Page:United States Statutes at Large Volume 54 Part 1.djvu/1009

 54 STAT.] 76TH CONG., 3D SESS.-CH. 757-OCT. 8, 1940 TITLE II-EXCESS PROFITS TAX SEC. 201. EXCESS PROFITS TAX OF 1940. The Internal Revenue Code is amended by inserting after section Excess Profits Tax 706 the following new subchapter which may be cited as the "Excess '3 Stat. '17 Profits Tax Act of 1940": 26U.S. C., upp.V. "SUBCHAPTER E-EXCESS PROFITS TAX "Part I "SEC. 710. IMPOSITION OF TAX. "(a) IMPOsrrITN.- There shall be levied, collected, and paid, for each taxable year beginning after December 31, 1939, on the adjusted excess profits net income, as defined in subsection (b), of every cor- poration (except a corporation exempt under section 727) a tax as follows: "(1) Upon adjusted excess profits net incomes of less than $20,000, 25 per centum of the adjusted excess profits net income. "$5,000 upon adjusted excess profits net incomes of $20,000; and upon adjusted excess profits net incomes in excess of $20,000, and not in excess of $50,000, 30 per centum in addition of such excess. "$14,000 upon adjusted excess profits net incomes of $50,000; and upon adjusted excess profits net incomes in excess of $50,000, and not in excess of $100,000, 35 per centum in addition of such excess. "$31,500 upon adjusted excess profits net incomes of $100,000; and upon adjusted excess profits net incomes in excess of $100,000, and not in excess of $250,000, 40 per centum in addition of such excess. "$91,500 upon adjusted excess profits net incomes of $250,000; and upon adjusted excess profits net incomes in excess of $250,000, and not in excess of $500,000, 45 per centum in addition of such excess. "$204,000 upon adjusted excess profits net incomes of $500,000; and upon adjusted excess profits net incomes in excess of $500,000, 50 per centum in addition of such excess. " (2) APPLICATION OF RATES IN CASE OF CERTAIN EXCHANGES.- If the taxpayer's highest bracket amount for the taxable year computed under section 752 (relating to certain exchanges) is less than $500,000, then in the application of paragraph (1) of this subsection to such taxpayer, in lieu of each amount, other than the percentages, specified in such paragraph, there shall be substituted an amount which bears the same ratio to the amount so specified as the highest bracket amount so computed bears to $500,000. "(b) DEFINITION OF ADJUSTED EXCESS PROFITS NET INCOME.-As lsed in this section, the term 'adjusted excess profits net income' in the case of any taxable year means the excess profits net income (as defined in section 711) minus the sum of: "(1) SPECIFIC EXEMPTION. -A specific exemption of $5,000; "(2) EXCESS PROFITS CREDIT.- The amount of the excess profits credit allowed under section 712; and "(3) TNr:SED EXCESS PROFITS CREDIT.-In the case of a taxpayer the normal-tax net income of which for the taxable year is not Adjustedexcess prof- its net income. Post, p. 988. Rates. Application of rates in case of certain ex- chanpgs. PIus, p. 995. " Adjusted excess profits net income" defined. Post, p. 976. Post, p. 97a. 975

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