Page:United States Statutes at Large Volume 49 Part 1.djvu/1764

 74TH CONGRESS. SESS. II. CH. 690. JU NE 22, 1936 . (2) If, in the case of such corporation, 50 per centum or more of its gross income (computed without the benefit of this section) for such period or such part thereof was derived from the active conduct of a trade or business within a possession of the United States ; or (3) If, in c ase of such citizen, 50 per centum or more of his gross income (computed without the benefit of this section) for such period or such part thereof was derived from the active con- duct of a trade or business within a possession of the United States either on his own account or as an employee or agent of another. (b) AM OUN TS RECEIVED IN UNITED STATES.-Notwithstanding the provisions of subsection (a.) there shall be included in gross income all amounts received by such citizens or corporations within the United Stat es, wh ether deriv ed fr om sou rces within or w ithou t the United States. (c) TAX IN CASE OF CORPOR ATIONS .-In the case of a domestic corporation entitled to the benefits of this section the normal tax imposed by section 13 shall be at the rate of 15 per centum instead of at the rates provided in such section, and such a corporation shall not be subject to the surtax imposed by section 14. (d) DEFINITION .-As used in this section the term "possession of the United States" does not include the Virgin Islands of the United Sta tes. (e) DEDUcTIoNs .- (1) C itizens of the U nited States ent itled to the ben efits of this section shall have the same deductions as are allowed by Supple- ment H in the case of a nonresident alien individual engaged in trade or business within the United States or having an office or place of business therein. (2) Domestic corporations 'entitled to the benefits of this section shall have the same deductions as are allowed by Supplement I in the case of a foreign corporation engaged in trade or business within the United States or having an office or place of business there in. (f) CREDITS AGAINST NET INCOME .-A citizen of the United States entitled to the benefits of this section shall be allowed a personal exemption of only $1,000 and shall not be allowed the credit for dependents provided in section 25 (b) (2). (g) ALLOWANCE OF DEDUCTIONS AND CREDITS.-Citizens of the United States and domestic corporations entitled to the benefits of this section shall receive the benefit of the deductions and credits allowed to them in this title only by filing or causing to be filed with the collector a true and accu rate return of t heir total incom e received from all sources in the United States, in the manner prescribed in th i s t it l e ; including therein all the information which t he Commis- sioner may deem necessary for the calculation of such deductions and credits. (h) CREDITS AGAINST T AX .-Persons ent itled to the ben efits of this section shall not be allowed the credits against the tax for taxes of for eign c ountr ies an d pos sessi ons of the United Stat es all owed by sec tion 131. (i ) A FFI LIA TIO N .-A corporation entitled to the benefits of thi s section s hall not be deem ed to be affilia ted with any oth er corporation within the meaning of section 141. SEC. 252. CITIZENS OF POSSESSIONS OF UNITED STATES. (a) Any individual who is a citizen of any possession of the United States (but not otherwise a citizen of the United States) and who is not a res ident of the Uni ted States, shal l be subject to taxation under 1719 If corpora tion de- rive d 50 perce nt fr om business therein . If citizen deriv ed 50 perc ent from active business therein. Amounts received in United States . Included in gross incom e. Domestic corp ora- tions, n ormal tax. Ante, p. 1655. Not subject to surtax. Ante, p. 1655. Status of Virgin Is- lands. Ded uct ions . Citiz ens all owe d same benefits as non- residents . Ante, p. 1714. Domestic corp ora- tions. Ante, p. 1717. Credits against net inc ome ; personal ex- emption. Ante, p. 1663. Allowan ce of dedu c, tions and credits. Credits agai nst tax. No allowance for , of foreign countries. Affiliation. Applicab ility to cor- po ration s. Ante, p. 1699. Citizens of posses- sions of United States. Income subje ct to taxation.