CH. 1—NORMAL TAXES AND SURTAXES
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such zone; except that June 25, 1950, shall be considered the date of the commencing of combatant activities in the combat zone designated in Executive Order 10195. (4) The term "compensation" does not include pensions and retirement pay. (5) The term "induction period" means any period during which, under laws heretofore or hereafter enacted relating to the induction of individuals for training and service in the Armed Forces of the United States, individuals (other than individuals liable for induction by reason of a prior deferment) are liable for induction for such training and service. SEC. 113. MUSTERING-OUT PAYMENTS ARMED FORCES.
FOR
MEMBERS
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THE
Gross income does not include amounts received during the taxable year as mustering-out payments with respect to service in the Armed Forces of the United States. SEC. 114. SPORTS PROGRAMS CONDUCTED FOR THE AMERICAN NATIONAL RED CROSS. (a) GENERAL RULE. — I n the case of a taxpayer which is a corpo-
ration primarily engaged in the furnishing of sports programs, gross income does not include amounts received as proceeds from a sports program conducted by the taxpayer if— (1) the taxpayer agrees in writing with the American National Red Cross to conduct such sports program exclusively for the benefit of the American National Red Cross; (2) the taxpayer turns over to the American National Red Cross the proceeds from such sports program, minus the expenses paid or incurred by the taxpayer— (A) which would not have been so paid or incurred but for such sports program, and (B) which would be allowable as a deduction under section 162 (relating to trade or business expenses) but for subsection (b) of this section; and (3) the facilities used for such program are not regularly used during the taxable year for the conduct of sports programs to ' which this subsection applies. For purposes of this subsection, the term "proceeds from such sports program" includes all amounts paid for admission to the sports program, plus all proceeds received by the taxpayer from such program or activities carried on in connection therewith. (b) TREATMENT OF EXPENSES.—Expenses described in subsection (a)(2) shall be allowed as a deduction under section 162 only to the extent that such expenses exceed the amount excluded from gross income by subsection (a) of this section. SEC. 115.
INCOME OF STATES, MUNICIPALITIES, ETC.
(a) GENERAL RULE.—Gross income does not include— (1) income derived from any public utility or the exercise of any essential governmental function and accruing to a State or Territory, or any political subdivision thereof, or the District of Columbia; or (2) income accruing to the government of any possession of the United States, or any political subdivision thereof, § 115(a)(2)
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