PUBLIC LAWS--CH. 289-MAY 28, 1938 Earned income. SEC. 185 . EARNED INCOME. Determination. Foreign, etc., taxes. Credit for, allowed partners. Ante, p. 506. In the case of the members of a partnership the proper part of each share of the net income which consists of earned income shall be determined under rules and regulations to be prescribed by the Commissioner with the approval of the Secretary and shall be sep- arately shown in the return of the partnership. SEC. 186. TAXES OF FOREIGN COUNTRIES AND POSSESSIONS OF UNITED STATES. The amount of income, war-profits, and excess-profits taxes imposed by foreign countries or possessions of the United States shall be allowed as a credit against the tax of the member of a part- nership to the extent provided in section 131. Partnership returns. SEC. 187. PARTNERSHIP RETURNS. Sworn statement of gross income, etc. Different taxable years of partner and partnership. General rule. Basis of computa- tion. Partnership year be- ginning in 1937. 49 Stat. 1709. Ante, pp . 521-622 . Insurance coil- panies. Tax on life insur- ance companies. "Life insurance com- pany" defined. Imposition of tax. Rate on special class net income. Ante, pp. 455-156 . Every partnership shall make a return for each taxable year, stat- ing specifically the items of its gross income and the deductions allowed by this title and such other information for the purpose of carrying out the provisions of this title as the Commissioner with the approval of the Secretary may by regulations prescribe, and shall include in the return the names and addresses of the individuals who would be entitled to share in the net income if distributed and the amount of the distributive share of each individual. The return shall be sworn to by any one of the partners. SEC. 188. DIFFERENT TAXABLE YEARS OF PARTNER AND PARTNER- SHIP. (a) GENERAL RmuE--If the taxable year of a partner is different from that of the partnership, the inclusions with respect to the net income of the partnership, in computing the net income of the part- ner for his taxable year, shall be based upon the net income of the partnership for any taxable year of the partnership (whether begin- ning on, before, or after January 1, 1938) ending within or with the taxable year of the partner. (b) PARTNERSHIP YEAR BEGINNING IN 1937. -If the taxable year of the partnership begins before January 1, 1938, and the taxable year of a partner begins after December 31, 1937, the computation of the net income of the partnership, and the inclusions with respect to the partnership net income, in computing the net income of such partner, shall be made by the method provided in sections 182 and 183 of the Revenue Act of 1936 and not by the method provided in sections 182 and 183 of this Act. Supplement G-Insurance Companies SEC. 201. TAX ON LIFE INSURANCE COMPANIES. (a) DErINIrr oN. -W hen used in this title the term "life insurance company" means an insurance company engaged in the business of issuing life insurance and annuity contracts (including contracts of combined life, health, and accident insurance), the reserve funds of which held for the fulfillment of such contracts comprise more than 50 per centum of its total reserve funds. (b) IMPOSITION or TAX.- (1) IN GENERAL-In lieu of the tax imposed by sections 13 and 14, there shall be levied, collected, and paid for each taxable year upon the special class net income of every life insurance company a tax of 161/2 per centum of the amount thereof. 522 L52 STAT.
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