Taxable Years Beginning in 1949 Sec. 125. (c) (2) Manner and effect of election.-The election authorized under this subsection shall be made in accordance with such regulations as the Commissioner with the approval of the Secretary shall prescribe. If such election is made with respect to any bond (described in paragraph (1)) of the taxpayer, it shall also apply to all such bonds held by the taxpayer at the beginning of the first taxable year to which the election applies and to all such bonds thereafter acquired by him and shall be binding for all subsequent taxable years with respect to all such bonds of the taxpayer, unless, upon application by the taxpayer, the Commissioner permits him, subject to such conditions as the Commissioner deems necessary, to revoke such election. The election authorized under this subsection in the case of a member of a partnership shall be exercisable with respect to bonds of the partnership only by the partnership. In the case of bonds held by a common trust fund, as defined in section 169, or by a foreign personal holding company, as defined in section 331, the election authorized under this subsection shall be exercisable with respect to such bonds only by the common trust fund or foreign personal holding company. Taxable Years Beginning in 1948 Sec. 125. (c) (2) Manner and effect of election. Sec. Sec. 125. (d) Definition of bond. -As used in this section, the term bond. "bond" means any bond, debenture, note, or certificate or other evidence of indebtedness, issued by any corporation and bearing interest (including any like obligation issued by a government or political subdivision thereof), with interest coupons or in registered form, but does not include any such obligation which constitutes stock in trade of the taxpayer or any such obligation of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year, or any such obligation held by the taxpayer primarily for sale to customers in the ordi. nary course of his trade or busi ness. Same as 1944. Taxable Years Beginning in 1946 and 1947 Sec. 125. (c) (2) Manner and effect of election. Same as 1944. Sec. 126. Income in respect of decedents. Sec. 126. Income in respect of decedents. Sec. 126. Income in respect of decedents. Taxable Years Beginning in 1945 Sec. 125. (c) (2) Manner and effect of election. Same as 1944. Sec. 125. (d) Definition of bond. Same as 1944. Sec. 126. Income in respect of decedents. Taxable Years Beginning in 1944 Sec. 125. (c) (2) Manner and effect of election.-The election authorized under this subsection shall be made in accordance with such regulations as the Commissioner with the approval of the Secretary shall prescribe. If such election is made with respect to any bond (described in paragraph (1)) of the taxpayer, it shall also apply to all such bonds held by the taxpayer at the beginning of the first taxable year to which the election applies and to all such bonds thereafter acquired by him and shall be binding for all subsequent taxable years with respect to all such bonds of the taxpayer, unless, upon application by the taxpayer, the Commissioner permits him, subject to such conditions as the Commissioner deems necessary, to revoke such election. The election authorized under this subsection in the case of a member of a partnership shall be exercisable with respect to bonds of the partnership only by the partnership. In the case of bonds. held by a common trust fund, as defined in section 169, or by a foreign personal holding company, as defined in section 331, the election authorized under this subsection shall be exercisable with respect to such bonds only by the common trust fund or foreign personal holding company. Sec. 125. (d) Definition of bond. -As used in this section, the term "bond" means any bond, debenture, note, or certificate or other evidence of indebtedness, issued by any corporation and bearing interest (including any like obligation issued by a government or political subdivision thereof), with interest coupons or in registered form, but does not include any such obligation which constitutes stock in trade of the taxpayer or any such obligation of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year, or any such obligation held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business. Sec. 126. Income in respect of decedents. Taxable Years Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule.— The amount of all items of gross income in respect of a decedent which are not properly includible in respect of the taxable period in which falls the date of his death or a prior period shall be included in the gross income, for the taxable year when received, of: (A) the estate of the decedent, if the right to receive the amount is acquired by the decedent's estate from the decedent; (B) the person who, by reason of the death of the decedent, acquires the right to receive the amount, if the right to receive the amount is not acquired by the decedent's estate from the decedent; or (C) the person who acquires from the decedent the right to receive the amount by bequest, devise, or inheritance, if the amount is received after a distribution by the decedent's estate of such right. Sec. 126. (a) (2) Income in case of sale, etc.—If a right, described in paragraph (1), to receive an amount is transferred by the estate of the decedent or a person who receives such right by reason of the death of the decedent or by bequest, devise, or inheritance from the decedent, there shall be included in the gross income of the estate or such person, as the case may be, for the taxable period in which the transfer occurs, the fair market value of such right at the time of such transfer plus the amount by which any consideration for the transfer exceeds such fair market value. For the purposes of this paragraph, the term "transfer" includes sale, exchange, or other disposition, but does not include a transfer to a person pursuant to the right of such person to receive such amount by reason of the death of the decedent or by bequest devise, or inheritance from the decedent. Taxable Years Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule. Sec. 126. (a) (2) Income in case of sale, etc. Same as 1944. Sec. 126. (a) (3) Character of Sec. 126. (a) (3) Character of income determined by reference income determined by reference to decedent.-The right, described to decedent. in paragraph (1), to receive an Same as 1944. Taxable Years Beginning in 1946 and 1947 Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule. Sec. 126. (a) (2) Income in case of sale, etc. Same as 1944. Sec. 126. (a) (3) Character of income determined by reference to decedent. Same as 1944. Taxable Years Beginning in 1945 Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule. Same as 1944. Sec. 126. (a) (2) Income in case of sale, etc. Same as 1944. Sec. 126. (a) (3) Character of income determined by reference to decedent. Same as 1944. Taxable Years Beginning in 1944 Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule.— The amount of all items of gross income in respect of a decedent which are not properly includible in respect of the taxable period in which falls the date of his death or a prior period shall be included in the gross income, for the taxable year when received, of: (A) the estate of the decedent, if the right to receive the amount is acquired by the decedent's estate from the decedent; (B) the person who, by reason of the death of the decedent, acquires the right to receive the amount, if the right to receive the amount is not acquired by the decedent's estate from the decedent; or (C) the person who acquires from the decedent the right to receive the amount by bequest, devise, or inheritance, if the amount is received after a distribution by the decedent's estate of such right. Sec. 126. (a) (2) Income in case of sale, etc.—If a right, described in paragraph (1), to receive an amount is transferred by the estate of the decedent or a person who receives such right by reason of the death of the decedent or by bequest, devise, or inheritance from the decedent, there shall be inIcluded in the gross income of the estate or such person, as the case may be, for the taxable period in which the transfer occurs, the fair market value of such right at the time of such transfer plus the amount by which any consideration for the transfer exceeds such fair market value. For the purposes of this paragraph, the term "transfer" includes sale, exchange, or other disposition, but does not inIclude a transfer to a person pursuant to the right of such person to receive such amount by reason of the death of the decedent or by bequest, devise, or inheritance from the decedent. Sec. 126. (a) (3) Character of income determined by reference to decedent.-The right, described in paragraph (1), to receive an Taxable Years Beginning before 1944 Sec. 126. (a) Inclusion in gross income. Sec. 126. (a) (1) General rule. Ninth Edition, p. 363. Sec. 126. (a) (2) Income in case of sale, etc. Section originated 1942 as Ninth Edition, p. 364. Sec. 126. (a) (3) Character of income determined by reference to decedent. Section originated 1942 as Taxable Years Beginning in 1949 amount shall be treated, in the hands of the estate of the decedent or any person who acquired such right by reason of the death of the decedent, or by bequest, devise, or inheritance from the decedent, as if it had been acquired by the estate or such person in the transaction by which the decedent acquired such right; and the amount includible in gross income under paragraph (1) or (2) shall be considered in the hands of the estate or such person to have the character which it would have had in the hands of the decedent if the decedent had lived and received such amount. Sec. 126. (b) Allowance of deductions and credit.-The amount of any deduction specified in section 23 (a), (b), (c), or (m) (relating to deductions for expenses, interest, taxes, and depletion) or credit specified in section 31 (foreign tax credit), in respect of a decedent which is not properly allowable to the decedent in respect of the taxable period in which falls the date of his death, or a prior period shall be allowed: Sec. 126. (b) (1) Expenses, interest, and taxes.-In the case of a deduction specified in section 23 (a), (b), or (c) and a credit specified in section 31, in the taxable year when paid, (A) to the estate of the decedent; except that (B) if the estate of the decedent is not liable to discharge the obligation to which the deduction or credit relates, to the person who, by reason of the death of the decedent or by bequest, devise, or inheritance acquires, subject to such obligation, from the decedent an interest in property of the decedent. Sec. 126. (b) (2) Depletion.-In the case of the deduction specified in section 23 (m), to the person described in subsection (a) (1) (A), (B), or (C) who, in the manner described therein, receives the income to which the deduction relates, in the taxable year when such income is received. |