Page:United States Statutes at Large Volume 47 Part 1.djvu/211

 72d CONGRESS. SESS. I. CH. 209 . JUNE 6, 1932 . 187 SEC. 47. RETURNS FOR A PERIOD OF LESS THAN TWELVE MONTHS. 1NCOME TAX (a) RE TURN S FOR SH ORT PERI OD R ESUL TING FRO M CH ANGE OF Ac- Returns for less than C OUNT ING PERI OD .-If a taxpayer, with the approval of the Commis- "B'a'wls of computing sioner, changes the basis of computing net income from fiscal year when accounting to calendar year a separate return shall be made for the period periodcbanges . 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 . -W he re a sep- arate 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 Commis- sioner with the approval of the Secretary, to be made for a frac- tional 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.-If a separate return is made 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 multi- plying 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) CAPITAL NET GAINS AND LOSSES-EARNED INCOME .-The Com- missioner 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 tax- payer 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 derived a capital net gain, or sustained a capital net loss, or received earned income. (e) 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 acc ount of a ch ange in the acco unti ng 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) CLOSING OF TAXABLE Y E AR IN CASE OF JEOPARDY.-For closing of taxable year in case of jeopardy, see section 146. Income based on period of sepa rate return. Income placed on ann ual basis. Computation of. Application of capital net gains and l osses, or earned income. Reduction of person- al credits for fractions of a year. Closing of taxable year. Post, p. 217. SEC. 48. DEFINITIONS. Definitions. When used in this title- (a) TAXAR7.R YEAR.-"Taxable yea r" m eans the calendar year or "Taxable year ." the seal year ending during such calendar year, upon the basis of which the net income is computed under this Part. "T axab le y ear " 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 wh ich such ret urn is made. The first taxable year, to be called the calendar ta ye ar rab932 year, taxable year 1932, shall be the calendar year 1932 or any fiscal year ending during the calendar year 1932.