# Pub. L. 88-272: changes to the Internal Revenue Code 1964-02-26, 78 Stat. 19. Source: . ## Legislative history - Bill: [H.R. 8363](https://www.congress.gov/bill/88th-congress/house-bill/8363) ## § 1: Tax imposed - § 1: Pub. L. 88–272 amended section generally by splitting the former first bracket which started at $2,000 into four new brackets, the 14 percent bracket representing a 30 percent reduction, the 15 percent bracket a 25 percent cut, and the 16 percent bracket a 20 percent cut, and reducing all other brackets by cuts averaging about 20 percent and effectuated these cuts in two steps, one in 1964, and one in 1965. ## § 2: Definitions and special rules - § 2(a): Pub. L. 88–272 inserted reference to section 141. ## § 3: Tax tables for individuals - § 3: Pub. L. 88–272 substituted optional tax tables covering five categories for taxable years beginning on or after Jan. 1, 1964, and before Jan. 1, 1965, and for years beginning after Dec. 31, 1964, for a single general table. ## § 5: Cross references relating to tax on individuals - § 5(b): Pub. L. 88–272 redesignated pars. (2), (3), (4), (7) and (8) as pars. (1) to (5), respectively, substituted “where an individual chooses the benefits of income averaging” for “with respect to compensation for longterm services” in par. (3), and struck out former pars. (1), (5) and (6) which referred to tax attributable to receipt of lump sum under annuity, endowment, or life insurance contract, to income from artistic work or inventions, and to back pay, respectively. ## § 11: Tax imposed - § 11(b): Pub. L. 88–272 applied the 30 percent tax to years beginning before Jan. 1, 1964 instead of July 1, 1964 in par. (1), and in par. (2), reduced the rate from 25 percent to 22 percent, and applied it to years beginning after Dec. 31, 1963, instead of June 30, 1964. - § 11(c): Pub. L. 88–272 increased the percentage from 22 to 28 for taxable years beginning after Dec. 31, 1963, and before Jan. 1, 1965, and to 26 percent for taxable years beginning after Dec. 31, 1964. The surtax exemption previously carried in subsec. (c), is now stated in subsec. (d). - § 11(d), § 11: Pub. L. 88–272 added subsec. (d) and redesignated former subsec. (d) as (e). ## § 12: Cross references relating to tax on corporations - § 12: Pub. L. 88–272 struck out par. (8) which referred to section 1503 for additional tax for corporations filing consolidated returns. ## § 15: Effect of changes - § 15(d): Pub. L. 88–272 amended subsection generally by substituting provisions relating to changes made by the Revenue Act of 1964, for provisions relating to taxable years beginning before Jan. 1, 1954, and ending after Dec. 31, 1953. ## § 22: Credit for the elderly and the permanently and totally disabled - § 22(a): Pub. L. 88–272, §§ 113(a), 201(d)(3), substituted “an amount equal to 17 percent, in the case of a taxable year beginning in 1964, or 15 percent, in the case of a taxable year beginning after December 31, 1964, of the amount received by such individual as retirement income (as defined in subsection (c) and as limited by subsection (d));” for “an amount equal to the amount received by such individual as retirement income (as defined in subsection (c) and as limited by subsection (d)), multiplied by the rate provided in section 1 for the first $2,000 of taxable income;”, and struck out “section 34 (relating to credit for dividends received by individuals)”, before “and section 35”. - § 22: Pub. L. 88–272, § 202(a), added subsec. (i) and redesignated former subsec. (i) as (j). ## § 46: Amount of credit - § 46: Pub. L. 88–272 struck out subpar. (B) relating to section 34, and redesignated subpars. (C) and (D) as (B) and (C), respectively. ## § 48: Energy credit - § 48(a)(1): Pub. L. 88–272, § 203(c)(2), added subpar. (C). - § 48(d): Pub. L. 88–272, § 203(a)(3)(A), (b), substituted “except as provided in paragraph (2)” for “if such property was constructed by the lessor (or by a corporation which controls or is controlled by the lessor within the meaning of section 368(c))” in par. (1), “if such property is leased by a corporation which is a member of an affiliated group (within the meaning of section 46(a)(5) to another corporation which is a member of the same affiliated group” for “if paragraph (1) does not apply” in par. (2), and deleted provisions which stated that if a lessor made an election under this subsection, subsec. (g) would not apply with respect to such property, and deductions otherwise allowable under section 162 to the lessee for amounts paid the lessor would be adjusted consistent with subsec. (g). - § 48: Pub. L. 88–272, § 203(a)(1), repealed subsec. (g) which required that the basis of section 38 property be reduced by 7 percent of the qualified investment. ## § 62: Adjusted gross income defined - § 62: Pub. L. 88–272 added par. (8). ## § 72: Annuities; certain proceeds of endowment and life insurance contracts - § 72(e)(3): Pub. L. 88–272 struck out par. (3) which provided for a limit on the tax attributable to the receipt of a lump sum. ## § 79: Group-term life insurance purchased for employees - Enacted 26 U.S.C. § 79. ## § 105: Amounts received under accident and health plans - § 105(d): Pub. L. 88–272 substituted provisions stating that “The preceding sentence shall not apply to amounts attributable to the first 30” days if the amounts exceed 75 percent of regular weekly wages, and if they do not exceed said 75 percent, the first sentence of this subsection shall not apply to the extent the amounts exceed $75 weekly and shall not apply to amounts attributable to the first 7 calendar days unless the employee is hospitalized for injury or sickness for at least 1 day in such period, for provisions stating that said “preceding sentence” did not apply in cases of sickness, to amounts attributable to the first 7 days unless the employee was hospitalized for sickness for at least 1 day during such period. ## § 121: Exclusion of gain from sale of principal residence - Enacted 26 U.S.C. § 121. ## § 140: Cross references to other Acts - § 140: Pub. L. 88–272 renumbered section 121 of this title as this section. ## § 163: Interest - § 163(b)(1): Pub. L. 88–272 included the purchase of educational services, and defined “educational services”. ## § 164: Taxes - § 164(a): Pub. L. 88–272, § 207(a), limited the subsection to State, local and foreign real property, income, war profits, excess profits, and unspecified taxes, on a business or activity described in section 212, and to State and local personal property, general sales, gasoline, diesel fuel and other motor fuel taxes. - § 164(b): Pub. L. 88–272, § 207(a), added subsec. (b). Former subsec. (b), which denied the deduction for certain Federal income taxes, for Federal war profits and excess profits taxes, import duties, excise and stamp taxes, and estate, inheritance, legacy, succession and gift taxes, local assessments against benefits increasing property values, and certain taxes imposed by any foreign country or possession of the United States if the taxpayer chose to benefit by section 901 relating to foreign tax credit, and for taxes on real property to the extent that they are treated as imposed on another taxpayer, was struck out. - § 164(c): Pub. L. 88–272, § 207(a), substituted provisions denying the deduction for taxes assessed against local benefits which increase property value, except for so much as is properly allocable to maintenance or interest charges, and for real property taxes to the extent they are treated as imposed on another taxpayer, for provisions relating to certain retail sales taxes and gasoline taxes, the extent to which they were deductible, and to definition of “state or local sales tax”. - § 164(f): Pub. L. 88–272, § 207(b)(1), inserted “State” before “real property taxes”. - § 164(g): Pub. L. 88–272, § 207(b)(2), designated existing provisions as par. (1), substituted “1451” for “1451(f)” and added par. (2). ## § 165: Losses - § 165(c)(3): Pub. L. 88–272, § 208(a), inserted requirement that losses must exceed $100 to be deductible. - § 165(i): Pub. L. 88–272, § 238, added subsec. (i). Former subsec. (i) redesignated (j). - § 165(j): Pub. L. 88–272, § 238, redesignated former subsec. (i) as (j). ## § 170: Charitable, etc., contributions and gifts - § 170(b)(1)(A)(v), § 170(b)(1)(A)(vi), § 170(b)(2), § 170(b): Pub. L. 88–272, § 209 (a), (c)(1), (d)(1), added cls. (v) and (vi) in par. (1)(A), and par. (5), and in par. (2), extended the 2-year carryforward of unused charitable contributions to 5 years and changed the method of computation by including the aggregate of the excess contributions made in taxable years before the contribution year, in cl. (i), and references to third, fourth or fifth succeeding years in cl. (ii). - § 170(e): Pub. L. 88–272, § 231(b)(1), substituted “certain property” for “section 1245 property” in heading, and inserted reference to section 1250(a) in text. - § 170(f): Pub. L. 88–272, § 209(e), added subsec. (f). Former subsec. (f) redesignated (h). - § 170(g): Pub. L. 88–272, § 209(b), added subsec. (g). Former subsec. (g) redesignated (i). - § 170(h), § 170(i): Pub. L. 88–272, § 209(e), redesignated former subsecs. (f) and (g) as (h) and (i), respectively. ## § 172: Net operating loss deduction - § 172(b): Pub. L. 88–272, § 210(a)(1)–(4), (b), inserted subpar. (D) in par. (1), references to such subpar. (D) in par. (1)(A)(i) and (1)(B), subpars. (C) and (D) in par. (3), provided that the net operating loss deduction in par. (2)(B) be determined without regard to that portion of a net operating loss due to a foreign expropriation loss, if such portion may not, under par. (1)(D), be carried back to such prior taxable year, and that if a portion of the net operating loss is attributable to foreign expropriation to which par. (1)(D) applied, such portion shall be considered a separate loss for such year to be applied after the other portion of such net operating loss. - § 172: Pub. L. 88–272, § 210(a)(5), added subsec. (k) and redesignated former subsec. (k) as (l). ## § 213: Medical, dental, etc., expenses - § 213(b): Pub. L. 88–272 excluded persons attaining age 65 before the close of the taxable year from the limitation, whether they are the taxpayer and his spouse, or the mother or father of the taxpayer and his spouse. ## § 217: Moving expenses - Enacted 26 U.S.C. § 217. ## § 226: Cross reference - § 226: Pub. L. 88–272 renumbered section 217 of this title as this section. ## § 243: Dividends received by corporations - § 243(a): Pub. L. 88–272 substituted provisions permitting a deduction for 85 percent of dividends received except that it shall be 100 percent when received by a small business investment company operating under the Small Business Investment Act of 1958, and 100 percent in case of qualifying dividends, for provisions permitting an 85 percent deduction for corporations other than one operating under the Small Business Investment Act of 1958, and for other than dividends described in section 244(1) of this title. - § 243(b): Pub. L. 88–272 added subsec. (b) and omitted a prior subsec. (b) which allowed a 100 percent deduction of dividends received by a small business investment company operating under the Small Business Investment Act of 1958, other than dividends described in section 244(1) of this title. - § 243(c): Pub. L. 88–272 substituted “subsection (a)” for “subsections (a) and (b)” and added par. (4). - § 243(d): Pub. L. 88–272 substituted “subsection (a)” for “subsections (a) and (b)”. ## § 246: Rules applying to deductions for dividends received - § 246(b): Pub. L. 88–272 substituted “243(a)(1), 244(a)” for “243(a), 244” wherever appearing. ## § 264: Certain amounts paid in connection with insurance contracts - § 264(a): Pub. L. 88–272 added par. (3) and sentence providing that par. (3) shall apply only to contracts purchased after August 6, 1963. - § 264(c): Pub. L. 88–272 added subsec. (c). ## § 265: Expenses and interest relating to tax-exempt income - § 265: Pub. L. 88–272 provided that interest on face-amount certificates issued by a face-amount certificate company, and interest on amounts received for the purchase of such certificates to be issued by such institution, shall not be considered interest on indebtedness to purchase or carry obligations the interest on which is wholly exempt from the taxes under this subtitle, to the extent the average amount of such obligations held by such institution during the taxable year doesn’t exceed 15 percent of the average total assets held by such institution during the taxable year. ## § 269: Acquisitions made to evade or avoid income tax - § 269(a): Pub. L. 88–272 substituted “the Secretary or his delegate may disallow such deduction, credit, or other allowance” for “such deduction, credit or other allowance shall not be allowed”. ## § 272: Disposal of coal or domestic iron ore - § 272: Pub. L. 88–272 inserted “or domestic iron ore” in section catchline, and “or iron ore” wherever appearing in text. ## § 274: Disallowance of certain entertainment, etc., expenses - § 274(c): Pub. L. 88–272 limited subsec. (c) to individuals traveling outside the United States. ## § 275: Certain taxes - Enacted 26 U.S.C. § 275. ## § 301: Distributions of property - § 301(b): Pub. L. 88–272 inserted reference to section 1250(a). - § 301(d): Pub. L. 88–272 inserted reference to section 1250(a). ## § 312: Effect on earnings and profits - § 312(c): Pub. L. 88–272 inserted reference to section 1250(a). ## § 316: Dividend defined - § 316(b)(2): Pub. L. 88–272 inserted definition of “distribution of property”. ## § 331: Gain or loss to shareholder in corporate liquidations - § 331(b): Pub. L. 88–272 inserted “(other than a distribution referred to in paragraph (2)(B) of section 316(b))”. ## § 368: Definitions relating to corporate reorganizations - § 368(a): Pub. L. 88–272, § 218(a), (b)(1), inserted “(or in exchange solely for all or a part of the voting stock of a corporation which is in control of the acquiring corporation)” in par. (1)(B), and in par. (2)(C), inserted references to par. (1)(B), and substituted “assets or stock” for “assets” wherever appearing. - § 368(b): Pub. L. 88–272, § 218(b)(2), inserted references to par. (1)(B) wherever appearing. ## § 381: Carryovers in certain corporate acquisitions - § 381(c)(15): Pub. L. 88–272, § 225(i)(3), substituted “subsections (b)(7) and (c) of section 545, relating to deductions with respect to payment of certain indebtedness” for “section 545(b)(7), relating to a deduction for payment of certain indebtedness incurred before Jan. 1, 1934”. - § 381(c)(19): Pub. L. 88–272, § 209(d)(2), permitted deductions for contributions made in the taxable year and in 4 prior taxable years, instead of one prior taxable year, and provided that each taxable year beginning on or before the distribution or transfer date shall be treated as a prior taxable year with reference to the acquiring corporation’s taxable years beginning after such date. ## § 401: Qualified pension, profit-sharing, and stock bonus plans - § 401(i), § 401(j): Pub. L. 88–272 added subsec. (i) and redesignated former subsec. (i) as (j). ## § 402: Taxability of beneficiary of employees’ trust - § 402(a): Pub. L. 88–272, § 232(e)(1), struck out “except that section 72(e)(3) shall not apply” after “(relating to annuities)”. - § 402(a): Pub. L. 88–272, § 221(c)(1), substituted “subsections (e) and (f) of section 425” for “section 421(d)(2) and (3)”. - § 402(b), § 402(d): Pub. L. 88–272, § 232(e)(2), (3), struck out “except that section 72(e)(3) shall not apply” after “(relating to annuities)”. ## § 403: Taxation of employee annuities - § 403(a)(1), § 403(b)(1), § 403(c): Pub. L. 88–272, § 232(e)(4)–(6), struck out “except that section 72(e)(3) shall not apply” after “(relating to annuities)”. ## § 406: Employees of foreign affiliates covered by section 3121(l) agreements - Enacted 26 U.S.C. § 406. ## § 407: Certain employees of domestic subsidiaries engaged in business outside the United States - Enacted 26 U.S.C. § 407. ## § 421: General rules - § 421: Pub. L. 88–272 amended section generally, and among other changes, inserted provisions relating to the effect of a qualifying transfer, and to the basis of shares acquired when an option is exercised by an estate, and omitted provisions relating to treatment of restricted stock options, a special rule where option price was between 85 percent and 95 percent of value of stock, acquisition of new stock, definitions, modification, extension, or renewal of option, and corporate reorganizations, liquidations, etc. See sections 421 to 425 of this title. ## § 423: Employee stock purchase plans - Enacted 26 U.S.C. § 423. ## § 424: Definitions and special rules - Enacted 26 U.S.C. § 424. ## § 441: Period for computation of taxable income - § 441(f)(2)(A): Pub. L. 88–272 inserted “, including,” before “or ending with reference to”. ## § 461: General rule for taxable year of deduction - § 461(f): Pub. L. 88–272 added subsec. (f). ## § 483: Interest on certain deferred payments - Enacted 26 U.S.C. § 483. ## § 535: Accumulated taxable income - § 535(b)(1): Pub. L. 88–272 substituted “section 275(a)(4)” for “section 164(b)(6)”. ## § 541: Imposition of personal holding company tax - § 541: Pub. L. 88–272 reduced the tax from 75 percent of undistributed income not in excess of $2,000, and 85 percent when in excess of $2,000, to 70 percent. ## § 542: Definition of personal holding company - § 542(a)(1): Pub. L. 88–272, § 225(b), substituted “60 percent of its adjusted ordinary gross income (as defined in section 543(b)(2)) for the taxable year is personal holding company income (as defined in section 543(a))” for “80 percent of its gross income for the taxable year is personal holding company income as defined in section 543”. - § 542(b): Pub. L. 88–272, § 225(k)(1), substituted “adjusted ordinary gross income” for “gross income”, wherever appearing. - § 542(c)(2), § 542(c)(6), § 542(c)(7), § 542(c)(8), § 542(c): Pub. L. 88–272, § 225(c)(1), (2), inserted among the exceptions, domestic building and loan associations within section 7701(a)(19) without regard to subpars. (D) and (E) thereof, added par. (6), redesignated former pars. (10) and (11) as (7) and (8), respectively, and omitted former pars. (6) to (9) which related to licensed personal finance companies, lending companies, loan or investment corporations, and finance companies, respectively. - § 542(d): Pub. L. 88–272, § 225(c)(3), added subsec. (d). ## § 543: Personal holding company income - § 543(a): Pub. L. 88–272, § 225(d), amended subsec. (a) generally, and among other changes, substituted “adjusted ordinary gross income” for “gross income”, provided, relative to rental income, that in addition to the 50-percent test of par. (2)(A), now applied on the basis of adjusted income from rents and adjusted ordinary gross income, a second test for exclusion shall be whether the sum on the dividends paid during the taxable year, the dividends paid on the last day of the year, and the consent dividends for the taxable year, equals or exceeds the amount by which the personal holding company income for the year exceeds 10 percent of the ordinary gross income, relative to mineral, oil, and gas royalties, that in addition to the 50-percent test of par. (3)(A), now applied on the basis of adjusted ordinary gross income, and the 15-percent test of par. (3)(C), from which test have been excluded deductions “specifically allowable under sections other than section 162” and is also now applied on the basis of adjusted gross income, the royalties shall be excluded if the personal holding company income for the taxable year is not more than 10 percent of the ordinary gross income, relative to copyright royalties, retained the 50-percent test as in par. (4)(A), making it applicable to ordinary gross income, included in the computation of the income for the taxable year the adjusted income from rents and the adjusted income from mineral, oil, and gas royalties, excluded from the sum of deductions allocable to royalties, deductions specifically allowable under sections other than 162, and changed the requirement that deductions constitute 50 percent or more of gross income to provide that they must equal 25 percent of ordinary gross income reduced by royalties paid and by depreciation deductions with respect to copyrights, relative to produced film rents, that they be treated on their own basis and not as rentals, and defined “produced film rents”, relative to use of corporation property by shareholders, that personal holding company income includes copyright royalties and the adjusted income from mineral, oil, and gas royalties, eliminated gains from the sale or other disposition of any interest in an estate or trust, from the sale or exchange of stock or securities, and from futures transactions in any commodity, and also definition of “rents”. See subsec. (b)(3). - § 543(b): Pub. L. 88–272, § 225(d), added subsec. (b). Former subsec. (b), which provided that gross income and personal holding company income determined with respect to transactions relating to gains from stock and security transactions, and with respect to transactions relating to gains from commodity transactions, should include only the excess of gains over losses from such transactions, was struck out. - § 543(d): Pub. L. 88–272, § 225(k)(2), struck out subsec. (d) which related to special adjustment on disposition of antitrust stock received as a dividend. ## § 544: Rules for determining stock ownership - § 544: Pub. L. 88–272 substituted “section 543(a)(7)” for “section 543(a)(5)”, and “section 543(a)(4)” for “section 543(a)(9),” wherever appearing. ## § 545: Undistributed personal holding company income - § 545(a): Pub. L. 88–272, § 225(i)(1), inserted reference to subsection (c). - § 545(b)(1), § 545(b)(2): Pub. L. 88–272, §§ 207(b)(5), 209(c)(2), substituted “section 275(a)(4)” for “section 164(b)(6)” in par. (1), and inserted reference to section 170(b)(5) in par. (2). - § 545(c): Pub. L. 88–272, § 225(i)(2), added subsec. (c). ## § 562: Rules applicable in determining dividends eligible for dividends paid deduction - § 562(b): Pub. L. 88–272 designated existing provisions as subpars. (A) and (B) of par. (1), excepted personal holding companies in section 542, and foreign personal holding companies in section 552 therefrom, and added par. (2). ## § 584: Common trust funds - § 584(c)(2): Pub. L. 88–272 struck out “section 34 or” before “section 116 applies”. ## § 614: Definition of property - § 614(b): Pub. L. 88–272, § 226(a), amended subsec. (b) generally, and among other changes, substituted provisions stating that except as otherwise provided, all of the taxpayer’s operating mineral interests in a separate tract or parcel of land will be combined and treated as one property, that the taxpayer may not combine any operating mineral interest in one tract or parcel of land with an operating mineral interest in another tract or parcel of land, that if he has more than one operating mineral interest in a single tract of land he may elect to treat one or more of such interests as separate properties, limited, however, to one combination of interests in a single tract of land, and providing, in the event the election in par. (2) is made with respect to any tract of land, for the treatment of interests discovered or acquired by the taxpayer in such a tract after the taxable year for which the election is made, for provisions which permitted a taxpayer who owned two or more separate operating mineral interests which constituted all or a part of an operating unit, to elect to form one aggregation and treat as one property any two or more of these interests, treating as separate properties any interests which he did not include in the one aggregation, to aggregate separate interests whether or not in a single tract of land, or contiguous tracts of land, and which forbade him to form more than one aggregation within a single operating unit, inserted provisions in par. (3) relating to unitization or pooling arrangements, and in par (5), providing that if the taxpayer has operating mineral interests on the day preceding the first day of the first taxable year beginning after Dec. 31, 1963, which he treats under subsec. (d) of this section as in effect before amendment by Pub. L. 88–272, he shall continue such treatment and it shall be deemed adopted pursuant to pars. (1) and (2) of this subsection, and struck out provisions defining “operating mineral interests”, and providing for termination of election with respect to mines, excepting oil and gas wells. For definition of “operating mineral interests”, see subsec. (d) of this section. - § 614(c): Pub. L. 88–272, § 226(b)(1), (2), struck out par. (5) which defined operating mineral interests, and “1958” before “Special rules” in heading. - § 614(d): Pub. L. 88–272, § 226(b)(3), amended subsec. (d) generally, substituting the definition of operating mineral interests, for provisions relating to the 1939 Code treatment respecting operating mineral interest in case of oil and gas wells. - § 614(e)(2): Pub. L. 88–272, § 226(b)(4), struck out “within the meaning of subsection (b)(3)” at end. ## § 631: Gain or loss in the case of timber, coal, or domestic iron ore - § 631: Pub. L. 88–272, § 227(b)(1), inserted reference to domestic iron ore in heading. - § 631(c): Pub. L. 88–272, § 227(a)(1), inserted “or domestic iron ore” in heading, “or iron ore mined in the United States” after “coal (including lignite)”, “or iron ore” after “coal” wherever appearing, and provided that the subsection shall not apply to any disposal of iron ore to a person whose relationship to the person disposing of such ore would result in the disallowance of losses under section 267 of 717(b), or to a person owned or controlled by the same interests which own or control the person disposing of such iron ore. ## § 642: Special rules for credits and deductions - § 642(a): Pub. L. 88–272, § 201(d)(6)(A), struck out par. (3) which related to dividends received by individuals. - § 642(i): Pub. L. 88–272, § 201(d)(6)(B), designated existing provisions as par. (1) and added par. (2). ## § 691: Recipients of income in respect of decedents - § 691(c)(2)(B): Pub. L. 88–272 substituted “421(c)(2), relating to the deduction for estate tax with respect to stock options to which part II of subchapter D applies” for “421(d)(6)(B), relating to the deduction for estate tax with respect to restricted stock options”. ## § 702: Income and credits of partner - § 702(a)(5): Pub. L. 88–272 struck out “a credit under section 34,” before “an exclusion”. ## § 751: Unrealized receivables and inventory items - § 751(c): Pub. L. 88–272, in second sentence, inserted reference to section 1250. ## § 832: Insurance company taxable income - § 832(c)(10): Pub. L. 88–272 inserted reference to part I of subchapter D. ## § 834: Determination of taxable investment income - § 834(d)(2): Pub. L. 88–272 provided that for taxable years beginning after Dec. 31, 1962, no accrual of discount shall be required under par. (2) on any bond. ## § 852: Taxation of regulated investment companies and their shareholders - § 852(b)(3)(C), § 852(b)(3)(D)(i): Pub. L. 88–272, § 229(a)(1), (2), substituted “45 days” for “30 days”. - § 852(d): Pub. L. 88–272, § 229(b), added subsec. (d). ## § 853: Foreign tax credit allowed to shareholders - § 853(c): Pub. L. 88–272 substituted “45 days” for “30 days”. ## § 854: Limitations applicable to dividends received from regulated investment company - § 854(a): Pub. L. 88–272, § 201(d)(8), struck out “section 34(a) (relating to credit for dividends received by individuals),” before “section 116” and the comma before “and”. - § 854(b): Pub. L. 88–272, §§ 201(d)(9), (10), 229(a)(4), substituted “45 days” for “30 days” in par. (2), and struck out “the credit under section 34(a),” before “the exclusion” in par. (1), and “the credit under section 34,” before “the exclusion” in par. (2). ## § 855: Dividends paid by regulated investment company after close of taxable year - § 855(c): Pub. L. 88–272 substituted “45 days” for “30 days”. ## § 856: Definition of real estate investment trust - § 856(a)(6): Pub. L. 88–272 substituted “adjusted ordinary gross income (as defined in section 543(b)(2))” for “gross income”. ## § 857: Taxation of real estate investment trusts and their beneficiaries - § 857(c): Pub. L. 88–272 struck out “section 34(a) (relating to credit for dividends received by individuals),” before “section 116” and the comma before “and”. ## § 871: Tax on nonresident alien individuals - § 871(a): Pub. L. 88–272, § 113(b)(2), substituted “30 percent tax” for “and gross income of not more than $15,400” in heading. - § 871(b): Pub. L. 88–272, §§ 113(b)(1), (3), 201(d)(12), substituted “$19,000 in the case of a taxable year beginning in 1964 or more than $21,200 in the case of a taxable year beginning after 1964” for “$15,400”, “the credit under section 35” for “the sum of the credits under sections 34 and 35” in text, and “Regular tax” for “and gross income of more than $15,400” in heading. ## § 901: Taxes of foreign countries and of possessions of United States - § 901(d): Pub. L. 88–272 inserted reference to section 275. ## § 903: Credit for taxes in lieu of income, etc., taxes - § 903: Pub. L. 88–272 substituted “sections 164(a) and 275(a)” for “section 164(b)”. ## § 904: Limitation on credit - § 904(g)(2): Pub. L. 88–272 substituted “section 1503(b)” for “section 1503(d)”. ## § 911: Citizens or residents of the United States living abroad - § 911(c)(1)(B): Pub. L. 88–272 substituted “$25,000” for “$35,000”. ## § 1016: Adjustments to basis - § 1016(a)(15): Pub. L. 88–272, § 227(b)(5), inserted “or domestic iron ore”. - § 1016(a)(19): Pub. L. 88–272, § 203(a)(3)(C), inserted “and in section 203(a)(2) of the Revenue Act of 1964”. - § 1016(a)(21): Pub. L. 88–272, § 225(j)(2), added par. (21). ## § 1023: Cross references ## § 1033: Involuntary conversions - § 1033(h)(3): Pub. L. 88–272 added par. (3). ## § 1212: Capital loss carrybacks and carryovers - § 1212(a): Pub. L. 88–272 designated existing provisions as subsec. (a), limited such subsection to corporations, and added subsec. (b). ## § 1222: Other terms relating to capital gains and losses - § 1222(9), § 1222(10): Pub. L. 88–272 struck out provisions from par. (9) relating to taxpayers other than corporations, and inserted “In the case of a corporation” in par. (10). ## § 1231: Property used in the trade or business and involuntary conversions - § 1231(b)(2): Pub. L. 88–272 inserted reference to iron ore in text, and to domestic iron ore in heading. ## § 1245: Gain from dispositions of certain depreciable property - § 1245(a)(2), § 1245(a)(3)(C): Pub. L. 88–272 redefined “recomputed basis” with respect to elevators or escalators in par. (2), and inserted subpar. (C) in par. (3). ## § 1250: Gain from dispositions of certain depreciable realty - Enacted 26 U.S.C. § 1250. ## § 1341: Computation of tax where taxpayer restores substantial amount held under claim of right - § 1341(b)(2): Pub. L. 88–272 substituted “7701(a)(33) without regard to the limitation continued in the last two sentences thereof)” for “1503(c) without regard to paragraph (2) thereof)”. ## § 1402: Definitions - § 1402(a)(3)(B): Pub. L. 88–272 inserted reference to iron ore. ## § 1441: Withholding of tax on nonresident aliens - § 1441(a), § 1441(b): Pub. L. 88–272 reduced the withholding rate from 18% to 14%. ## § 1503: Computation and payment of tax - § 1503(a): Pub. L. 88–272, § 234(a), struck out provisions which increased the tax imposed under section 11(c), or section 831, by 2% of the consolidated taxable income of the affiliated group of includible corporations, and defined “consolidated taxable income”. - § 1503(b): Pub. L. 88–272, § 234(b)(1), (2), redesignated subsec. (d) as (b), and substituted references to section 7701 for references to former subsection (c) of this section, in subpar. (A), and definition of “consolidated taxable income” for provisions relating to the computation of tax, for purposes of par. (1)(A), on the portion of consolidated taxable income attributable to any corporation, without regard to the increase of 2% as in subsec. (a), in subpar. (C). Former subsec. (b), which limited the 2% increase in subsec. (a) in cases where the affiliated group included one or more Western Hemisphere trade corporations or one or more regulated public utilities, to the amount by which the consolidated taxable income of the affiliated group exceed the income attributable to such corporations and utilities, was struck out. - § 1503(c): Pub. L. 88–272, § 234(b)(1), struck out subsec. (c) which defined regulated public utility. See section 7701(a)(33) of this title. - § 1503(d): Pub. L. 88–272, § 234(b)(1), redesignated subsec. (d) as (b). ## § 1552: Earnings and profits - § 1552(a)(3): Pub. L. 88–272 struck out “(determined without regard to the 2 percent increase provided by section 1503(a))”, before “based on their contributions”. ## § 1561: Limitation on accumulated earnings credit in the case of certain controlled corporations - Enacted 26 U.S.C. § 1561. ## § 1563: Definitions and special rules - Enacted 26 U.S.C. § 1563. ## § 3121: Definitions - § 3121(a)(11): Pub. L. 88–272 substituted “is a plan described in section 403(a), or” for “meets the requirements of section 401(a)(3), (4), (5), and (6)” in subpar. (5)(B), and added subpar. (5)(C). ## § 3401: Definitions - § 3401(a)(14): Pub. L. 88–272, § 204(b), added par. (14). - § 3401(a)(15): Pub. L. 88–272, § 213(c), added par. (15). ## § 3402: Income tax collected at source - § 3402(a): Pub. L. 88–272, § 302(a), reduced tax from 18% to 14%. - § 3402(c)(1): Pub. L. 88–272, § 302(b), substituted new tables reflecting lowered withholding rates. ## § 6012: Persons required to make returns of income - § 6012(c): Pub. L. 88–272 inserted provisions relating to sale of residence. ## § 6014: Income tax return—tax not computed by taxpayer - § 6014(a): Pub. L. 88–272 struck out “34 or” before “37 shall not be allowed”, and inserted provision that in case of a married individual filing a separate return and electing benefits of this subsection, neither Table V in section 3(a) nor Table V in section 3(b) shall apply. ## § 6039: Returns required in connection with certain options - Enacted 26 U.S.C. § 6039. ## § 6040: Cross references ## § 6052: Returns regarding payment of wages in the form of group-term life insurance - Enacted 26 U.S.C. § 6052. ## § 6163: Extension of time for payment of estate tax on value of reversionary or remainder interest in property - § 6163(b): Pub. L. 88–272 substituted “or periods not in excess of 3” for “not in excess of 2”. ## § 6212: Notice of deficiency - § 6212(c)(2)(A): Pub. L. 88–272 substituted “with respect to the” for “to take”. ## § 6323: Validity and priority against certain persons - § 6323(a): Pub. L. 88–272, § 236(c)(1), substituted “subsections (c) and (d)” for “subsection (c)”. - § 6323(d), § 6323(e): Pub. L. 88–272, § 236(a), added subsec. (d) and redesignated former subsec. (d) as (e). ## § 6324: Special liens for estate and gift taxes - § 6324(a), § 6324(b): Pub. L. 88–272, § 236(c)(2), inserted “and subsection (d) (relating to purchases of motor vehicles)”. - § 6324: Pub. L. 88–272, § 236(b), added subsec. (d). ## § 6501: Limitations on assessment and collection - § 6501(f): Pub. L. 88–272 substituted “gross income and adjusted ordinary gross income, described in section 543” for “gross income, described in section 543(a)”. ## § 6504: Cross references - § 6504(3): Pub. L. 88–272 substituted “with respect to the” for “to take”. ## § 6511: Limitations on credit or refund - § 6511(d)(6): Pub. L. 88–272 designated existing provisions as clause (i) and added clause (ii) in par. (2)(B), and added par. (5). ## § 6652: Failure to file certain information returns, registration statements, etc. - § 6652(a): Pub. L. 88–272 provided a penalty for failure to make a return required by section 6039(a) with respect to a transfer of stock or a transfer of legal title to stock, and by section 6052(a) with respect to group-term life insurance on the life of an employee. ## § 6655: Failure by corporation to pay estimated income tax - § 6655(c)(2): Pub. L. 88–272, § 122(c)(1), substituted “any installment date” and “such installment date” for “the 15th day of the 12th month”. - § 6655(d): Pub. L. 88–272, § 122(c)(2), redesignated cls. (A)(i) and (ii) as (A)(iii) and (iv), respectively, added cls. (A)(i) and (ii), and substituted “(3, 5, 6, 8, 9,)” for “(6 or 8, or 9)” in subpar. (B)(ii). ## § 7701: Definitions - § 7701(a)(20): Pub. L. 88–272 inserted “For the purpose of applying the provisions of section 79 with respect to group-term life insurance purchased for employees”. - § 7701(a)(33): Pub. L. 88–272 added par. (33).