CH. 1
NORMAL TAXES AND SURTAXES
187
This paragraph shall apply with respect to amounts received for services under a particular contract only if at some time during the taxable year 25 percent or more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for the individual who has performed, is to perform, or may be designated (by name or by description) as the one to perform, such ' services. (6) U S E OF CORPORATION PROPERTY BY SHAREHOLDER.—Amounts
^ received as compensation (however designated and from whomsoever received) for the use of, or right to use, property of the corporation in any case where, at any time during the taxable year,
- 25 percent or more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for an individual
entitled to the use of the property; whether such right is obtained directly from the corporation or by means of a sublease or other arrangement. This paragraph shall apply only to a corporation which has personal holding company income for the taxable year, computed without regard to this paragraph and paragraph (7), in excess of 10 percent of its gross income. (7) RENTS.—Rents, unless constituting 50 percent or more of the gross income. For purposes of this paragraph, the term "rents" means compensation, however designated, for the use of, or right to use, property, and the interest on debts owed to the corporation, to the extent such debts represent the price for which . real property held primarily for sale to customers in the ordinary course of its trade or business was sold or exchanged by the corporation; b u t does not include amounts constituting personal holding company income under paragraph (6). (8) M I N E R A L, OIL, OR GAS ROYALTIES.—Mineral, oil,
or
royalties, unless— (A) such royalties constitute 50 percent or more of the income, and (B) the deductions allowable under section 162 (relating to or business expenses) other than compensation for personal ices rendered by the shareholders, constitute 15 percent or of the gross income.
gas
gross trade servmore
(b) LIMITATION ON GROSS INCOME IN CERTAIN TRANSACTIONS.—
For purposes of this part— (1) gross income and personal holding company income determined with respect to transactions described in section 543(a)(2) (relating to gains from stock and security transactions) shall include only the excess of gains over losses from such transactions, and (2) gross income and personal holding company income determined with respect to transactions described in section 543(a)(3) (relating to gains from commodity transactions) shall include only the excess of gains over losses from such transactions. (c) GROSS INCOME OF INSURANCE COMPANIES OTHER T H A N L I F E
OR M U T U A L. — I n the case of an insurance company other than life or mutual, the term "gross income" as used in this part means the gross income, as defined in section 832(b)(1), increased by the amount of losses incurred, as defined in section 832(b)(5), and the amount of expenses incurred, as defined in section 832(b)(6), and decreased by § 543(c)
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