1987 I TITLE 26.--INT1 him. Such distributees shall for the purpose of the normal ta; he allowed as credits such part of tho amount so distributed 01 made available as represents the items specified ia subdivisions my and (b) of scctior;216. _ ~° ` ’ I s. )‘ Wheio the grantor of a trust has, at any time durin·g the • mxa lo yéar, either alone or ln conjunotion with any pcrsor not l V · : ciaty of the trust, the poivofto rcvcst ixrhimsclf title to n ~ part of the corpus of the trust, then tho_incomo__ qt suc}; part of the trust for such taxable year shall be included in comoming tho not income of the grantoxj. _ ’ 1 _ . th) Where any partofothe lnoomoof a trust may, in the discretion of the gran-tor of the trust, olthenj aloné or in con junction with any pcrsoxr not at boneilciary_ ot the t1*ust,[b< . distributed to tha; grautor_or bc, held or accumulated for future distribution to him, or whore any partot thé income ot a tnrugi is`o;· may be applied to the paymentof premiums upon policies of ins‘urancc on tho life ot the grantor _(éxccpfpolicics of insur ance irrevocably payable for the purposes and in the Illflllllél spocfiled in paragraph '(10), or subdivision (11) `otsoction 214) such bart of the income of the trust shall be included in com puting thomotjncome of the grantor., (Feb. 26, 1926, c. 27 § 219, 44 Stat. 32..) { ' _ .» Soc notcfat béglnniug ot this chapter. . _ ·· ' gotta I antlrll of this;title,’* mentioned in the text, constitute P I and II of chapter 19 of this supplemental, title. " Sections 212, 214, and 216 mentioned in tho texture set out lx §§ 953, 955, and’957, respectively, obthis supplomental‘titlo$__’· t o- 961. Evasion of snrtax; aocumulatéd proiitb of corponjationso statcmwts of gains and proits; not i¤oom¢.——-(a) .It any, cor- _·i•ox·ation, howovcrl cicatcd or offgnihod, ia formed or availed ’ of_ for the purriosoot preventing the impositiondot the surtax upon its shareholders through the medium 'of permitting its Flinn and pronto to accumulate instead ot being divided or distributed, there shall be levied, collected, jand paid for each taxable yan oponthe not income ot such corporation a ta: equal to 50 per gicntum ot `thé a.mount.‘tborcot, which shall be in addition to the tau: 'impomd by section 230 of this title and shall (except as provldcd in subdivision (d) ot this ·section·) he computed, collected, and paid upon the same , basis and in the manner and mzbjoct to the same provisions of law, _ including penalties, as that tax. _ . i [ . (b)_ The fict that a·ny_oorporatton is--a more holding or invést- »ment coxnpgnyg or that the `galns or prodts arc permitted to accumulate beyond the roaaonablc needs ot the business, shall . be prima evidence ot a pdrposcto escape tho surtax; . - (c) When by the `commissioner; or any collector, ovory corporation shall forward to him a corrocbstatotnont ot snob gains and wont: and the names. and addresses of the individuals or shareholders who would be entitled to the same it dlvlddd ’01‘·di8£1'ibH€@, and, ot tho amounts that would be Ddyablcto oooh; ‘ _ I _ » ‘ ‘ (d)_ As mod in this section the tcrmm " not income". moans the net incomo as, in_ section 232, incroasod by tho sum ot the nxnount ot the deduction allowed- under poragiiaph (6) ot subdlvmon (a) of section @4; and the amount ot the lntoxtest on; obligations of, the Unitéd State; lwuod attor Boptombor 1, l917, which would bcsnbjcct to tax ln wholc or in part in the honda ot an individual owner. at ` _ 3 * (cl The tax by subdivision (a) lot this section shall not apply as t of any taxable year lt all the shareholders of thegcoitporationllncludo (atc tho time of Bling tholr `roturns) _· in thelr gross income thai;} oindfc diot1·~ibutlva share, whether distributed orgnot, éttbc not ot tho corporation-tor ouch ymr. Any amount so included in tho grosai lncomo; ot n ‘ sharcholdctrnhall be treated as n dividend xoggolved. Any ‘sub~ ‘ sequent distribution made by th? Wflwrotion out ot the camlngs og prodns for such taxable your shall, it dlatrlbntod to ml? Sbareboldcti who jhas so included in his grgss lncomo his
ERNAI1 REVENUE d§962
- distributive share, 'be exempt from tax in the um0m1t‘0f the
{ share so includedr (Feb. 26; 1926, u. 27, § 220, 44‘Stet. 34.) 5. . See note at begihning 0" this chapter. ‘ " ‘ Sections 230, 232, and 234, montimmd in the text, are set out ' 5 in §§ 981, 984, and 986, -rr·spoetivo]y, of this supplemental title.
- _ 962. Taixes to be deducted and withheld at source`; returns.——
{ (a) All pe_rs¤ms, in yvhatpver copircity acting, -il1(:1Udi1ig lessees or II1OI'_tg§lgO1'S of reel or D€l`S()H£ll__D1'0[}€ftY,· tiduciaries, em- ' ployers, zugd all officers and employees of the United- States, having the control, receipt, <3u:¤tody, dispowl, 01* _I$8?»’¤1911f of· ’ ii1terc·st· (except inferogt oh deposits with persons cmryinig on Q the ·b&U1kil1{,’_t“)!1Si1}@SS paid to persons xgotiengarged in business in;
- the United States and not h&».viug” an office or place of DHSBIQSS
’· thereirn), rent; salhri.cs,¤wage§, premitims, zmnuities,_conzpe11eab tions, remuueratious, enuolumeutsg or other iixed or determi- ’ `hebleeuhwxal or periodical gains, profits, and ihcome. ofeny hon- ' reside11f·utie11 individual, 01··of‘ zinyparthership not engaged in ' trade or busiuessuwithjn the United States and not having-may • _0iIiée or qylave of busihéss therein and composed in whole or in ' part of nonresident. aliens (other than income received as · diyideude of the class allowedes a credit by subdivision (a) ot section 216) shalllexcept in the eases provided for in subdivision (b) and except as otherwise provided in regulations ’ prescribed by `tl1e_`commis,sioner under section 211) deduct and i withhold from such armiml or‘peri0dico1`gains, 'prodts, 8l1d`_if1- come aotax ,equa1`t0 5 per cghtum thereof: Provided; That the _ commissioner may euthorizc such tex toebe deducted and with-
- .he1d from the interest upon any securities the owners of which
[ are not known to the withholding agent. ( ° I (b) In; any cose.-where bonds. mortgagee, ordeeds-of trust. B 01- /ot.!-rar-similar obligations of a corporation contain gi contract , or provision by which `the obligor egrew to pay any portion ot L jthe tax imposed by thie title upon the obtigee, or to .reimhm·se‘ I {the obligée for any portion of tbegtsx,. or to my the interest , h without deduction forhanytgx which_theT obligor maybe re—` i. quired or permitted to my thereon, or to retain therefrom under any law of the United States, the obligor Shall 'deduct and I I `withhold a tax oiiual to 2;per centum of [hé`iD.E¢l‘8§t epoxy smh bonds,. mortgagee, deeds “ of trust, or other obligations, whet1T§r· ’ such interm is, payable annually or at” shorter or ionger periods 5 _1 ind Whether payable to ehouremdent alien individual or to an , individual citieen orxeetdeut of- the United States or to te part- · L` uership : Provided, That the commissiohermay equthoriie smh h tux to be deducted and withheld in the case jet interwt upon ` eu auch hondmmortgages, deeds ot trusthor! etmr obligations, . the owners ot· which are not known to the withholding-ege¤t._ ·
[Such deduction and withholding sha!} not he required in there '
V dee ot n citizen or rwidéllt ehtitled to receive ihtereet,`it , hehleewith the withholding egeet om orbetore 1 h ~ signednotice in writing clhiming the heueht ot the credits prof videdjfu Subdivisions (c) and (d)__‘ot section 216 P'¤or—i¤ the _ ease ot e nonresident elieu iudividhad it so provided for . [ations prwcribed by the commissioner uhder subdivf y (S) V of sectio¤‘217. Such deduction and withholding ehell be at the rate of 1% per cegntmu instead of et the rote ot 2 per centum ih [ i the base of a citizen or ruideut eutitfed to receive ouch interest it he mmkvith the withholding agwt on `or hetero. February 1 ‘ a. signed rgoticedu writirg that his net income in excess of the " credits proyided in section 216 does hotiexceed $4,000. _ " (c)` Every person required to deduct and withhold any tex under this section shell make return thereof on or before March 15 of each Fear and she!} ouor bMore June 15 pay the tex to the omeiel of the United States ·Government authorized to re- - ceive it. Erery such person is hereby made liable. for such tax e and is hereby indemnmedlageinst the cloims and demadde of » euy p&so¤ for the nmoimt of any [!tt)’II1€HI`S¤1Ili\d€`iD accordance . with the provisions of this Section. " , .
