72d CONGRESS . SESS. I. CH . 209. JUNE 6,1932 .
183 the extent allowable under such section if it had remained in force
INCOME TAX wit h respect to such year .
Limitation on stock (r) LIMITATION ON STOCK LOSSES .-
losses . (1) Losses from sales or exchanges of stocks and bonds (as sales or exchanges . de ned in subsection (t) of this section) which are not capital assets (as defined in section 101) shall be allowed only to the pose, P• 191. extent of the gains from such sales or exchanges (including gains which may be derived by a taxpayer from the retirement of his own obligations) . (2) Los ses di sallow ed as a dedu ction by para graph 11), c orn- pu D Cea ~o o om: puted without regard to any losses sustained during the preceding taxable i n succeeding taxable year shall, to an amount not in excess of the taxpayer's net income for the' taxable year, be considered for the purposes of this title as losses sustained in the succeeding taxable year from sales or exchanges of stock s or bond s which a re not ca pital ass ets . Exceptions. (3) This subsection shall not apply to a dealer in securities (as Dealer in securities. to stocks and bonds acquired for resale to customers) in respect of transactions in the ordinary course of his business, nor toa Bank or trust com- bank or trust compa ny inc orpora ted un der the laws of the Unite d parry . States or of any State or Territory, nor to persons carrying on the banking business (where the receipt of deposits constitutes a major part of such business) in respect of transactions in the ordinary course of such banking business. S SAME--SHORT SALES.-For the
of this title, gains Gains or losses from or osses (A) from short sales of stock purposes an bon ds, or (B) ttrribu- sho rt
ort sales of stocks, etc . table to privileges or options to buy or sell such stocks and bonds, or Duetooptionstobuy (C) from sales or exchanges of such privileges or options, shall be such stocks, etc . ef such considered as gains or losses from sales or exchanges of stocks or Privileges, etc . bonds which are not capi tal asset s . (t) DEFINITION OF STOCKS AND BONDS .-As used in subsections (r) Stocks and bonds de- and (s), the term "stocks and bonds" means (1) shares of stock in shares of stock in a corporation . any corporation, or (2) rights to subscribe for or to receive such subscription s . shares, or (3) bonds, debentures, notes, or certificates or other evi- Bonds ' etc' dences of indebtedness, issued by any corporation (other than a government or political subdivision thereof), with interest coupons Certates of profit. or in registered form, or (4) certificates of profit, or of interest in proper ty or acc umulation s, in any investme nt trust or simila r organi- zation holding or dealing in any of the instruments mentioned or described in this subsection, regardless of whether or not such investment trust or similar organization constitutes a corporation within the meaning of this Act . SEC. 24 . ITE MS NOT DEDUCTIBLE.
Items not dedu ctible . (a) GENERAL RULE .-In computing net income no deduction shall Objects specified . in an case be allowed in respect of-
Personal, etc ., ex- 1 Pe rsonal, l iving= or family e xpenses ;
pen ses . 23 Any amount paid out for new buildings or for permanent men&ospert' improve- improvements or betterments made to increase the value of any pr operty or estate ;
Restoring property . (3) Any amount expended in restoring allowance or in making good the exhaustion thereof for which an allowance is or has been made ; or
Life insurance preml . (4) Premiums paid on any life insurance policy covering the lams for employees . life of any officer or employee, or of any person financially inter- ested in any trade or business carried on by the taxpayer, when the taxpayer is directly or indirectly a beneficiary under such policy .
