Page:United States Statutes at Large Volume 56 Part 1.djvu/844

 PUBLIC LAWS-CH. 619-OCT. 21, 1942 Ante, p. 814. 63 Stat. 462. 26U.S.. . 3761. 54 Stat. 97. 26U.S.0.ii710- 752; Supp. I, I 710- 743. Pot, p. 899. 55 Stat. 28. 26U. .C., Supp.I, 734 (d). ously replaced, and if the liquidation was an involuntary liquidation shall be included in the inventory of the taxpayer for the year of replacement at the inventory cost basis of the goods replaced. "(D) Election Irrevocable. - An election by the taxpayer to have the provisions of this paragraph apply, once made, shall be irrevocable and shall be binding for the year of the involuntary liquidation and for all determinations for subse- quent taxable years insofar as they are related to the year of liquidation or replacement. "(E) Adjustment in Certain Cases. - If the adjustments specified in subparagraph (A) are, with respect to any tax- able year, prevented, on the date of the filing of the income tax return of the taxpayer for the year of the replacement, or within three years from such date, by any provision or rule of law (other than this subparagraph and other than section 3761, relating to compromises), such adjustments shall nevertheless be made if, in respect of the taxable year for which the adjustment is sought, a notice of deficiency is mailed or a claim for refund is filed, as the case may be, within three years after the date of the filing of the income tax return for the year of replacement. If, at the time of the mailing of such notice of deficiency or the filing of such claim for refund, the adjustment is so prevented, then the amount of the adjustment authorized by this paragraph shall be limited to the increase or decrease of the tax imposed by this chapter and Subchapter E of Chapter 2 previously deter- mined for such taxable year which results solely from the effect of subparagraph (A), and such amount shall be assessed and collected, or credited or refunded, in the same manner as if it were a deficiency or an overpayment, as the case may be, for such taxable year and as if, on the date of the filing of the income tax return for the year of the replacement, three years remain before the expiration of the periods of limitation upon assessment or the filing of claim for refund for the taxable year. The tax previously deter- mined shall be ascertained in accordance with section 734 (d). The amount to be assessed and collected under this paragraph in the same manner as if it were a deficiency or to be credited or refunded in the same manner as if it were an overpayment shall not be diminished by any credit or set-off based upon any item, inclusion, deduction, credit, exemption, gain, or loss, other than one resulting from the effect of subparagraph (A). Such amount, if paid, shall not be recovered by a claim or suit for refund, or suit for erroneous refund based upon any item, inclusion, deduction, credit, exemption, gain, or loss, other than one resulting from the effect of subparagraph (A)." SEC. 120. ALIMONY AND SEPARATE MAINTENANCE PAYMENTS. 53 Stat. 9. 26 us. . . (a) AMOUNT INCLUDIBLE IN GROSS INcoME. - Section 22 (relating to definition of gross income) is amended by inserting at the end thereof the following new subsection: "(k) ALIMONT, ETr., INCOME.-In the case of a wife who is divorced or legally separated from her husband under a decree of divorce or of separate maintenance, periodic payments (whether or not made at regular intervals) received subsequent to such decree in discharge of, or attributable to property transferred (in trust or otherwise) in dis- 816 [56 STAT.

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