Page:United States Statutes at Large Volume 55 Part 1.djvu/726

 55 STAT.] 77TH CONG. , IST SESS.-CH. 412-SEPT. 20, 1941 "(A) Income Taxes.- In computing such normal-tax net income the deduction for the tax imposed by this subchapter shall not be allowed ;". (B) Section 711 (a) (2) (C) (relating to adjustment for income taxes in computing excess-profits net income under invested capital credit) is amended to read as follows: "(C) Income Taxes.- In computing such normal-tax net income the deduction for the tax imposed by this subchapter shall not be allowed;". (2) TAXABLE YEARS IN THE BASE PERIOD.-Section 711 (b) (1) (A) (relating to adjustment for income taxes for taxable years in the base period) is repealed. (d) COMPUTATION OF CHARITABLE, ETC., DEDUCTIONS. - (1) Section 711 (a) (1) of the Internal Revenue Code is amended by inserting at the end thereof the following new subparagraph: "(G) Computation of Charitable, Etc. Deductions.- In determining any deduction the amount of which is limited to a percentage of the taxpayer's net income (or net income from the property), such net income (or net income from the property) shall be computed without regard to the deduction on account of the tax imposed by this subchapter." (2) Section 711 (a) (2) of the Internal Revenue Code is amended by adding at the end thereof the following new sub- paragraph: "(I) Computation of Charitable, Etc., Deductions.- In determining any deduction the amount of which is limited to a percentage of the taxpayer's net income (or net income from the property), such net income (or net income from the property) shall be computed without regard to the deduc- tion on account of the tax imposed by this subchapter." (e) ExcEss-PROFITs CREDrr CARRY-OVER.- Section 710 (c) (1) (defining the unused excess-profits credit) is amended by adding at the end thereof a new sentence to read as follows: "For such purpose the excess-profits credit and the excess-profits net income for any taxable year beginning in 1940 shall be computed under the law applicable to taxable years beginning in 1941." . (f) EQUITY INVESTED CAPITAL.-Se(tion 718 (c) (3) (relating to the computation of earnings and profits for invested capital purposes) is amended by adding after the word "subchapter" the words "or chapter 1". (g) ADJUSTMENT OF ABNORMAL BASE PERIOD NET INcoiE. -- Section 722 (c) (placing a limit on the amount of relief afforded under sec- tion 722) is amended by adding at the end thereof a new sentence to read as follows: "For the purposes of this subsection and subsec- tion (d) the taxpayer's normal-tax net income shall be computed without deduction of the tax imposed by this subchapter.". (h) NONDEDUCTIBILITY OF EXCESS Porrrs TAX IN COMPUTrATON OF DECLARED VALUE EXCESS PROFITrrs TAx. -Section 602 of the Internal Revenue Code is amended by striking out "computed without the deduction of the tax imposed by section 600" and inserting in lieu thereof "computed without the deduction of the tax imposed by sec- tion 600 or the tax imposed by Subchapter E of Chapter 2". (i) ADJUSTED DECLARED VALUTE. - (1) Section 1202 (b) (1) (C) of the Internal Revenue Code is amended to read as follows: "(C) its net income computed without the deduction of the tax imposed by Subchapter E of Chapter 2,". 701 54 Stat. 977. 26U.S.C.§711(a) (2) (C). 54 Stat. 977. 26U.S. C. §711(b) (1) (A). 54 Stat. 976. 26U.S.C. 711(a) (1). 54 Stat. 976, 977. 26U.S.C. 711(a) (2). Ante, p. 17. 54 Stat. 984 . 26U.S.(.§718(c) (3). Ante, p. 24. 53 Stat. 111 . 26U.S.C. 602. 53 Stat. 111 . 26 r. S. C. §600. Post, p. 704. 54 Stat. 975; ante, p. 26. 26U.S.C.§§710- 752. 53 Stat. 170 . 26 U.S. C. 1202 (b) (1) (C).

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