Page:United States Statutes at Large Volume 68A.djvu/255

 CH. 1—NORMAL TAXES AND SURTAXES

215

Subchapter J—Estates, Trusts, Beneficiaries, and Decedents Part I. Estates, trusts, and beneficiaries. Part II. Income in respect of decedents.

PART I—ESTATES, TRUSTS, AND BENEFICIARIES Subpart A. General rules for taxation of estates and trusts. Subpart B. Trusts which distribute current income only. Subpart C. Estates and trusts which may accumulate income or which distribute corpus. Subpart D. Treatment of excess distributions by trusts. Subpart E. Grantors and others treated as substantial owners. Subpart F. Miscellaneous.

Subpart A—General Rules for Taxation of Estates and Trusts

Sec. 641. Imposition of tax. Sec. 642. Special rules for credits and deductions. Sec. 643. Definitions applicable to subparts A, B, C, and D.

SEC. 641. IMPOSITION OF TAX. (a) APPLICATION OF T A X. — The taxes imposed by this chapter

on individuals shall apply to the taxable income of estates or of any kind of property held in trust, iacluding— (1) income accumulated in trust for the benefit of unborn or unascertained persons or persons with contingent interests, and income accumulated or held for future distribution under the terms of the will or trust; (2) income which is to be distributed currently by the fiduciary . to the beneficiaries, and income collected by a guardian of an infant which is to be held or distributed as the court may direct; (3) income received by estates of deceased persons during the , period of administration or settlement of the estate; and •; (4) income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated. (b) COMPUTATION AND PAYMENT.—The taxable income of an estate

or trust shall be computed in the same manner as in the case of au individual, except as otherwise provided in this part. The tax shall be computed on such taxable income and shall be paid by the fiduciary. SEC. 642. SPECIAL RULES FOR CREDITS AND DEDUCTIONS. •

(a) CREDITS AGAINST T A X. — (1) PARTIALLY TAX-EXEMPT INTEREST.—An estate or trust shall

be allowed the credit against tax for partially tax-exempt interest provided by section 35 only in respect of so much of such interest as is not properly allocable to any beneficiary under section 652 or 662. If the estate or trust elects under section 171 to treat as amortizable the premium on bonds with respect to the interest on which the credit is allowable under section 35, such credit (whether § 642(a)(1)

�