date or dates prescribed for payment thereof will result in undue hardship to the taxpayer, the Commissioner, with the approval of the Secretary, may grant an extension of time for the payment of the deficiency or any part thereof for a period not in excess of 18 months. The term "undue hardship means more than an inconvenience to the taxpayer. It must appear that substantial financial loss or sacrifice will result to the taxpayer from making payment of the deficiency at the due date. No extension will be granted where the deficiency is due to negligence or intentional disregard of the rules and regulations or to fraud with intent to evade the tax.

Any application for an extension of time for the payment of a deficiency must be made under oath on Form 1127 in accordance with instructions printed thereon, and must be accompanied by evidence showing that undue hardship to the taxpayer would result if the extension were refused. The extension will not be granted on a general statement of hardship, but in each case there must be furnished a statement of the specific facts showing what, if any, financial loss or sacrifice will result if the extension is not granted. Wherever practicable a certified statement of assets and liabilities of the taxpayer should be submitted. The application, with the evidence, must be filed with the collector who will at once transmit it to the Commissioner with his recommendations as to the extension. When it is received by the Commissioner it will be examined and within thirty days rejected, approved, or tentatively approved subject to certain conditions of which the taxpayer will be immediately notified.

As a condition to the granting of such an extension, the Commissioner may require the taxpayer to furnish a bond in an amount not exceeding double the amount of the deficiency. If a bond is required it must be filed with the collector within 10 days after notification by the Commissioner that such bond is required. It shall be conditioned upon the payment of the deficiency, interest, and additional amounts assessed in connection therewith in accordance with the terms of the extension granted, and shall be executed by a surety company holding a certificate of authority from the Secretary of the Treasury as an acceptable surety on Federal bonds, and shall be subject to the approval of the Commissioner. In lieu of such a bond, the taxpayer may file a bond secured by deposit of Liberty bonds or other bonds or notes of the United States equal in their total par value to the amount of the deficiency, interest, and additional amounts assessed in connection therewith, as provided in section 1029 of the Act. The amount of the deficiency and additions thereto shall be paid on or before the expiration of the period of the extension without the necessity of notice and demand from the collector.

Extensions of time for the payment of a deficiency may be made in respect of the tax imposed by this title and in respect of deficiencies assessed after the enactment of the Revenue Act of 1924 (in accordance with the provisions of section 280 of the statute), in respect of income, war-profits or excess-profits taxes imposed by the Revenue Act of 1916, the Revenue Act of 1917, the Revenue Act of 1918, the Revenue Act of 1921, or any of these acts as amended. See section 280 of the statute and article 1291.

ART. 1235. Interest on a deficiency.-Interest upon the amount assessed as a deficiency under this title shall be assessed at the same time as the deficiency, at the rate of 6 per cent per annum from the date prescribed for the payment of the tax to the date the deficiency is assessed. If the taxpayer has elected to pay his tax in installments, the interest shall be assessed on the amount of the deficiency prorated to each installment from the date prescribed for the payment of the installment to the date the deficiency is assessed. If the time for the payment of a deficiency, or any part of the deficiency, is extended (see section 274(g) and article 1234), interest shall be collected as a part of the tax on that part of the deficiency, time for payment of which is so extended, at the rate of 6 per cent per annum for the entire period of the extension. If the deficiency or a part thereof, the time for payment of which is so extended, is not paid on or before the expiration of the period of the extension, interest on such unpaid amount shall be collected at the rate of 1 per cent a month from the date of the expiration of the period of extension until it is paid. The additions to tax in case of delinquency imposed by section 276(b) of the statute (see article 1261) do not apply in case of a deficiency the time for payment of which has been extended under section 274(g).

If the Commissioner institutes a proceeding in court for the collection of an amount determined by him as a deficiency, or a part thereof, which is disallowed by the Board, and procures a judgment in the proceeding, the court shall include in its judgment interest on the amount recovered at the rate of 6 per cent per annum from the date prescribed for the payment of the tax until the date of the judgment.

ADDITIONS TO THE TAX IN CASE OF DEFICIENCY

SEC. 275. (a) If any part of any deficiency is due to negligence, or intentional disregard of rules and regulations but without intent to defraud, 5 per centum of the total amount of the deficiency (in addition to such deficiency) shall be assessed, collected, and paid in the same manner as if it were a deficiency, except that the provisions of subdivisions (e) and (f) of section 274 shall not be applicable.

(b) If any part of any deficiency is due to fraud with intent to evade tax, then 50 per centum of the total amount of the deficiency (in addition to such

deficiency) shall be so assessed, collected, and paid, in lieu of the 50 per centum addition to the tax provided in section 3176 of the Revised Statutes, as amended.

ART. 1251. Additions to tax in case of a deficiency.—If a deficiency or any part of a deficiency is due to negligence or intentional disregard of rules and regulations but without intent to defraud, 5 per cent of the total amount of the deficiency shall be assessed, collected, and paid in the same manner as if it were a deficiency. This amount shall be in addition to the deficiency but shall not be subject to the interest imposed on the deficiency by section 274(f) nor shall such amount be prorated to the installments as provided in section 274(e) of the statute. See articles 1233 and 1235. If a deficiency or any part thereof is due to fraud with intent to evade the tax, there shall be assessed, collected, and paid in the same manner and subject to the same provisions as those mentioned in the first sentence of this article an addition of 50 per cent of the total amount of the deficiency. This addition shall be in lieu of the 50 per cent addition to the tax provided in section 3176 of the Revised Statutes as amended.

ADDITIONS TO THE TAX IN CASE OF DELINQUENCY

SEC. 276. (a) (1) Where the amount determined by the taxpayer as the tax imposed by this title, or any installment thereof, or any part of such amount or installment, is not paid at the time prescribed for its payment, there shall be collected as a part of the tax, interest upon such unpaid amount at the rate of 1 per centum a month from the date prescribed for its payment until it is paid.

(2) Where an extension of time for payment of the amount so determined as the tax by the taxpayer, or any installment thereof, has been granted, and the amount the time for payment of which has been extended, and the interest thereon determined under paragraph (2) of subdivision (c) of section 270, is not paid in full prior to the expiration of the period of the extension, then, in lieu of the interest provided for in paragraph (1) of this subdivision, interest at the rate of 1 per centum a month shall be collected on such unpaid amount from the date of the expiration of the period of the extension until it is paid.

(b) Where a deficiency, or any interest or additional amounts assessed in connection therewith under subdivision (f) of section 274, or under section 275, or any addition to the tax in case of delinquency provided for in section 3176 of the Revised Statutes, as amended, is not paid in full within ten days from the date of notice and demand from the collector, there shall be collected as part of the tax, interest upon the unpaid amount at the rate of 1 per centum a month from the date of such notice and demand until it is paid. If any part of a deficiency prorated to any unpaid installment under subdivision (e) of section 274 is not paid in full on the date prescribed for the payment of such installment, there shall be collected as part of the tax interest upon the unpaid amount at the rate of 1 per centum a month from such date until it is paid.

(c) In the case of estates of incompetent, deceased, or insolvent persons, there shall be collected interest at the rate of 6 per centum per annum in lieu of the interest provided in subdivisions (a) and (b) of this section.

(d) If a claim in abatement is filed, as provided in section 279, the provisions of subdivisions (b) and (c) of this section shall not apply to the amount covered by the claim in abatement.

ART. 1261. Additions to tax in case of delinquency in payment of tax.—Where the amount determined by the taxpayer as the tax imposed by this title, or any installment thereof, or any part of such amount or installment, is not paid within the time prescribed for its payment (see section 270 of the statute and article 1201), there shall be collected as a part of the tax interest upon such unpaid amount at the rate of 1 per cent a month from the date prescribed for its payment until it is paid. Since the tax is due and payable on the dates prescribed, without notice and demand from the collector for payment, interest at the rate of 1 per cent a month begins to run, if the tax is not paid on such dates, without notice of any kind to the taxpayer from the Government. If, however, an extension of time has been granted for the payment of the amount reported by the taxpayer as the tax, or any installment thereof, or any part of such amount or installment, and such amount or installment with the interest thereon (see section 270 (c) of the statute and article 1201) is not paid in full on or before the date of expiration of the period of the extension, interest shall be collected on the unpaid amount at the rate of 1 per cent a month from the date of the expiration of the period of extension until such amount is paid, and not from the date prescribed in the statute for the payment of such tax or installment thereof until paid.

Where a deficiency or any interest on such deficiency assessed under the provisions of section 274(f) (see articles 1232 and 1235), or any additions to the deficiency assessed under section 275 of the statute (see article 1251), or any addition to tax in case of delinquency in filing a return as provided by section 3176 of the Revised Statutes, as amended (see article 445), is not paid in full within ten days from the date of notice and demand from the collector, there shall be collected as a part of the tax interest upon the unpaid amount at the rate of 1 per cent a month from the date of such notice and demand until such amount is paid. If, however, any part of the deficiency is not payable on notice and demand from the collector, but on a date prescribed by the statute (as in the case. where part of a deficiency is prorated to installments not yet due, and thus becomes payable at the same time as the installments), interest at the rate of 1 per cent a month shall be collected on any part remaining unpaid after the date prescribed for its payment from such date until it is paid. See section 274(e) of the statute and article 1235.

If the estate of an incompetent, deceased, or insolvent person is delinquent in the payment of the amount of tax shown on its return, or any installment thereof, or any deficiency, or any part of such tax, installment, or deficiency, the interest on such amount for the period of the delinquency in payment shall be at the rate of 6 per cent per annum and not at the rate of 1 per cent a month, as in the case of other taxpayers. The additions to tax in case of delinquency in payment of a deficiency provided by section 276 (b) of the statute do not apply where the time for payment of such deficiency is extended under the provisions of section 274(g) of the statute. See article 1234. The provisions of subdivisions (b) and (c) of section 276 of the statute are also inapplicable to any amount covered by a claim in abatement filed in accordance with the provisions of section 279 of the statute. See article 1281.

PERIOD OF LIMITATION UPON ASSESSMENT AND COLLECTION OF TAX

SEC. 277. (a) Except as provided in section 278 and in subdivision (b) of section 274 and in subdivision (b) of section 279

(1) The amount of income, excess-profits, and war-profits taxes imposed by the Revenue Act of 1921, and by such Act as amended, for the taxable year 1921 and succeeding taxable years, and the amount of income taxes imposed by this Act, shall be assessed within four years after the return was filed, and no proceeding in court for the collection of such taxes shall be begun after the expiration of such period.

(2) The amount of income, excess-profits, and war-profits taxes imposed by the Act entitled "An Act to provide revenue, equalize duties, and encourage the industries of the United States, and for other purposes," approved August 5, 1909, the Act entitled "An Act to reduce tariff duties and to provide revenue for the Government, and for other purposes," approved October 3, 1913, the Revenue Act of 1916, the Revenue Act of 1917, the Revenue Act of 1918, and by any such Act as amended, shall be assessed within five years after the return was filed, and no proceeding in court for the collection of such taxes shall be begun after the expiration of such period.

(3) In the case of income received during the lifetime of a decedent, the tax shall be assessed, and any proceeding in court for the collection of such tax shall be begun, within one year after written request therefor (filed after the return is made) by the executor, administrator, or other fiduciary representing the estate of such decedent, but not after the expiration of the period prescribed for the assessment of the tax in paragraph (1) or (2) of this subdivision.

(b) The period within which an assessment is required to be made by subdivision (a) of this section in respect of any deficiency shall be extended (1) by 60 days if a notice of such deficiency has been mailed to the taxpayer under subdivision (a) of section 274 and no appeal has been filed with the Board of Tax Appeals, or, (2) if an appeal has been filed, then by the number of days between the date of the mailing of such notice and the date of the final decision by the Board.

SEC. 278. (a) In the case of a false or fraudulent return with intent to evade tax or of a failure to file a return the tax may be assessed, or a proceed