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Page:United States Statutes at Large Volume 83.djvu/678

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PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

income from such building or structure shall include the rental value of the portion so occupied. " (C) CHANGE I N METHOD or DEPRECIATION.—Any change

in the computation of the allowance for depreciation for any taxable year, permitted or required by reason of the application of subparagraph (A), shall not be considered a change in a method of accounting. '(3)

PROPERTY CONSTRUCTED, ETC., BEFORE J U L Y

25, i96 9.—

Paragraph (1) of this subsection shall not apply, and subsection (b) shall apply, in the case of property— " (A) the construction, reconstruction, or erection of which was begun before July 25, 1969, or " (B) for which a written contract entered into before July 25, 1969, with respect to any part of the construction, reconstruction, or erection or for the permanent financing thereof, was on July 25, 1969, and at all times thereafter, binding on the taxpayer. "(4) USED SECTION 1250 PROPERTY.—Except as provided in paragraph (5), in the case of section 1250 property acquired after July 24, 1969, the original use of which does not commence with the taxpayer, the allowance for depreciation under this section shall be limited to an amount computed under— " (A) the straight line method, or " (B) any other method determined by the Secretary or his delegate to result in a reasonable allowance under subsection (a), not including— "(i) any declining balance method, "(ii) the sum of the years-digits method, or "(iii) any other method allowable solely by reason of the application of subsection (b)(4) or paragraph (1) (C) of this subsection. "(5) Us USED RESIDENTIAL RENTAL PROPERTY.—In the case of section 1250 property which is residential rental property (as defined in paragraph (2)(B)) acquired after July 24, 1969, having a useful life of 20 years or more, the original use of which does not commence with the taxpayer, the allowance for depreciation under this section shall be limited to an amount computed under— " (A^ the straight line method, " (B) the declining balance method, using a rate not exceeding 125 percent of the rate which would have been used had the annual allowance been computed under the method described in subparagraph (A), or " (C) any other method determined by the Secretary or his delegate to result in a reasonable allowance under subsection (a), not including— " (i) the sum of the years-digits method, "(ii) any declining balance method using a rate in excess of the rate permitted under subparagraph (B), or "(iii) any other method allowable solely by reason of the application of subsection (b)(4) or paragraph (1)(C) of this subsection. "(6)

2?usci8°^*

S P E C I A L RULES.—

" (A) Under regulations prescribed by the Secretary or his delegate, rules similar to the rules provided in paragraphs ( ^) ' ( ^) ' (^^)' ^"^ (^^) ^* section 48(h) shall be applied for purposes of paragraphs (3), (4), and (5) of this subsection.

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PUBLIC LAW 9 1 - 1 7 2 - D E C. 30, 1969

" (B) For purposes of paragraphs (2), (4), and (5), if section 1250 property which is not property described in subsection (a) when its original use commences, becomes property described in subsection (a) after July 24, 1969, such property shall not be treated as property the original use of which commences with the taxpayer. " (C) Paragraphs (4) and (5) shall not apply in the case of section 1250 property acquired after July 24, 1969, pursuant to a written contract for the acquisition of such property or for the permanent financing thereof, wiich was, on July 24, 1969, and at all times thereafter, binding on the taxpayer. " (k) DEPRECIATION or EXPENDITURES To REHABILITATE LOW-INCOME RENTAL HOUSING.—

"(1) 60-MONTH RULE.—The taxpayer may elect, in accordance with regulations prescribed by the Secretary or his delegate, to compute the depreciation deduction provided by subsection (a) attributable to rehabilitation expenditures incurred with respect to low-income rental housing after July 24, 1969, and before January 1, 1975, under the straight line method using a useful life of 60 months and no salvage value. Such method shall be in lieu of any other method of computing the depreciation deduction under subsection (a), and in lieu of any deduction for amortization, for such expenditures. "(2)

LIMITATIONS.—

" (A) The aggregate amount of rehabilitation expenditures paid or incurred by the taxpayer with respect to any dwelling unit in any low-income rental housing which may be taken into account under paragraph (1) shall not exceed $15,000. " (B) Rehabilitation expenditures paid or incurred by the taxpayer in any taxable year with respect to any dwelling unit in any low-income rental housing shall be taken into account under paragraph (1) only if over a period of two consecutive years, including the taxable year, the aggregate amount of such expenditures exceeds $3,000. "(3) DEFINITIONS.—For purposes of this subsection— " (A) REHABILITATION EXPENDITURES.—The term 'rehabilitation expenditures' means amounts chargeable to capital account and incurred for property or additions or improvements to property (or related facilities) with a useful life of 5 years or more, in connection with the rehabilitation of an existing building for low-income rental housing; but such term does not include the cost of acquisition of such building or any interest therein. " (B) LOW-INCOME RENTAL HOUSING.—The term 'lowincome rental housing' means any building the dwelling units in which are held for occupancy on a rental basis by families and individuals of low or moderate income, as determined by the Secretary or his delegate in a manner consistent with the policies of the Housing and Urban Development Act of 1968 ^2 sta^. 476^.^ pursuant to regulations prescribed under this subsection. note. " (C) DWELLING UNIT.—The term 'dwelling unit' means a house or an apartment used to provide living accommodations in a building or structure, but does not include a unit in a hotel, motel, inn, or other establishment more than one-half of the units in which are used on a transient basis."

651

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Page:United States Statutes at Large Volume 83.djvu/680

 652 26 USC /2°50

PUBLIC LAW 91-172-DEC. 30, 1969 ^^^

EECAPTURE OF ADDITIONAL DEPRECIATION.

[83 STAT. Sectioil

1250(a)

(relating to gain from dispositions of certain depreciable realty) is amended to read as follows: " (a) GENERAL RULE.—Except as otherwise provided in this section— "(1) ADDITIONAL DEPRECIATION AFTER DECEMBER 31, 1969.—If

68A Stat. 325.

75 Stat. 150; 12 USC 1715/, 1715Z-1. ^°^'' P- ^'^-

Ante, p. 649.

Ante, p. 651.

section 1250 property is disposed of after December 31, 1969, the applicable percentage of the lower of— " (A) that portion of the additional depreciation (as defined in subsection (b)(1) or (4)) attributable to periods after December 31, 1969, in respect of the property, or " (B) the excess of— " (i) the amount realized (in the case of a sale, exchange, or involuntary conversion), or the fair market value of such property (in the case of any other disposition), over "(ii) the adjusted basis of such property, shall be treated as gain from the sale or exchange of property which is neither a capital asset nor property described in section 1231. Such galu shall be recognized notwithstanding any other provision of this subtitle. " (C) APPLICABLE PERCENTAGE.—For purposes of paragraph (1), the term 'applicable percentage' means— " (i) in the case of section 1250 property disposed of pursuant to a written contract which was, on July 24, 1969, and at all times thereafter, binding on the owner of the property, 100 percent minus 1 percentage point for each full month the property was held after the date the property was held 20 full months; "(ii) in the case of section 1250 property constructed, reconstructed, or acquired by the taxpayer before January 1, 1975, with respect to which a mortgage is insured under section 221(d)(3) or 236 of the National Housing j^ct, or housing is financed or assisted by direct loan or tax abatement under similar provisions of State or local laws, and with respect to which the owner is subject to the restrictions described in section 1039(b)(1)(B), 100 percent minus one percentage point for each full month the property was held after the date the property was held 20 full months; "(iii) in the case of residential rental property (as defined in section 167( j)(2)(B)) other than that covered by clauses (i) and ( i i), 100 percent minus 1 percentage point for each full month the property was held after the date the property was held 100 full months; "(iv) in the case of section 1250 property with respect to which a depreciation deduction for rehabilitation expenditures was allowed under section 167(k), 100 percent minus 1 percentage point for each full month in excess of 100 full months after the date on which such property was placed in service; and " (v) m the case of all other section 1250 property, 100 percent. Clauses (i), (ii), and (iii) shall not apply with respect to the additional depreciation described in subsection (b)(4). " (2) ADDITIONAL

DEPRECIATION BEFORE J A N U A R Y

i,

1970.—

" (A) IN GENERAL.—If section 1250 property is disposed of after December 31, 1963, and the amount determined under

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Page:United States Statutes at Large Volume 83.djvu/681

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

paragraph (1)(B) exceeds the amount determined under paragraph (1)(A), then the applicable percentage of the lower of— "(i) that portion of the additional depreciation attributable to periods before January 1, 1970, in respect of the property, or "(ii) the excess of the amount determined under paragraph (1)(B) over the amount determined under paragraph (1)(A), shall also be treated as gain from the sale or exchange of property which is neither a capital asset nor property described in section 1231. Such gain shall be recognized notwithstanding any other provision of this subtitle.

653

26 USC 1231.

" (B) APPLICABLE PERCENTAGE.—For purposes of subpara-

graph (A) the term 'applicable percentage' means 100 percent minus 1 percentage pomt for each full month the property was held after the date on which the property was held for 20 full months." (c) ADDITIONAL DEPRECIATION.—Section 1250(b) (relating to defi- 78 Stat. 101. nition of additional depreciation) is amended by adding at the end thereof the following new paragraph: " (4) ADDITIONAL DEPRECIATION ATTRIBUTABLE TO REHABILITATION EXPENDITURES.—The term 'additional depreciation' also

means, in the case of section 1250 property with respect to which a depreciation deduction for rehabilitation expenditures was allowed under section 167(k), the depreciation adjustments allowed under such section to the extent attributable to such property, except that, in the case of such property held for more than one year after the rehabilitation expenditures so allowed were incurred, it means such adjustments only to the extent that they exceed the amount of the depreciation adjustments which would have resulted if such adjustments had been determined under the straight line method of adjustment without regard to the useful life permitted under section 167(k)." (d)

Ante, p. esi.

CHANGE I N METHOD OF COMPUTING DEPRECIATION.—Section

167(e) (relating to depreciation) is amended by adding at the end thereof the following new paragraph: "(3) CHANGE WITH RESPECT TO SECITON I2.-)0 PROPERTY.—A taxpayer may, on or before the last day prescribed by law (including extensions thereof) for filing his return for his first taxable year beginning after July 24, 1969, and in such manner as the Secretary or his delegate shall by regulation prescribe, elect to change his method of depreciation in respect of section 1250 property (as defined in section 1250(c)) from any declining balance or sum of the years-digits method to the straight line method. A n election may be made under this paragraph notwithstanding any provision to the contrary in an agreement under subsection (d). " (e) TECHNICAL AND CONFORMING CHANGES.—

(1) Subsection (d) of section 1250 is amended by striking out "subsection (a)(1) " wherever it appears and inserting in lieu thereof "subsection (a) ". (2) Subsection (f) of section 1250 is amended— (A) by striking out "subsection (a)(1) " in paragraph (1) and inserting in lieu thereof "subsection (a) ", and

^e Stat. 1034.

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Page:United States Statutes at Large Volume 83.djvu/682

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PUBLIC LAW 91-172-DEC. 30, 1969

78 Stat. 104. 26 USC 1250

[83 STAT.

(B) by striking out paragraph (2) thereof and inserting in lieu thereof the following: "(2)

ORDINARY INCOME ATTRIBUTABLE TO AN ELEMENT.—For

purposes of paragraph (1), the amount taken into account for any element shall be the sum of— •'(A) the amount (if any) determined by multiplying— " (i) the amount which bears the same ratio to the lower of the amounts specified in subparagraph (A) or (B) of subsection (a)(1) for the section 1250 property as the additional depreciation for such element attributable to periods after December 31, 1969, bears to the sum of the additional depreciation for all elements attributable to periods after December 31, 1969, by "(ii) the applicable percentage for such element, and " (B) the amount (if any) determined by multiplying— " (i) the amount which bears the same ratio to the lower of the amounts specified in subsection (a)(2)(A) (i) or (ii) for the section 1250 property as the additional depreciation for such element attributable to periods before January 1, 1970, bears to the sum of the additional depreciation for all elements attributable to periods before January 1, 1970, by "(ii) the applicable percentage for such element. For purposes of this paragraph, determinations with respect to any element shall be made as if it were a separate property." (f) 68A Stat. 126.

CARRYOVERS I N CERTAIN

381(c)(6) (relating to method of computing depreciation allowance) is amended to read as follows: "(6)

Ante, pp. 625,

649

CORPORATE ACQUISITIONS.—Section

METHOD OF COMPUTING DEPRECIATION ALLOWANCE.—The

acquiring corporation shall be treated as the distributor or transferor corporation for purposes of computing the depreciation allowance under subsections (b), (j), and (k) of section 167 on ' property acquired in a distribution or transfer with respect to so much of the basis in the hands of the acquiring corporation as does not exceed the adjusted basis in the hands of the distributor or transferor corporation." (g) ErFECTiVE DATE.—The amendments made by this section shall apply with respect to taxable years ending after July 24, 1969. Subtitle D—Subchapter S Corporations

8o^stft''\"i3^^°' 26 USC 13 711378.

SEC. 531. QUALIFIED PENSION, ETC., PLANS OF SMALL BUSINESS CORPORATIONS. (a) IN GENERAL.—Subchapter S of chapter 1 (relating to election of certain small business corporations as to taxable status) is amended by adding at the end thereof the following new section: "SEC. 1379. CERTAIN QUALIFIED PENSION, ETC., PLANS. " (a) ADDITIONAL REQUIREMENT FOR QUALIFICATION or STOCK BONUS OR PROFIT-SHARING PLANS.—A trust forming part of a stock bonus or

profit-sharing plan which provides contributions or benefits for employees some or all of whom are shareholder-employees shall not constitute a qualified trust under section 401 (relating to qualified pension, profit-sharing, and stock bonus plans) unless the plan of which such trust is a part provides that forfeitures attributable to contributions deductible under section 404(a)(3) for any taxable year (beginning after December 31, 1970) of the employer with respect to which

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PUBLIC LAW 91-172-DEC. 30, 1969

655

it is an electing small business corporation may not inure to the benefit of any individual who is a shareholder-employee for such taxable year. A plan shall be considered as satisfying the requirement of this subsection for the period beginning with the tirst day of a taxable year and ending with the 15th day of the third month following the close of such taxable year, if all the provisions of the plan which are necessary to satisfy this requirement are in effect by the end of such period and have been made effective for all purposes with respect to the whole of such period. "(b)

TAXAmi.ITY OF SirAREIIOU)ER-E>IlM.OYEE B E X E F I C I A R I E S. " (1) IX"CLI'SION OF EXCESS COXTRIHUTIOXS IX (IROSS IXCOME.

Notwithstanding the provisions of section 402 (relating to tax- ^^ "^*^ '*°2. ability of beneficiary of employees' trust), section 403 (relating ^ " f e, pp. 591, to taxation of employee anmiities), or section 405(d) (rehiting to taxability of beneficiaries luuler (pialified bond purcliase plans), an individual who is a shareholder-employee of an electing small business corporation shall include iri gross income, for his taxable year in which or with which the taxable year of the corporation ends, the excess of the amount of contributions paid on his behalf which is deductible under section 404(a)(1), (2), or (3) by the corporation for its taxable year over the lesser of— " (A) 10 percent of the compensation received or accrued by him from such corporation during its taxable year, or " (B) $2,500. "(2)

TREA'J-:MEXT OF A:MOUNTS IXCEUDED IN (JROSS IXCO^IE.—Any

amount included in the gross income of a shareholder-employee under paragraph (1) shall be treated as (onsideration for the contract contributed by the shareholder-employee for purposes of section 72 (relating to annuities). 68A Stat. 20. "(3) I)EDi'("rix FOR A:S[01"XTS NOT RECEIVED AS HEXEFTTS.—If— " (A) amounts are included in the gross income of an individual under paragraph (l), and " (B) the rights of such individual (or his beneficiaries) under the plan terminate before payments under the plan which are excluded from gross income equal the amounts included in gross income under paragraph (1), then there slujll be allowed as a deduction, for the taxable year in which such rights terminate, an amount equal to the excess of the amounts included in gross income under paragraph (1) over such payments. "(c) CAFtRYOVER OF A:\rUNTS DEDUCTIBLE.—Ko aiuouiit deductible shall be carried forward under the second sentence of section 404(a) (3)(A) (relating to limits on deductible contributions under stock bonus and profit-sharing trusts) to a taxable year of a corporation with respect to which it is not an electing small business corporation from a taxable year (beoinning after December 31, 1970) with respect to which it is an electing small business corporation. " (d) SIIAREIIOEDER-EMPLOYEE.—For purposes of this section, the term 'shareliolder-employee' means an employee or officer of an electing small business corporation who owns (or is considered as owning within the meaning of section 318(a)(1), on any day during the taxable year of such corporation, more than 5 percent of the outstanding stock of the corporation." (b) CONFORMING X\>IENDIMENT.—Section 62 (relating to adjusted ^SA Stat. 17; gross income defined) is amended by inserting after paragraph (8) the ^^ ^'^'' ^^' following new paragraph: "(9)

PENSION,

ETC.,

FLANS

OF

ELECTING

SMALL

BUSINESS

CORPORATIONS.—The deduction allowed by section 1379(b)(3)."

supra.

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Page:United States Statutes at Large Volume 83.djvu/684

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PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

(c) CLERICAL AMENDMENT.—The table of sections for subchapter S of chapter 1 is amended by adding at the end thereof the following new item: "Sec. 1379. Certain qualified pensions, etc., plans."

(d) EFFECTIVE DATE.—The amendments made by this section shall apply with respect to taxable years of electing small business corporations beginning after December 31, 1970.

TITLE VI—STATE AND LOCAL OBLIGATIONS SEC. 601. ARBITRAGE BONDS. 82^stl^'266?^'

(^). ^ ^ Tp B E TREATED AS TAX-EXEMPT OBLIGATIONS.—Section 103

26 USC 103.

(relating to interest on certain governmental obligations) is amended by redesignating subsection (d) as (e), and by inserting after subsection (c) the following new subsection: " (d) ARBITRAGE BONDS.— " (1) SUBSECTION (a)(1) NOT TO APPLY.—Except as provided in

26 USC 165.

68A Stat. 42.

26 USC 318.

this subsection, any arbitrage bond shall be treated as an obligation not described in subsection (a)(1). "(2) ARBITRAGE BOND.—For purposes of this subsection, the term 'arbitrage bond' means any obligation which is issued as part of an issue all or a major portion of the proceeds of which are reasonably expected to be used directly or indirectly— " (A) to acquire securities (within the meaning of section 165(g)(2)(A) or (B)) or obligations (other than obligations described in subsection (a)(1)) which may be reasonably expected at the time of issuance of such issue, to produce a yield over the term of the issue which is materially higher (taking into account any discount or premium) than the yield on obligations of such issue, or " (B) to replace funds which were used directly or indirectly to acquire securities or obligations described in subparagraph (A). "(3) EXCEPTION.—Paragraph (1) shall not apply to any obligation— " (A) which is issued as part of an issue substantially all of the proceeds of which are reasonably expected to be used to provide permanent financing for real property used or to be used for residential purposes for the personnel of an educational institution (within the meaning of section 151(6)(4)) which graiits baccalaureate or higher degrees, or to replace funds which were so used, and " (B) the yield on which over the term of the issue is not reasonably expected, at the time of issuance of such issue, to be substantially lower than the yield on obligations acquired or to be acquired in providing such financing. This paragraph shall not apply with respect to any obligation for any period during which it is held by a person who is a substantial user of property financed by the proceeds of the issue of which such obligation is a part, or by a member of the family (within the meaning of section 318(a)(1)) of any such person.

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PUBLIC LAW 91-172-DEC. 30, 1969

657

"(4) SPECIAL RULES.—For purposes of paragraph (1), an obligation shall not be treated as an arbitrage bond solely by reason of the fact that— " (A) the proceeds of the issue of which such obligation is a part may be invested for a temporary period in securities or other obligations until such proceeds are needed for the purpose for which such issue was issued, or " (B) an amount of the proceeds of the issue of which such obligation is a part may be invested in securities or other obligations which are part of a reasonably required reserve or replacement fund. The amount referred to in subparagraph (B) shall not exceed 15 percent of the proceeds of the issue of which such obligation is a part unless the issuer establishes that a higher amount is necessary. "(5) BEGULATIONS.—The Secretary or his delegate shall prescribe such regulations as may be necessary to carry out the purposes of this subsection." (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall apply with respect to obligations issued after October 9, 1969.

TITLE VII—EXTENSION OF TAX SURCHARGE AND EXCISE TAXES; TERMINATION OF INVESTMENT CREDIT SEC. 701. EXTENSION OF TAX SURCHARGE. (a) SURCHARGE EXTENSION. Section 51(a) (relating to imposition

of tax surcharge) is amended— (1) by adding at the end of paragraph (1)(A) the following: "CALENDAR YEAR 1970: TABLE 1.—SINGLE PERSON (OTHER THAN HEAD OF HOUSEHOLD) AND MARRIED PERSONS FILING SEPARATE RETURNS If the adjusted taxis: At least—

But less than—

0

$155

$155

175 195 215 235 255 275 300 340 380 420 460 500 540 580 620 660 700 740 780 820 860 900 940 980

175 195 215 235 255 275 300 340 380 420 460 500 540 580 620 660 700 740 780 820 860 900 940 980

1,020

If the adjusted tax Is: The tax Is—

0 $1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

At least—

But less than—

The tax is—

$1,020 $1,060 $26 1,060 1,100 27 1,100 1,140 28 1,140 1,180 29 1,180 1,220 30 1,220 1,260 31 1,260 1,300 32 1,300 1,340 33 1,340 1,380 34 1,380 1,420 35 1,420 1,460 36 1,460 1,500 37 1,500 1,540 38 1,540 1,580 39 1,580 1,620 40 1,620 1,660 41 1,660 1,700 42 1,700 1,740 43 1,740 1,780 44 1,780 1.820 45 1,820 1,860 46 1,860 1,900 47 1,900 1,940 48 1,940 1,980 49 1,980 2,020 50 2,020 and over, 2.5% of the adjusted tax.

Ante,

p. 93.

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Rh them such astounding news, and it was easy to calculate their rate of progress.

After running about a hundred miles or so, at high speed Mr. Sharp found it necessary to slow down the motor, as some of the new bearings were heating. Still this gave them no alarm, as they were making good time. They came to a stop that night, and calculated that by the next evening, or two at the latest, they; would be back in Shopton. But they did not calculate on an accident.

One of the cylinders on the big motor cracked, as they started up next morning, and for some hours they had to hang in the air, suspended by the gas in the container, while Mr. Sharp and Tom took out the damaged part, and put in a spare one, the cylinders being cast separately. It was dusk when they finished, and too late to start up, so they remained about in the same place until the next day.

Morning dawned with a hot humidness, unusual at that time of the year, but partly accounted for by the fact that they were still within the influence of the southern climate. With a whizz the big propellers were set in motion, and, with Tom at the wheel, the ship being about three miles in the air, to which height it had risen after the repairs were made, the journey was recommenced.

title: Page:Tom Swift and His Airship.djvu/181


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Page:United States Statutes at Large Volume 83.djvu/686

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PUBLIC LAW 91-172-DEC. 30, 1969

[83

STAT.

TABLE 2.—HEAD OF HOUSEHOLD If the adjusted tax is: At least—

If the adjusted tax is:

But less than—

The tax is—

0

$230

$230

250 270 290 310 330 350 370 390 410 430 460 500 540 580 620 660 700 740 780 820 860 900 940 980

0 $1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

250 270 290 310 330 350 370 390 410 430 460 500 540 580 620 660 700 740 780 820 860 900 940 980

1,020

At least—

But less than—

The tax is—

$1,020 $1,060 $26 1,060 1,100 27 1,100 1,140 28 1,180 1,140 29 1,180 1,220 30 1,220 1,260 31 1,260 1,300 32 1,300 1,340 33 1,340 1,380 34 1,380 1,420 35 1,420 1,460 36 1,460 1,500 37 1,500 1,540 38 1,540 1,580 39 1,580 1,620 40 1,620 1,660 41 1,660 1,700 42 1,700 1,740 43 1,740 1,780 44 1,780 1,820 45 1,820 1,860 46 1,860 1,900 47 1,900 1,940 48 1,940 1,980 49 1,980 2,020 50 2,020 and over, 2.5% of the adjusted tax.

TABLE 3.-IVIARRIED PERSONS OR SURVIVING SPOUSE FILING JOINT RETURN If the adjusted tax i s: At least—

If the adjusted tax is:

But less than—

The tax is—

0

$300

$300

320 340 360 380 400 420 440 460 480 500 520 540 560 580 620 660 700 740 780 820 860 900 940 980

0 $1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

320 340 360 380 400 420 440 460 480 500 520 540 560 580 620 660 700 740 780 820 860 900 940 980

Ante, p. 95.

1,020

At least—

But less than—

The tax is—

$1,020 $1,060 $26 1,060 1,100 27 1,100 1,140 28 1,140 1,180 29 1,180 1,220 30 1,220 1,260 31 1,260 1,300 32 1,300 1,340 33 1,340 1,380 34 1,380 1,420 35 1,420 1,460 36 1,460 1,500 37 1,500 1,540 38 1,540 1,580 39 1,580 1,620 40 1,620 1,660 41 1,660 1,700 42 1,700 1,740 43 1,740 1,780 44 1,780 1,820 45 1,820 1,860 46 1,860 1,900 47 1,900 1,940 48 1,940 1,980 49 1,980 2,020 50 2,020 and over, 2.5% of the adjusted tax."

(2) by striking out the table in paragraph (1)(B) and inserting in lieu thereof the following table: Percent "Calendar year 1968.. 19691970..

Estates and trusts

Corporation

7.5 10.0 2.5

10.0 10.0 2.5."

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PUBLIC LAW 91-172-DEC. 30, 1969

(3) by striking out "January 1, 1970" the first time it appears in paragraph (2)(A) and inserting in lieu thereof "July 1, 1970", "^"K^'^'^,^' and (4) by striking out paragraph (2)(A) (ii) and inserting in lieu thereof the following: " (ii) a fraction, the numerator of which is the sum of the number of days in the taxable year occurring on and after the effective date of the surcharge and before January 1, 1970, plus one-half times the number of days in the taxable year occurring after December 31, 1969, and before July 1, 1970, and the denominator of which is the number of days in the entire taxable year." (b) RECEIPT t)r MINIMUM DISTRIBUTIONS.—Section 963(b) (relat- Ante, p. 95. ing to receipt of minimum distributions) is amended— (1) by striking out "surcharge period" in the heading of paragraph (1) and inserting in lieu thereof "surcharge period ending before January 1, 1970"; (2) by striking out "1964" in the heading of paragraph (2) and inserting in lieu thereof "1964 and taxable years beginning in 1969 and ending in 1970 to the extent subparagraph (B) applies"; and (3) by striking out the last two sentences and inser.'ing in lieu thereof the following: "In the case of a taxable year beginning before the surcharge period and ending within the surcharge period, or beginning within the surcharge period and ending after the surcharge period, or beginning before January 1, 1970, and ending after December 31, 1969, the required minimum distribution shall be equal to the sum of— " (A) that portion of the minimum distribution which would be required if the provisions of paragraph (1) were applicable to the taxable year, which the number of days in such taxable year which are within the surcharge period and before January 1, 1970, bears to the total number of days in such taxable year, " (B) that portion of the minimum distribution which would be required if the provisions of paragraph (2) were applicable to such taxable year, which the number of days in such taxable year which are within the surcharge period and after December 31, 1969, bears to the total number of days in such taxable year, and " (C) that portion of the minimum distribution which would be required if the provisions of paragraph (3) were applicable to such taxable year, which the number of days in such taxable year which are not within the surcharge period bears to the total number of days in such taxable year. As used in this subsection, the term 'surcharge period' means the period beginning January 1, 1968, and ending June 30, 1970." (c) EFFECTIVE DATES.—The amendments made by subsections (a) and (b) shall apply to taxable years ending after December 31, 1969, and beginning before July 1, 1970.

659

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PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

SEC. 702. CONTINUATION OF EXCISE TAXES ON COMMUNICATION SERVICES AND ON AUTOMOBILES. (a) PASSENGER AUTOMOBILES.—

26 ulc 406^•

(^) ^ ^ GENERAL.—Section 4061(a)(2)(A) (relating to tax on passenger automobiles, etc.) is amended to read as follows: " (A) Articles enumerated in subparagraph (B) are taxable at whichever of the following rates is applicable: "If the article is sold— Before January 1, 1971 During 1971 During 1972 During 1973

gJltlT^ies^'

82 Stat. 265.

The 7 5 3 1

The tax imposed by this subsection shall not apply with respect to articles enumerated in subparagraph (B) which are sold by the manufacturer, producer, or importer after December 31, 1973." ^^^ CONFORMING AMENDMENT.—Section 6412(a)(1) (relating to floor stocks refunds on passenger automobiles, etc.) is amended by striking out "January 1, 1970, January 1, 1971, January 1, 1972, or January 1, 1973", and inserting in lieu thereof "January 1, 1971, January 1, 1972, January 1, 1973, or January 1, 1974". {b) COMMUNICATIONS SERVICES.— (1) CONTINUATION OF TAX.—Section 4251(a)(2)

(relating to tax on certain communications services) is amended by striking out the table and inserting in lieu thereof the following table:

"Amounts paid pursuant to bills first rendered— Before January 1, 1971 During 1971 During 1972 During 1973 (2) CONFORMING AMENDMENT.—Section 4251(b)

26 USC 4251

note

76 Stat. 963.

tax rate is— percent. percent percent. percent.

Percent— 10 5 3 1". (relating to

termination of tax) is amended by striking out "January 1, 1973", and inserting in lieu thereof "January 1, 1974". (3) EEPEAL OF SUBCHAPTER B OF CHAPTER 3 3.—Section 105(b)(3) of the Revenue and Expenditure Control Act of 1968 (82 Stat. 266) is amended to read as follows: "(3) REPEAL OF SUBCHAPTER B OF CHAPTER 33.—Effective with respect to amounts paid pursuant to bills first rendered on or after January 1, 1974, subchapter B of chapter 33 (relating to the tax on communications) is repealed. For purposes of the preceding sentence, in the case of communications services rendered before November 1, 1973, for which a bill has not been rendered before January 1, 1974, a bill shall be treated as having been first rendered on December 31, 1973. Effective January 1, 1974, the table of subchapters for chapter 33 is amended by striking out the item relating to such subchapter B." SEC. 703. TERMINATION OF INVESTMENT CREDIT. (a) IN GENERAL.—Subpart B of part IV of subchapter A of chapter 1 (relating to rules for computing credit for investment in certain depreciable property) is amended by adding at the end thereof the following new section: •'SEC. 49. TERMINATION OF CREDIT. " (a) GENERAL RULE.—For purposes of this subpart, the term 'section 38 property' does not include property— "(1) the physical construction, reconstruction, or erection of which is begun after April 18, 1969, or

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Page:United States Statutes at Large Volume 83.djvu/689

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

" (2) which is acquired by the taxpayer after April 18, 1969, other than pre-termination property. " (b) PRE-TERMINATION PROPERTY.—For purposes of this section— "(1) BINDING CONTRACTS.—Any property shall be treated as pre-termination property to the extent that such property is constructed, reconstructed, erected, or acquired pursuant to a contract which was, on April 18, 1969, and at all times thereafter, binding on the taxpayer. " (2) EQUIPPED BUILDING RULE.—If—

" (A) pursuant to a plan of the taxpayer in existence on April 18, 1969 (which plan was not substantially modified at any time after such date and before the taxpayer placed the equipped building in service) j the taxpayer has constructed, reconstructed, erected, or acquired a building and the machinery and equipment necessary to the planned use of the building by the taxpayer, and " (B) more than 50 percent of the aggregate adjusted basis of all the property of a character subject to the allowance for depreciation making up such building as so equipped is attributable to either property the construction, reconstruction, or erection of which was begun by the taxpayer before April 19, 1969, or property the acquisition of which by the taxpayer occurred before such date, then all property comprising such building as so equipped (and any incidental property adjacent to such building which is necessary to the planned use of the building) shall be pre-termination property. For purposes of subparagraph (B) of the preceding sentence, the rules of paragraphs (1) and (4) shall be applied. For purposes of this paragraph, a special purpose structure shall be treated as a building. " (3) P L A N T FACILITY RULE. — " (A) GENERAL RULE.—If—

" (i) pursuant to a plan of the taxpayer in existence on April 18, 1969 (which plan was not substantially modified at any time after such date and before the taxpayer placed the plant facility in service), the taxpayer has constructed, reconstructed, or erected a plant facility, and either "(ii) the construction, reconstruction, or erection of such plant facility was commenced by the taxpayer before April 19, 1969, or "(iii) more than 50 percent of the aggregate adjusted basis of all the property of a character subject to the allowance for depreciation making up such plant facility is attributable to either property the construction, reconstruction, or erection of which was begun by the taxpayer before April 19, 1969, or property the acquisition of which by the taxpayer occurred before such date, then all property comprising such plant facility shall be pretermination property. For purposes of clause (iii) of the preceding sentence, the rules of paragraphs (1) and (4) shall be applied. " (B) PLANT FACILITY DEFINED.—For purposes of this paragraph, the term 'plant facility' means a facility which does not include any building (or of which buildings constitute an insignificant portion) and which is— " (i) a self-contained, single operating unit or processing operation,

661

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Page:United States Statutes at Large Volume 83.djvu/690

 662

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

"(ii) located on a single site, and "(iii) identified, on April 18, 1969, in the purchasing and internal financial plans of the taxpayer as a single unitary project. ''(C) SPECIAL RULE.—For purposes of this subsection, if— " (i) a certificate of convenience and necessity has been issued before April 19, 1969, by a Federal regulatory agency with respect to two or more plant facilities which are included under a single plan of the taxpayer to construct, reconstruct, or erect such plant facilities, and "(ii) more than 50 percent of the aggregate adjusted basis of all the property of a character subject to the allowance for depreciation making up such plant facilities is attributable to either property the construction, reconstruction, or erection of which was begun by the taxpayer before April 19, 1969, or property the acquisition of which by the taxpayer occurred before such date, such plant facilities shall be treated as a single plant facility. " (D) COMMENCEMENT OF CONSTRUCTION.—For purposes of

subparagraph (A) ( i i), the construction, reconstruction, or erection of a plant facility shall not be considered to have commenced until construction, reconstruction, or erection has commenced at the site of such plant facility. The preceding sentence shall not apply if the site of such plant facility is not located on land. " (4) MACHINERY OR EQUIPMENT RULE.—Any piece of machinery or equipment— " (A) more than 50 percent of the parts and components of which (determined on the basis of cost) were held by the taxpayer on April 18, 1969, or are acquired by the taxpayer pursuant to a binding contract which was in effect on such date, for inclusion or use in such piece of machinery or equipment, and " (B) the cost of the parts and components of which is not an insignificant portion of the total cost, shall be treated as property which is pre-termination property. "(5)

76 Stat. 967; 26 USC^ 48.

26 USC 47.

CERTAIN LEASE-BACK TRANSACTIONS, ETC.—

" (A) Where a person who is a party to a binding contract described in paragraph (1) transfers rights in such contract (or in the property to which such contract relates) to another person but a party to such contract retains a right to use the property under a lease with such other person, then to the extent of the transferred rights such other person shall, for purposes of paragraph (1), succeed to the position of the transferor with respect to such binding contract and such property. I n any case in which the lessor does not make an election under section 48(d) — " (i) the preceding sentence shall apply only if a party to the contract retains the right to use the property under a lease for a term of at least 1 year; and "(ii) if such use is retained (other than under a longterm lease), the lessor shall be deemed for the purposes of section 47 as having made a disposition of the property at such time as the lessee loses the right to use the property.

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Page:United States Statutes at Large Volume 83.djvu/691

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

For purposes of clause (ii), if the lessee transfers the lease in a transfer described in paragraph (7), the lessee shall be considered as having the right to use of the property so long as the transferee has such use. " (B) For purposes of subparagraph (A) — " (i) a person who holds property (or rights in property) which is pre-termination property by reason of the application of paragraph (4) shall, with respect to such property, be treated as a party to a binding contract described in paragraph (1), and "(ii) a corporation which is a member of the same affiliated group (as defined in paragraph (8)) as the transferor described in subparagraph (A) and which simultaneously with the transfer of property to another person acquires a right to use such property under a lease with such other person shall be treated as the transferor and as a party to the contract. " (6) CERTAIN LEASE AND CONTRACT OBLIGATIONS.—

" (A) Where, pursuant to a binding lease or contract to lease in effect on April 18, 1969, a lessor or lessee is obligated to construct, reconstruct, erect, or acquire property specified in such lease or contract or in a related document filed before April 19, 1969, with a Federal regulatory agency, or property the specifications of which are readily ascertainable from the terms of such lease or contract or from such related document, any property so constructed, reconstructed, erected, or acquired by the lessor or lessee shall be pre-termination property. In the case of any project which includes property other than the property to be leased to such lessee, the preceding sentence shall be applied, in the case of the lessor, to such other property only if the binding leases and contracts with all lessees in effect on April 18, 1969, cover real property constituting 25 percent or more of the project (determined on the basis of rental value). For purposes of the preceding sentences of this paragraph, in the case of any project where one or more vendor-vendee relationships exist, such vendors and vendees shall be treated as lessors and lessees. " (B) Where, in order to perform a binding contract or contracts in effect on April 18, 1969, (i) the taxpayer is required to construct, reconstruct, erect, or acquire property specified in any order of a Federal regulatory agency for which application was filed before April 19, 1969, (ii) the property is to be used to transport one or more products under such contract or contracts, and (iii) one or more parties to the contract or contracts are required to take or to provide more than 50 percent of the products to be transported over a substantial portion of the expected useful life of the property, then such property shall be pre-termination property. " (C) Where, in order to perform a binding contract in effect on April 18, 1969, the taxpayer is required to construct, reconstruct, erect, or acquire property specified in the contract to be used to produce one or more products and (unless the other party to the contract is a State or a political subdivision of a State which is required by the contract to make substantial expenditures which benefit the taxpayer) the other party to the contract is required to take substantially all of the products to be produced over a substantial portion of the expected useful life of the property, then such property shall

663

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text:
Page:United States Statutes at Large Volume 83.djvu/692

 664

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

be pre-termination property. For purposes of applying the preceding sentence in the case of a contract for the extraction of minerals, property shall be treated as specified in the contract if (i) the specifications for such property are readily ascertainable from the location and characteristics of the mineral properties specified in such contract from which the minerals are to be extracted; (ii) such property is necessary for and is to be used solely in the extraction of minerals under such contract; (iii) the physical construction, reconstruction, or erection of such property is begun by the taxpayer before April 19, 1970, such property is acquired by the taxpayer before April 19, 1970, or such property is constructed, reconstructed, erected, or acquired pursuant to a contract which was, on April 18, 1970, and at all times thereafter, binding on the taxpayer; (iv) such property is placed in service on or before December 31, 1972; (v) such contract is a fixed price contract (except for provisions for price changes under which the loss of the credit allowed by section 38 would not result in a price change); and (vi) such property is not placed in service to replace other property used in extracting minerals under such contract. "(7)

^ 68A70 Stat. 102_^ _ 245; Stat. 402; 80 Stat.I577. ""

68A Stat. 104:

80 Stat. 1576.

CERTAUST TRANSFERS TO BE DISREGARDED.—

" (A) If property or rights under a contract are transferred in— " (i) a transfer by reason of death, "(ii) a transaction as a result of which the basis of the property in the hands of the transferee is determined by reference to its basis in the hands of the transferor by reason of the application of section 332, 351,361,371 (a), 374(a), 721, or 731, or "(iii) 'a sale of substantially all of the assets of the transferor pursuant to the terms of a contract, which was on April 18, 1969, and at all times thereafter, binding on the transferee, and such property (or the property acquired under such contract) would be treated as pre-termination property in the hands of the decedent or the transferor, such property shall be treated as pre-termination property in the hands of the transferee. " (B) If— "(i) property or rights under a contract are acquired in a trausaction to which section 334(b)(2) applies, "(ii) the stock of the distributing corporation was acquired before April 19, 1969, or pursuant to a binding contract in effect April 18, 1969, and "(iii) such property (or the property acquired under such contract) would be treated as pre-termination property in the hands of the distributing corporation, such property shall be treated as pre-termination property in the hands of the distributee. "(8)

PROPERTY ACQUIRED FROM AFFILIATED CORPORATION.—In

the case of property acquired by a corporation which is a member of an affiliated group from another member of the same group— " (A) such corporation shall be treated as having acquired such property on the date on which it was acquired by such other member,

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Page:United States Statutes at Large Volume 83.djvu/693

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

665

" (B) such corporation shall be treated as having entered into a binding contract for the construction, reconstruction, erection, or acquisition of such property on the date on which such other member entered into a contract for the construction, reconstruction, erection, or acquisition of such property, and " (C) such corporation shall be treated as having commenced the construction, reconstruction, or erection of such property on the date on which such other member commenced such construction, reconstruction, or erection. For purposes of this subsection and subsection (c), a contractbetween two corporations which are members of the same affiliated group shall not be treated as a binding contract as between such corporations, unless, at all times after June 30, 1969, and prior to the completion of performance of such contract, such corporations are not members of the same affiliated group. For purposes of the preceding sentences, the term 'affiliated group' has the meaning assigned to it by section 1504(a), except that all corporations shall ^^A Stat. 369. be treated as includible corporations (without any exclusion under section 150J:(b)), "(9) BARGES FOR OCEAN-GOING VESSELS.—Barges specifically designed and constructed, reconstructed, erected, or acquired for use with ocean-going vessels which are designed to carry barges and which are pre-termination property, but not in excess of— " (A) the number to be used with such vessels specified in applications for mortgage or construction loan insurance fi^ed with the Secretary of Commerce on or before April 18, 1969, under title X I of the Merchant Marine Act, 1936, or 73^ltar*i69^^2^72 " (B) if subparagraph (A) does not apply and if more than 46 USC 127150 percent of the barges which the taxpayer establishes as 1279b. necessary to the initial planned use of such vessels are pretermination property (determined without regard to this paragraph), the number which the taxpayer establishes as so necessary, together with the machinery and equipment to be installed on such barges and necessary for their planned use, shall be treated as pretermination property. "(10) CERTAIN NEW-DESIGN PRODUCTS.—Where—

" (A) on April 18, 1969, the taxpayer had undertaken a project to produce a product of a new design pursuant to binding contracts in effect on such date which—• "(i) were fixed-price contracts (except for provisions requiring or permitting price changes resulting from changes in rates of pay or costs of materials), and "(ii) covered more than 50 percent of the entire production of such design to be delivered by the taxpayer before January 1, 1973, and " (B) on or before April 18, 1969, more than 50 percent of the aggregate adjusted basis of all property of a character subject to the allowance for depreciation required to carry out such binding contracts was property the construction, reconstruction, or erection of which had been begun by the taxpayer, or had been acquired by the taxpayer (or was under a binding contract for such construction, reconstruction, erection, or acquisition), then all tangible personal property placed in service by the taxpayer before January 1, 1972, which is required to carry out such binding contracts shall be deemed to be pre-termination property. For purposes of subparagraph (B) of the preceding sentence, jigs, dies, templates, and similar items which can be used only for the

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Page:United States Statutes at Large Volume 83.djvu/694

 666

Ts^stft^'i/^^' 26 USC 48.

PUBLIC LAW 91-172-DEC. 30, 1969

manufacture or assembly of the production under the project and which Avere described in written engineering and internal financial plans of the taxpayer in existence on April 18, 1969, shall be treated as property which on such date was under a binding contract for construction. "(c) LEASED PROPERTY.—In the case of property which is leased after April 18, 1969 (other than pursuant to a binding contract to lease entered into before April 19, 1969), which is section 38 property with respect to the lessor but is property which would not be section 38 property because of the application of subsection (a) if acquired by the lessee, and which is property of the same kind which the lessor ordinarily sold to customers before April 19, 1969, or ordinarily leased before such date and made an election under section 48(d), such propt I'ty sjiall not be section 38 property with respect to either the lessor or the lessee. " (d) PROPERTY PLACED IN SERVICE ArTi:R 1975.—For purposes of this subpart, the term 'section 38 property' does not include any property placed in service after December 31, 1975." (b)

76 Stat. 963.

[83 STAT.

LIMITATIONS ON U S E OF CARRYOVERS AND CARRYBACKS.—Section

46(b) (relating to carryback and carryover of unused credits) is amended by adding at the end thereof the following new paragraphs: " (5) TAXABLE YEARS BEGINNING AFTER DECEMBER S I, I 9 6 8, AND ENDING AFTER APRIL 18, 1909.—The amount which may be added

under this subsection for any taxable year beginning after December 31, 1968, and ending after April 18, 1969, shall not exceed 20 percent of the higher of— " (A) the aggregate of the investment credit carrybacks and investment credit carryovers to the taxable year, or " (B) the highest amount computed under subparagraph (A) for any preceding taxable year wdiich began after December 31, 1968, and ended after April 18, 1969. "(6)

ADDITIONAL S-YEAR CARRYOVER PERIOD I N CERTAIN CASES.—

Any portion of an investment credit carryback or carryover to any taxable year beginning after December 31, 1968, and ending after April 18, 1969, which— " (A) may be added under this subsection under the limitation provided by paragraph (2), and " (B) may not be added under the limitation provided by paragraph (5), shall be an investment credit carryover to each of the 3 taxable years following the last taxable year for which such portion may be added under paragraph (1), and shall (subject to the provisions of paragraphs (1), (2), and (5)) be added to the amount allowable as a credit by section 38 for such years." 26 USC 47.

(c) RULES RELATING TO CERTAIN CASUALTIES AND THEFTS AND TO REPLACEMENT OF CERTAIN SECTION 38 PROPERTY.— (1) PROPERTY DESTROYED BY CASUALTY.—Section 47(a)(4) (re-

lating to rules with respect to section 38 property destroyed by casualty, etc.) is amended by adding at the end thereof the following new sentence: "Subparagraphs (B) and (C) shall not apply with respect to any casualty or theft occurring after April 18, 1969." (2)

REPLACE]MENT OF CERTAIN SECTION;?8 PROPERTY.—Section

47(a) (relating to certain dispositions of section 38 property) is amended by adding at the end thereof the following new paragraph: "(5)

CERTAIN PROPERTY REPLACED AFTJ:R APRIL I S,

any case in which— " (A) section 38 property is disposed of, and

1969.—In

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Page:Tom Swift and His Airship.djvu/182

172 "It's cooler up here than down below," remarked Tom, as he shifted the wheel and rudder a bit, in response to a gust of wind, that heeled the craft over.

"Yes, I think we're going to have a storm," remarked Mr. Sharp, eyeing the clouds with a professional air. "We may run ahead of it, or right into it. We'll go down a bit, toward night, when there's less danger of being shot."

So far, on their return trip, they had not been low enough, in the day time, to be in any danger from persons who hoped to earn the five thousand dollars reward.

The afternoon passed quickly, and it got dark early. There was a curious hum to the wind, and, hearing it, Mr. Sharp began to go about the ship, seeing that everything was fast and taut.

"We're going to have a blow," he remarked, "and a heavy one, too. We'll have to make everything snug, and be ready to go up or down, as the case calls for."

"Up or down?" inquired Mr. Damon.

"Yes. By rising we may escape the blow, or, by going below the strata of agitated air, we may escape it."

"How about rain?"

"Well, you can get above rain, but you can't get below it, with the law of gravitation working

title: Page:Tom Swift and His Airship.djvu/182


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Page:United States Statutes at Large Volume 83.djvu/695

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

667

" (B) property which would be section 38 property but for section 49 is placed in service by the taxpayer to replace the property disposed of, the increase under paragraph (1) and the adjustment under paragraph (3) shall not be greater than the increase or adjustment which would result if the qualified investment of the property described in subparagraph (B) (determined as if such property were section 38 property) were substituted for the qualified investment of the property disposed of (as determined under paragraph (1)). Except in the case of a disposition by reason of a casualty or theft occurring before April 19, 1969, the preceding sentence shall apply only if the section 38 property disposed of is replaced within 6 months after the date of such disposition." (d) CONFORMING AMENDMENT.—The table of sections for subpart B of part IV of subchapter A of chapter 1 (relating to rules for computing credit for investment in certain depreciable property) is amended by adding at the end thereof the following new item:

^"^^' P- ^6°-

"Sec. 49. Termination of credit." SEC. 704. AMORTIZATION OF POLLUTION CONTROL FACILITIES.

(a) ALLOWANCE.—Part VI of subchapter B of chapter 1 (relating p^'tf^*^*' t%. to itemized deductions for individuals and corporations) is amended 674. by striking out section 169 and inserting in lieu thereof the following 26 USC leris?. new section: "SEC. 169. AMORTIZATION OF POLLUTION CONTROL FACILITIES. " (a) ALLOWANCE OF DEDTJCI^ON.—Every person, at his election, shall be entitled to a deduction with respect to the amortization of the amortizable basis of any certified pollution control facility (as defined in subsection (d), based on a period of 60 months. Such amortization deduction shall be an amount, with respect to each month of such period within the taxable year, equal to the amortizable basis of the pollution control facility at the end of such month divided by the number of months (including the month for which the deduction is computed) remaining in the period. Such amortizable basis at the end of the month shall be computed without regard to the amortization deduction for such month. The amortization deduction provided by this section with respect to any month shall be in lieu of the depreciation deduction with respect to such pollution control facility for such month provided by section 167. The 60-month period shall begin, as to, / " ^ ^ ^k?^'*^' any pollution control facility, at the election of the taxpayer, with the 26 USC 167. month following the month in which such facility was completed or acquired, or with t]ie succeeding taxable year. " (b) ELECTION or AMORTIZATION.—The election of the taxpayer to

take the amortization deduction and to begin the 60-month period with the month following the month in which the facility is completed or acquired, or with the taxable year succeeding the taxable year in which such facility is completed or acquired, shall be made by filing with the Secretary or his delegate, in such manner, in such form, and within such time, as the Secretary or his delegate may by regulations prescribe, a statement of such election. " (c) TERMINATION

or

AMORTIZATION

DEDUCTION.—A

taxpayer

which has elected under subsection (b) to take the amortization deduction provided in subsection (a) may, at any time after making such election, discontinue the amortization deduction with respect to the remainder of the amortization period, such discontinuance to begin as of the beginning of any month specified by the taxpayer in a notice in writing filed with the Secretary or his delegate before the beginning of such month. The depreciation deduction provided under section 167 shall be allowed, beginning with the first month as to which the

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Page:United States Statutes at Large Volume 83.djvu/696

 668

so^ stau*i2?6!' 81 Stat. 485.

33 USC 466j. 42 USC i8S7h.

PUBLIC LAW 91-172-DEC. 30, 1969

amortization deduction does not apply, and the taxpa3'er shall not be entitled to any further amortization deduction under this section with respect to such pollution control facility. '" (d) DEFINITIONS.—For purposes of this section— "(1) CERTIFIED POLI^UTION CONTROL FACILITY.—The term 'certified pollution control facility* means a new identifiable treatment facility which is used, in connection with a plant or other property in operation before January 1, 1969, to abate or control water or atmospheric pollution or contamination by removing, altering, disposing, or storing of pollutants, contaminants, wastes, or heat and which— " (A) the State certifying authority having jurisdiction with respect to such facility has certified to the Federal certifying authority as having been constructed, reconstructed, erected, or acquired in conformity with the State program or requirements for abatement or control of water or atmospheric pollution or contamination; and " (R) the Federal certifying authority has certified to the Secretary or his delegate (i) as being in compliance with the applicable regulations of Federal agencies and (ii) as being in furtherance of the general policy of the United States for cooperation with the States in the prevention and abatement of water pollution under the Federal Water Pollution Control A(tt, as amended {i\^ U.S.C. 466 et seq.), or in the prevention and abatement of atmospheric pollution and contamination under the Clean Air Act. as amended (-I'i U.S.C. 1857etseq.). "(•^) STATE CERTIFYINC; AUTnoRrrv.—The term 'State certifying authority' means, in the case of water pollution, the State water pollution control agency as defined in section 13(a) of the Federal AVater Pollution (\)ntrol Act and, in the case of air pollution, the air pollution control agency as defined in section
 * >,2(b) of the Clean Air Act. The term 'State certifying authority*

includes any interstate agency authorized to act in place of a certifying authority of the State. "(3) FEDERAL CERTIFYING AiTiioRrrY.—The term 'Federal certifying authority' means, in the case of water pollution, the Secretary of the Interior and, in the case of air pollution, the Secretary of Health, Education, and Welfare. "'(4)

^r'usc 1^7^'

[83 STAT.

XEAV lOEN'TIFlABLE TREATMENT FACILITY.

For purpOSCS of

l)aragraph (1), the term 'new identifiable treatment facility' inchules only tangible pr<)perty (not including a building and its structural components, other than a building which is exclusively a treatment facility) which is of a character subject ^^* ^'^^' allowance for depreciation provided in section 167, which is identifiable as a treatment facility, and which— "'(A) is property— "(i) the construction, reconstruction, or erection of which is completed by the taxpayer after December 31. 1968, or "(ii) acquired after December 31, 1968, if the original use of the property connnences with the taxpayer and commences after snch date, and " (B) is ]daced in service by the taxpaver before Januarv 1, 1975. In applying this section in the case of property described in clause (i) of subparagraph (A), there shall be taken into account only that portion of the basis which is properly attributable to constrnction, reconstruction, or erection after December 31, 1908.

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Page:United States Statutes at Large Volume 83.djvu/697

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

669

"(e) PROFITMAKING ABATEMENT WORKS, ETC.—The Federal certifying authority shall not certify any property under subsection (d)(1)(B) to the extent it appears that by reason of profits derived through the recovery of wastes or otherwise in the operation of such property, its costs will be recovered over its actual useful life. "(f)

AMORTIZABLE BASIS.—

" (1) DEFINED.—For purposes of this section, the term 'amortizable basis' means that portion of the adjusted basis (for determining gain) of a certified pollution control facility which may be amortized under this section. "(2)

SPECIAL RULES.—

" (A) If a certified pollution control facility has a useful life (determined as of the first day of the first month for which a deduction is allowable under this section) in excess of 15 years, the amortizable basis of such facility shall be equal to an amount which bears the same ratio to the portion of the adjusted basis of such facility, which would be eligible for amortization but for the application of this subparagraph, as 15 bears to the number of years of useful life of such facility. " (B) The amortizable basis of a certified pollution control facility with respect to which an election under this section is in effect shall not be increased, for purposes of this section, for additions or improvements after the amortization period has begun. " (g) DEPRECIATION DEDUCTION.—The depreciation deduction provided by section 167 shall, despite the provisions of subsection (a), be allowed with respect to the portion of the adjusted basis which is not the amortizable basis. " (h) INVESTMENT CREDIT NOT To B E ALLOWED.—In the case of any property with respect to which an election has been made under subsection (a), so much of the adjusted basis of the property as (after the application of subsection (f)) constitutes the amortizable basis for purposes of this section shall not be treated as section 38 property within the meaning of section 48(a). "(i) L I F E TENANT AND REMAINDERMAN.—In the case of property held by one person for life with remainder to another person, the deduction under this section shall be computed as if the life tenant were the absolute owner of the property and shall be allowable to the life tenant, "(j)

Ante, p. 649. 26 USC 167.

76 Stat. 967.

CROSS REFERENCE.—

"For special rule with respect to certain gain derived from the disposition of property the adjusted basis of which is determined with regard to this section, see section 1245." (b)

CONFORMING, ETC., AMENDMENTS.—

(1) The table of sections for part VI of subchapter B of chapter 1 is amended by striking out the item relating to section 169 and inserting in lieu thereof the following new item: "Sec. 169. Amortization of pollution control facilities."

(2) The heading and the first sentence of section 642(f) (relating to special rules for credits and deductions of estates and trusts) are amended to read as follows: "(f) AMORTIZATION DEDUCTIONS.—The benefit of the deductions for amortization provided by sections 168, 169, 184, and 187 shall be ^" P- ^6^allowed to estates and trusts in the same manner as in the case of an 674.°^'' ^^' ^^°' individual." (3) Section 1082(a)(2)(B) (relating to basis for determining SSA Stat. 315. gain or loss) is amended by striking out "or 169" and inserting in lieu thereof ", 169, 184, 185, or 187".

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text:
Page:United States Statutes at Large Volume 83.djvu/698

 670

Ante. p. 571.

26 u^c mo

68A Stat. 45;

76 Stat. 1063; Ante, p. 5 7 1.

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

(4) Section 1245(a) of such Code (relating to gain from disposition of certain depreciable property) is amended— (A) by inserting after paragraph (2)(C) (added by section 212(a)(1) of this Act) the following new subparagraph: " (D) with respect to any property referred to in paragraph (3)(D), its adjusted basis recomputed by adding thereto all adjustments attributable to periods beginning with the first month for which a deduction for amortization is allowed under section 169 or 185"; (B) by striking out "168" each place it appears in paragraph (2) and inserting in lieu thereof "168,169,184,185, or 187". (C) by striking out "section 167" in paragraph (3) and inserting in lieu thereof "section 167 (or subject to the allowance of amortization provided in section 185)"; (D) by striking out "or" at the end of paragraphs (3)(A) and (B); _ (E) by striking out the period at the end of paragraph (3)(C) and inserting in lieu thereof ", or"; and (F) by adding at the end of paragraph (3) the following new subparagraph: " (D) so much of any real property (other than any property described in subparagraph (B)) which has an adjusted basis in which there are reflected adjustments for amortization under section 169 or 185." (^) Section 1250(b)(3) (relating to depreciation adjustments) is amended by striking out "168" and inserting in lieu thereof "168, 169, or 185". (c) EFFECTIVE DATE.—The amendments made by this section shall apply with respect to taxable years ending after December 31, 1968. SEC. 705. AMORTIZATION OF RAILROAD ROLLING STOCK AND RIGHTOF-WAY IMPROVEMENTS. (a) ALLOWANCE.—Part VI of subchapter B or chapter 1 (relating to itemized deductions for individuals and corporations) is amended by addinff after section 183 (as added by section 213 of this Act) the following new sections: "SEC. 184. AMORTIZATION OF CERTAIN RAILROAD ROLLING STOCK. " (a) ALLOWANCE OF DEDUCTION.—Every person, at his election, shall be entitled to a deduction with respect to the amortization of the adjusted basis (for determining gain) of any qualified railroad rolling stock (as defined in subsection (d)), based on a period of 60 months. Such amortization deduction shall be an amount, with respect to each month of such period within the taxable year, equal to the adjusted basis of the qualified railroad rolling stock at the end of such month divided by the number of months (including the month for which the deduction is computed) remaining in the period. Such adjusted basis at the end of the month shall be computed without regard to the amortization deduction for such month. The amortization deduction provided by this section with respect to any qualified railroad rolling stock for any month shall be in lieu of the depreciation deduction with respect to such rolling stock for such month provided by section 167. The 60-month period shall begin, as to any qualified railroad rolling stock, at the election of the taxpayer, with the month following the month in which such rolling stock was placed in service or with the succeeding taxable year. " (b) ELECTION OF AMORTIZATION.—The election of the taxpayer to

take the amortization deduction and to begin the 60-month period with the month following the month in which the qualified railroad rolling stock was placed in service, or with the taxable year succeeding the

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text:
Page:United States Statutes at Large Volume 83.djvu/699

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

671

taxable year in which such rolling stock is placed in service, shall be made by filing with the Secretary or his delegate, in such manner, in such form, aaid within such time, as the Secretary or his delegate may by regulations prescribe, a statement of such election. "(c)

TERMINATION OF AMORTIZATION DEDUCTION.—A

taxpayer

which has elected under subsection (b) to take the amortization deduction provided by subsection (a) may, at any time after making such election, discontinue the amortization deduction with respect to the remainder of the amortization period, such discontinuance to begin as of the beginning of any month specified by the taxpayer in a notice in writing filed with the Secretary or his delegate before the beginning of such month. The depreciation deduction provided under section 167 i

n

i

n

1

1

"

'

• 1

1

r*

i

i

i

i

"

shall be allowed, beginning with the first month as to which the amortization deduction does not apply, and the taxpayer shall not be entitled to any further amortization deduction under this section with respect to such rolling stock. " (d) QUALIFIED RAILROAD ROLLING STOCK.—Except as provided in subsection (e)(4), the term 'qualified railroad rolling stock' means, for purposes of this section, rolling stock of the type used by a common carrier engaged in the furnishing or sale of transportation by railroad and subject to the jurisdiction of the Interstate Commerce Commission if— " (1) such rolling stock is— " (A) used by a domestic common carrier by railroad on a full-time basis, or on a part-time basis if its only additional use is an incidental use by a Canadian or Mexican common carrier by railroad on a per diem basis, or " (B) owned and used by a switching or terminal company all of whose stock is owned by one or more domestic common carriers by railroad, and "(2) the original use of such rolling stock commences with the taxpayer after December 31, 1968. "(e)

SPECIAL RULES.—

"(1) IN GENERAL.—Except as otherwise provided in this subsection, this section shall apply to qualified railroad rolling stock placed in service after 1968 and before 1975. "(2) PLACED I N SERVICE I N I 9 6 9. — I f any qualified railroad

rolling stock is placed in service in 1969— " (A) the month as to which the amortization period shall begin with respect to such rolling stock shall be determined as if such rolling stock were placed in service on December 31, 1969, and " (B) subsections (a) and (b) shall be applied by substituting '48' for '60' each place that it appears in such subsections. This section shall not apply to any qualified railroad rolling stock laced in service in 1969 and owned by any person who is not a omestic common carrier by railroad, or a corporation at least 95 percent of the stock of which is owned by one or more such common carriers. " (3) PLACED I N SERVICE I N 1970.—If any qualified railroad rolling stock is placed in service in 1970 by a domestic common carrier by railroad or by a corporation at least 95 percent of the stock of which is owned by one or more such common carriers, then subsection (a) shall be applied, without regard to paragraph (2), as if such rolling stock were placed in service on December 31, 1969.

S

"(4)

RAILROAD ROLLING STOCK NOT I N SHORT SUPPLY.—The

Secretary or his delegate shall determine (with the assistance of the Secretary of Transportation) which types of railroad rolling

^"'^' P- 649. '"^ u s e t fi.'7 26 TTcr* 167.

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text:
Page:United States Statutes at Large Volume 83.djvu/700

 672

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

stock are not in short supply and shall prescribe regulations desijj:natino; such types. The term '(jualified railroad rolling- stock' shall not include any rolling stock which— ' ' (A) is of the type of roHin"ated, whichever is later. " (5) A D J U S T E D BASIS.—

26 USC'i??'"

" (A) The adjusted basis of any (jualitied railroad rollinjr stock, with respect to which an election has been made under this section, shall not be increased, for purposes of this section, for amounts chargeable to capital account for additions or improvements after the amortizaticm period has begun. " (B) Costs incurred in connection with a used unit of railroad rolling stock which are properly chargeable to capital account shall be treated as a separate unit of railroad rolling stock for purposes of this section. "^^^ '^^^^ depreciation deduction provided by section 167 shall, despite the provisions of subsection (a), be allowed with. respect to the portion of the adjusted basis which is not taken into account in applying this section. "(6) CoNSTUFCTivE TERMiNATiox.—If at any time during the amortization period any qualified railroad rolling stock ceases to meet the requirements of subsection (d)(1), the taxpayer shall be deemed to ha^e terminated under subsection (c) his election under this section. Such termination shall be effective beginning with the month following the month in which such cessation occurs. " (7) ME'nroD OF ACCOUNTIX(} FOK DATE PLACED ix SEHVICE.—For

purposes of subsections (a) and (b), in the case of (pialified railroad rolling stock placed in service after December HI, 1969, and before January 1, 1970, the taxpayer may elect (unless paragraph (3) is applicable) to begin the 60-month period with the date when such rolling stock is treated as having been placed in service under a method of accounting for acquisitions and retirements of property which— " (A) prescribes a date when property is placed in service, and " (B) is consistently followed by the taxpayer. "(f) L I F E TENAXT AX^D KEMAIXDERMAX.—In the case of qualified railroad rolling stock leased to a domestic common carrier, and held by one person for life with remainder to another person, the deduction under this section shall be computed as if the life tenant were the absolute owner of the property and shall be allowable to the life tenant. " (g) CROSS REFEREXCE.— "For treatment of certain Rain derived from the disposition of property the adjusted basis of which is determined with regard to this section, see section 1245." "SEC. 185. AMORTIZATION OF RAILROAD GRADING AND TUNNEL BORES. " (a) GEXERAL R U E E. — I n the case of a domestic common carrier by

railroad, the taxpayer shall, at his election, be entitled to a deduction with respect to the amortization of the adjusted basis (for determining gain) of his qualified railroad grading and tunnel bores. The amortization deduction proA'ided by this section with respect to such property shall be in lieu of any depreciation deduction, or other amortization deduction, with respect to such property for any taxable year to which the election applies.

�


text:
Page:United States Statutes at Large Volume 83.djvu/701

 83

STAT. ] '• (b)

PUBLIC LAW 91-172-DEC. 30, 1969

673

A3I(JI>;TOFDEIHCTIOX.—

" (1) I x GEXEKAL.—The (lodiiction ullowable under siibsectioji (a) for any tax a b l e year shall be an a m o u n t determined by amort i z i n g r a t a b l y over a period of 50 year s the a d j u s t e d basis ( for determining g a i n) of the qualified r a i l r o a d g r a d i n g and tuniiel bores of the tax p a y e r. S u c h 5-year period shall commence w i t h the first tax a b l e year for which an election m i d e r t h i s section is effective. " (2) SPECIAL RULE. — I n the case of qualified r a i l r o a d g r a d i n g and t u n n e l bores placed i n s e r \ i c e after the b e g i n n i n g of the first taxable year for which a n election under this section is effective, the 50-year j^eriod w i t h respect to such property shall begin with the year following the year the property is placed in service. "'(c) ELECTION o r A:MoriTizATiox.—The election of the tax p a y e r to t a k e the amortization deduction provided in subsection (a) may be m a d e for any tax a b l e year b e g i n n i n g after December?>1, 1909, S u c h election shall be m a d e by filing w i t h the Secretary o r his delegate, in such m a n n e r, in such form, and within such t i m e, as the Secretary o r his delegate may by r e g u l a t i o n s prescribe, a statement of such election. The election shall r e m a i n in effect for all tax a b l e year s subsequent to the first year for which it is effective and shall a p p l y to all qualified r a i l r o a d g r a d i n g and tunnel bores of the taxpayer, unless, on application by the tax p a y e r, the Secretary o r h i s delegate permits h i m, subject to such conditions as the Secretary o r h i s delegate deems necessary, to revoke such election. " (d) D E E IX I T I O X S. — For purposes of t h i s section— " (1)

RAILHOAD ORADIXO AXD Ti'xxEL BORES.—The term ' r a i l r o a d

g r a d i n g and t u n n e l bores" means all improvements r e s u l t i n g from excavations ( i n c l u d i n g t u m i e l i n g), construction of e m b a n k m e n t s, clearings, di^•ersions of r o a d s and s t r e a m s, s o d d i n g of slopes, and from s i m i l a r work necessary to p r o v i d e, construct, reconstruct, alter, p r o t e c t, inqn'OAe, replace, o r restore a r o a d b e d o r right-ofway for railroad track. I f expenditures for improvements described i n the preceding sentence a r c i n c u r r e d w i t h respe€t to a n e x i s t i n g r o a d b e d o r righ.t-of-way for I'ailroad t r a c k, such expenditures shall be considered, in a p p l y i n g t h i s section, as costs for r a i l r o a d g r a d i n g or t u n n e l bores placed in service in the year i n which such costs a r e i n c u r r e d. "(2)

Q U A L I F I E D KAILKOAD GRADIXG AXD TUXX^EL BORES.—The

term 'qualified r a i l r o a d g r a d i n g and t u n n e l bores' means r a i l r o a d g r a d i n g and t u n n e l bores the o r i g i n a l use of which commences after December 31, 1968. "(e)

TREATMEXT

Urox^

RETIRE3IEXT.—If

any

qualified

railroad

g r a d i n g o r t u n n e l bore is r e t i r e d or a b and o n e d during a tax a b l e year for which a n election, under this section is in effect, n o deduction shall be allowed o n account of such retiremento r a b and o n m e n t and the amortization deduction under t h i s section shall continue w i t h respect to such property. T h i s subsection shall not a p p l y if the retiremento r a b and o n m e n t is a t t r i b u t a b l e p r i m a r i l y to fire, s to n n, or other casualty. "(f)

IX ' V E S T M E X T C R E D I T X O T To B E A L L O W E D. — Property eligible

to be a m o r t i z e d under t h i s section shall not be t r e a t e d as section 38 property w i t h i n the m e a n i n s: of section 48(a). (g) KEGFLATIOX'S.— IJie Secretary o r i n s delegate shall prescribe such r e g u l a t i o n s as may be necessary to c a r r y o u t the purposes of t h i s section. " (h) CROSS R E F E R E X C E. —

"For special rule with respect to certain gain derived from the disposition of property the adjusted basis of which is determined with regard to this section, see section 1245."

'^^ Stat. 967. 26 USC 48.

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text:
Page:United States Statutes at Large Volume 83.djvu/702

 674

P U B L I C LAW 9 1 - 1 7 2 - D E C. 30, 1969

[83 STAT.

(b) CONFORMING AMENDMENT. — The t a b l e of sections for x^art VI of

jgliaulW.'^'' 26 USC 263.

subchapter B of chapter 1 is amended by a d d i n g a t the end thereof the following new items: "Sec. 184. Amortization of certain railroad rolling stock. "Sec. 185. Amortization of railroad grading and tunnel bores." (c) EFFECTIVE D A T E. — The amendments m a d e by t h i s section shall a p p l y w i t h respect to tax a b l e years b e g i n n i n g after December 31, 1969. SEC. 706. EXPENDITURES IN CONNECTION WITH CERTAIN RAILROAD ROLLING STOCK. (^) I ^ GENERAL. — S e c t i o n 263 ( r e l a t i n g to capital expenditures) is amended by a d d i n g a t the e n d thereof the following new subsection: "(e)

26 USC 162, 212.

Post, p. 711.

CONNECTION

WITH

CERTAIN

RAILROAD

R O L L I N G S TO C K. — I n the case of expenditures i n connection w i t h the rehabilitation of a u n i t of r a i l r o a d r o l l i n g stock (except a locomotive) used by a domestic common c a r r i e r by r a i l r o a d which would, b u t for t h i s subsection, be p r o p e r l y c h a r g e a b l e to capital account, such expenditures, if during any 12-month period they d o not exceed a n a m o u n t equal to 20 percent of the basis of such unit i n the h and s of the tax p a y e r, shall be t r e a t e d ( notwithstanding subsection (a)) as deductjble r e p a i r s under section 162 o r 212." (b) EFFECTIVE D A T E. — The amendment m a d e by subsection (a) shall a p p l y w i t h respect to tax a b l e years b e g i n n i n g after December 31, 1969. SEC. 707. AMORTIZATION OF CERTAIN COAL MINE SAFETY EQUIPMENT. (a) A L L O W A N C E. — Part VI of subchapter B of chapter 1 ( r e l a t i n g to itemized deductions for i n d i v i d u a l s and corporations) is amended by a d d i n g after section 186 ( a d d e d by section 904 of t h i s Act) the following new section. "SEC. 187. AMORTIZATION OF CERTAIN COAL MINE SAFETY EQUIPMENT. "(a)

^"'^' p- 649-

EXPENDITURES I N

ALLOW^ANCE OF DEDUCTION. — E v e r y

p e r s o n, at h i s

election,

shall be entitled to a deduction w i t h respect to the amortization of the adjusted basis (for determining g a i n) of any certified coal mine safety equipment ( a s defined in subsection (d)), based on a period of 60 months. S u c h amortization deduction shall be a n a m o u n t, w i t h respect to each month of such period w i t h i n the taxable year, equal to the adjusted basis of the certified coal m i n e safety equipment a t the e n d of such month divided by the n u m b e r of months ( i n c l u d i n g the month for which the deduction is c o m p u t e d) r e m a i n i n g in the period. S u c h adjusted basis a t the e n d of the month shall be c o m p u t e d w i t h o u t r e g a r d to the amortization deduction for such month. The amortization deduction provided by t h i s section w i t h respect to any certified coal mine safety equipment for any month shall be in lieu of the depreciation deduction with respecl to such equipment for such month provided by section 167. The 60-month period shall begin, as to any certified coal m i n e safety equipment, a t the election of the tax p a y e r, w i t h the month following the month in which such equipment was placed in service o r w i t h the succeeding tax a b l e year. "(b)

ELECTION OF AMORTIZATION. — The election of the tax p a y e r to

take the amortization deduction and to begin the 60-month period w i t h the month following the month in which the certified coal m i n e safety equipment was placed in service, or w i t h the taxable year succeeding the taxable year i n which such equipment is placed in service, shall be m a d e by filing w i t h the Secretary or h i s delegate, in such m a n n e r, i n such form, and w i t h i n such time, as the Secretary o r h i s delegate may by r e g u l a t i o n s prescribe, a statement of such election. "(c)

TERMINATION

OF AMORTIZATION

DEDUCTION.—A

taxpayer

which has elected under subsection (b) to t a k e the amortization deduc-

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text:
Page:Tom Swift and His Airship.djvu/183

Rh as it does at present. How's the gas generator, Tom?"

"Seems to be all right," replied the young inventor, who had relinquished the wheel to the balloonist.

They ate an early supper, and, hardly had the dishes been put away, when from the west, where there was a low-flying bank of clouds, there came a mutter of thunder. A little later there was a dull, red illumination amid the rolling masses of vapor.

"There's the storm, and she's heading right this way," commented Mr. Sharp.

"Can't you avoid it?" asked Mr. Damon, anxiously.

"I could, if I knew how high it was, but I guess we'll wait and see how it looks as we get closer."

The airship was flying on, and the storm, driven by a mighty wind, was rushing to meet it. Already there was a sighing, moaning sound in the wire and wooden braces of the Red Cloud.

Suddenly there came such a blast that it heeled the ship over on her side.

"Shift the equilibrium rudders!" shouted Mr. Sharp to Tom, turning the wheel and various levers over to the lad. "I'm going to get more speed out of the motor!"

title: Page:Tom Swift and His Airship.djvu/183


text:
Page:United States Statutes at Large Volume 83.djvu/703

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

tion provided by subsection (a) may, at any time after making such election, discontinue the amortization deduction with respect to the remainder of the amortization period, such discontinuance to begin as of the beginning of any month specified by the taxpayer in a notice in writing filed with the Secretary or his delegate before the beginning of such month. The depreciation deduction provided under section 167 shall be allowed, beginning with the first month as to which the amortization deduction does not apply, and the taxpayer shall not be entitled to any further amortization deduction under this section with respect to such equipment. " (d) CERTIFIED COAL M I N E SAFETY EQUIPMENT.—For purposes of this section, the term 'certified coal mine safety equipment means property which— "(1) is electric face equipment (within the meaning of section 305 of the Federal Coal Mine Health and Safety Act of 1969) required in order to meet the requirements of section 305(a)(2) of such Act, " (2) the Secretary of the Interior certifies is permissible within the meaning of such section 305(a)(2), and " (3) is placed in service before January 1, 1975. For purposes of this section, any property placed in service in connection with any used electric face equipment which the Secretary of the Interior certifies makes such electric face equipment permissible shall be treated as a separate item of certified coal mine safety equipment.

675

^^usc leV'

Post, p. 775.

" (e) SPECIAL RULES.—

" (1) The adjusted basis of any certified coal mine safety equipment, with respect to which an election is made under this section, shall not be increased, for purposes of this section, for amounts chargeable to capital account for additions or improvements after the amortization period has begun. "(2) The depreciation deduction provided by section 167 shall, despite the provisions of subsection (a), be allowed with respect to the portion of the adjusted basis which is not taken into account in applying this section." (b) CLERICAL AMENDMENT.—The table of sections for part VI of subchapter B of the chapter 1 is amended by adding at the end thereof the following new item: "Sec. 187. Amortization of certain coal mine safety equipment."

(c) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years ending after December 31, 1969.

TITLE VIII—ADJUSTMENT OF TAX BURDEN FOR INDIVIDUALS SEC. 801. PERSONAL EXEMPTIONS. (a) INCREASE TO $625 FOR 1970.— Effective with respect to taxable years beginning after December 31, 1969, and before January 1, 1971— (1) section 151 (relating to allowance of personal exemptions) is amended by striking out "$600" wherever it appears therein and inserting in lieu thereof "$625"; and (2) section 6013(b)(3)(A) (relating to assessment and collection in case of certain returns of husband and wife) is amended by striking out "$600" wherever it appears therein and inserting in lieu thereof "$625", and by striking out "$1,200" wherever it appears therein and inserting in lieu thereof "$1,250". (b) INCREASE TO $650 FOR 1971.—Effective with respect to taxable years beginning after December 31, 1970, and before January 1, 1972—

esA Stat. 42. ^SA Stat. 733.

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Page:United States Statutes at Large Volume 83.djvu/704

 676 68A Stat. 42 26 USC 151.

68A Stat. 733.

26 USC ^^'

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

(1) section 151 (relating to allowance of personal exemptions) is amended by striking out "$625" wherever it appears therein and inserting in lien thereof "$650"'; and (2) section 6013(b)(3)(A) (relating to assessment and collection in case of certain returns of husband and wife) is amended by striking out "$625" wherever it appears therein and inserting in lieu thereof "$650",, and by striking out "$1,250" wherever it appears therein and inserting in lieu thereof "$1,300". (c) INCREASE TO $700 FOR 1972.—Effective with respect to taxable years beginning after December 31, 1971, and before January 1, 1973—• (1) section 151 (relating to allowance of personal exemptions) is amended by striking out "$650" wherever it appears therein and inserting in lieu thereof "$700"; and (2) section 6013(b)(3)(A) (relating to assessment and collection in case of certain returns of husband and wife) is amended by striking out "$650" wherever it appears therein and inserting in lieu thereof "$700", and by striking out "$1,300" wherever it appears therein and inserting in lieu thereof "$1,400". (d) INCREASE TO $750 FOR 1973 AND SUBSEQUENT YEARS.—Effective with respect to taxable years beginning after December 31, 1972— (1) section 151 (relating to allowance of personal exemptions) is amended by striking out "$700" wherever it appears therein and inserting in lieu thereof "$750"; and (2) section 6013(b)(3)(A) (relating to assessment and collection in case of certain returns of husband and Avife) is amended by striking out "$700" wherever it appears therein and inserting in lieu thereof "$750", and by striking out "$1,400", wherever it appears therein and inserting in lieu thereof "$1,500". SEC. 802. LOW INCOME ALLOWANCE; INCREASE IN STANDARD DEDUCTION. ^'^^ ^^ GENERAL.—Section 141 (relating to the standard deduction) is amended by striking out subsections (a), (b), and (c) and inserting in lieu thereof the following: " (a) STANDARD DEDUCTION.—Except as otherwise provided in this section, the standard deduction referred to in this title is the larger of the percentage standard deduction or the low income allowance. " (b) PERCVENTAGE STANDARD DEDUCTION.—The percentage standard deduction is an amount equal to the applicable percentage of adjusted gross income shown in the following table, but not to exceed the maximum amount shown in such table (or one-half of such maximum amount in the case of a separate return by a married individual): "Taxable years beginning in— 1970 1971 1972 1973 and thereafter

Applicable percentage

Maximum amount

10 13 14 15

$1,000 1,500 2,000 2.000

" (c) Low INCOME ALLOW^ANCE.—

"(1) IN GENERAL.—The low income allowance is an amount equal to the sum of— " (A) the basic allowance, and " (B) the additional allowance. "(2) BASIC ALLOWANCE.—For purposes of this subsection, the basic allowance is an amount equal to the sum of— " (A) $200, plus " (B) $100, multiplied by the number of exemptions. The basic allowance shall not exceed $1,000.

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text:
Page:United States Statutes at Large Volume 83.djvu/705

 83 STAT. ] "(3)

PUBLIC LAW 91-172-DEC. 30, 1969

677

ADDITIONAL ALLOWANCE.—

" (A) IN GENERAL.—For purposes of this subsection, the additional allowance is an amount equal to the excess (if any) of $900 over the sum of— "(i) $100, multiplied by the number of exemptions, plus "(ii) the income phase-out. •'(B) INCOME PHASE-OUT.—For purposes of subparagraph (A) (ii), the income phase-out is an amount eq^ual to one-half of the amount by which the adjusted gross income for the taxable year exceeds the sum of— " (i) $1,100, plus • "(ii) $625, multiplied by the number of exemptions. ••(4)

MARRIED INDIVIDUALS FILING SEPARATE RETURNS.—In

the

case of a married taxpayer filing a separate return— " (A) the low income allowance is an amount equal to the basic allowance, and " (B) the basic allowance is an amount (not in excess of $500) equal to the sum of— " (i) $100, plus _ " (ii) $100, multiplied by the number of exemptions. •*(5) NUMBER OF EXEMPTIONS.—For purposes of this subsection, the number of exemptions is the number of exemptions allowed as a deduction for the taxable year under section 151. 676"'"' ^^' ^^^' "(6) SPECIAL RULE FOR 1971.—For a taxable year beginning after December 31, 1970, and before January 1, 1972,— " (A) paragraph (3)(A) shall be applied by substituting •$850' for '$900', " (B) paragraph (3)(B) shall be applied by substituting 'one-fifteenth' for 'one-half, " (C) paragraph (3)(B)(i) shall be applied by substituting '$1050' for '$1100', and " (D) paragraph (3)(B) (ii) shall be applied by substituting'$650'for'$625'." (b) DETERMINATION OF MARriAL STATUS.—Section 143 (relating to 68Astat.4i. determination of marital status) is amended— ^^ ^^^ ^'^^' (1) by striking out "For purposes of this part—" and inserting in lieu thereof " (a) GENERAL RULE.—For purposes of this part—"; and (2) by adding at the end thereof the following new subsection: "(b)

CERTAIN MARRIED INDIVIDUALS LIVING APART.—For purposes

of this part, if— "(1) an individual who is married (within the meaning of subsection (a)) and who files a separate return maintains as his home a household which constitutes for more than one-half of the taxable year the principal place of abode of a dependent (A) who (within the meaning of section 152) is a son, stepson, daughter, or stepdaughter of the individual, and (B) with respect to whom such individual is entitled to a deduction for the taxable year under section 151, "(2) such individual furnishes over half of the cost of maintaining such household during the taxable year, and "(3) during the entire taxable year such individual's spouse is not a member of such household, such individual shall not be considered as married."

26 USC is2.

(c) TECHNICAL AND CONFORMING AMENDMENTS.—

(1) Section 4(a) (relating to number of exemptions) is amended to read as follows: '•(a) NUMBER OF EXEMPITONS.—For purposes of the tables prescribed by the Secretary or his delegate pursuant to section 3, the term

68A Stat. 10. ^°®'' P- ^84.

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text:
Page:United States Statutes at Large Volume 83.djvu/706

 678 ^^^nfe, pp. 675, 78 Stat. 140.

PUBLIC LAW 91-172-DEC. 30, 1969

'number of exemptions' means the number of exemptions allowed Under section 151 as deductions in computing taxable income." (2) Section 4(c) (relating to married individuals filing separate returns) is amended to read as follows: "(c)

Post, p. 684. ^"^''^-

Ante, p. 677. 78 Stat. 140.

26 USC Ml.

AnL^^^^587^'

Ante, p. 676.

68A Stat. 5; 78 Stat. 19.

[83 STAT.

HUSBAND OR W I F E FILING SEPARATE RETURN.—

"(1) A husband or wife may not elect to pay the optional tax imposed by section 3 if the tax of the other spouse is determined under section 1 on the basis of taxable income computed without regard to the standard deduction. " (2) Except as otherwise provided in this subsection, in the case of a husband or wife filing a separate return the tax imposed by section 3 shall be the lesser of the tax shown in— " (A) the table prescribed under section 3 applicable in the case of married persons filing separate returns which applies the percentage standard deduction, or " (B) the table prescribed under section 3 applicable in the case of married persons filing separate returns which applies the low income allowance. "(3) The table referred to in paragraph (2)(B) shall not apply in the case of a husband or wife filing a separate return if the tax of the other spouse is determined with regard to the percentage standard deduction; except that an individual described in section 141(d)(2) may elect (under regulations prescribed by the Secretary or his delegate) to pay the tax shown in the table referred to in paragraph (2)(B) in lieu of the tax shown in the table referred to m paragraph (2)(A). For purposes of this title, an election under the preceding sentence shall be treated as an election made under section 141(d)(2). "(4) For purposes of this subsection, determination of marital status shall be made under section 143." (3) Paragraph (4) of section 4(f) is amended to read as follows: "(4) For computation of tax by Secretary or his delegate, see section 6014." (^) Section 141(d) (relating to married individuals filing separate returns) is amended— (A) by striking out "minimum standard deduction" each place it appears and inserting in lieu thereof "low income allowance"; and (B) by striking out "10-percent" each place it appears therein and inserting in lieu thereof "percentage". (^) Section 1304(c)(4) (relating to special rules for income averaging) is amended by striking out "section 143" and inserting in lieu thereof "section 143(a)". (d) EFFECTIVE DATE.—The amendments made by subsections (a), (b), and (c) shall apply to taxable years beginning after December 31, 1969. (e) YEARS AFTER 1971.—Effective with respect to taxable years beginning after December 31, 1971, section 141(c) (relating to low income allowance), as amended by subsection (a), is amended to read as follows: "(c) Low INCOME ALLOWANCE.—The low income allowance is $1,000 ($500, in the case of a married individual filing a separate return)." SEC. 803. TAX RATES FOR SINGLE INDIVIDUALS AND HEADS OF HOUSEHOLDS; OPTIONAL TAX. (a) KATES OF TAX ON INDIVIDUALS.—Section 1 (relating to the tax imposed) is amended to read as follows:

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