Taxable Years Beginning in 1949 taxable year without regard to such net operating loss and without regard to any net operating loss carry-back. For the purposes of the preceding sentence, the net operating loss for any taxable year beginning after December 31, 1941 shall be reduced by the sum of the net income for each of the two preceding taxable years (computed for each such preceding taxable year with the exceptions, additions, and limitations provided in subsection (d) (1), (2), (4), and (6), and computed by determining the net operating loss deduction without regard to such net operating loss or to the net operating loss for the succeeding taxable year). Taxable Years Beginning in 1948 Sec. 122. (c) Amount of net The operating loss deduction. Sec. 122. (c) Amount of net operating loss deduction. amount of the net operating loss deduction shall be the aggregate of the net operating loss carry-overs and of the net operating loss carrybacks to the taxable year reduced by the amount, if any, by which the net income (computed with the exceptions and limitations provided in subsection (d) (1), (2), (3), and (4)) exceeds, in the case of a taxpayer other than a corporation, the net income (computed without such deduction), or in the case of a corporation, the normaltax net income (computed without such deduction and without the credit provided in section 26 (e)); Same as 1944. Sec. 122. (d) Exceptions, addiThe ex- tions, and limitations. Sec. 122. (d) Exceptions, additions, and limitations. ceptions, additions, and limitations referred to in subsections (a), (b), and (c) shall be as follows: Sec. 122. (d) (1) The deduction for depletion shall not exceed the amount which would be allowable if computed without reference to discovery value or to percentage depletion under section 114 (b) (2), (3), or (4); Sec. 122. (d) (2) There shall be included in computing gross income the amount of interest received which is wholly exempt from the taxes imposed by this chapter, decreased by the amount of interest paid or accrued which is not allowed as a deduction by Same as 1944. Taxable Years Beginning in 1946 and 1947 Sec. 122. (c) Amount of net operating loss deduction. Same as 1944. Sec. 122. (d) Exceptions, additions, and limitations. Same as 1944. Taxable Years Beginning in 1945 Sec. 122. (c) Amount of net operating loss deduction. Same as 1944. Sec. 122. (d) Exceptions, additions, and limitations. Same as 1944. Taxable Years Beginning in 1944 taxable year without regard to such net operating loss and without regard to any net operating loss carry-back. For the purposes of the preceding sentence, the net operating loss for any taxable year beginning after December 31, 1941 shall be reduced by the sum of the net income for each of the two preceding taxable years (computed for each such preceding taxable year with the exceptions, additions, and limitations provided in subsection (d) (1), (2), (4), and (6), and computed by determining the net. operating loss deduction without regard to such net operating loss or to the net operating loss for the succeeding taxable year). Sec. 122. (c) Amount of net operating loss deduction. The amount of the net operating loss deduction shall be the aggregate of the net operating loss carry-overs and of the net operating loss carrybacks to the taxable year reduced by the amount, if any, by which the net income (computed with the exceptions and limitations provided in subsection (d) (1), (2), (3), and (4)) exceeds, in the case of a taxpayer other than a corporation, the net income (computed without such deduction), or, in the case of a corporation, the normaltax net income (computed without such deduction and without the credit provided in section 26 (e)); Sec. 122. (d) Exceptions, additions, and limitations. — The exceptions, additions, and limitations referred to in subsections (a), (b), and (c) shall be as follows: Sec. 122. (d) (1) The deduction for depletion shall not exceed the amount which would be allowable if computed without reference to discovery value or to percentage depletion under section 114 (b) (2), (3), or (4); Sec. 122. (d) (2) There shall be included in computing gross income the amount of interest received which is wholly exempt from the taxes imposed by this chapter, decreased by the amount of interest paid or accrued which is not allowed as a deduction by Taxable Years Beginning before 1944 Sec. 122. (c) Amount of net operating loss deduction. Section originated 1939 as Ninth Edition, p. 332. Sec. 122. (d) Exceptions, additions, and limitations. Section originated 1938 as Eighth Edition, p. 70, Taxable Years Beginning in 1949 section 23 (b), relating to interest on indebtedness incurred or continued to purchase or carry certain tax-exempt obligations; Sec. 122. (d) (3) No net operating loss deduction shall be allowed; Sec. 122. (d) (4) Gains and losses from sales or exchanges of capital assets shall be taken into account without regard to the provisions of section 117 (b). As so computed the amount deductible on account of such losses shall not exceed the amount includible on account of such gains; Sec. 122. (d) (5) Deductions otherwise allowed by law not attributable to the operation of a trade or business regularly carried on by the taxpayer shall (in the case of a taxpayer other than a corporation) be allowed only to the extent of the amount of the gross income not derived from such trade or business. For the purposes of this paragraph deductions and gross income shall be computed with the exceptions, additions, and limitations specified in paragraphs (1) to (4) of this subsection. Sec. 122. (d) (6) There shall be allowed as a deduction the amount of tax imposed by Subchapter E of Chapter 2 paid or accrued within the taxable year, subject to the following rules (A) No reduction in such tax shall be made by reason of the credit for income, war-profits, or excess-profits taxes paid to any foreign country or possession of the United States; (B) Such tax shall be computed without regard to the adjustments provided in section 734; and (C) Such tax, in the case of a consolidated return for excessprofits tax purposes, shall be allocated to the members of the affiliated group under regulations prescribed by the Commissioner, with the approval of the Secretary. Sec. 122. (e) No carry-back to year prior to 1941.-As used in this section, the term "preceding taxable year" and the term "preceding taxable years" do not include any taxable year beginning prior to January 1, 1941. Taxable Years Beginning in 1945 Sec. 122. (e) No carry-back to year prior to 1941. Same as 1944. Taxable Years Beginning in 1944 section 23 (b), relating to interest on indebtedness incurred or continued to purchase or carry certain tax-exempt obligations; Sec. 122. (d) (3) No net operating loss deduction shall be allowed; Sec. 122. (d) (4) Gains and losses from sales or exchanges of capital assets shall be taken into account without regard to the provisions of section 117 (b). As so computed the amount deductible on account of such losses shall not exceed the amount includible on account of such gains; Sec. 122. (d) (5) Deductions otherwise allowed by law not attributable to the operation of a trade or business regularly carried on by the taxpayer shall (in the case of a taxpayer other than a corporation) be allowed only to the extent of the amount of the gross income not derived from such trade or business. For the purposes of this paragraph deductions and gross income shall be computed with the exceptions, additions, and limitations specified in paragraphs (1) to (4) of this subsection. Sec. 122. (d) (6) There shall be allowed as a deduction the amount of tax imposed by Subchapter E of Chapter 2 paid or accrued within the taxable year, subject to the following rules (A) No reduction in such tax shall be made by reason of the credit for income, war-profits, or excess-profits taxes paid to any foreign country or possession of the United States; (B) Such tax shall be computed without regard to the adjustments provided in section 734; and (C) Such tax, in the case of a consolidated return for excessprofits tax purposes, shall be allocated to the members of the affiliated group under regulations prescribed by the Commissioner, with the approval of the Secretary. Sec. 122. (e) No carry-back to year prior to 1941.-As used in this section, the term "preceding taxable year" and the term "preceding taxable years" do not include any taxable year beginning prior to January 1, 1941. Sec. 123. (c) The election provided for in subsection (a) with respect to taxable years beginning after December 31, 1938, and before January 1, 1942, may be exercised by the taxpayer at, or at any time prior to the time prescribed for the filing of the taxpayer's return for the taxable year of the taxpayer beginning in 1942, or if there is more than one taxable year of the taxpayer beginning in 1942, for the last taxable year so beginning, provided the records of the taxpayer are sufficient to permit an accurate computation of income for such years, and the taxpayer consents in writing to the assessment, within such period as may be agreed upon, of any deficiency for such years, even though the statutory period for the assessment of any such deficiency had expired prior to the filing of such consent. |