72d CONGRESS . SESS. I. CH. 209 . JU NE 6, 1932.
221 the income of the estate or trust for any taxable year of the estate or trust ending within his taxab le year . SEC. 165 . EMPLOYEE S' TRUSTS . A trus t created by an employer as a pa rt of a stock bo nus, pension, or profit-sharing plan for the exclusive benefit of some or all of his employees, to which contributions are made by such employer, or employees, or both, for the purpose of distributing to such em- ployees the earn ings and princip al of th e fund ac cumulate d by the trust in accordance with such plan, shall not be taxable under section 161, but the amount actually distributed or made available to any distributee shall be taxable to him in the year in which so distributed or made available to the extent that it exceeds the amounts paid in by him . Such dis tributees shall f or the purpose o f the normal tax be allowed as credits against net income such part of the amount so distributed or made available as represents the items of dividends and interest specified in section 25(a) and (b) . SEC. 166 . REVOCABLE TRUSTS .
R evoca ble trust s . Where at any time during the taxable year the power to revest in the grantor title to any part of the corpus of the trust is vested- (1) in the grantor, either alone or in conjunction with any Income therefrom person not having a su bstantial advers e interest in th e disposition computed o'sneetincome grant- of such part of the corpus or the income therefrom, or (2) in any person not having a substantial adverse interest in the di sposition of suc h part of the co rpus or the inco me therefrom, then the income of such part of the trust for su ch taxable year s hall be included in computing the net income of the grantor . SEC. 167. INCOME FOR BENEFIT OF GRANTOR . (a) Where any part of the income of a trust- (1) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be, held or accumulated for future distribution to the grantor ; or (2) may, in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income, be distributed to the grantor ; or (3) is, or in the discretio n of the grantor or of any perso n not having a substantial adverse interest in the disposition of such part of the income may be, applied to the payment of premiums upon policies of insurance on the life of the grantor ( exce pt pol icies of insuran ce irrev ocably p ayable f or the p urposes and i n the ma nner specified i n section 23(n), relating to the so-called A1it4p . "charitable contribution" deduction) ; then such part of the income of the trust shall be included in com- puting the net income of the grantor . (b) As used in this section, the term " in the discretion of the "In the discretion of grantor " means " in the discretion of the grantor, either alone or the grantor" def ined. In conjunction with any person not having a substantial a dver se interest in the disposition of the part of the income in question ". SEC. 168. CAPITAL NET GAINS AND LOSSES .
Capital net gains and losses . In the case of an esta te or trust, or of a beneficiary of an estate Determination of ; to be separately shown in or trust, the proper part of each share of the net income which con- returns . sists, respectively, of ordinary net income, capital net gain, or capital net loss, shall be determined under rules and regulations to be pre- scribed by the Commissioner with the approval of the Secretary, and shall be separately shown in the return of the estate or trust, and shall be taxed to the beneficiary or to the estate or trust as INCOME TAX Employees' trusts . Profit-sharing trusts, etc ., for employees, not taxed . Ante, P . 219. Distributees taxed on amount received . Credits. Ante, p. 184 . Income for benefit of grantor, co mputed with grantor's net in- come. When held for future distribution . Whe n distribute d to grantor . when applied to life ins urance premi ums . Exception .
