Page:United States Statutes at Large Volume 52.djvu/501

 PUBLIC LAWS-CH. 289-MAY 28, 1938 Regulations as to change. Change to different method. Distributions by corporations. Post,p. 496. Determination of gain or loss. Post. 484. Sources within and without United States. Post, p. 503. Foreign personal holding companies. Post, p. 548. Consent dividends. Post, p. 470. the filing of his return for the preceding taxable year, has filed with the Commissioner his election to have it apply. (6) REGULATIONS AS TO CHANGE.- The change to such method shall be made in accordance with such regulations as the Commis- sioner, with the approval of the Secretary, may prescribe as neces- sary to prevent the avoidance of tax. (7) CHANGE TO DIFFERENT METHOD.-An election made under this subsection shall be irrevocable and the method so elected shall be applied in all subsequent taxable years notwithstanding any change in the principal business of the taxpayer, unless with the approval of the Commissioner change to a different method is authorized, and then upon such terms and conditions and in accordance with such regulations as the Commissioner, with the approval of the Secretary, may prescribe. (e) DISTRIBUTIONS BY CORPORATIONs.-Distributions by corpora- tions shall be taxable to the shareholders as provided in section 115. (f) DETERMINATION OF GAIN OR Loss.-In the case of a sale or other disposition of property, the gain or loss shall be computed as provided in section 111. (g) GROSS INCOME FROM SOURCES WITHIN AND WITHOUT UNITED STATES. -For computation of gross income from sources within and without the United States, see section 119. (h) FOREIGN PERSONAL HOLDING COMPANIES.- For provisions relat- ing to gross income of foreign personal holding companies and of their shareholders, see section 334. (i) CONSENT DIVIDENDS. -For inclusion in gross income of amounts specified in shareholders' consents, see section 28. Deductions from SEC. 23. DEDUCTIONS FROM GROSS INCOME. gross income. General expenses of carrying on business. Corporate charita- be contributions. Interest. Taxes generally. Exceptions. Federal income, etc taxes. 4 tat. 101; post, p. W7. In computing net income there shall be allowed as deductions: (a) EXPENSES.- (1) IN GENERAL. -All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including a reasonable allowance for salaries or other compensation for personal services actually rendered; traveling expenses (including the entire amount expended for meals and lodging) while away from home in the pursuit of a trade or business; and rentals or other payments required to be made as a condition to the continued use or possession, for purposes of the trade or business, of property to which the taxpayer has not taken or is not taking title or in which he has no equity. (2) CORPORATE CHARITABLE CONTRIBUTIONS.- No deduction shall be allowable under paragraph (1) to a corporation for any con- tribution or gift which would be allowable as a deduction under subsection (q) were it not for the 5 per centum limitation therein contained and for the requirement therein that payment must be made within the taxable year. (b) INTEREST.- A ll interest paid or accrued within the taxable year on indebtedness, except on indebtedness incurred or continued to pur- chase or carry obligations (other than obligations of the United States issued after September 24, 1917, and originally subscribed for by the taxpayer) the interest upon which is wholly exempt from the taxes imposed by this title. (c) TAXES GENERALLY. - - Taxes paid or accrued within the taxable year, except- (1) Federal income, war-profits, and excess-profits taxes (other than the excess-profits tax imposed by section 106 of the Revenue Act of 1935 or by section 602 of this Act); 460 [52 STAT.

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