Page:United States Statutes at Large Volume 56 Part 1.djvu/870

 [56 STAT. PUBLIC LAWS-CH. 619-OCT. 21, 1942 53 Stat. 17. 26 U.S.. 25 (a). Ante, pp. 811,826. 53 Stat. 17 . 26U..c.. 25(a). Ante, pp. 811, 825. 53 Stat. 48. 26U.S.C. 116(a). 53 Stat. 50. 26U. S.C. § 116 h). 25 (a) if received from sources within the United States; but such individuals shall not be allowed as a deduction from his gross income any deductions properly allocable to or chargeable against amounts excluded from gross income under this subsection. "(2) TAXABLE YEAR OF CHANGE OF RESIDENCE TO UNITED STATES.- In the case of an individual citizen of the United States, who has been a bona fide resident of a foreign country or countries for a period of at least two years before the date on which he changes his residence from such country to the United States, amounts received from sources without the United States (except amounts paid by the United States or any agency thereof), which are attributable to that part of such period of foreign residence before such date, if such amounts would constitute earned income as defined in section 25 (a) if received from sources within the United States; but such individual shall not be allowed as a deduction from his gross income any deductions properly allocable to or chargeable against amounts excluded from gross income under this subsection." (b) TAXABLE YEARS TO WHICH AMENDMENT APPLICABLE.- The amendment made by subsection (a) shall be applicable with respect to taxable years beginning after December 31, 1942, and so much of the amendment made by subsection (a) as inserts paragraph (2) in section 116 (a) shall also be applicable to taxable years beginning in 1942. SEC. 149. RECIPROCAL EXEMPTION OF COMPENSATION OF EMPLOY- EES OF THE COMMONWEALTH OF THE PHILIPPINES. (a) Section 116 (h) (relating to reciprocal exemption of official compensation) is amended to read as follows: "(h) COMPENSATION OF EMPLOYEES OF FOREIGN GOVERNMENTS OR OF THE COMMONWEALTH OF THE PHILIPPINES. - "(1) RULE FOR EXCLUSION. -Wages, fees, or salary of an em- ployee of a foreign government or of the Commonwealth of the Philippines (including a consular or other officer, or a nondiplo- matic representative) received as compensation for official services to such government or such Commonwealth- "(A) If such employee is not a citizen of the United States, or is a citizen of the Commonwealth of the Philip- pines (whether or not a citizen of the United States); and "(B) If the services are of a character similar to those per- formed by employees of the Government of the United States in foreign countries or in the Commonwealth of the Philip- pines, as the case may be; and "(C) If the foreign government, or the Commonwealth of the Philippines, whose employee is claiming exemption grants an equivalent exemption to employees of the Government of the United States performing similar services in such foreign country or such Commonwealth, as the case may be. "(2) CERTIFICATE BY SECRETARY OF STATE. -The Secretary of State shall certify to the Secretary of the Treasury the names of the foreign countries which grant an equivalent exemption to the employees of the Government of the United States performing services in such foreign countries, and the character of the serv- ices performed by employees of the Government of the United States in foreign countries. If the Commonwealth of the Philip- pines grants an equivalent exemption to the employees of the United States performing services in such Commonwealth the Secretary of State shall certify such fact to the Secretary of the 842

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