Page:United States Statutes at Large Volume 68A.djvu/274

 234

INTERNAL REVENUE CODE OF 1954

(2) are used to a substantial degree for purposes other than those prescribed in section 642(c); or (3) are invested in such a manner as to jeopardize the interests of the rehgious, charitable, scientific, etc., beneficiaries, the amount otherwise allowable under section 642(c) as a deduction shall be limited to the amount actually paid out during the taxable year and shall not exceed 20 percent of the taxable income of the trust (computed without the benefit of section 642(c) but with the benefit of section 170(b)(1)(A)). Paragraph (1) shall not apply to income attributable to property of a decedent dying before January 1, 1951, which is transferred under his will to a trust created by such will. In the case of a trust created by the will of a decedent dying on or after January 1, 1951, if income is required to be accumulated pursuant to the mandatory terms of the will creating the trust, paragraph (1) shall apply only to income accumulated during a taxable year of the trust beginning more than 21 years after the date of death of the last life in being designated in the trust instrument. (d) CROSS R E F E R E N C E. — For disallowance of certain charitable, etc., deductions otherwise allowable under section 642(c), see section 503(e). SEC. 682. INCOME OF AN ESTATE OR TRUST IN CASE OF DIVORCE, ETC. (a) INCLUSION IN GROSS INCOME OF W I F E. — The r e shall be included

in the gross income of a wife who is divorced or legally separated under a decree of divorce or of separate maintenance (or who is separated from her husband under a written separation agreement) the amount of the income of any trust which such wife is entitled to receive and which, except for this section, would be includible in the gross income of her husband, and such amount shall not, despite any other provision of this subtitle, be includible in the gross income of such husband. This subsection shall not apply to that part of any such income of the trust which the terms of the decree, written separation agreement, or trust instrument fix, in terms of an amount of money or a portion of such income, as a sum which is payable for the support of minor children of such husband. In case such income is less than the amount specified in the decree, agreement, or instrument, for the purpose of applying the preceding sentence, such income, to the extent of such sum payable for such support, shall be considered a payment for such support. (b) W I F E CONSIDERED A BENEFICIARY.—For purposes of computing the taxable income of the estate or trust and the taxable income of a wife to whom subsection (a) or section 71 applies, such wife shall be considered as the beneficiary specified in this part. A periodic payment under section 71 to any portion of which this part applies shall be included in the gross income of the beneficiary in the taxable year in which under this part such portion is required to be included. (c) CROSS R E F E R E N C E. — For definitions of "husband" and "wife", as used in this section, see section 7701(a) (17).

§ 681(c)(2)

�