Page:United States Statutes at Large Volume 42 Part 1.djvu/257

SIXTY-SEVENTH CONGRESS. Sess. I. Ch. 136. 1921. 229 distribution and cancellation or redemption essentially equivalent to “"°°“ “*· the distribution of a taxable dividend, the amount received in redemption or cancellation of the stock shall be treated as a taxable dividend to the extent of the earnings or profits accumulated by such corporation after February 28, 1913. (e) For the purposes of this Act, a taxable distribution made by a c,,§,f,‘§','jd,§,$;gb§,';,’•?'j,S*¤· corporation to its shareholders or members shall be included in the ` gross mcome of the distributees as of the date when the cash or other property is unqualiiiedly made subject to their demands. _ _ ( ) Any distribution made during the first sixty days of any tax- t°1g§'§L:{€§§,°§T"m“ able year shall be_ deemed to have been made from eam' or rofits ‘ accumulated during preceding taxable ears; but an mglstrigution made during the remainder 0 the taxalile year shall be deemed to have been made from earnings or profits accumulated between the close of the preceding taxable year and the date of distribution, to the extent o such earnings or profits, and if the books of the corporation do not show the amount of such eamings or profits, the earnings or profits for the accounting period within which the distribution was made shall be deemed to have been accumulated ratably _ during such period. This subdivision shall not be in effect after D,,];§§,bZ,‘;°§ff§§2l?‘t°' December 31, 1921. BASIS Fon DETERMINING GAIN on Loss. Gm °**°S$· Sec. 202. (a) That the basis for ascertaining the gain derived or ,2§,,.h°;L%°éu,$;‘$g;tZ{ loss sustained from a sale or other disposition of proplerty, real, £::f,{g;'Y2%*°13=b“°° personal, or mixed, acquired after February 28, 1913, s all be the ` cost of such propert ; except that— Ex°°pd°”S' (1) In the case ofy such lpro erty, which should be included in the "“°°'y "°‘l“° inventory, the basis shaH e the last invento value thereof ; _ (2) In the case of such property, acquiredrlri gift after December 3,g‘§f‘{,*;,‘§,?,,.1;§;b,‘f§ 31, 1920, the basis shall be the same as that which it would have in *¤1¤¤¤<*S¤*¤°¤¤*· the hands of the donor or the last preceding owner by whom it was _ not acquired by gift. If the facts necessary to determine such basis ‘“°°“"”“‘““" are unknown to the donee, the Commissioner shall, if possible, obtain such facts from such donor or last preceding owner, or any other person cognizant thereof. If the Commissioner finds it impossible to obtain such facts, the basis shall be the value of such property _ as found by the Commissioner as of the date or ap roximate date at which, accordin to the best information the Cibmmissioner is able to obtain, such property was ac uired by such donor or last precedin owner. In the case of sugli protperty acquired by gift ,,§,‘,§",,,,]'§’f §'°{},‘@'*{)°§'. on or belore December 31, 1920, the basis or ascertaining gain or ¢°¤¤*>°*‘ 3% lmloss from ai salefor olgher dispositiopl thereof phallhbe the fair market rice or va ue 0 suc ro erty at the time o suc acquisition; P (3) In the case of siichpproperty, acquired by bequest, devise, or inheritance, the basis shall be the fair marketlplrice or yalue of such c,x·:ggg_"°b'° *° °*· property at the time of such acquisition. e provisions of this paragraph shall apply to the acquisition of such property mterests as are s ecified in subdivision (c) or (e) of section 402. _ {;:;‘·PP·"8·2’°;md (b) 'lphe basis for ascertaining the gain derived or loss sustained bez¤m°°un.fmp°i?`ioia, from the sale or other disposition o lproperty, real, personal, or °¤S¤*¤° bmmixed, acquired before March 1, 1913, s all be the same as that provided b subdivision (a); but— _ _ H _ at (1) Ifyits fair market price or value as of March 1, 1913, is m excess ,,,,s,_""'°° “‘ ”°°“ of such basis the gain to be included in the gross income shall be the excess of the amount realized therefor over such fair market rice or value; P (2) If its fair market price or value as of March 1, 1913, is lower ,,§§"*°‘ ""' u" than such basis, the deductible loss is the excess of the fair market price or value as of March 1, 1913, over the amount realized therefor; and