Page:United States Statutes at Large Volume 58 Part 1.djvu/257

 58 STAT.] 78TH CONG., 2D SESS.-CH. 210-MAY 29, 1944 those which under section 22 (n) are to be subtracted from gross Ate, p. 23. income in computing adjusted gross income, (B) all credits with respect to taxes of foreign countries and possessions of the United States, (C) all credits with respect to taxes withheld at the source under section 143 (a) (relating to interest on tax-free covenant 5 Stt60. bonds), and (D) all credits against net income with respect to Supp. III, 143 interest on certain obligations of the United States and Govern- Post,p239. ment corporations of the character specified in section 25 (a) 6st7c. (1) and (2). m, 25 (a) , "(3) METHOD AND EFFECT OF ELECTION.- "(A) If the adjusted gross income shown on the return is $5,000 or more, the standard deduction shall be allowed only if the taxpayer so elects in his return, and the Commis- sioner, with the approval of the Secretary, shall by regula- tions prescribe the manner of signifying such election in the return. "(B) If the adjusted gross income shown on the return is less than $5,000, the standard deduction shall be allowed only if the taxpayer elects, in the manner provided in Supplement Ae,. 2; T, to pay the tax imposed by such supplement. 647.n, "(C) If the taxpayer does not signify, in the manner pro- vided by subparagraph (A) or (B), his election to take the standard deduction, it shall not be allowed. If he does so signify, such election shall be irrevocable. "(D) If the adjusted gross income shown on the return is $5,000 or more, but the correct adjusted gross income is less than $5,000, then an election by the taxpayer under sub- paragraph (A) to take the standard deduction shall be con- sidered as his election to pay the tax imposed by Supplement T; and his failure to make under subparagraph (A) an Antp.P22; election to take the standard deduction shall be considered his election not to pay the tax imposed by Supplement T. If the adjusted gross income shown on the return is less than $5,000, but the correct adjusted gross income is $5,000 or more, then an election by the taxpayer under subparagraph (B) to pay the tax imposed by Supplement T shall be con- sidered as his election to take the standard deduction; and his failure to elect under subparagraph (B) to pay the tax imposed by Supplement T shall be considered his election not to take the standard deduction. "(4) HUSBAND AND WIFEn-In the case of husband and wife living together, the standard deduction shall not be allowed to either if the net income of one of the spouses is determined without regard to the standard deduction. For the purposes of this paragraph the determination of whether an individual is married and living with his spouse shall be made as of the last day of the taxable year, unless his spouse dies during the taxable year, in which case such determination shall be made as of the date of such spouse's death. "(5) SHORT PERIOD. -In the case of a taxable year of less than twelve months on account of a change in the accounting period, the standard deduction shall not be allowed." (b) ESTATES, TRUSTS, AND COM1MON TRUST FUNDS. - (1) ESTATES AND TRUSTs. -Section 162 (relating to net income 23US.6 of estates and trusts) is amended by inserting at the end thereof Supp.mi§s6 the following: "(f) The standard deduction provided in section 23 (aa) shall not Ad- p. be allowed." . 16% 43 (a); Bupp. (2). post, p. post p. 237
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