PUBLIC LAWS-CH. 258-JULY 16, 1947 "Taxable income." Post, p. 349. Ante, p. 334 . Report, etc., in gross income. Ante, p. 343. Distributive share of net income. any trade or business and in which capital is not a material income- producing factor. SEC. 2 . TAXABLE INCOME DEFINED.- For the purposes of this title, and unless otherwise required by the context, the words "taxable income" mean the amount of net income derived from sources within the District within the meaning of title X of this article in excess of the exemption granted by section 4 of this title. SEC. 3 . IMPosITIoN AND RATE or TAX.- For the privilege of carrying on or engaging in any trade or business within the District and of receiving income from sources within the District, there is hereby levied for each taxable year a tax at the rate of 5 per centum upon the taxable income of every unincorporated business, whether domestic or foreign (except those expressly exempt under title II of this article). SEC. 4. ExEMPrION.- Before computing the tax upon the taxable income of an unincorporated business, there shall be deducted there- from an exemption of $10,000, except that where the period covered by a return is less than a year, or where a return shows that an unincor- porated business has been carried on for less than twelve months, such exemption shall be prorated on a daily basis: Provided,however, That any amount exempted under this section from the tax imposed by section 3 of this title shall be reported and included in the gross income of that person or those persons entitled to a share therein in proportion to the share to which each person is entitled, and shall be reported in the return of each of such persons for his taxable year in which is ended the taxable year of the unincorporated business. SEC. 5. BY WHOM PAYABLE. -The taxes imposed by section 3 of this title shall be payable by the person or persons, jointly and severally, conducting the unincorporated business. The taxes imposed under this title may be assessed in the name of the unincorporated business or in the name or names of the person or persons liable for the payment of such taxes, or both. SEC. 6. PARTNERS ONLY TAXABLE.- Individuals carrying on any trade or business in partnership in the District, other than an unin- corporated business, shall be liable for income tax only in their individual capacities. The tax on all such income shall be assessed against the individual partners under title VI of this article. There shall be included in computing the net income of each partner his distributive share, whether distributed or not, of the net income of the partnership for the taxable year; or if his net income for such taxable year is computed upon the basis of a period different from that upon the basis of which the net income of the partnership is computed, then his distributive share of the net income of the part- nership for any accounting period of the partnership ending within the taxable year upon the basis of which the partner's net income is computed. TITLE IX-TAX ON ESTATES AND TRUSTS SEC. 1 . RESIDENT AND NONRESIDENT ESTATES AND TRUSTS.- For the purposes of this title, estates and trusts are (a) resident estates or trusts, or (b) nonresident estates or trusts. If the decedent was at the time of his death domiciled within the District, his estate is a resident estate, and any trust created by his will is a resident trust. If the decedent was not at the time of his death domiciled within the District, his estate is a nonresident estate, and any trust created Creatoroftrust by his will is a nonresident trust. If the creator of a trust was at the time the trust was created domiciled within the District, or if the trust consists of property of a person domiciled within the Dis- trict, the trust is a resident trust. If the creator of the trust was not at the time the trust was created domiciled within the District, 346 [61 STAT.