Page:United States Statutes at Large Volume 58 Part 1.djvu/69

 (except for the provisions of sections 3801 and 3807) by the operation 53 S 1 at. 1 47162. of any law or rule of law (other than section 3761, relating to corn- 3761. promises) any increase in the tax previously determined for such Pot,pp. 7, 246. taxable year shall be considered a deficiency for the purposes of this section. For the purposes of this section the term tax previously "Te'previouslyde- determined' shall have the meaning assigned to such term by sec- tion 3801 (d). "(c) EXTENSION OF STATUTE OF LIMITATIONS.-Notwithstanding any law or rule of law (other than section 3761, relating to compra- 23U. . . 3761. mises), any amount determined as a deficiency under subsection (b), or which would be so determined if assessment were prevented in the manner described in subsection (b), with respect to any taxable year may be assessed as if on the date of the expiration of the time pre- scribed by law for the assessment of a deficiency for the fifth taxable year of the five consecutive taxable years specified in subsection (a), one year remained before the expiration of the period of limitation upon assessment for any such taxable year." (b) EFEwCTIVE DATE OF AMENDMENT. -The amendment made by subsection (a) shall be applicable to taxable years beginning after December 31, 1939, but shall not affect any tax liability for any tax- able year beginning prior to January 1, 1944. SEC. 130. TECHNICAL AMENDMENTS RELATING TO FOREIGN TAX CREDIT. (a) LIMrr ON CREDrr.-Section 131 (b) (relating to limitations on 526US. 6 . Supp. credit allowed for taxes of foreign countries and possessions of the nI, 131 (b). United States) is amended to read as follows: "(b) LIMIT ON CREDrr. -The amount of the credit taken under this section shall be subject to each of the following limitations: "(1) The amount of the credit in respect of the tax paid or accrued to any country shall not exceed, in the case of a taxpayer other than a corporation, the same proportion of the tax against which such credit is taken, which the taxpayer's net income from sources within such country bears to his entire net income for the same taxable year, or in the case of a corporation, the same proportion of the tax against which such credit is taken, which the taxpayer's normal-tax net income from sources within such country bears to its entire normal-tax net income for the same taxable year; and "(2) The total amount of the credit shall not exceed, in the case of a taxpayer other than a corporation, the same proportion of the tax against which such credit is taken, which the taxpayer's net income from sources without the United States bears to his entire net income for the same taxable year, or, in the case of a corporation, the same proportion of the tax against which such credit is taken, which the taxpayer's normal-tax net income from sources without the United States bears to its entire normal-tax net income for the same taxable year; and "(3) For the purposes of paragraphs (1) and (2) of this sub- section, the terms 'normal-tax net income from sources within such country' and 'normal-tax net income from sources without the United States' shall mean the net income from such sources minus an amount equivalent to the same proportion of the credit pro- vided in section 26 (e) which the taxpayer's excess profits net - P- "- income from such sources bears to its entire excess profits net income for the same taxable year." (b) TAXES OF FOREIGN SUBsiIARY. -The first sentence of section 2s Uta. p7.p 131 (f) (relating to foreign taxes deemed to have been paid by a m. 3l(o. 93650o---4P . 1- - - 49 78TH CONG., 2D SESS.- - CH. 63-FEB. 25,1944 58 STAT.]

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