74TH C ONGRESS. SESS . II. CH. 690 . J UNE 22, 1936 .
16 59 pensation for personal services actually rendered ; traveling expenses (in clud ing the entire amount expended for meals and lod ging ) while away from home in the pursuit of a trade or business ; and rentals or other payments required to be made as a condition to the continued use or possession, for purposes of the trade or business, of property to which the taxpayer has not taken or is not taking title or in which he has no equity . (b) INTEREST .-All interest paid or accrued within the taxable Interest on debts ; year on indebt edness, except on indebtedness incurred or continued e xceptions. to purchase or carry obligations (other than obligations of the United States issued after September 24, 191 7, and originally sub- scribed for by the taxpayer) the interest upon which is wholly exempt from the taxes imposed by this title . (c) TAXES GENERALLY .-Taxes paid or accrued within the taxable Taxes generally. Exceptions . year, except- (1) Federal income, war-profits, and excess-profits taxes (other Ante, p . 1019. than the excess-profits tax imposed by section 106 of the Revenue Act of 1935) ; (2) income, war-profits, and excess-profits taxes imposed by the authority of any foreign co untry or possession of the United States ; but this deduction shall be allowed in the case of a tax- De duction for fo reign payer who does not signify in his return his desire to have to any taPOst, p. 1696. extent the benefits of section 131 (relating to credit for taxes of foreign countries and possessions of the United States)
(3) estate, inheritance, le gacy, succession, and gi ft taxes ; a n d (4) taxes assessed against local b enefits of a kind tending to increase the value o f the property assessed ; b ut th is p ar ag ra ph shall not exclude the allowance as a deduction of so much of such taxes as is properly allocable to maintenance or interest charges . (d) TAXES OF SHAREHOLDER PA ID BY COR POR ATI ON .-The deduc- Taxes of shareholder tion for taxes allowed by subsection (c) shall be allowed to a cor- pai d by corporation . poration in the case of * taxes imposed upon a shareholder of the corpora tion upon his interest as shar eholder which are paid by the corporation without reimbursement from the shareholder, but in such cases no deduction shall be allowed the shareholder for the amount of such taxes. (e) LOSSES BY INDIVIDUALS .-In the case of an individual, losses ua losses by individ . sustained during the taxable year and not compensated for by insurance or otherwise- (1) if incurred in trade or business ; or
Incurre d in bu siness, etc . (2) if incurred in any transaction entered into for profit, Not connected with thou h not connected with the trade or business ; or
trade or bus iness . (3 of property not connecte d with the trade or business i f the Casualty losses not connected wi th lo ss ar ises f rom f ires, storm s, sh ipwrec k, or other casu alty, or fr om ses s. theft. No loss shall be allowed as a deduction under this para- duct ed Disallowed, if ax graph if at the time of the filing of the return such loss has been purposes. claimed as a deduction for estate tax purposes in the estate tax return. (f) LOSSES BY CORPORATIONS .-In the case of a corporation, losses cion has by cor pora- sustained during the taxable yea r and not compensated for by insurance or otherwise . (g) WAGERING Losses .-Losses from wagering transactions shall ii agering losses . be allowed only to the extent of the gains from such transactions .
Basis for det erminin g (h) BASIS FOR DETERMINING Loss .-The basis for determining the loss . amount of deduction for losses sustai ned, to be allowed under sub- section (e) or ( f), shall be the adjusted basis provided in section 113 (b) for determining the loss from the sale or other disposition Post, p. 16 a"" of property .
