Page:United States Statutes at Large Volume 53 Part 2.djvu/622

 PUBLIC LAWS-CH. 367-JULY 26, 1939 Inclusion in net in- come of beneficiary, etc. Trust set aside for charitable purposes. Ante. p. 1090. Different taxable year. Revocable trusts. Income for benefit of grantor. When held for future distribution. Wbendistributedto grantor. Application to life insurance premiums. Ante, p. 1090. "In discretion of grantor" defined. Income from in- tangible personal property held by trust. erly paid or credited during such year to any legatee, heir, or beneficiary, but the amount so allowed as a deduction shall be included in computing the net income of the legatee, heir, or beneficiary; (3) there shall be allowed as a deduction (in lieu of the deduc- tions for charitable contributions authorized by section 5 (a) (10)) any part of the gross income, without limitation, which pursuant to the terms of the will or deed creating a trust, is during the taxable year paid or permanently set aside for the purposes and in the manner provided in section 5 (a) (10) or is to be used exclusively for the purposes enumerated in section 5 (a) (10). (d) DIRENT TAXABLE YEALR-If the taxable year of a beneficiary is different from that of the estate or trust, the amount which he is required, under subparagraph (1) of paragraph (c) of this section, to include in computing his net income, shall be based upon the income of the estate or trust for any taxable year of the estate or trust ending within or with his taxable year. (e) REVOCABLE TRUSTS. -- Where at any time the power to revest in the grantor title to any part of the corpus of the trust is vested- (1) in the grantor, either alone or in conjunction with any person not having a substantial adverse interest in the disposition of such part of the corpus or the income therefrom; or (2) in any person not having a substantial adverse interest in the disposition of such part of the corpus or the income there- from, then the income of such part of the trust shall be included in comput- ing the net income of the grantor. (f) INCOME FOR BENEFIT OF GRANrTOR. -W here any part of the income of a trust- (1) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be, held or accumulated for future distri- bution to the grantor; or (2) may, in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income, be distributed to the grantor; or (3) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be applied to the payment of premiums upon policies of insurance on the life of the grantor (except policies of insurance irrevocably payable for the purposes and in the manner specified in section 5 (a) (10), relating to the so-called "charitable contribution" deduction); then such part of the income of the trust shall be included in comput- ing the net income of the grantor. (g) DEFINrIION OF "IN DISCRETION OF GRANTOR." -As used in this section, the term "in the discretion of the grantor" means "in the dis- cretion of the grantor, either alone or in conjunction with any person not having a substantial adverse interest in the disposition of the part of the income in question." (h) INCOME FROM INTANGIBLE PERSONAL PROPErY .HELD BY TRUST.- Income from intangible personal property held by any trust company or by any national bank situated in the District (with or without an individual trustee, resident or nonresident) in trust to pay the income for the time being to, or to accumulate or apply such income for the 1098 [53 STAT.

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