Page:United States Statutes at Large Volume 50 Part 1.djvu/854

45TH CONGRESS, 1ST SESSION-CH. 815-AUGUST 26, 1937 TITLE IV-TRUSTS SEC. 401. DENIAL OF PERSONAL EXEMPTION TO TRUSTS . Section 163 (a) of the Revenue Act of 1936 is amended to read as follows : " (a) CREDITS OF ESTATE OR TRUST . - "(1) For the purpos e of the norm al tax and the surta x an estate or trust shall be allowed the same personal exemption as is allowed to a single person under section 25 (b) ( 1) , except that no exemption shall be allowed a trust if the trust instrument requires or permits the accumulation of any portion of the income o f the tr ust and there is not dis tributed an amoun t equal to the net income . For the purposes of this paragraph the term "net income" does not include amounts included in gross income which, under the law of the jurisdiction under which the trust is administered, cannot (even if permitt ed or required by the trust instrument to be considered as inc ome) be considered as income and are not distributable . "(2) If no part of the income of the estate or trust is included in computing the net income of any legatee, heir, or beneficiary, then the estate or trust shall be allowed the same credits against net income for interest as are allowed by section 25 (a) ." SEC. 402 . FIDUCIARY RETURNS . Section 142 (a) of the Revenue Act of 1936 is amended to read as follows " (a) REQUIREMENT OF RETURN.-Every fiduciary (except a receiver appointed by authority of law in possession of part only of the pro perty of an individual) shall make under oath a return for any of the following individuals, estates, or trusts for which he acts, stating specifically the items of gross income thereof and the deduc- tions and credits allowed under this title and such other informa- tion for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regu- lations prescribe- "(1) Every individual having a net income for the taxable year of $1,000 or over, if single, or if married and not living with husband or wife ; "(2) Every individual having a net income for the taxable year of $2,500 or over, if married and living with husband or wife ; "(3) Every individual having a gross income for the taxable year of $5,000 or over, regardless of the amount of his net income ; "(4) (A) Every estate, and every trust entitled to the per- sonal exemption allowed by section 163 (a) (1), the net income of which for the taxable year is $1,000 or over . "(B) Every trust, not entitled to a personal exemption under section 163 (a) (1 ), which has a net income for the taxable year. "( 5) Every estate or trust the gross income of which for the taxable year is $5,000 or over, regardless of the amount of the net income ; "( 6) Every estate or trust of which any beneficiary is a nonresident alien ; and "( 7) Regardless of the amount of the gross or net income, every trust, though hav ing no net income, which would have a net income if distributions had not been made which under the terms of the trust instrument were in the discretion of the 829 Title IV-Trusts . Denial of pe rso nal exemption to trusts . 49 stat . 1707. Credits of estate or trust . Fiduciary returns . 49Stat. 1700. Requirement of re- turn . Sworn statement of income, etc ., of bene- ficiaries . Deductions, etc ., al- lowed . Net income of $1,000 or over, if single, etc . Net income of $2,500 or over, if married, etc . Gross income of $5,000 or over . Estates, or trusts where net income $1,000 or over. 49 Stat. 1707. Trusts not entitled to personal exemption having net income . Gro ss income of $5,000 or more . Nonresident alien beneficiary . Distributions dis- cretionary or based on a contingency .