Taxable Years Beginning in 1943 Taxable Years Taxable Years Supplement C-Credits Against Supplement C-Credits Against Supplement C-Credits Against [Supplementary to Subchapter B, Part III] Sec. 131. Taxes of foreign coun- Sec. 131. Taxes of foreign coun- Sec. 131. Taxes of foreign countries and possessions of United tries and possessions of United tries and possessions of United States. States. States. Sec. 131. (a) Allowance of Sec. credit. If the taxpayer chooses to have the benefits of this section, the tax imposed by this chapter, except the tax imposed under Sec. 102 or section 450, shall be credited with: 131. (a) Allowance of Sec. 131. (a) Allowance of credit. If the taxpayer signifies credit. If the taxpayer signifies in his return his desire chooses to in his return his desire chooses to have the benefits of this section, the have the benefits of this section, the tax imposed by this chapter, except tax imposed by this chapter, except the tax imposed under Sec. 102 the tax imposed under Sec. 102 or section 450, shall be credited or section 450, shall be credited with: with: Sec. 131. (a) (1) Citizens and domestic corporations. In the case of a citizen of the United States and of a domestic corporation, the amount of any income, war-profits, and excess-profits taxes paid or accrued during the taxable year to any foreign country or to any possession of the United States; and Sec. 131. (a) (2) Resident of the Sec. 131. (a) (1) Citizens and domestic corporations. In the case of a citizen of the United States and of a domestic corporation, the amount of any income, war-profits, and excess-profits taxes paid or accrued during the taxable year to any foreign country or to any possession of the United States; and Sec. 131. (a) (2) Resident of United States. In the case of a resident of the United States, the amount of any such taxes paid or accrued during the taxable year to any possession of the United States; and Sec. 131. (a) (3) Alien resident Sec. 131. (a) (3) Alien resident Sec. 131. (a) (3) Alien resident of United States. In the case of of United States. In the case of of United States. In the case of an alien resident of the United an alien. resident of the United an alien resident of the United States, the amount of any such States, the amount of any such States, the amount of any such taxes paid or accrued during the taxes paid or accrued during the taxes paid or accrued during the taxable year to any foreign coun- taxable year to any foreign coun- taxable year to any foreign country, if the foreign country of which try, if the foreign country of which try, if the foreign country of which such alien resident is a citizen or such alien resident is a citizen or subject, in imposing such taxes, subject, in imposing such taxes, allows a similar credit to citizens of allows a similar credit to citizens of the United States residing in such the United States residing in such country; and country; and 4 such alien resident is a citizen or subject, in imposing such taxes, allows a similar credit to citizens of the United States residing in such country; and Sec. 131. (a) (4) Partnerships Sec. 131. (a) (4) Partnerships Sec. 131. (a) (4) Partnerships and estates. In the case of any and estates. In the case of any and estates. In the case of any such individual who is a member of such individual who is a member of such individual who is a member of a partnership or a beneficiary of a partnership or a beneficiary of a partnership or a beneficiary of an estate or trust, his proportion- an estate or trust, his proportion- an estate or trust, his proportionate share of such taxes of the part- ate share of such taxes of the part- ate share of such taxes of the partnership or the estate or trust paid nership or the estate or trust paid or accrued during the taxable year or accrued during the taxable year to a foreign country or to any posto a foreign country or to any possession of the United States, as the session of the United States, as the case may be. case may be. Such choice may be made or changed at any time prior to the expiration of the period prescribed for making a claim for credit or re nership or the estate or trust paid Such choice may be made or Such choice may be made or changed at any time prior to the ex- changed at any time prior to the expiration of the period prescribed piration of the period prescribed for making a claim for credit or re-for making a claim for credit or re Sec. 131. (a) Allowance of Sec. 131. (a) Allowance of credit. credit. If the taxpayer signifies-If the taxpayer signifies in in his return his desire to have the his return his desire to have the benefits of this section, the tax im- benefits of this section, the tax posed by this chapter, except the imposed by this chapter shall be tax imposed under Sec. 102, shall credited with: be credited with: Sec. 131. (a) (1) Citizen and domestic corporation. In the case of a citizen of the United States and of a domestic corporation, the amount of any income, war-profits, and excess-profits taxes paid or accrued during the taxable year to any foreign country or to any possession of the United States; and Sec. 131. (a) (1) Citizen and domestic corporation. In the case of a citizen of the United States and of a domestic corporation, the amount of any income, war-profits, and excess-profits taxes paid or accrued during the taxable year to any foreign country or to any possession of the United States; and Sec. 131. (a) (2) Resident of Sec. 131. (a) (2) Resident of United States. In the case of a United States. In the case of a resident of the United States, the resident of the United States, the amount of any such taxes paid or amount of any such taxes paid or accrued during the taxable year to accrued during the taxable year to any possession of the United any possession of the United States; and States; and Sec. 131. (a) (3) Alien resident Sec. 131. (a) (3) Alien resident Sec. 131. (a) (3) Alien resident See p. 230, Eighth Edition. of United States. In the case of of United States. In the case of of United States. country; and and Sec. 131. (a) (4) Partnerships Sec. 131. (a) (4) Partnerships Sec. 131. (a) (4) Partnerships a partnership or a beneficiary of of a partnership or a beneficiary Sec. 131 (a). I. R. C., supra, amended by Sec. 216 (a), R. A. of 1939, to read as above. Sec. 229 of said Act makes amendment applicable to tax See p. 230, Eighth Edition. Taxable Years Beginning in 1943 Taxable Years Taxable Years fund of the tax imposed by this fund of the tax imposed by this fund of the tax imposed by this chapter. chapter. Sec. 131 (a), I. R. C., supra, amended by Sec. 158 (a), R. A. of 1942, to read as above. Sec. 158 (c) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1940. For Sec. 131 (a), I. R. C., supra, before amendment, see 1942 column. Sec. 131. (b) Limit on credit.The amount of the credit taken under this section shall be subject to each of the following limitations: Sec. 131 (a), I. R. C., supra, amended by Sec. 158 (a), R. A. of 1942, by omitting language in stricken through type and adding language in italics and also by pluralizing "citizen" and "corporation" in heading of paragraph (a) (1). Sec. 158 (c) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1940. Sec. 131. (b) Limit on credit. chapter. Sec. 131 (a), I. R. C., supra, amended by Sec. 158 (a), R. A. of 1942, by omitting language in stricken through type and adding language in italics and also by pluralizing "citizen" and "corporation" in heading of paragraph (a) (1). Sec. 158 (e) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1940. Sec. 131. (b) Limit on credit.The amount of the credit taken The amount of the credit taken under this section shall be subject under this section shall be subject to each of the following limita- to each of the following limitations: tions: Sec. 131. (b) (1) The amount of Sec. 131. (b) (1) The amount of the credit in respect of the tax the credit in respect of the tax Sec. 131. (b) (1) The amount of the credit in respect of the tax paid or accrued to any country paid or accrued to any country paid or accrued to any country shall not exceed the same propor- shall not exceed the same propor- shall not exceed the same proportion of the tax against which such tion of the tax against which such tion of the tax against which such credit is taken, which the tax- credit is taken, which the tax- credit is taken, which the taxpayer's net income from sources payer's net income from sources payer's net income from sources within such country bears to his within such country bears to his within such country bears to his entire net income, in the case of a entire net income, in the case of a entire net income, in the case of a taxpayer other than a corporation, taxpayer other than a corporation, taxpayer other than a corporation, or to the sum of the normal tax net or to the sum of the normal tax net or to the normal tax net income, income and the amount of the credit income and the amount of the credit in the case of a corporation, for for adjusted excess profits net in- for adjusted excess profits net in- the same taxable year; and come provided in section 26 (e), come provided in section 26 (e), in the case of a corporation, for in the case of a corporation, for the same taxable year; and the same taxable year; and Sec. 131. (b) (2) The total amount of the credit shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer's net in Sec. 131. (b) (2) The total amount of the credit shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer's net in Sec. 131. (b) (2) The total amount of the credit shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer's net in come from sources without the come from sources without the come from sources without the United States bears to his entire net income, in the case of a taxpayer other than a corporation, or to the sum of the normal tax net income and the amount of the credit for adjusted excess profits net income provided in section 26 (e), in the case of a corporation, for the same taxable year. Sec. 131 (b), I. R. C., supra, amended by Sec. 158 (d), R. A. of 1942, to read as above. Sec. 101 of said Act makes amendment applicable to taxable beginning years after Dec. 31, 1941. For Sec. 131 (b), I. R. C., before amendment, see 1942 column. United States bears to his entire Sec. 131 (b), I. R. C., supra, of See other columns for prior amendments of Sec. 131 (b), I. R. C. United States bears to his entire net income, in the case of a taxpayer other than a corporation, or to the normal tax net income, in the case of a corporation, for the same taxable year. Sec. 131 (b), I. R. C., supra, amended by Sec. 216 (b), R. A. of 1939, to read as above. Sec. 229 of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1939. For Sec. 131 (b), I. R. C., before amendment, see Sec. 181 (b), I. R. C., in 1939 column. Sec. 131. (c) Adjustments on Sec. 131. (c) Adjustments on Sec. 131. (c) Adjustments on payment of accrued taxes. If payment of accrued taxes. If payment of accrued taxes.-If accrued taxes when paid differ accrued taxes when paid differ accrued taxes when paid differ from the amounts claimed as cred- from the amounts claimed as cred- from the amounts claimed as credits by the taxpayer, or if any tax its by the taxpayer, or if any tax its by the taxpayer, or if any tax Taxable Years able years beginning after Dec. 31, 1939. For Sec. 131 (a), I. R. C., before amendment, see Sec. 131 (a), I. R. C. in 1939 column. Taxable Years Taxable Years Sec. 131. (b) Limit on credit.— Sec. 131. (b) Limit on credit.The amount of the credit taken The amount of the credit taken under this section shall be subject under this section shall be subject to each of the following limita- to each of the following limitations: tions: Sec. 131. (b) (1) The amount of Sec. 131. (b) (1) The amount of the credit in respect of the tax the credit in respect of the tax paid or accrued to any country paid or accrued to any country shall not exceed the same propor- shall not exceed the same proportion of the tax against which such credit is taken, which the taxpayer's net income from sources within such country bears to his entire net income, in the case of a taxpayer other than a corporation, or to the normal tax net income, in the case of a corporation, for the same taxable year; and tion of the tax against which such Sec. 131. (b) Limit on credit. See p. 230, Eighth Edition. Sec. 131. (b) (2) The total Sec. 131. (b) (2) The total amount of the credit shall not ex- amount of the credit shall not exceed the same proportion of the ceed the same proportion of the tax against which such credit is tax against which such credit is taken, which the taxpayer's net in- taken, which the taxpayer's net income from sources without the come from sources without the United States bears to his entire United States bears to his entire net income, in the case of a tax- net income for the same taxable payer other than a corporation, or year. to the normal tax net income, in the case of a corporation, for the same taxable year. Sec. 131 (b), I. R. C., supra, amended by Sec. 216 (b), R. A. of 1939, to read as above. Sec. 229 of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1939. For Sec. 131 (b), I. R. C., before amendment, see Sec. 131 (b), I. R. C., in 1939 column. Sec. 131. (c) Adjustments on Sec. 131. (c) Adjustments on payment of accrued taxes. If payment of accrued taxes. If accrued taxes when paid differ accrued taxes when paid differ from the amounts claimed as cred- from the amounts claimed as credits by the taxpayer, or if any tax its by the taxpayer, or if any tax Sec. 131. (c) Adjustments on payment of accrued taxes. See p. 232, Eighth Edition. or Taxable Years Taxable Years Beginning in 1941 or in paid is refunded in whole or in paid is refunded in whole redeter to with In paid is refunded in whole or in part, the taxpayer shall notify the Commissioner, who shall redeterand the or years affected, mine the amount of the tax for the mine the amount of the tax for the mine the amount of the tax for the years affected, and the year year be shall years affected, and the year or amount of tax due upon such re- amount of tax due upon such re- amount of tax due upon such redetermination, if any, shall be determination, if any, shall be determination, if any, paid by the taxpayer upon notice paid by the taxpayer upon notice paid by the taxpayer upon notice and demand by the collector, or and demand by the collector, or and demand by the collector, or the amount of tax overpaid, if any, the amount of tax overpaid, if any, the amount of tax overpaid, if any, shall be credited or refunded to shall be credited or refunded to shall be credited or refunded In the provisions of section 322. the taxpayer in accordance with the taxpayer in accordance with the taxpayer in accordance In the provisions of section 322. the provisions of section 322. the case of such a tax accrued but the case of such a tax accrued but the case of such a tax accrued but a not paid, the Commissioner not paid, the Commissioner as a not paid, the Commissioner as condition precedent to the allow-condition precedent to the allow-condition precedent to the allowance of this credit may require the ance of this credit may require the ance of this credit may require the taxpayer to give a bond with sure- taxpayer to give a bond with sure-taxpayer to give a bond with sureties satisfactory to and to be ap- ties satisfactory to and to be ap- ties satisfactory to and to be approved by the Commissioner in proved by the Commissioner in proved by the Commissioner such sum as the Commissioner may such sum as the Commissioner may such sum as the Commissioner may require, conditioned upon the pay- require, conditioned upon the pay- require, conditioned upon the payof any ment by the taxpayer of any ment by the taxpayer of ment by the taxpayer amount of tax found due upon any amount of tax found due upon any amount of tax found due upon any such redetermination; and the bond such redetermination; and the bond such redetermination; and the bond herein prescribed shall contain such herein prescribed shall contain such herein prescribed shall contain such sioner may require. further conditions as the Commis- further conditions as the Commis- further conditions as the Commissioner may require. sioner may require. as in any Sec. 131. (d) Year in which Sec. 131. (d) Year in which Sec. 131. (d) Year in which credit taken. The credits provided credit taken.-The credits provided credit taken. The credits provided for in this section may, at the op- for in this section may, at the op- for in this section may, at the option of the taxpayer and irrespec- tion of the taxpayer and irrespec- tion of the taxpayer and irrespective of the method of accounting tive of the method of accounting tive of the method of accounting employed in keeping his books, be employed in keeping his books, be employed in keeping his books, be taken in the year in which the taken in the year in which the taken in the year in which the taxes of the foreign country or the taxes of the foreign country or the taxes of the foreign country or the possession of the United States possession of the United States possession of the United States If the taxaccrued, subject, however, to the accrued, subject, however, to the accrued, subject, however, to the conditions prescribed in subsection conditions prescribed in subsection conditions prescribed in subsection If the tax- (c) of this section. If the tax- (c) of this section. (c) of this section. payer elects to take such credits payer elects to take such credits payer elects to take such credits in the year in which the taxes of in the year in which the taxes of in the year in which the taxes of the foreign country or the posses- the foreign country or the possesthe foreign country or the possession of the United States accrued, sion of the United States accrued, sion of the United States accrued, the credits for all subsequent years the credits for all subsequent years the credits for all subsequent years shall be taken upon the same basis, shall be taken upon the same basis, and no portion of any such taxes and no portion of any such taxes shall be allowed as a deduction in shall be allowed as a deduction in the same or any succeeding year. the same or any succeeding year. shall be taken upon the same basis, and no portion of any such taxes the same or any succeeding year. shall be allowed as a deduction in Sec. 131. (e) Proof of credits.Sec. 131. (e) Proof of credits.Sec. 131. (e) Proof of credits.The credits provided in this sec- The credits provided in this sec- The credits provided in this seetion shall be allowed only if the tion shall be allowed only if the tion shall be allowed only if the taxpayer establishes to the satis- taxpayer establishes to the satis- taxpayer establishes to the satisfaction of the Commissioner (1) faction of the Commissioner (1) faction of the Commissioner (1) the total amount of income derived the total amount of income derived the total amount of income derived from sources without the United from sources without the United from sources without the United States, determined as provided in States, determined as provided in States, determined as provided in section 119, (2) the amount of in- section 119, (2) the amount of in- section 119, (2) the amount of income derived from each country, come derived from each country, come derived from each country, the tax paid or accrued to which the tax paid or accrued to which the tax paid or accrued to which is claimed as a credit under this is claimed as a credit under this is claimed as a credit under this section, such amount to be deter-section, such amount to be deter-section, such amount to be deter |