions.Tax in force in United States possessions (including Philippines). APPLICATION OF TITLE TO POSSESSIONS. With respect to the following income, the tax under this title shall be in force in any possession of the United States (including the Philippine Islands); such tax shall (without regard to the residence or citizenship or place of organization of the taxpayer) be collected by the appropriate internal-revenue officers of such possession; and the proceeds thereof shall accrue to the general government of such possession:
(a)Any income specified in subsection (a)*Ante*, p. 1734.
(1)or
(3)of section 501 if the Federal excise tax with respect to the articles in question accrued in such possession; and
(b)any income specified in subsection
(2)of section 501 if the reimbursement specified therein relates to articles sold in such possession by the taxpayer under this title and if the geographical scope of the Federal excise tax in question extended to such possession. Income taxable as provided in this section shall not be otherwise taxable under this title. In applying section 501 to such income, the gross income and deductions shall be determined in accordance with the Federal Revenue Act applicable to the taxable year. In*Ante*, p. 1738. applying section 502 to such income, income taxes paid to such possession shall be deemed to be Federal income taxes. SEC. 506. Closing agreements. CLOSING AGREEMENTS. Any person who is liable for the tax imposed by this title andSettlement of taxpayer’s liability.Refund claims. who has filed any claim or claims for refund of any amount paid or collected as tax under the Agricultural Adjustment Act, as amended, may apply to the Commissioner of Internal Revenue for an adjustment of such liability for tax in conjunction with such claim or claims for refund, and thereafter, the Commissioner, for such purposes, may, in his discretion, consider such liability and such claim or claims as one case and, in his discretion, may enter into a written agreement with such person for the settlement of such case by such payment by, or refund to, such person as may be specified in such agreement. Such agreement shall be a final settlementAgreement to be final settlement; exceptions. of the liability for tax and the claim or claims for refund covered by such agreement, except in case of fraud, malfeasance, or misrepresentation of a material fact. In the absence of fraud or mistake in mathematical calculation, any action taken or any consideration given by the Commissioner pursuant to this section shall not be subject to review by any court, or any administrative, or accounting officer, employee, or agent of the United States. TITLE IV—Title IV—Export, Charitable, Etc., Refunds And Floor Stocks Adjustment Under Agricultural Adjustment Act. EXPORT, CHARITABLE, ETC., REFUNDS AND FLOOR STOCKS ADJUSTMENT UNDER AGRICULTURAL ADJUSTMENT ACT SEC. 601. REFUNDS UNDER AGRICULTURAL ADJUSTMENT ACT ON EXPORTS, DELIVERIES FOR CHARITABLE DISTRIBUTION OR USE, ETC.
(a)The provisions of sections 10 (d), 15 (a), 15 (c), 16
(e)(1),Provisions of designated Act reenacted.[U. S. C., p. 155; Supp. I, p. 16](/us/usc/p155/p16). 16
(e)(3), and 17
(a)of the Agricultural Adjustment Act, as amended, are hereby reenacted but only for the purpose of allowing refunds in accordance therewith in cases where the delivery for 1740charitable distribution or use, or the exportation, or the manufacture of large cotton bags, or the decrease in the rate of the processing tax (or its equivalent under section 16
(e)(3)), took place prior to January 6, 1936.
(b)Restriction on refunds to processor liable for tar on article on which claim is based. Except for refunds under section 15
(a)of the Agricultural Adjustment Act, as reenacted herein, no refund under this section shall be made to the processor or other person who paid or was liable for the tax with respect to the articles on which the claim is based. No refund under this section shall be allowable to any person with respect to any articles where such person prior to January 6, 1936, paid an amount as tax under the Agricultural Adjustment Act, as amended, by taking as a credit against such amount an amount otherwise allowable as a refund with respect to such articles under sections 15 (a), 15 (c), 16
(e)(1), 16
(e)(3), or 17
(a)of said Act. No refund if otherwise reimbursed.No refund under this section shall be allowed to any person except to the extent that he establishes that he has not received, and is not entitled to receive, reimbursement of such amount from the processor or other vendor with respect to the articles on which the claim is No disallowance on ground tax as to article from which processed unpaid.based. No claim under this section (except claims of processors under section 15
(a)) shall be disallowed on the ground that the tax with respect to the article or the commodity from which processed has not been paid.
(c)Filing claims, time limit, etc. No refund under this section shall be made unless the claimant files a claim therefor prior to January 1, 1937, under rules and regulations prescribed by the Commissioner of Internal Revenue with the approval of the Secretary of the Treasury, and no claim shall be *Ante*, pp. 769, 773.allowed in an amount less than $10. Sections 16
(g)and 21
(f)of the Agricultural Adjustment Act, as amended, are repealed.
(d)Findings of fact, mathematical calculations, etc., finality of. In the absence of fraud, the findings of fact and the decision of the Commissioner of Internal Revenue upon the merits of any claim adjusted pursuant to this section and the mathematical calculation therein shall not be subject to review by any administrative or accounting officer, employee, or agent of the United States.
(e)Determination with respect to refunds, finality of. The determination of the Commissioner of Internal Revenue with respect to any refund under this section shall be final and no court shall have jurisdiction to review such determination.
(f)Interest on refunds. No interest shall be allowed in connection with any refund made under this section.
(g)Rate adjustment*Ante*, pp. 48, 769. Section 16
(1)of the Agricultural Adjustment Act, as reenacted by subsection
(a)of this section, is amended by striking out “subsequent to June 26, 1934” and by inserting in lieu thereof “on or after June 1, 1934”. SEC. 602. Floor stocks. FLOOR STOCKS AS OF JANUARY 6, 1936.
(a)Holders, on January 6, 1936, of articles processed from commodities subject to tax. There shall be paid to any person who, at the first moment of January 6, 1936, held for sale or other disposition (including manufacturing or further processing) any article processed wholly or in chief value from a commodity subject to processing tax, an amount Conditional payment.computed as provided in subsection (b), except that no such payment shall be made to the processor or other person who paid or was liable for the tax with respect to the articles on which the claim is based.
(b)Method of computing refund. The amount of the payment under subsection
(a)shall be equal to the processing tax which would have been payable with respect to the commodity from which the article was processed, if Limitation.it had been processed on January 5, 1936, but not in excess of
(1)the amount of the burden of the tax with respect to the article which was shifted to the claimant in the price he paid for the article (to the extent that the claimant has not received and is not 1741entitled to receive reimbursement for such burden from the processor or other vendor) and not in excess of
(2)the amount of that part of the burden of the tax applicable to the articles held on January 6, 1936, which the claimant has not passed on to his vendees and has not included in the sale price of such articles. In lieu of a detailedProof of claim. schedule of articles, purchases, sale prices, and sales under clauses
(1)and
(2)of this subsection, the claimant may (subject to the approval of the Commissioner and such investigations as he may cause to be made) submit, as a part of his claim, an affidavit setting forth the total amount of tax burden passed on to him on the articles with respect to which claim is made ; the total amount of such burden for which he has received or is entitled to receive reimbursement from the processor or other vendor; the total amount of such burden that he has passed on to his vendees or has included in the sale prices of such articles; and the total amount of such burden that he has borne himself.
(c)As used in this section—Terms defined.
(1)The term “commodity subject to a processing tax” means“Commodity subject to a processing tax.” a commodity upon the processing of which a tax was provided for under the Agricultural Adjustment Act, as amended, as of January 5, 1936.
(2)The term “tax with respect to the article” means any tax“Tax with respect to the article.” under the Agricultural Adjustment Act, as amended, with respect to the article (or with respect to any commodity or other article from which it was processed).
(3)The term “sale price” includes the price at which the“Sale price.” claimant actually sold the article or articles prior to the date of the filing of his claim or, if the article or articles have not been sold, the price at which he is offering the same for sale on the date of the filing of his claim.
(d)No payment shall be made under this section unless theFiling claims, time limitation. claimant files a claim therefor prior to January 1, 1937, in conformity with regulations prescribed by the Commissioner with the approval of the Secretary, nor unless he establishes to the satisfaction of the Commissioner the facts on which such claim is based.
(e)No claim under this section shall be disallowed on the groundNo disallowance because processing tax unpaid. that the tax with respect to the article or the commodity from which processed has not been paid, but no claim shall be allowed in an amount less than $10. No payment shall be made under this sectionDouble refund restriction. in connection with any article with respect to which a refund has been allowed or credit has been taken under the Agricultural Adjustment Act, as amended, or a refund has been allowed or is allowable under section 601 of this title.
(f)No payment shall be made under this section with respectLimitations on payments.Articles held in retail floor stocks; exceptions. to articles held in retail floor stocks except
(1)flour, prepared flour, cereal preparations, and gluten, made chiefly from wheat, as classified in Wheat Regulations, Series 1, Supplement 1, promulgated under the Agricultural Adjustment Act and the amendments thereto,
(2)articles processed wholly or in chief value from cotton, and
(3)direct-consumption sugar processed from sugar beets or sugarcane. No payment under this section shall be made with respect toArticles processed from wheat, etc., held in other than retail stocks; exceptions. articles processed from wheat, sugar beets, or sugarcane held in other than retail stocks except
(1)flour, prepared flour, cereal preparations, and gluten, made chiefly from wheat, as classified in Wheat Regulations, Series 1, Supplement 1, and
(2)direct-consumption sugar.
(g)In the case of articles which were agreed to be sold underContracts entered into prior to January 6, 1936. a contract entered into prior to January 6, 1936, whereby the vendee agreed to pay a price including the amount of the tax with 1742respect to the articles, but which were not delivered prior to such date, the vendee shall be considered the holder of such articles.
(h)Finality of findings of fact, decision, etc. In the absence of fraud the findings of fact and the decision of the Commissioner upon the merits of any claim under this section, and the mathematical calculation therein shall not be subject to review by any other administrative or accounting officer, employee, or agent of the United States.
(i)Determination with respect to payments, finality of. The determination of the Commissioner with respect to any payment under this section shall be final and no court shall have jurisdiction to review such determination.
(j)No allowance for interest. No interest shall be allowed in connection with any payment made under this section. SEC. 603. Proclamations, etc. PROCLAMATIONS, ETC., MADE APPLICABLE. Issue under Agricultural Adjustment Act made applicable for determining refund, etc.The proclamations, certificates, and regulations prescribed by the Secretary of Agriculture under the Agricultural Adjustment Act, as amended, in effect on January 5, 1936, insofar as not inconsistent with this Act, are hereby made applicable for the purpose of determining the amount of any refund or payment authorized under sections 601 and 602. TITLE V—Title V—Amendments to taxes on certain oils. AMENDMENTS TO TAXES ON CERTAIN OILS SEC. 701. TAX ON CERTAIN OILS. Vol. 47, p. 259; Vol. 48, p. 762.The first sentence of section 601
(8)of the Revenue Act of 1932, as amended, is amended to read as follows: " “(8) Taxes on items specified. Whale oil (except sperm oil), fish oil (except cod oil, cod-liver oil, and halibut-liver oil), marine-animal oil, tallow, inedible animal oils, inedible animal fats, inedible animal greases, fatty acids derived from any of the foregoing, and salts of any of the foregoing; all the foregoing, whether or not refined, sulphonated, sulphated, hydrogenated, or otherwise processed, 3 cents Sesame oil.Vol. 46, p. 680.per pound; sesame oil provided for in paragraph 1732 of the Tariff Act of 1930, sunflower oil, rapeseed oil, kapok oil, hempseed oil, perilla oil, fatty acids derived from any of the foregoing or from linseed oil, and salts of any of the foregoing; all the foregoing, whether or not refined, sulphonated, sulphated, hydrogenated, or otherwise processed, 4½ cents per pound; any article, Vol. 48, p. 763; *Ante*, p. 1026.merchandise, or combination (except oils specified in section 602½ of the Revenue Act of 1934, as amended), 10 per centum or more of the quantity by weight of which consists of, or is derived directly or indirectly from, one or more of the products specified above in this paragraph or in section 602½ of the Revenue Act of 1934, as amended, a tax at the rate or rates per pound equal to that proportion of the rate or rates prescribed in this paragraph or such section 602½ in respect of such product or products which the quantity by weight of the imported article, merchandise, or combination, consisting of or derived from such product or products, bears to the total weight of the imported article, merchandise, or combination; hempseed, perilla seed, rape-seed, sesame seed, and kapok seed, 2 cents per pound.” " SEC. 702. Processing tax on certain oils.Vol. 48, p. 763. PROCESSING TAX ON CERTAIN OILS.
(a)The first sentence of section 602½ of the Revenue Act of 1934 is amended to read as follows: " “(a) Designated oils having no previous domestic processing. There is hereby imposed upon the first domestic processing of coconut oil, palm oil, palm-kernel oil, fatty acids derived from any of the foregoing oils, salts of any of the foregoing (whether or not 1743such oils, fatty acids, or salts have been refined, sulphonated, sulphated, hydrogenated, or otherwise processed), or any combination or mixture containing a substantial quantity of any one or more of such oils, fatty acids, or salts, a tax of 3 cents per pound to be paid by the processor, but the tax under this section shall not apply (1)Exceptions. with respect to any fatty acid or salt resulting from a previous first domestic processing taxed under this section or upon which an import tax has been paid under section 601
(8)of the Revenue Act ofVol. 48, p. 762.[U. S. C., p. 1120](/us/usc/p1120). 1932, as amended, or
(2)with respect to any combination or mixture by reason of its containing an oil, fatty acid, or salt with respect to which there has been a previous first domestic processing or upon which an import tax has been paid under such section 601
(c)(8).” "
(b)Notwithstanding the provisions of subsection
(a)of this section, the first domestic processing of sunflower oil or sesame oilTax on sunflower, etc., oils. (or any combination or mixture containing a substantial quantity of sunflower oil or sesame oil), if such oil or such combination or mixture or such oil contained therein was imported prior to the effective date of this title, shall be taxed in accordance with the provisions of section 602½ of the Revenue Act of 1934 in force onVol. 48, p. 763. the date of the enactment of this Act. SEC. 703. Miscellaneous provisions. MISCELLANEOUS PROVISIONS. Nothing in section 601
(8)of the Revenue Act of 1932, asTrade agreements, etc.No tax levied in contravention of. amended, shall be construed as imposing a tax in contravention of an obligation undertaken in any trade agreement heretofore entered into under the authority of section 350 of the Tariff Act of 1930, as amended, or as imposing a tax on the importation of glycerin orGlycerin or stearine pitch. stearine pitch or on the importation of any article by reason of any component of such article derived directly or indirectly from a waste not named in section 601
(8)of the Revenue Act of 1932, asVol. 48, p. 762.Section repealed.*Ante*, p. 1026.Taxes remitted. amended. Section 402 of the Revenue Act of 1935 is hereby repealed. All taxes accrued or paid under section 402 of the Revenue Act of 1935 on the importation of glycerin or stearine pitch shall be remitted or refunded under such regulations as the Secretary of the Treasury may prescribe. SEC. 704. EFFECTIVE DATE. The provisions of this title shall be effective on and after theEffective date. sixtieth day following the date of the enactment of this Act. TITLE VI—Title VI—Miscellaneous Provisions. MISCELLANEOUS PROVISIONS SEC. 801. Exemption from admissions tax of certain concerts.Conducted by non-profit civic, etc., associations.Vol. 44, p. 92. EXEMPTION FROM ADMISSIONS TAX OF CERTAIN CONCERTS. Section 500
(2)of the Revenue Act of 1926 is amended by striking out the period at the end thereof and inserting in lieu thereof a comma and the following: “and any admissions to concerts conducted by a civic or community membership association if no part of the net earnings thereof inures to the benefit of any stockholders or members of such association.” SEC. 802. Suits to enforce liens for taxes.[R. S., sec. 3207, p. 616](/us/rs/s3207/p616); [U. S. C., p. 1195](/us/usc/p1195). SUITS TO ENFORCE LIENS FOR TAXES.
(a)Section 3207
(a)of the Revised Statutes, as amended, is amended to read as follows: " “Sec. 3207.
(a)In any case where there has been a refusal or neglectProceedings in chancery to subject property to tax payment. to pay any tax, and it has become necessary to seize and sell property and rights to property, whether real or personal, to satisfy the same, whether distraint proceedings have been commenced or not, 1744the Attorney General at the request of the Commissioner of Internal Revenue may direct a bill in chancery to be filed, in a district court of the United States, to enforce the lien of the United States for tax upon any property and rights to property, whether real or personal, or to subject any such property and rights to property owned by the delinquent, or in which he has any right, title, or Persons claiming interest made parties.interest, to the payment of such tax. All persons having liens upon or claiming any interest in the property or rights to property sought to be subjected as aforesaid shall be made parties to such proceedings and be brought into court as provided in other suits in chancery Adjudication by court.therein. And the said court shall, at the term next after the parties have been duly notified of the proceedings, unless otherwise ordered by the court, proceed to adjudicate all matters involved therein and finally determine the merits of all claims to and liens upon the property and rights to property in question, and in all cases where a claim or interest of the United States therein is established, may decree a sale of such property and rights to property, by the proper officer of the court, and a distribution of the proceeds of such sale according to the findings of the court in respect to the interests of Receiver, appointment of.the parties and of the United States. In any such proceeding, at the instance of the United States, the court may appoint a receiver to enforce the lien, or, upon certification by the Commissioner of Internal Revenue during the pendency of such proceedings that it is in the public interest, may appoint a receiver with all the powers of a receiver in equity.” "
(b)Pending suits not abated. No suit brought by the United States to enforce any lien for tax on any property, or rights to property, whether real or personal, which is pending in any court of the United States on the date of the enactment of this Act, shall abate, but any such suit shall be continued in accordance with the provisions of subsection
(a)of this section. SEC. 803. Interest on erroneous refunds.Vol. 45, p. 875. INTEREST ON ERRONEOUS REFUNDS.
(a)Section 610 of the Revenue Act of 1928, as amended, is amended by adding at the end thereof a new subsection to read as follows: " “(d) Rate. Erroneous refunds recoverable by suit under this section shall bear interest at the rate of 6 per centum per annum from the date of the payment of the refund.” " SEC. 804. Interest on overpayments. INTEREST ON OVERPAYMENTS. Vol. 45, p. 876.Section 614
(2)of the Revenue Act of 1928 is amended by striking out the period at the end thereof and inserting in lieu thereof the following: “, whether or not such refund check is accepted by the taxpayer after tender of such check to the taxpayer. The acceptance of such check shall be without prejudice to any right of the taxpayer to claim any additional overpayment and interest thereon.” SEC. 805. Estate taxes.Vol. 44, p. 71; Vol. 48, p. 752. ESTATE TAXES—REVOCABLE TRANSFERS.
(a)Section 302
(1)of the Revenue Act of 1926, as amended, is amended to read as follows: " “(d) Revocable transfers preceding death.
(1)To the extent of any interest therein of which the decedent has at any time made a transfer (except in case of a bonafide sale for an adequate and full consideration in money or money’s worth), by trust or otherwise, where the enjoyment thereof was subject at the date of his death to any change through the exercise of a power (in whatever capacity exercisable) by the decedent alone or by the decedent in conjunction with any other person (without 1745regard to when or from what source the decedent acquired such power), to alter, amend, revoke, or terminate, or where any such power is relinquished in contemplation of decedent’s death.” "
(b)Except in the case of transfers made after the date of theGross estate. No interest of decedent included in; exception. enactment of this Act, no interest of the decedent of which he has made a transfer shall be included in the gross estate under such section 302
(1)unless it was includible under such section before its amendment by this section. SEC. 806. Registration under Narcotic Laws.Vol. 38, p. 786; Vol. 44, p. 96.[U. S. C., p. 1124](/us/usc/p1124). REGISTRATION UNDER THE NARCOTIC LAWS.
(a)The fourth paragraph of section 1 of the Act entitled “An Act to provide for the registration of, with collectors of internal revenue, and to impose a special tax upon all persons who produce, import, manufacture, compound, deal in, dispense, sell, distribute, or give away opium or coca leaves, their salts, derivatives, or preparations, and for other purposes”, approved December 17, 1914, as amended (38 Stat. 785), is amended to read as follows: " “Importers, manufacturers, producers, or compounders, lawfullyImporters, etc., required to register. entitled to import, manufacture, produce, or compound any of the aforesaid drugs, $24 per annum; wholesale dealers, lawfully entitled to sell and deal in any of the aforesaid drugs, $12 per annum; retail dealers, lawfully entitled to sell and deal in any of the aforesaid drugs, $3 per annum; physicians, dentists, veterinary surgeons, and other practitioners, lawfully entitled to distribute, dispense, give away, or administer any of the aforesaid drugs to patients upon whom they in the course of their professional practice are in attendance, $1 per annum or fraction thereof during which they engage in any of such activities; persons not registered as an importer, manufacturer,Persons not registered but lawfully entitled for research, etc. producer, or compounder and lawfully entitled to obtain and use in a laboratory any of the aforesaid drugs for the purpose of research, instruction, or analysis shall pay $1 per annum, but suchRecords to be kept. persons shall keep such special records relating to receipt, disposal, and stocks on hand of the aforesaid drugs as the Commissioner of Narcotics, with the approval of the Secretary of the Treasury, may by regulation require. Such special records shall be open at all times to the inspection of any duly authorized officer, employee, or agent of the Treasury Department.” "
(b)The second proviso of section 6 of the said Act of DecemberDrugs not affected by Act.Records, etc., to be kept by lawful manufacturers, vendors, etc. 17, 1914, as amended, is amended by inserting after the words “mentioned in this section” the following: “lawfully entitled to manufacture, produce, compound, or vend such preparations and remedies,”.
(c)This section shall take effect on July 1, 1936.Effective date. SEC. 807. Refund claims. RECONSIDERATION OF REFUND CLAIMS.
(a)Section 3226 of the Revised Statutes, as amended, is amendedReconsideration, etc., of.[R. S., sec. 3226, p. 619](/us/rs/s3226/p619).[U. S. C., p. 1202](/us/usc/p1202). by adding at the end thereof the following new sentence: “Any consideration, reconsideration, or action by the Commissioner with respect to such claim following the mailing of a notice by registered mail of disallowance shall not operate to extend the period within which suit may be begun.”
(b)The amendment made by subsection
(a)shall not operate (1)Effect on pending, etc., suits.Vol. 48, p. 756. to bar a suit or proceeding in respect of a claim reopened prior to the date of the enactment of this Act, if such suit or proceeding was not barred under the law in effect prior to the date of the enactment of this Act, or
(2)to prevent the suspension of the statute of limitationsSuspension of statute of limitations.Vol. 45, p. 874. for filing suit under section 608
(b)(2), as amended, of the Revenue Act of 1928. 1746 SEC. 808. Interest on judgments.Vol. 36, p. 1141; [U. S. C., p. 1265](/us/usc/p1265). INTEREST ON JUDGMENTS. Section 177
(b)of the Judicial Code, as amended, is amended to read as follows: " “(b) Overpayments. In any judgment of any court rendered (whether against the United States, a collector or deputy collector of internal revenue, a former collector or deputy collector, or the personal representative in case of death) for any overpayment in respect of any internal-revenue tax, interest shall be allowed at the rate of 6 per centum per annum upon the amount of the overpayment, from the date of the payment of collection thereof to a date preceding the date of the refund check by not more than thirty days, such date to be Tender of check to stop interest.determined by the Commissioner of Internal Revenue. The Commissioner is hereby authorized to tender by check payment of any such judgment, with interest as herein provided, at any time after such judgment becomes final, whether or not a claim for such payment has been duly filed, and such tender shall stop the running of interest, whether or not such refund check is accepted by the judgment creditor.” " SEC. 809. Jewelry tax. TERMINATION OF JEWELRY TAX. Termination of.Vol. 47, p. 261.The tax imposed by section 605 of the Revenue Act of 1932 shall not apply to any article sold by the manufacturer, producer, or importer after the date of the enactment of this Act. SEC. 810. Furs. TAX ON FURS.
(a)Tax rate.Vol. 47, p. 261. Effective after the date of the enactment of this Act, section 604 of the Revenue Act of 1932 is amended by striking out “10 per centum” and inserting in lieu thereof “3 per centum”.
(b)Tax exemption repeal.Vol. 48, p. 768. The exemption of articles sold for less than $75, provided by section 608 of the Revenue Act of 1934, shall not apply to articles sold after the date of the enactment of this Act. SEC. 811. Shingles. IMPORTATION OF SHINGLES. Importation of red cedar, from Canada.Whenever any organization or association representing the producers of more than 75 per centum of the red cedar shingles produced in the United States during the previous half-year period shall request the President to limit the importation of red cedar shingles *Post*, p. 3981.from Canada under paragraph 1760 of the reciprocal trade agreement entered into with the Dominion of Canada under date of November 15, 1935, and the President finds from available statistics that the total quantity of red cedar shingles produced in the Dominion of Canada which is entered, or withdrawn from warehouse, for consumption in the United States, during any given half of any calendar year exceeds or will exceed 25 per centum of the combined total of the shipments of red cedar shingles by producers in the United States and the imports during the preceding half year, the President shall issue an order limiting for the six months immediately following the half of the calendar year in which said excess occurred, the quantity of red cedar shingles to be imported from Canada to 25 per centum of the combined total of the shipments and imports of red cedar shingles for such preceding half calendar year. The President shall issue a new order for each half of the calendar year thereafter during the continuation of the operation of the reciprocal trade agreement entered into with the Dominion of Canada, under date of November 15, 1935, with the same limitations as hereinbefore set forth. 1747 TITLE VII—Title VII—Refunds of Amounts Collected under the Agricultural Adjustment Act. REFUNDS OF AMOUNTS COLLECTED UNDER THE AGRICULTURAL ADJUSTMENT ACT SEC. 901. REPEALS. Sections 21 (d), 21 (e), and 21
(g)of the Agricultural AdjustmentDesignated sections repealed.*Ante*, p. 771. Act, as amended, are hereby repealed. SEC. 902. Conditions on allowance of refunds.Proof necessary to establish right to receive. CONDITIONS ON ALLOWANCE OF REFUNDS. No refund shall be made or allowed, in pursuance of court decisions or otherwise, of any amount paid by or collected from any claimant as tax under the Agricultural Adjustment Act, unless the claimant establishes to the satisfaction of the Commissioner in accordance with regulations prescribed by him, with the approval of the Secretary, or to the satisfaction of the trial court, or the Board of Review in cases provided for under section 906, as the case*Post*, p. 1748. may be—
(a)That he bore the burden of such amount and has not been relieved thereof nor reimbursed therefor nor shifted such burden, directly or indirectly,
(1)through inclusion of such amount by the claimant, or by any person directly or indirectly under his control, or having control over him, or subject to the same common control, in the price of any article with respect to which a tax was imposed under the provisions of such Act, or in the price of any article processed from any commodity with respect to which a tax was imposed under such Act, or in any charge or fee for services or processing;
(2)through reduction of the price paid for any such commodity; or
(3)in any manner whatsoever; and that no understanding or agreement, written or oral, exists whereby he may be relieved of the burden of such amount, be reimbursed therefor, or may shift the burden thereof; or
(b)That he has repaid unconditionally such amount to his vendee
(1)who bore the burden thereof,
(2)who has not been relieved thereof nor reimbursed therefor, nor shifted such burden, directly or indirectly, and
(3)who is not entitled to receive any reimbursement therefor from any other source, or to be relieved of such burden in any manner whatsoever. SEC. 903. Claims. FILING OF CLAIMS. No refund shall be made or allowed of any amount paid by orTerminal date for filing. collected from any person as tax under the Agricultural Adjustment Act unless, after the enactment of this Act and prior to July 1, 1937, a claim for refund has been filed by such person in accordance with regulations prescribed by the Commissioner with the approval of the Secretary. All evidence relied upon in support of such claimSupporting evidence. shall be clearly set forth under oath. The Commissioner is authorizedNumber of claims by any claimant. to prescribe by regulations, with the approval of the Secretary, the number of claims which may be filed by any person with respect to the total amount paid by or collected from such person as tax under the Agricultural Adjustment Act, and such regulations may require that claims for refund of processing taxes with respect. to any commodity or group of commodities shall cover the entire period during which such person paid such processing taxes. SEC. 904. Statute of limitations. STATUTE OF LIMITATIONS. Notwithstanding any other provision of law, no suit or proceeding,Period in which suits may be brought or maintained. whether brought before or after the date of enactment of this Act, shall be brought or maintained in any court for the recovery, recoup1748ment, set-off, refund, or credit of, or counterclaim for, any amount paid by or collected from any person as tax (except processing tax, as defined herein) under the Agricultural Adjustment Act
(a)before the expiration of eighteen months from the date of filing a claim therefor under this title, unless the Commissioner renders a decision thereon within that time, or
(b)after the expiration of two years from the date of mailing by registered mail by the Commissioner to the claimant a notice of disallowance of that part of the claim Action by Commissioner not to extend period.to which such suit or proceeding relates. Any consideration or any action by the Commissioner with respect to such claim following the mailing of notice of disallowance shall not operate to extend the period within which any suit or proceeding may be brought. SEC. 905. JURISDICTION OF COURTS. Jurisdiction of courts.Concurrent with the Court of Claims, the District Courts of the United States (except as provided in section 906 of this title) shall have jurisdiction of cases to which this title applies, regardless of the amount in controversy, if such district courts would have had jurisdiction of such cases but for limitations under the Judicial Code, as amended, on jurisdiction of such courts based upon the amount Customs Court, restriction.in controversy. The United States Customs Court shall not have jurisdiction of any such cases. SEC. 906. Refunds of processing taxes. PROCEDURE ON CLAIMS FOR REFUNDS OF PROCESSING TAXES.
(a)Procedure for recovery of amounts paid or collected. Notwithstanding any other provision of law, no suit or proceeding, whether brought liefore or after the date of the enactment of this Act, shall be brought or maintained in any court for the refund of any amount paid or collected as processing tax, as defined herein, under the Agricultural Adjustment Act, except as provided Time limitation.in this section. The Commissioner shall allow or disallow, m whole or in part, any claim for refund of any such amount within three years after such claim was filed, unless such time has been extended by written consent of the claimant.
(b)Board of Review established.Composition, chairman, quorum, etc. There is hereby established in the Treasury Department a Board of Review (hereinafter referred to as “the Board”). The Board shall be composed of nine members who shall be officers or employees of the Treasury Department designated by the Secretary of the Treasury. One of such members shall be designated by the Secretary to act as chairman of the Board. The chairman may from time to time divide the Board into divisions of one or more members, assign the members of the Board thereto, and in case of a division of more than one member designate the chief thereof. A majority of the members of the Board or of any division thereof shall constitute a quorum for the transaction of the business of the Board or of the division respectively. A vacancy in the Board or in any division thereof shall not impair the powers nor affect the duties of the Board or division nor of the remaining members of the Board or division respectively. The Secretary of the Treasury shall assign to the Board such personnel in the Treasury Department as may be Jurisdiction.necessary to perform its functions. The Board shall have jurisdiction in proceedings under this section to review the allowance or disallowance of the Commissioner of a claim for refund, and to determine the amount of refund due any claimant with respect to such claim. The Commissioner shall make refund of any such amount determined by a decision of the Board which has become Proceedings.final. The proceedings of the Board and its divisions shall be conducted in accordance with such rules and regulations as the Board may prescribe, with the approval of the Secretary. 1749
(c)The allowance or disallowance of the Commissioner of a claimCommissioner’s decision. for refund under this section shall be final, unless within three months after the date of mailing by registered mail by the Commissioner of notice that a claim for refund of any such amount has been disallowed, in whole or in part, the claimant files a petition with the Board requesting a hearing on the merits of his claim, in whole or in part. Upon the filing of any such petition, the claimantHearings. shall be entitled to a hearing as provided herein, and within three months after the date of such filing the Board shall set a date for such hearing which shall be not more than two years from the date of filing of the petition. Such hearing shall be held in Washington, District of Columbia, or in the collection district in which is located the principal place of business of the claimant, as the claimant may designate in his petition, or in any place which may be designated by the Commissioner and the claimant by stipulation in writing, and may be continued from day to day. The Board shall notify the claimant and the Commissioner of the time and place set for such hearing by registered mail.
(d)Each such hearing shall be conducted by a presiding officerProceedings. who shall be a member of the Board or an officer or employee of the Treasury Department designated a presiding officer by the Secretary of the Treasury, and assigned by the Board to preside at such hearing, and shall be open to the public. The proceedings in suchRules. hearings shall be conducted in accordance with such rules of practice and procedure (other than rules of evidence) as the Board may prescribe with the approval of the Secretary of the Treasury, and in accordance with the rules of evidence applicable in courts of equity of the District of Columbia. The claimant and the Commissioner shall be entitled to be represented by counsel, to have witnesses subpenaed, and to examine and cross-examine witnesses. The presiding officerProduction of evidence, witnesses, etc. shall have authority to administer oaths, examine witnesses, rule on questions of procedure and the admissibility of evidence, and to require by subpena, signed by any member of the Board, the attendance and testimony of witnesses, and the production of all necessary returns, books, papers, records correspondence, memoranda, and other evidence, from any place in the United States at any designated place of hearing, and to require the taking of a deposition by any designated individual competent to administer oaths. Any witness summoned or whose deposition is taken pursuantFees, etc., of witnesses. to this section shall receive the same fees and mileage as witnesses in the courts of the United States.
(e)The presiding officers shall recommend findings of fact andFindings of fact and decision. a decision to the Board or the proper division thereof within six months after the conclusion of the hearing. Briefs with respect to such recommendations may be submitted to the Board or such division on behalf of the Commissioner and the claimant within thirty days after such recommendations have been made, unless such time is extended by the Board or such division. Except upon specific order of the chairman of the Board, no oral argument may be presented to the Board or such division after the conclusion of the hearing. The Board or a division shall make its findings of fact and decision in writing as quickly as practicable. The findings ofTime limitation. fact and the decision of a division shall become the findings of fact and decision of the Board within thirty days after they have been made by the division, unless within such period, the chairman has directed that such findings and decision small be reviewed by the Board. The findings and decision of a division shall not be a part of the record in any case in which the chairman directs that such findings and decision shall be reviewed by the Board. Copies of 1750the findings of fact and decision of the Board shall be mailed to the claimant and the Commissioner by registered mail.
(f)Table of costs and fees to be drawn. The Board, with the approval of the Secretary of the Treasury, is authorized to draw up a table of costs and fees relating to such hearings, and the preparation of transcripts of record thereof, not to exceed with respect to any one item those charged in the Supreme Court of the United States. Such costs and fees shall be paid by the claimant and be collected in accordance with such rules and regulations as may be prescribed by the Board, with the approval of the Secretary. If the hearing provided herein results in a modification of the allowance or disallowance of the Commissioner, such costs shall be returned to the claimant.
(g)Circuit Court of Appeals.Review of decision by, on petition. A review of the decision of the Board, made after the hearing provided in this section, may be obtained by the claimant or Commissioner by filing a petition for review in the Circuit Court of Appeals of the United States within any circuit wherein such claimant resides, or has his principal place of business, or, if none, in the United States Court of Appeals for the District of Columbia, or any such court which may be designated by the Commissioner and the claimant by stipulation in writing, within three months after the date of the mailing to the claimant and the Commissioner of the Copy of petition to Commissioner, etc.copy of the findings and decision of the Board. A copy of such petition shall forthwith be served upon the Commissioner or upon any officer designated by him for that purpose, or upon the claimant, according to which party files such petition, and upon the Board. Transcript of record to be filed.Thereupon the Board shall certify and file in the court, in which such petition has been filed, a transcript of the record upon which the findings and decision complained of were based. Upon the filing of such transcript such court shall have exclusive jurisdiction to affirm the decision of the Board, or to modify or reverse such decision, if it is not in accordance with law, with or without remanding the cause for a rehearing, as justice may require. No objection shall be considered by the court unless such objection shall have been urged before the Board or division and the presiding officer, or unless there Additional evidence.were reasonable grounds for failure so to do. If the claimant or the Commissioner shall apply to the court for leave to adduce additional evidence and shall show to the satisfaction of the court that such additional evidence is material, and that there were reasonable grounds for failure to adduce such evidence in the hearing before the presiding officer, the court may order such additional evidence to be taken before such officer, and to be adduced upon the hearing in such manner and upon such terms and conditions as to the court may Effect of, on Board’s findings.seem proper. The Board may modify its findings of fact and decision by reason of the additional evidence so taken and it shall file Finality of court decision; review by Supreme Court.with the court such modified or new findings and decision. The judgment of the court shall be final, subject to review by the Supreme Court of the United States, upon certification or certiorari as [U. S. C., p. 1272](/us/usc/p1272).provided in sections 239 and 240 of the Judicial Code, as amended. Such courts are authorized to adopt rules for the filing of petitions for review, the preparation of the record for review, and the Costs.conduct of the proceedings on review. If the decision of the Board is affirmed, costs shall be awarded against the claimant, and if such decision is reversed, the judgment shall provide for a refund of any costs paid by the claimant. In case of modification of such decision costs shall be awarded or refused as justice may require. The decision of the Board made after the hearing provided herein shall become final in the same manner that decisions of the Board of Tax Vol. 44, p. 111.Appeals become final under section 1005 of the Revenue Act of 1926, as amended. 1751 SEC. 907. Evidence and presumptions.Prima facie evidence as to extent claimant bore tax burden. EVIDENCE AND PRESUMPTIONS.
(a)Where the refund claimed is for an amount paid or collected as processing tax, as defined herein, it shall be primafacie evidence that the burden of such amount was borne by the claimant to the extent (not to exceed the amount of the tax) that the average margin per unit of the commodity processed was lower during the tax period than the average margin was during the period before and after the tax. If the average margin during the tax period was not lower, it shall be primafacie evidence that none of the burden of such amount was borne by the claimant but that it was shifted to others.
(b)The average margin for the tax period and the averageDetermination of average margin. margin for the period before and after the tax shall each be determined as follows:
(1)Tax period.— The average margin for the tax period shallTax period. be the average of the margins for all months (or portions of months) within the tax period. The margin for each such month shall be computed as follows: From the gross sales value of all articles processed by the claimant from the commodity during such month, deduct the cost of the commodity processed during the month and deduct the processing tax paid with respect thereto. The sum so ascertained shall be divided by the total number of units of the commodity processed during such month, and the resulting figure shall be the margin for the month.
(2)Period before and after the tax.— The average marginPeriod before and after tax. for the period before and after the tax shall be the average of the margins for all months (or portions of months) within the period before and after the tax. The margin for each such month shall be computed as follows: From the gross sales value of all articles processed by the claimant from the commodity during such month, deduct the cost of the commodity processed during the month. The sum so ascertained shall be divided by the number of units of the commodity processed during such month, and the resulting figure shall be the margin for the month.
(3)Average margin.— The average margin for each periodAverage margin; ascertainment. shall be ascertained in the same manner as monthly margins under subdivisions
(1)and (2), using total gross sales value, total cost of commodity processed, total processing tax paid, and total units of commodity processed, during such period.
(4)Combination of commodities.— Where, as, for example,Combination of commodities. in the case of certain types of tobacco, the articles produced and sold by the claimant are the product of several commodities combined by him during processing, the average margins shall be established with respect to such commodities as a group, and not individually, in accordance with rules and regulations prescribed by the Commissioner, with the approval of the Secretary of the Treasury.
(5)Cost of commodity.— The cost of commodity processedCost of commodity. during each month shall be
(a)the actual cost of the commodity processed if the accounting procedure of the claimant is based thereon, or
(b)the product computed by multiplying the quantity of the commodity processed by the current prices at the time of processing for commodities of like quality and grade in the markets where the claimant customarily makes his purchases.
(6)Gross sales value of articles.— The gross sales value ofGross sales value of articles. articles shall mean
(a)the total of the quantity of each article derived from the commodity processed by the claimant during each month multiplied by
(b)the claimant’s sale prices current at the time of processing for articles of similar grade and quality. 1752
(7)Quantity. The quantity of each article derived from the commodity processed may be either
(a)the actual quantity obtained, as shown by the records of the claimant, or
(b)an estimated quantity computed by multiplying the quantity of commodity processed by appropriate conversion factors giving the quantity of articles customarily obtained from the processing of each unit of the commodity.
(c)“Tax period” construed. The “tax period” shall mean the period with respect to which the claimant actually paid the processing tax to a collector of internal revenue and shall end on the date with respect to which the “Period before and after the tax”.last payment was made. The “period before and after the tax” shall mean the twenty-four months (except that in the case of tobacco it shall be the twelve months) immediately preceding the effective date of the processing tax, and the six months, February to Determining prices for part of period.July, 1936, inclusive. If during any part of such period the claimant was not in business, or if his records for any part of such period are so inadequate as not to provide satisfactory data on prices paid for commodities purchased or prices received for articles sold, the average prices paid or received by representative concerns engaged in a similar business and similarly circumstanced may with the approval of the Commissioner, where necessary for a fair Average margin.comparison, be substituted in making the necessary computations. If the claimant was not in business during the entire period before and after the tax, the average margin, during such period, of representative concerns engaged in a similar business and similarly circumstanced, as determined by the Commissioner, shall be used as his average margin for such period.
(d)Purchase or sale other than through an arm’s-length transaction, etc. If the claimant made any purchase or sale otherwise than through an arm’s-length transaction, and at a price other than the fair market price, the Commissioner may determine the purchase or sale price to be that for which such purchases or sales were at that time made in the ordinary course of trade.
(e)Rebuttal of presumption. Either the claimant or the Commissioner may rebut the presumption established by subsection
(a)of this section by proof of the actual extent to which the claimant shifted to others the burden of the processing tax. Such proof may include, but shall not be limited to—
(1)Proof permitted. Proof that the difference or lack of difference between the average margin for the tax period and the average margin for the period before and after the tax was due to changes in factors other than the tax. Such factors shall include any clearly shown change
(A)in the type or grade of article or commodity, or
(B)in costs of production. If the claimant asserts that the burden of the tax was borne by him and the burden of any other increased costs was shifted to others, the Commissioner shall determine, from the effective dates of the imposition or termination of the tax and the effective date of other changes in costs as compared with the date of the changes in margin (when margins are computed for weeks, months, or other intervals between July 1, 1931, and August, 1936, in the manner specified in subsection (b)), and from the general experience of the industry, whether the tax or the increase in other costs was shifted to others. If the Commissioner determines that the difference in average margin was due in part to the tax and in part to the increase in other costs, he shall apportion the change in margin between them;
(2)Proof that the claimant modified existing contracts of sale, or adopted a new form of contract of sale, to reflect the initiation, termination, or change in amount of the processing tax, or at any such time changed the sale price of the article (including the effect 1753of a change in size, package, discount terms, or any other merchandising practice) by substantially the amount of the tax or change therein, or at any time billed the tax as a separate item to any vendee, or indicated by any writing that the sale price included the amount of the tax, or contracted to refund any part of the sale price in the event of recovery of the tax or decision of its invalidity; but the claimant may establish that such acts were caused by factors other than the processing tax, or that they do not represent his practice at other times. If the claimant processed any product in addition to the commodity with respect to the processing of which there was paid or collected an amount as tax for which he claims a refund, and if the Commissioner has reason to believe that the burden of such amount was shifted in whole or in part by means of the transactions relating to such product, the average margin with respect to such product, and articles processed therefrom, shall also be considered, and shall be determined for the tax period applicable to the commodity and for the period before and after the tax in the manner prescribed in subsection
(b)of this section. To the extent the Commissioner determines that the average margin with respect to such product was higher during the tax period than it was during the period before and after the tax, it shall be primafacie evidence that such amount was not borne by the claimant but that it was shifted to others. SEC. 908. Allowance of claims. LIMITATIONS ON ALLOWANCE OF CLAIMS AND INTEREST.
(a)No claim shall be allowed under this title in an amount lessMinimum amount. than $10.
(b)No interest shall be allowed by the Commissioner or by anyInterest limited. court with respect to any amount paid or collected as tax under the Agricultural Adjustment Act, except with respect to amounts, refund of which is made or allowed under this title. SEC. 909. LIMITATIONS ON REVIEW. In the absence of fraud or mistake in mathematical calculation,Limitations on review. the findings of fact and conclusions of law of the Commissioner upon the merits of any claim presented under this title shall not be subject to review by any other administrative or accounting officer, employee, or agent of the United States. SEC. 910. LIABILITY OF COLLECTORS. No collector of internal revenue or customs, or internal revenueLiability of collectors. or customs officer or employee, shall be in any way liable to any person for any act done by him in the assessment or collection of any amount as tax under the Agricultural Adjustment Act, or for the recovery of any money exacted by or paid to him and paid into the Treasury, in performance of his official duties under the provisions of such Act, or if such collector or officer acted under the direction of the Secretary or other proper officer of the Government. SEC. 911. Inapplicability to certain refunds.Designated provisions of Agricultural Adjustment Act not included.Vol. 48, pp. 39–40; pp. 768–770.Vol. 40, p. 696. INAPPLICABILITY TO CERTAIN REFUNDS. The provisions of this title shall not apply to any refund authorized under the provisions of sections 15, 16, or 17 of the Agricultural Adjustment Act, as amended and reenacted, or with respect to any articles exported under the provisions of section 317 of the Tariff Act of 1930. No refund shall be made or allowed of any amount paid or collected as tax under the Agricultural Adjustment Act, as amended and reenacted, to the extent that refund or credit with respect to such amount has been made to any person. 1754 SEC. 912. Period not extended. PERIOD NOT EXTENDED. No revival of barred suits.Any suit or proceeding with respect to any amount paid or collected as tax under the Agricultural Adjustment Act which is barred on the date of enactment of this Act shall remain barred. No claim with respect to any such amount which is barred from allowance at the time of the enactment of this Act shall hereafter be allowed in any amount. SEC. 913. Definitions. DEFINITIONS. When used in this title—
(a)“Tax”; terms included. The term “tax” means a tax or exaction denominated a “tax” under the Agricultural Adjustment Act, and shall include any penalty, addition to tax, additional tax, or interest applicable to such tax.
(b)“Processing tax.” The term “processing tax” means any tax or exaction denominated a “processing tax” under the Agricultural Adjustment Act, Amounts not included.but shall not include any amount paid or collected as tax with respect to the processing of a commodity for a customer for a charge or fee.
(c)“Commodity.” The term “commodity” means any commodity, prior to processing, of a type with respect to the processing of which a processing tax was imposed under the Agricultural Adjustment Act.
(d)“Article.” The term “article” means the product which is obtained by processing a commodity, and includes the product obtained by further manufacture or by combination with other materials.
(e)“Refund.” The term “refund” includes any recovery, recoupment, set-off, credit, or counterclaim.
(f)“Agricultural Adjustment Act.” The term “Agricultural Adjustment Act” means the Agricultural Adjustment Act as originally enacted and the amendments thereto adopted prior to January 6, 1936. SEC. 914. Authority of Commissioner. AUTHORITY OF COMMISSIONER. Examination of books and other relevant material.In connection with the establishment of the facts required to be established under this title, the Commissioner of Internal Revenue is hereby authorized, by any officer or employee of the Treasury Department and of the Bureau of Internal Revenue, including the field service, designated by him for that purpose, to examine any books, papers, records, or memoranda which are relevant and material in connection with any claim made pursuant to this title, to Attendance of claimant, etc.require the attendance of the claimant or of any officer or employee of the claimant, or the attendance of any other person having Taking of testimony, etc.knowledge in the premises, and to take, or cause to be taken, his testimony with reference to any such matter, with power to administer oaths Attendance of witnesses; production of books, etc.to such person or persons. It shall be lawful for the Commissioner, or any person designated by him, to summon witnesses to appear before the Commissioner, or before any person designated by him, at a time and place named in the summons, and to produce such books, papers, correspondence, memoranda, or other records as the Commissioner may deem relevant or material, and to give testimony or answer interrogatories, under oath, relating to any claim [R. S., secs. 3174, 3175, pp. 609, 610](/us/rs/s3174/3175/pp609/610).[U. S. C., p. 1190](/us/usc/p1190).Witnesses; fees and mileage.made pursuant to this title. The provisions of 3174 and 3175 of the Revised Statutes, as amended, shall be applicable with respect to any summons issued pursuant to the provisions of this title. Any witness summoned under this title shall be paid the same fees and Information procured available to Secretary of Agriculture.mileage as are paid witnesses in the courts of the United States. All information obtained by the Commissioner pursuant to this section shall be available to the Secretary of Agriculture upon written To be kept confidential.request therefor. Such information shall be kept confidential by 1755all officers and employees of the Department of Agriculture, andPenalty for violation. any such officer or employee who violates this requirement shall, upon conviction, be subject to a fine of not more than $1,000 or to imprisonment for not more than one year, or both, and shall be removed from office. SEC. 915. Salaries and administrative expenses.Funds available.*Ante*, 774. SALARIES AND ADMINISTRATIVE EXPENSES. Funds made available to the Secretary of Agriculture, by the appropriation for the fiscal year 1936 in section 32 of Public Numbered 320, 74th Congress, approved August 24, 1935, to the extent of the unobligated balance thereof; and by the appropriation in section 12
(a)of the Agricultural Adjustment Act, in an amount not in excess of $15,000,000; shall be available until June 30, 1937, for transferTransfer to Treasury Department. to the Treasury Department for salaries and administrative expenses in carrying out the provisions of this title and of Title IV, *Ante*, p. 1739.including necessary investigative work, and for refunds and payments under Title IV. Such funds shall be available for expenditureServices, etc., in District of Columbia. by the Secretary of the Treasury for personal services and rent in the District of Columbia and elsewhere, for law books, books of reference, press releases, trade journals, periodicals, and newspapers, for contracting reporting services, printing and paper in addition to allotments under the existing law, travel expenses, for mileage and per diem of witnesses, in lieu of subsistence, payment of which mileage and per diem may be made in advance upon certification of such officer as the Commissioner or the Secretary may designate, and such certification shall be conclusive. In addition to the foregoing, theMiscellaneous expenses. administrative expenses provided for in this section shall include such miscellaneous expenses as may be authorized or approved by the Commissioner or the Secretary for carrying out the provisions of this title, including witness fees and mileage for experts, notarial fees, or like services, and stenographic work for taking depositions. SEC. 916. Rules and regulations. RULES AND REGULATIONS. The Commissioner shall, with the approval of the Secretary, prescribe such rules and regulations as may be deemed necessary to carry out the provisions of this title. SEC. 917. Personnel. PERSONNEL.
(a)The Secretary may appoint such officers, attorneys, economists,Appointment of. and other experts without regard to the Classification Act of 1923, as amended, and without regard to the civil-service laws or regulations, as are necessary to execute the functions vested in him and the Commissioner by this title. No compensation at a rate in excessSalary limitation. of $8,500 per annum shall be paid to any such appointee.
(b)Officers and employees of the other executive departmentsDetails from other departments. and establishments of the Government may, at the request of the Secretary of the Treasury, and with the approval of the head of any such department or establishment, be detailed to the Treasury Department from time to time for such temporary duties as may be necessary in carrying out the provisions of this title. The proper appropriationReimbursement of appropriations. of such executive department or establishment from which such officers or employees are so detailed shall be reimbursed by the Treasury Department to the extent of salaries and other compensation paid to such officer’s and employees during the time they shall be so detailed. 1756 TITLE VIII—Title VIII—General Provisions. GENERAL PROVISIONS SEC. 1001. Definitions. DEFINITIONS.
(a)When used in this Act—
(1)“Person” The term “person” means an individual, a trust or estate, a partnership, or a corporation.
(2)“Corporation.” The term “corporation” includes associations, joint-stock companies, and insurance companies.
(3)“Partnership.” The term “partnership” includes a syndicate, group, pool, joint venture, or other unincorporated organization, through or by means of which any business, financial operation, or venture is carried on, and which is not, within the meaning of this Act, a “Partner.”trust or estate or a corporation; and the term “partner” includes a member in such a syndicate, group, pool, joint venture, or organization.
(4)“Domestic.” The term “domestic” when applied to a corporation or partnership means created or organized in the United States or under the law of the United States or of any State or Territory.
(5)“Foreign.” The term “foreign” when applied to a corporation or partnership means a corporation or partnership which is not domestic.
(6)“Fiduciary.” The term “fiduciary” means a guardian, trustee, executor, administrator, receiver, conservator, or any person acting in any fiduciary capacity for any person.
(7)“Withholding agent.” The term “withholding agent” means any person required to deduct and withhold any tax under the provisions of section 143 or 144.
(8)“Stock.” The term “stock” includes the share in an association, joint-stock company, or insurance company.
(9)“Shareholder.” The term “shareholder” includes a member in an association, joint-stock company, or insurance company.
(10)“United States.” The term “United States” when used in a geographical sense includes only the States, the Territories of Alaska and Hawaii, and the District of Columbia.
(11)“Secretary.” The term “Secretary” means the Secretary of the Treasury.
(12)“Commissioner.” The term “Commissioner” means the Commissioner of Internal Revenue.
(13)“Collector.” The term “collector” means collector of internal revenue.
(14)“Taxpayer.” The term “taxpayer” means any person subject to a tax imposed by this Act.
(b)“Includes” and “including.” The terms “includes” and “including” when used in a definition contained in this Act shall not be deemed to exclude other things otherwise within the meaning of the term defined. SEC. 1002. SEPARABILITY CLAUSE. Separability clause.If any provision of this Act, or the application thereof to any person or circumstances, is held invalid, the remainder of the Act, and the application of such provisions to other persons or circumstances, shall not be affected thereby. SEC. 1003. EFFECTIVE DATE OF ACT. Effective date.Except as otherwise provided, this Act shall take effect upon its enactment. Approved, June 22, 1936, 9 p.m. Making appropriations for the Department of the Interior for the fiscal year ending June 30, 1937, and for other purposes. 1936-06-22 691 Chapter 49 Stat. 1757 74 2 United States Government Publishing Office text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. Digitization Vendor 2025-01-07 public 1757 [CHAPTER 691.] AN ACT Making appropriations for the Department of the Interior for the fiscal year ending June 30, 1937, and for other purposes. June 22, 1936.[[H. R. 10630](/us/bill/74/hr/10630).[
Connectionstraces to 10
Traces to 10 documents
statutes-at-large
11 references not yet in our index
  • 49 Stat. 115
  • 49 Stat. 43
  • 46 Stat. 500
  • 49 Stat. 1048
  • 48 Stat. 31
  • 49 Stat. 750
  • 48 Stat. 1061
  • 49 Stat. 571
  • 49 Stat. 610
  • 49 Stat. 1648
  • 49 Stat. 1757
Citation graph
cites case law
Public Law 740
Stat.Chapter 354
Stat.Private Law 130
Stat.Chapter 173
Stat.Chapter 247
Stat.Public Law 301
Stat.Chapter 298
Stat.Chapter 807
Stat.Public Law 98
Stat.Public Law 96–52
Stat.49 Stat. 115
Stat.49 Stat. 43
Stat.46 Stat. 500
Cites 21 · showing 12Cited by 0 across 0 sources
★   the supreme law of the land   ★
Don't Tread on Me
E Pluribus Unum — out of many, one

"If you don't know your rights, you don't have any."

Marginalia · a citizen's law index
A research desk, not legal advice. Always read the cited source before relying on a summary.
Questions or an issue? support@self-law.org
disclaimerMarginalia is a research index, not a law firm. Nothing on this site is legal, tax, or financial advice and no attorney–client relationship is formed by using it. Statutes, regulations, and case law change; summaries, search results, AI output, and member posts may be incomplete, out of date, or wrong. Any interpretation drawn from material on this site should be validated by a licensed attorney in your jurisdiction before you act on it.