Page:United States Statutes at Large Volume 44 Part 1.djvu/2004

 §982 True :26.-zzvm 982. Organisations exempted.-—·’1‘he - following organizations · shall be exempt from taxation under this title- ` W Labor, agricultural; or hortiozelmral organiza-tions.--(1) Lahor, agricultural, or horticultural organizations;. ’ · — Memes! savings banks.--(2) Mutual savings banks not having e capital stock represented by shares;. " " · — ` Fmt:-mal bmczlcirzry societies, orders and so g>rth·.—-(3) Fraternal beueiicinry societies; orders, gr associations, (a) operating under the lodge system or for the exclusive beneilt of the membersdof El fraternity itself operating under the lodge system; sud (b)‘ providing for the payment of life, sick, accl-` {lent, or other "beneiits to the members of such society, order, or association or their dependents; ._ -. Domestao building and loom assocshtions; cooperative banks opr·mted· without projlt.-——(4,) Domestic building and loan associations substantially all the business ofwvhich is confined to ma_king' loans to members`; and cooperative banks without capital stock organized and operated for- mn-tual purposes and without profit; f _ = p . ‘· ·  _ ' Cemetery companies for bcnerit of members.-—.(5) Cemetery companies owned and operated exclusively for the benefit of their members or which are not operated for .protlt.;· and any _° corporation `olnarteeetl; solely for burial purposes as il cemetery oorpoeation,a11d·not permitted by its charter to engage in any business not Qnecessarily incident to that purpose, no- part fof the net ‘G&·1‘1liI1gS of which `lnuxes to the bcneiit of any pl—1mte‘ shareholder or individual; ._ · U · ‘ (‘ofg·po:·atious, community chest, foundations, (md so jozjth, forry·cI£géous ang! charitable 1)urpoaes.-z-(6) Corporations, anti any communlti chest, fund, or foundation, organized and operated exclusively ·'for religious, charitable; scientiilc, lit—_ every, or educational purposesl or- forj the prevention ot cruelty to children or a~nimsls,i no part of the net earnings of which.- inni·es__to_ the benefit of any private shareh0lder·or‘ indivldnsl ;` Business leagues, chambers of commerce; ond so [ortho-—(7)f Business leagtiw, `cchambers of cominerce, · or boards of trade, not organized rr for tpront and_no` part of the net earnings of which imires to the benetlt of j any private. shareholder or · individual; N "  l __ ·, ,°Ci;•ic leogueg oraoroqwizations for promotion of social wolfare; associations of eiviployeese-——(8) _Clvlc·leagues or organiza-l tions not organized for pront but operated exclusively for the promotion of social welfare, or local associations of `employees, the membership otwhlch is limited to the employees qt n desig-· eaten personior persons in a particular mnniclpalitywand the net earnings oats which are devoted exclusively to charitable, t ’- educational, or recreatlo11al.pu'rposes; · n. ,‘ _ `_ M __C’lubs {gr sospropttable purposes.-—(9) Clubs 01°g§l1iZ€(]_&lld l operated exclusively for pleasure, recreation, and other non— protltnhle purposes, no port of the net earnings of which lnures to the benent of any private shareholder _;, . »_ Bmetolent life e°mw~¢mce.assoc£aHo:¢é· [other mutual com-d panics] ;—‘ eondition.s.·-—·(1§)) Benevolent life insurance associations ot a, purely local l,cha1‘ac tcr, mutual. ditch or irrigation _ companies, mutual or cooperative telephone companies,. or like organizations; hut only it 85 per centum-or·more of the income consists ot amounts collected frotgu. nnemhers for the sole purpose · of meeting losses andexpcnses;. _. Mutual hail, cyclone, dud insurance compa»nios.—-»($11) Farmers? or other mutual hall, cyclone, casualty, oxjnre instirance companies or a&oclations_ (including lnterinsnrers and reciprocnlnnderwriters) the income of which is used og held for the purpose of paying losses or expenses; · · l ·. ~. _‘ — Associations for marketlng produce of mem bers.-—-·(°12)· Farm- ‘ ers', fruit growers? or like associations organize}! and operated on a cooperative basis (a') for the purpow of marketing the products of members or other producers, and turning beck to them the proceeds of sales, less the necessary marketing expenses, dn the basis ot éithélf the quantity ot the value of the-

QRNAL REVENUE 1990 products furnished by them, or (b) for the purpose of pmchasing supplies and equipment for tlic use of members or other persons, and tH1’I11I}g'0V€l' such supplies and equipment to them at actual cost, plus necessary expenses. Exemption shall nop ·bé denied any such association because it ha; capital stock, if tlxc diiiidend rate of such stock is fixed at not to exceed thélcgal rate of interest in the State of incorporation. ora 8 per céntluxn per annum, whichévc; is greater, on the value of the considers.- , tion for which the stoclrwas issued, and it substantially all ; " such stock `(other than nonvoting preferred stock, the owners of which are not ontitledor permitted to participuté, directly   ‘ or indirectly, in tho p1·0Hts·"o£ the; association, upon dissolution  or - otherwise, beyond the- ilied dividends) isowned by producers who · market I! their products or purchase thai} supplies and equipment through the association; nor shall *,1 exemption be denied 'any such associntion‘-l£ecauso` there is accumulated and maintained by it a tesepjvo required by State law or a" reasonable reserve fornany necossagy purpok. _. —· V Such an association may market the products of nonmembernin an amount the value of which doesrnot exceed the value of the products maxékctcd for mcmbers, and mayjzinrchase supplios` ‘ and equipment. for nonmombors ln. an amount the value of which- doés not exceed the walue of the supplies and equipment . purchased for members, provided the value of the made fof persons who are neither members nor producers docs not .c1Ececd 15 péri ccntuln of the value of all its purch&; n ‘Uorp0;·ation.s for holding title to property, and so forth.-- (13) Corporations organized for tho. cxcluslve   of _ holding title to pfoperty, collecting lincome therefrom, and turning ove? thewentiré amount thereof, lean expenseslta an .o17ga.nization which itself is exempt from the tax imposed by "this°title; and — _ _ · · ’. `_ Federal l¢m`d_ banks} national farm loan aasociqiti-ono, condos forth.- (14) Federal land banks, national farmdohn associations, and Federal intermediate credit banks. as provided in the Federal Fa`rin Loan Act,. as amended. (Feb. 26, -1926, c. s 231, 44 smc. ao.) ’ · f ~ ‘ o [Soc, note at beginning of this chapter. . . _ _ "Thl¤ ti_tle," herein, referred to, constitute; c. 19 of this sup· . plemental titlrc. ·',l‘ho Federal Farm Loan Act, mentioned in the text, isxset out in cbs. 7, 8, and 9 ot Title 12, Banks and Banking. y 984. Computation of net income.-———·In the case ot z.i_ corporation subject ·to. thé tax imposed by section 230 the te1*m`“ uct income<" menus; the gross income as donned in section 233 less` the deductions allowed by soctions§:__234 nud’20Q, and the not income shalfbc computed on the same basis as is' provided in ~ .subdiyisi.ons (b) hand" (d) of section 212 or in séction 226; In the casa of ta foreign corporation: or of `a corporation entitled _ to the boneilts 01 section 262 the computation shall also be made in fh&12illll€l.’ prowjiclcd in section 217. (Feb. 28, *19%; c. 27, § 232, 44 Stat. 41.) ”  l ` ` — A See note at liéglnnlng ot this .cbnpten·.‘ t. . Sections 206, 212, 217, 228, 230, 233, 234, and 292, mentioned ln the text, are set out in li 937; 953,. 958, 968, 981, 985, 9%, and t 1030, rvspoctwcly, ot this nudplcmental title,. ~ _ ’ ma 985. Gmés income.-—··('§) ·InYtho case of n corporation subject l to the tax imposed by section 230*thé term "gross income " moans the gross income! as clcgned in` sections 213 and ~217, ` éxcopt that mutual marine insnknrgo coinpamos shall include in gross income `tho`groas"picminms_ collcctédt and gecoiycd b¥_ tlncnrloss amounts paid for roinsursnncof 1 _ Q _ (b) In the cannot a foreign corporation, gross income m§a¤S only gross. inconxoqtrom sources within the United _ Stntw, dotorminnk} (oxcepfin tho caso'ot insurance companies snbjéct to 1 tho t¤·i:.~lmposod` by section; 243 9:.246) in thémanncr provided- ‘i¤ section 217. » (Feb._%, 1926, c. 27,. §_ B3, 44 Stat. 411) · . Bee bots at bcginnlng of thin chapter. · . i `” . ‘ · ’ Sections 213, 217, 236, 243, and 246, herein referred to, IN . not out ln it 954, 958, 981, 1§)01, and 1006, respectively. cfu this . _ supplemental-titlt. ‘ 5,; - ·` ‘