29.211-7

29.212-1

29.214-1

29.217-1

29.218-1

29.235-1

29.236-1

29.262-3

29.294-1

Taxation of nonresident alien individuals. [Amended]

Gross income of nonresident alien individuals. [Amended]

Credits to nonresident alien individuals. [Amended]

Time and place of filing returns of nonresident alien individuals. [Amended]

Date on which tax shall be paid by nonresident alien individual. [Amended]

FOREIGN CORPORATIONS

Time and place for filing returns of foreign corporations. [Amended] Dates on which tax shall be paid by foreign corporations. [Amended]

CHINA TRADE ACT CORPORATIONS

Meaning of terms used in connection with China Trade Act corporations. [Amended]

PENALTIES IN CONNECTION WITH ESTIMATED TAX Additions to the tax. [Added]

29.456-1

status the

changes during

taxable

[Amended]

Limitation

year.

on the

amount of victory tax. [Amended]

Subpart F-Definitions

tions, are divided into eight subparts.

• Subpart H relates to miscellaneous provisions. [First sentence amended and new sentence added by T.D. 5391, July 14, 1944, 9 F.R. 80091] [Insert following statutory quotation immediately preceding § 29.4-1; T.D. 5425, Dec. 29, 1944, 10 F.R. 10]

SEC. 5. ALTERNATIVE TAX ON INDIVIDUALS WITH ADJUSTED GROSS INCOME OF LESS THAN $5,000. (Individual Income Tax Act of 1944, Part I.)

(b) Technical amendment. Section 4 (relating to special classes of taxpayers) is amended by striking out subsection (1) and inserting in lieu thereof the following:

(1) Individuals with adjusted gross income of less than $5,000,-Supplement T.

SEC. 2. TAXABLE YEARS TO WHICH APPLICABLE. (Individual Income Tax Act of 1944, Part I.)

Except as otherwise expressly provided, the amendments made by this part shall be applicable with respect to taxable years beginning after December 31, 1943.

§ 29.4-1 Application of regulations to special classes of taxpayers.

CODIFICATION: § 29.4-1 was amended as follows, by Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 10: By striking out the following: "Individuals with gross income from certain sources of $3,000 or less-sections 400 to 404, inclusive." and inserting in lieu thereof the following: "Individuals entitled to elect to pay the tax under Supplement T-sections 400 to 404, inclusive."

Subpart B-General Provisions

RATES OF TAX

[Insert following statutory quotation immediately preceding § 29.11-1; T.D. 5425, Dec. 29, 1944, 10 F.R. 101

SEC. 3. NORMAL TAX ON INDIVIDUALS. (Individual Income Tax Act of 1944, Part I.) Section 11 (relating to the normal tax on individuals) is amended to read as follows:

SEC. 11. NORMAL TAX ON INDIVIDUALS. There shall be levied, collected, and paid for each taxable year upon the net income of

If the surtax net income is—

Not over $2,000-

Over $2,000 but not over $4,000_ Over $4,000 but not over $6,000. Over $6,000 but not over $8,000---Over $8,000 but not over $10,000___ Over $10,000 but not over $12,000--. Over $12,000 but not over $14,000. Over $14,000 but not over $16,000-. Over $16,000 but not over $18,000_ Over $18,000 but not over $20,000--

every individual a normal tax of 3 per centum of the amount of the net income in excess of the credits against net income provided in section 25 (a). For alternative tax which may be elected if adjusted gross income is less than $5,000, see Supplement T.

SEC. 2. TAXABLE YEARS TO WHICH APPLICABLE. (Individual Income Tax Act of 1944, Part I.)

Except as otherwise expressly provided, the amendments made by this part shall be applicable with respect to taxable years beginning after December 31, 1943.

(b) Taxable years beginning after December 31, 1943. For taxable years beginning after December 31, 1943, chapter 1 imposes an income tax on individuals consisting of a normal tax (section 11) and a surtax (section 12). For optional tax in the case of taxpayers with adjusted gross income of less than $5,000 see section 400 and § 29.400-1 (b). The normal tax on individuals is at the rate of 3 percent and is upon net income reduced by the amount of the normal tax exemption provided in section 25 (a) (3) and by the credits under section 25 (a) (1) and (2), relating to interest on certain obligations of the United States and obligations of instrumentalities of the United States.

CODIFICATION: In § 29.11-1, the subheading "(a) Taxable years beginning prior to January 1, 1944" was added immediately after the section headnote, and a new paragraph (b) added as set forth above, by Treasury Decision 5425, Dec. 29, 1944, 10 FR. 10. [Insert following statutory quotation immediately preceding § 29.12-1; T.D. 5425, Dec. 29, 1944, 10 F.R. 101

SEC. 4. SURTAX ON INDIVIDUALS. (Individual Income Tax Act of 1944, Part I.)

(a) Imposition of tax. Section 12 (b) (relating to the surtax on individuals) is amended to read as follows:

(b) Rates of surtax. There shall be levied, collected, and paid for each taxable year upon the surtax net income of every individual the surtax shown in the following table:

The surtax shall be

20% of the surtax net income. $400, plus 22% of excess over $2,000. $840, plus 26% of excess over $4,000. $1,360, plus 30% of excess over $6,000. $1,960, plus 34% of excess over $8,000. $2,640, plus 38% of excess over $10,000. $3,400, plus 43% of excess over $12,000. $4,260, plus 47% of excess over $14,000. $5,200, plus 50% of excèss over $16,000. $6,200, plus 53% of excess over $18,000.

If the surtax net income is

Over $20,000 but not over $22,000--Over $22,000 but not over $26,000Over $26,000 but not over $32,000. Over $32,000 but not over $38,000. Over $38,000 but not over $44,000. Over $44,000 but not over $50,000.... Over $50,000 but not over $60,000_ Over $60,000 but not over $70,000. Over $70,000 but not over $80,000....

Over $80,000 but not over $90,000__. Over $90,000 but not over $100,000__ Over $100,000 but not over $150,000. Over $150,000 but not over $200,000_ Over $200,000--

(b) Limitation on aggregate tax. Section 12 is amended by striking out subsection (g) and inserting in lieu thereof the following:

(g) Limitation on tax. The tax imposed by this section and section 11, computed without regard to the credits provided in sections 31, 32, and 35, shall in no event exceed in the aggregate 90 per centum of the net income of the taxpayer for the taxable year.

(h) Alternative tax. For alternative tax which may be elected if adjusted gross income is less than $5,000, see Supplement T.

SEC. 2. TAXABLE YEARS TO WHICH APPLICABLE. (Individual Income Tax Act of 1944, Part I.) Except as otherwise expressly provided, the amendments made by this part shall be applicable with respect to taxable years beginning after December 31, 1943.

§ 29.12-1 Surtax-(a) Taxable years beginning before January 1, 1944. For taxable years beginning before January 1, 1944, in *

(b) Taxable years beginning after December 31, 1943. For taxable years beginning after December 31, 1943, there is imposed, in addition to the normal tax of 3 percent provided in section 11, a surtax at the rates specified in section 12, as amended, upon the surtax net income of every individual, resident or nonresident, except nonresident alien individuals subject to the tax imposed by section 211 (a). The surtax net income for such years is the net income minus the credits for surtax exemptions provided in section 25 (b).

CODIFICATION: In § 29.12-1, the existing headnote and first word of the first sentence were deleted, the text set forth above substituted therefor, and paragraph (b) was added, by Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 11.

§ 29.12-2 Computation of surtax. The following tables show the surtax due upon certain specified amounts of surtax net income. * [First sen

The surtax shall be—

$7,260, plus 56% of excess over $20,000. $8,380, plus 59% of excess over $22,000. $10,740 plus 62% of excess over $26,000. $14,460, plus 65% of excess over $32,000. $18,360, plus 69% of excess over $38,000. $22,500, plus 72% of excess over $44,000. $26,820, plus 75% of excess over $50,000. $34,320, plus 78% of excess over $60,000. $42,120, plus 81% of excess over $70,000. $50,220, plus 84% of excess over $80,000. $58.620, plus 87% of excess over $90,000. $67,320, plus 89% of excess over $100,000. $111,820, plus 90% of excess over $150,000 $156,820, plus 91% of excess over $200,000.

CODIFICATION: In § 29.12-2, the heading of the table appearing in 26 CFR, Cum. Supp., 29.12-2 was amended to read as follows: "Surtax table-Taxable years beginning after December 31, 1941, and before January 1, 1944", by Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 11

§ 29.12-3 Limitation on amount of tax. For taxable years beginning after December 31, 1943, the aggregate amount of the surtax and the normal tax, computed before the application thereto of the credit provided in section 31 (relating to the credit for foreign income tax), section 32 (relating to the credit for tax withheld at the source under section

(d) Information as to wholly tax exempt interest. The second sentence in section 22 (b) (4) is amended to read as follows: "Every person owning any of the obligations enumerated in clause (A), (B), or (C) shall, when so required by regulations prescribed by the Commissioner with the approval of the Secretary, submit in the return required by this chapter a statement showing the number and amount of such obligations owned by him and the income received therefrom, in such form and with such information as such regulations may prescribe."

*

SEC. 2. TAXABLE YEARS TO WHICH APPLICABLE. (Individual Income Tax Act of 1944, Part I.) Except as otherwise expressly provided, the amendments made by this part shall be applicable with respect to taxable years beginning after December 31, 1943.

COMPUTATION OF NET INCOME [Insert following statutory quotation immediately after § 29.22 (b) (13)−1; T.D. 5371, May 11, 1944, 9 F.R. 5111]

SEC. 109. EXCLUSION FROM GROSS INCOME OF MUSTERING-OUT PAYMENTS FOR MILITARY AND NAVAL PERSONNEL. (Revenue Act of 1943, Title I.)

Section 22 (b) (relating to exclusions from gross income) is amended by inserting at the end thereof the following:

(14) Mustering-out payments for military and naval personnel. Amounts received during the taxable year as mustering-out payments with respect to service in the military or naval forces of the United States. SEC. 101. TAXABLE YEARS TO WHICH AMENDMENTS APPLICABLE. (Revenue Act of 1943, Title I.)

Except as otherwise expressly provided, the amendments made by this title shall be applicable only with respect to taxable years beginning after December 31, 1943.

§ 29.22 (b) (14)-1 Mustering-out payments of military and naval forces. The exclusion from gross income under section 22 (b) (14) of mustering-out payments with respect to service in the military and naval forces applies only with respect to taxable years beginning after

December 31, 1943. For the purposes of such exclusion mustering-out payments are payments made to any recipients pursuant to the provisions of the Mustering-Out Payment Act of 1944. [T.D. 5371, May 11, 1944, 9 F.R. 5111]

§ 29.22 (c)-2 Valuation of inventories.

CODIFICATION: § 29.22 (c)-2 was amended by striking the first sentence of the fourth paragraph and inserting in lieu thereof the following, by Treasury Decision 5423, Dec. 15, 1944, 9 F.R. 14712: In respect of normal goods, whichever basis is adopted must be applied with reasonable consistency to the entire inventory except as to those goods inventoried under the elective method authorized by section 22 (d) or to animals inventoried under the elective "unit-livestock-price method" authorized by § 29.22 (c)−6.

§ 29.22 (c)-6 Inventories of livestock raisers and other farmers.

Because of the difficulty of ascertaining actual cost of livestock and other farm products, farmers who render their returns upon an inventory basis may value their inventories according to the "farm-price method," and farmers raising livestock may value their inventories of animals according to either the "farm-price method" or the "unit-livestock-price method."

The "farm-price method" provides for the valuation of inventories at market price less direct cost of disposition. If this method of valuing inventories is used, it must be applied to the entire inventory except as to livestock inventoried, at the taxpayer's election, under the "unit-livestock-price method." If the use of the "farm-price method" of valuing inventories for any taxable year involves a change in method of valuing inventories from that employed in prior years, permission for such change shall first be secured from the Commissioner as provided in § 29.41-2.

method"

The "unit-livestock-price provides for the valuation of the different classes of animals in the inventory at a standard unit price for each animal within a class. A livestock raiser electing this method of valuing his animals must adopt a reasonable classification of the animals in his inventory with respect to the age and kind included so that the unit prices assigned to the several classes will reasonably account for the normal costs incurred in producing the animals within such classes. Thus, if a cattle raiser determines that it costs approx