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operative bank within the meaning of the first sentence of this paragraph by reason of the application of the second and third sentences of paragraph (19) of this subsection, the deduction otherwise allowable under section 166(c) for a reasonable addition to the reserve for bad debts shall, under regulations prescribed by the Secretary or his delegate, be reduced in a manner consistent with the reductions provided by the table contained in section 593(b) (5).

(As amended June 25, 1959, Pub. L. 86-70, § 22 (g), (h), 73 Stat. 146; July 12, 1960, Pub. L. 86–624, § 18 (i), (j), 74 Stat. 416; Sept. 13, 1960, Pub. L. 86-778, title I, § 103 (t), 74 Stat. 941; Oct. 16, 1962, Pub. L. 87-834, §§ 6(c), 7(h), 76 Stat. 982, 988; Oct. 23, 1962, Pub. L. 87-870, § 5(a), 76 Stat. 1161.)

REFERENCES IN TEXT

Section 401(a) of the National Housing Act, referred to in subsec. (a) (19), is classified to section 1724 (a) of Title 12, Banks and Banking.

The date of the enactment of the Revenue Act of 1962, referred to in subsec. (a) (19), means the date of the enactment of Pub. L. 87-834, which was approved on Oct. 16, 1962.

AMENDMENTS

1962 Subsec. (a) (19). Pub. L. 87-834, § 6(c), amended subsec. (a) (19) generally to read as above set forth. Prior to such amendment, subsection read as follows: "The term 'domestic building and loan association' means a domestic building and loan association, a domestic savings and loan association, and a Federal savings and loan association, substantially all the business of which is confined to making loans to members."

Subsecs. (a) (30), (31). Pub. L. 87-834, § 7(h), added subsecs. (a) (30), (31).

Subsec. (a) (32). Pub. L. 87-870 added par. (32). 1960-Subsec. (a) (9). Pub. L. 86-624, § 18(i), eliminated the Territory of Hawaii.

Subsec. (a) (10). Pub. L. 86-624, § 18(1), eliminated the Territory of Hawaii.

Subsec. (a) (12). Pub. L. 86-778 designated existing provisions as par. (A) and added par. (B).

1959 Subsec. (a) (9). Pub. L. 86-70, § 22(g), subst1tuted "the Territory of Hawaii" for "the Territories of Alaska and Hawaii."

Subsec. (a) (10). Pub. L. 86-70, § 22(h), substituted "Territory of Hawaii" for "Territories."

EFFECTIVE DATE OF 1962 AMENDMENTS Section 6(g) (3) of Pub. L. 87-834 provided that: "The amendment made by subsection (c) [to subsec. (a) (19) of this section] shall apply to taxable years beginning after the date of the enactment of this Act [Oct. 16, 1962]."

Section 5(b) of Pub. L. 87-870 provided that: "The amendment made by subsection (a) of this section [adding subsec. (a) (32) of this section] shall apply with respect to taxable years beginning after the date of the enactment of the Revenue Act of 1962 [Oct. 16, 1962]."

EFFECTIVE DATE OF 1960 AMENDMENTS

Amendment of subsecs. (a) (9), (10) by Pub. L. 86-624 effective on August 21, 1959, see section 18(k) of Pub. L. 86-624, set out as a note under section 2202 of this title. Amendment of subsec. (a) (12) of this section by Pub. L. 86-778 effective on Sept. 13, 1960, see section 103 (v) (1) of Pub. L. 86-778, set out as a note under section 402 of Title 42, The Public Health and Welfare.

EFFECTIVE DATE OF 1959 AMENDMENT Amendment of section by Pub. L. 86-70 effective Jan. 3, 1959, see section 22(1) of Pub. L. 86-70 set out as a note under section 2202 of this title.

Chapter 80.-GENERAL RULES Subchapter A.-Application of Internal Revenue Laws § 7801. Authority of the Department of the Treasury. (a) Powers and duties of Secretary.

Except as otherwise expressly provided by law, the administration and enforcement of this title shall be performed by or under the supervision of the Secretary of the Treasury.

(b) Office of General Counsel for the Department. (1) General counsel.

There shall be in the Department of the Treasury the office of General Counsel for the Department of the Treasury. The General Counsel shall be appointed by the President, by and with the advice and consent of the Senate. The General Counsel shall be the chief law officer of the Department and shall perform such duties as may be prescribed by the Secretary.

(2) Assistant general counsels.

The President is authorized to appoint, by and with the advice and consent of the Senate, an Assistant General Counsel who shall be the Chief Counsel for the Internal Revenue Service and shall receive basic compensation at the annual rate of $19,000. The Chief Counsel shall be the chief law officer for the Internal Revenue Service and shall perform such duties as may be prescribed by the Secretary. The Secretary may appoint, without regard to the provisions of the civil service laws, and fix the duties of not to exceed five other assistant General Counsels.

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1959-Pub. L. 86-368 provided for Presidential appointment and for compensation of Assistant General Counsel who shall be Chief Counsel for Internal Revenue Service. EFFECTIVE DATE OF 1959 AMENDMENT

Section 3 of Pub. L. 86-368 provided that:

"(a) Except as otherwise provided in this Act, the amendments made by this Act [to this section] shall take effect on the date of the enactment of this Act [Sept. 22, 1959].

"(b) The amendments made by section 2 of this Act [to sections 7452 and 8023 (a), (b) of this title] shall take effect when the Chief Counsel for the Internal Revenue Service first appointed pursuant to the amendment made by section 1 of this Act [to this section] qualifies and takes office."

SAVING PROVISIONS

Section 4 of Pub. L. 86-368 provided that:

"(a) The position of the Assistant General Counsel serving as Chief Counsel of the Internal Revenue Service shall continue to exist until such time as the Chief

Counsel for the Internal Revenue Service first appointed pursuant to the amendment made by section 1 of this Act [to this section] qualifies and takes office, and at such time such position is hereby abolished.

"(b) Except as provided in subsection (a), this Act shall not be construed to abolish, terminate, or otherwise change, any office or position, or the appointment or employment of any officer or employee, existing immediately preceding the enactment of this Act [Sept. 22, 1959], but the same shall continue unless and until changed by lawful authority.

"(c) Any delegation of authority made pursuant to Reorganization Plan Numbered 26 of 1950 or Reorganization Plan Numbered 1 of 1952 [set out as notes under section 133z-15 of Title 5, Executive Departments and Government Officers and Employees], including any redelegation of authority made pursuant to any such delegation of authority, and in effect immediately preceding the enactment of this Act [Sept. 22, 1959] shall, notwithstanding the amendment made by section 1 of this Act [to this section], remain in effect unless distinctly inconsistent or manifestly incompatible with such amendment. The preceding sentence shall not be construed as limiting in any manner the power to amend, modify, or revoke any such delegation or redelegation of authority."

§ 7809. Deposit of collections.

(a) General rule.

Except as provided in subsections (b) and (c) and in sections 4735, 4762, 7651, 7652, and 7654, the gross amount of all taxes and revenues received under the provisions of this title, and collections of whatever nature received or collected by authority of any internal revenue law, shall be paid daily into the Treasury of the United States under instructions of the Secretary or his delegate as internal revenue collections, by the officer or employee receiving or collecting the same, without any abatement or deduction on account of salary, compensation, fees, costs, charges, expenses, or claims of any description. A certificate of such payment, stating the name of the depositor and the specific account on which the deposit was made, signed by the Treasurer of the United States, designated depository, or proper officer of a deposit bank, shall be transmitted to the Secretary or his delegate.

(c) Deposit of certain receipts.

Moneys received in payment for

(1) Work or services performed pursuant to section 7515 (relating to special statistical studies and compilations and other services on request);

(2) work or services performed (including materials supplied) pursuant to section 7516 (relating to the supplying of training and training aids on request); and

(3) other work or services performed for a State or a department or agency of the Federal Government (subject to all provisions of law and regulations governing disclosure of information) in supplying copies of, or data from, returns, statements, or other documents filed under authority of this title or records maintained in connection with the administration and enforcement of this title,

shall be deposited in a separate account which may be used to reimburse appropriations which bore all

or part of the costs of such work or services, or to refund excess sums when necessary. (As amended Oct. 23, 1962, Pub. L. 87-870, § 3(b), 76 Stat. 1161.) AMENDMENTS

1962 Subsec. (a). Pub. L. 87-870, § 3(b)(1), substituted "subsections (b) and (c) and in" for "subsection (b),".

Subsec. (c). Pub. L. 87-870, § 3(b) (2), added subsec. (c).

Subchapter B.-Effective Date and Related Provisions § 7852. Other applicable rules.

APPLICATION OF SUBSEC. (d) TO PUB. L. 87-834 Section 31 of Pub. L. 87-834, Oct. 16, 1962, 76 Stat. 1069, provided that: "Section 7852(d) of the Internal Revenue Code of 1954 [subsec. (d) of this section] (relating to treaty obligations) shall not apply in respect of any amendment made by this Act [see Short Title note under section 38 of this title]."

Subtitle G.-The Joint Committe on Internal Revenue Taxation

Chapter 92.-POWERS AND DUTIES
OF THE JOINT COMMITTEE

§ 8023. Additional powers to obtain data.
(a) Securing of data.

The Joint Committee or the Chief of Staff of the Joint Committee, upon approval of the Chairman or Vice Chairman, is authorized to secure directly from the Internal Revenue Service or the office of the Chief Counsel for the Internal Revenue Service or directly from any executive department, board, bureau, agency, independent establishment, or instrumentality of the Government, information, suggestions, rulings, data, estimates, and statistics, for the purpose of making investigations, reports, and studies relating to internal revenue taxation.

(b) Furnishing of data.

The Internal Revenue Service, the office of the Chief Counsel for the Internal Revenue Service, executive departments, boards, bureaus, agencies, independent establishments, and instrumentalities are authorized and directed to furnish such information, suggestions, rulings, data, estimates, and statistics directly to the Joint Committee or to the Chief of Staff of the Joint Committee upon request made pursuant to this section.

(As amended Sept. 22, 1959, Pub. L. 86-368, § 2(b), 73 Stat. 648.)

AMENDMENTS

1959 Subsec. (a). Pub. L. 86-368, § 2(b)(1), substituted "or the office of the Chief Counsel for" for the words "(including the Assistant General Counsel of the Treasury Department serving as the Chief Counsel of”.

Subsec. (b). Pub. L. 86-368, § 2(b)(2), substituted ", the office of the Chief Counsel for" for "(including the Assistant General Counsel of the Treasury Department serving as the Chief Counsel of".

EFFECTIVE DATE OF 1959 AMENDMENT Amendment of section by Pub. L. 86-368 effective when the Chief Counsel for the Internal Revenue Service first appointed pursuant to amendment of section 7801 of this title by Pub. L. 86-368 qualifies and takes office, see note set out under section 7801 of this title.

APPENDIX

RULES OF PRACTICE BEFORE THE TAX COURT OF THE UNITED STATES

Rule

28. Pretrial conferences.

Rule 19. Motions.

As amended to December 31, 1963

(b) Motions will be acted upon as justice may require and may, in the discretion of the Court, be placed upon the motion calendar for argument. Disposition of motions will be expedited if the party filing the same, after consultation with his adversary, is able to note on the motion that there is no objection thereo. (See Rule 27 (a) and (d) and Rule 30 (b).)

(c) The filing of a motion shall not constitute cause for postponement of a trial from the date set. (See also Rule 27(d) on motions for continuance.)

Rule 20. Extensions of time.

*

For continuances, see Rule 27(d).

Rule 21. Dismissal.

A case may be dismissed for cause upon motion of either party or of the Court. (See Rule 7(a) (2) and Rule 27(c) (3).)

Rule 24. Counsel-Appearance-Withdrawal-Substitution-Changed address.

(c) Substitution of counsel. New counsel may be substituted by conforming to the provisions of (a) (2) or (3) and (b) of this section. (See Rules 2, 4, 19, and 27 (d) .)

(See Rule 22(b) in regard to substitution of "first counsel of record" for purposes of service.)

Rule 27. Place, time, and notice of hearing and trialsattendance and continuances.

(a) Calendars of hearings on motions and other procedural and subsidiary matters. (1) If it is necessary for the Court to hear the parties on matters other than the merits, the proceedings will be listed for such hearing on a motion calendar which is I called in Washington, D.C., unless good cause for holding the hearing elsewhere is shown in a timely motion to the Court. Ordinarily such calendars will be set for call at 10 a.m. (see Rule 1) on Wednesdays throughout the year, but due notice of the time and place in each case will be given to the parties by the Clerk (see Rule 22).

(2) Attendance at hearings on motion calendar. If a party fails to appear at the call of the motion calendar, the Court will hear the proceeding ex parte. However, a memorandum or brief stating the position of the petitioner upon the pending motion will be accepted, when the failure of the peti

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tioner to appear is justified by distance, shortness of time, or other good reason stated in such memorandum or brief.

(3) Where the motion or order is directed to defects in a pleading, prompt filing of a proper pleading correcting the defects may obviate the necessity of a hearing thereon.

(b) Report calendars. On a calendar specially set for the purpose or on a trial calendar, and after due notice of the time and place given to the parties by the Clerk, any case at issue may be listed and called, first, for report as to whether the case is to be tried or otherwise disposed of, and if the latter, to report on its status, and second, if it is to be tried, for report on the current status of preparations for trial, particular reference being given to the requirements of Rule 31(b).

(c) Trial calendars. (1) Each case, when at issue, will be placed upon a calendar for trial in accordance with Rule 26 and the Clerk, not less than 90 days in advance unless otherwise authorized by the Chief Judge, will notify the parties of the place where and the date and time when it will be called. (2) Calendar call. Each case appearing on such a calendar will be called at the time and place scheduled. The cases will be called usually in the order listed, and counsel or the parties will state their estimate of the time required for trial or file stipulations in lieu of trial. The cases for trial will thereupon be tried in due course, but not necessarily in the order listed.

(3) Attendance at trials. The unexcused absence of a party or his counsel when a case is called for trial will not be the occasion for delay. The case may be dismissed for failure properly to prosecute or the trial may proceed and the case be regarded as submitted on the part of the absent party or parties.

(4) The Court may require appearance for argument or it may accept briefs in lieu of personal appearance.

(1) Court

(d) Continuances-motions-trials. action on cases set for hearing on motions or trial will not be delayed by a motion for continuance unless it is timely, sets forth good and sufficient cause, and complies with all applicable Rules.

(2) Conflicting engagements of counsel or the employment of new counsel will never be regarded as good ground for a continuance unless set forth in a motion filed promptly after the notice of hearing or trial has been mailed or unless extenuating circumstances are shown which the Court deems adequate (see Rule 20).

(e) Reserve calendar. A case once at issue may, upon motion, be placed on an inactive list called the reserve calendar. Good cause must be shown, as, for example, that the case will be governed by the decision in a case pending in a higher court. The case may be placed later on a trial calendar by motion of either party or by the Court on its own motion when the reason for inaction no longer exists.

Rule 28. Pretrial conferences.

(a) General. In appropriate cases the Court will undertake to confer with the parties in pretrial conferences with a view to narrowing issues, stipulating facts, simplifying the presentation of evidence or otherwise assisting in the preparation for trial or possible disposition of the case in whole or in part without trial.

(b) Cases calendared for trial. Either party in a case listed for trial on any trial calendar may request of the trial judge, or the judge on his own motion may order, a pretrial conference. The trial judge may, in his discretion, set the case for a pretrial conference at such time and place during the calendar or prior thereto as may appear to be practicable and appropriate.

(c) Cases not yet calendared for trial. Prior to listing of any case for trial, the Chief Judge in his discretion, upon motion of either party or upon his own motion, may place any case upon the next calendar in the city involved for a pretrial conference, or may assign a particular case to a judge for a pretrial conference either in Washington, D.C., or in any other city where such conference may conveniently be held.

(d) Conditions. A request or motion for a pretrial conference shall include a statement of the reasons therefor. Pretrial conferences will in no circumstances be held as a substitute for the conferences required between the parties by Rule 31(b) (2), and a pretrial conference for the purpose of assisting the parties in entering into the stipulations called for by Rule 31(b) (1) will be held by the Court only where the party requesting such pretrial conference has in good faith attempted without success to obtain such stipulation from his adversary. Nor will any pretrial conference be held where the Court is satisfied that the request therefor is frivolous or is made for purposes of delay.

(e) Order. The judge holding a pretrial conference may, in his discretion, issue an appropriate order.

Rule 31. Evidence and submission of evidence.

(a) Rules applicable. The trials before the Court and its Divisions will be conducted in accordance with the rules of evidence applicable in trials without a jury in the United States District Court for the District of Columbia. With reference to the examination of unwilling or hostile witnesses, see Rule 43(b) of the Rules of Civil Procedure for the United States District Courts.1

(b) Stipulations-(1) Stipulations required. The Court expects the parties to stipulate evidence to the fullest extent to which complete or qualified agreement can be reached including all material

facts that are not or fairly should not be in dispute.

(2) In preparation for trial. The party expecting to introduce any evidence which might possibly be stipulated (as for example, entries or summaries from books of account and other records, documents, and all other evidence, to the extent not disputed) shall confer with his adversary promptly after receipt of the trial notice, and both shall endeavor to stipulate all facts not already stipulated.

(3) Presentation-Copies-Form. Stipulations in writing may be filed with the Court in advance or presented at the trial and when filed need not be offered formally to be considered in evidence. They shall be filed in duplicate except that duplicates of the exhibits attached to the original of the stipulation need not be filed. (See Rule 4 as to form and style.)

(4) Objections. Any objection to all or any part of a stipulation should be noted in the stipulation, but the Court will consider any objection to stipulated facts made at the trial.

(i) If

(5) Results of noncompliance by a party. at the date of issuance of trial notice in a case a party has failed to confer with his adversary, or has refused or failed to stipulate the facts and evidence which are not in dispute or fairly should not be in dispute, and after trial notice, still fails or refuses to stipulate, as required under subparagraphs (1) and (2) of this paragraph, the party proposing to stipulate may within 50 days, but not less than 35 days, prior to the date set for call of the case from a trial calendar, file with the Court a motion for an order to show cause why the facts and evidence covered in his motion should not be accepted as established for the purposes of the case. The facts and evidence of the proposed stipulation covered by the motion shall be shown with particularity and by numbered paragraphs. The motion shall contain adequate references to the sources of the matter set forth, and where such sources are in possession or under control of the moving party, the motion shall also show that the opposing party has had and has reasonable access thereto. The motion shall be accompanied by proof of service on the opposing party or his counsel. Upon the filing of such motion, an order to show cause as moved shall be issued forthwith, unless the Court, in its discretion, directs otherwise.

(ii) The party against whom the order to show cause has issued shall, within 25 days of the date of such order, file a response listing by numbers the paragraphs in the proposed stipulation in respect

1 Rules of Civil Procedure for the United States District Courts:

RULE 43. Evidence.

A

(b) Scope of examination and cross-examination. party may interrogate any unwilling or hostile witness by leading questions. A party may call an adverse party or an officer, director, or managing agent of a public or private corporation or of a partnership or association which is an adverse party, and interrogate him by leading questions and contradict and impeach him in all respects as if he had been called by the adverse party, and the witness thus called may be contradicted and impeached by or on behalf of the adverse party also, and may be cross-examined by the adverse party only upon the subject matter of his examination in chief.

of which there is no dispute. Where there is disagreement with respect to any paragraph in part only, the response shall show the part admitted and the part denied. Where there is any disagreement with respect to any paragraph, either in whole or in part, or where the disagreement takes the form merely of a variance in the statement of the facts or evidence, the response shall show the basis for the disagreement including references to pertinent sources. Where the truth and authenticity of facts or evidence is not disputed, an objection on the ground of materiality or relevance may be noted but is not to be regarded as just cause for refusal to stipulate. The response shall be accompanied by proof of service on the opposing party or his counsel.

(iii) The matters covered by the show cause order and response shall be heard at the call of the case from the trial calendar, or, if practicable, at such earlier time and at such place as the Chief Judge in his discretion may fix.

(6) No evidence received to alter or contradict. The Court may set aside a stipulation in whole or in part where justice requires, but otherwise will not receive evidence tending to qualify, change, or contradict any fact properly introduced into the record by stipulation.

(c) Depositions must be offered. Testimony taken by deposition will not be considered until offered and received in evidence.

(d) Marking exhibits. Exhibits attached to a stipulation or a deposition shall be numbered serially, i.e., 1, 2, 3, etc., if offered by the petitioner; shall be lettered serially, i.e., A, B, C, etc., if offered by respondent; and shall be marked serially, i.e., 1-A, 2-B, 3-C, etc., if offered as a joint exhibit.

(e) Documentary evidence-(1) Copies. A copy of any book, record, paper, or document may be offered directly in evidence in lieu of the original,

where the original is available or where there is no objection, and, where the original is admitted in evidence, a copy may be substituted later for the original or such part thereof as may be material or relevant, upon leave granted in the discretion of the trial Judge.

(2) Return after final decision. Either party desiring the return at his expense of any exhibit belonging to him, after the decision of the Court in any case has become final, shall make prompt application in writing to the Clerk, suggesting a practical manner of delivery. Otherwise exhibits may be disposed of as the Court deems advisable.

(f) Ex parte statements are not evidence. Ex parte affidavits, statements in briefs, and unadmitted allegations in pleadings do not constitute evidence.

(g) Failure of proof. Failure to adduce evidence in support of the material facts alleged by the party having the burden of proof and denied by his adversary, may be ground for dismissal. The provisions of Rule 30 do not relieve the party upon whom rests the burden of proof of the necessity of properly producing evidence in support of issues joined on questions of fact.

Rule 64. Renegotiation of contracts cases.

(d) (See statutory references, footnotes 2 and 3.) Rule 65. Bond to stay execution of order of Renegotiation Board.

(c) Sureties and callateral. (1) The Tax Court will accept as sureties on such bonds companies holding certificates of authority from the Secretary of the Treasury. See Treasury Department, Dept. Cir. 570: 1962 Revision.)

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