Gifts Made During 1944 to 1949, Inclusive tion of cruelty to children or animals; no part of the net earnings of which inures to the benefit of any private shareholder or individual, and no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation; Sec. 1004. (b) (3) a trust, or community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, including the encouragement of art and the prevention of cruelty to children or animals, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation; but only if such gifts are to be used within the United States exclusively for such purposes; Sec. 1004. (b) (4) a fraternal society, order, or association, operating under the lodge system, but only if such gifts are to be used within the United States exclusively for religious, charitable, scientific, literary, or educational purposes, including the encouragement of art and the prevention of cruelty to children or animals; Sec. 1004. (b) (5) posts or organizations of war veterans, or auxiliary units or societies of any such posts or organizations, if such posts, organizations, units, or societies are organized in the United States or any of its possessions, and if no part of their net earnings inures to the benefit of any private shareholder or individual; Sec. 1004. (b) (6) the special fund for vocational rehabilitation authorized by section 12 of the World War Veterans' Act, 1924, 43 Stat. 611 (U. S. C., Title 38, § 440); Sec. 1004. (b) (7) the United Nations, but only if such gifts (A) are to be used exclusively for the acquisition of a site in the city of New York for its headquarters, and (B) are made after December 1, 1946, and before December 2, 1947. Sec. 1004 (b) (7), I. R. C., supra, added to I. For any amendments prior to 1944, see- Sec. 1004. (c) Extent of deductions.-The deductions provided in subsection (a) (2) or (3) or in subsection (b) shall be allowed only to the extent that the gifts therein specified are included in the amount of gifts against which such deductions are applied. Sec. 1004 (c), I. R. C., supra, amended by Sec. For any amendments prior to 1944, see- Sec. 1005. Gifts made in property. If the gift is made in property, the value thereof at the date of the gift shall be considered the amount of the gift. Sec. 1005, I. R. C., supra, originated 1924 as Sec. 320, R. A. of 1924. For any amendments prior to 1944, see- Sec. 1006. Returns. Sec. 1006. (a) Requirement.-Any individual who within the calendar year 1940 or any calendar year thereafter makes any transfers by gift (except those which under section 1003 are not to be included in the total amount of gifts for such year) shall make a return under oath in duplicate. The return shall set forth (1) each gift made during the calendar year which under section 1003 is to be included in computing net gifts; (2) the deductions claimed and allowable under section 1004; (3) the net gifts for each of the preceding calendar years; and (4) such further information as may be required by regulations made pursuant to law. Sec. 1006. (b) Time and place for filing.—The return shall be filed on or before the 15th day of March following the close of the calendar year with the collector for the district in which is located the legal residence of the donor, or if he has no legal residence in the United States, then (unless the Commissioner designates another district) with the collector at Baltimore, Maryland. Sec. 1006, I. R. C., supra, originated 1924 as Sec. For any amendments prior to 1944, see- Ninth Edition, p. 1088. Sec. 1007. Records and specials returns. Sec. 1007. (a) By donor.-Every person liable to any tax imposed by this chapter or for the collection thereof, shall keep such records, render under oath such statements, make such returns, and comply with such rules and regulations, as the Commissioner, with the approval of the Secretary, may from time to time prescribe. Sec. 1007. (b) To determine liability to tax.Whenever in the judgment of the Commissioner necessary he may require any person, by notice served upon him, to make a return, render under oath such statements, or keep such records, as the Commissioner deems sufficient to show whether or not such person is liable to tax under this chapter. Sec. 1007, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1008. Payment of tax. Sec. 1008. (a) Time of payment.—The tax imposed by this chapter shall be paid by the donor on or before the 15th day of March following the close of the calendar year. Sec. 1008. (b) Extension of time for payment.— At the request of the donor, the Commissioner may extend the time for payment of the amount determined as the tax by the donor, for a period not to exceed six months from the date prescribed for the Gifts Made During 1944 to 1949, Inclusive payment of the tax. In such case the amount in respect of which the extension is granted shall be paid on or before the date of the expiration of the period of the extension. Sec. 1008. (c) Voluntary advance payment.A tax imposed by this chapter, may be paid, at the election of the donor, prior to the date prescribed for its payment. Sec. 1008. (d) Fractional parts of cent.-In the payment of any tax under this chapter a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to 1 cent. Sec. 1008. (e) Receipts.-The collector to whom any payment of any gift tax is made shall, upon request, grant to the person making such payment a receipt therefor. Sec. 1008, supra, originated 1924 as Sec. 324, For any amendments prior to 1944, see The tax imposed by this chapter shall be a lien upon all gifts made during the calendar year, for ten years from the time the gifts are made. If the tax is not paid when due, the donee of any gift shall be personally liable for such tax to the extent of the value of such gift. Any part of the property comprised in the gift sold by the donee to a bona fide purchaser for an adequate and full consideration in money or money's worth shall be divested of the lien herein imposed and the lien, to the extent of the value of such gift, shall attach to all the property of the donee (including after-acquired property) except any part sold to a bona fide purchaser for an adequate and full consideration in money or money's worth. If the Commissioner is satisfied that the tax liability has been fully discharged or provided for, he may, under regulations prescribed by him with the approval of the Secretary, issue his certificate, releasing any or all of the property from the lien herein imposed. Sec. 1009, I. R. C., supra, originated 1932 as Sec. 510, R. A. of 1932. For any amendments prior to 1944, see Eighth Edition, p. 549, Ninth Edition, p. 1090. Sec. 1010. Examination of return and determination of tax. As soon as practicable after the return is filed the Commissioner shall examine it and shall determine the correct amount of the tax. Sec. 1010, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1011. Definition of deficiency. As used in this chapter in respect of the tax imposed by this chapter the term "deficiency" meansSec. 1011. (1) The amount by which the tax imposed by this chapter exceeds the amount shown as the tax by the donor upon his return; but the amount so shown on the return shall first be increased by the amounts previously assessed (or collected without assessment) as a deficiency, and decreased by the amounts previously abated, refunded, or otherwise repaid in respect of such tax; or Sec. 1011. (2) If no amount is shown as the tax by the donor upon his return, or if no return is made by the donor, then the amount by which the tax exceeds the amounts previously assessed (or collected without assessment) as a deficiency; but such amounts previously assessed, or collected without assessment, shall first be decreased by the amounts previously abated, refunded, or otherwise repaid in respect of such tax. Sec. 1011, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1012. Assessment and collection of deficiencies. Sec. 1012. (a) (1) Petition to Board of Tax Appeals. If the Commissioner determines that there is a deficiency in respect of the tax imposed by this chapter, the Commissioner is authorized to send notice of such deficiency to the donor by registered mail. Within 90 days after such notice is mailed (not counting Saturday, Sunday or a legal holiday in the District of Columbia as the ninetieth day), the donor may file a petition with the Board of Tax Appeals for a redetermination of the deficiency. No assessment of a deficiency in respect of the tax imposed by this chapter and no distraint or proceeding in court for its collection shall be made, begun, or prosecuted until such notice has been mailed to the donor, nor until the expiration of such 90-day period, nor, if a petition has been filed with the Board, until the decision of the Board has become final. Notwithstanding the provisions of section 3653 (a) the making of such assessment or the beginning of such proceeding or distraint during the time such prohibition is in force may be enjoined by a proceeding in the proper court. If the notice is addressed to a donor outside the States of the Union and the District of Columbia, the period specified in this paragraph shall be one hundred and fifty days in lieu of ninety days. Sec. 1012 (a) (1), I. R. C., supra, amended by Sec. 203 (a), Act of Dec. 29, 1945, by adding word "Saturday." Sec. 203 (b) of said Act makes amendment effective as of September 8, 1945. Sec. 1012. (a) (2) Cross references.— For exceptions to the restrictions imposed by this subsection see Subsection (d) of this section, relating to waivers by the donor; Subsection (f) of this section, relating to notifications of mathematical errors appearing upon the face of the return; Section 1013, relating to jeopardy assessments; Section 1015, relating to bankruptcy and receiverships; and Section 1145, relating to assessment or collection of the amount of the deficiency determined by the Board pending court review. Gifts Made During 1944 to 1949, Inclusive Sec. 1012. (b) Collection of deficiency found by Board.-If the donor files a petition with the Board, the entire amount redetermined as the deficiency by the decision of the Board which has become final shall be assessed and shall be paid upon notice and demand from the collector. No part of the amount determined as a deficiency by the Commissioner but disallowed as such by the decision of the Board which has become final shall be assessed or be collected by distraint or by proceeding in court with or without assessment. Sec. 1012. (c) Failure to file petition.—If the donor does not file a petition with the Board within the time prescribed in subsection (a) the deficiency, notice of which has been mailed to the donor, shall be assessed, and shall be paid upon notice and demand from the collector. Sec. 1012. (d) Waiver of restrictions.-The donor shall at any time have the right, by a signed notice in writing filed with the Commissioner, to waive the restrictions provided in subsection (a) on the assessment and collection of the whole or any part of the deficiency. Sec. 1012. (e) Increase of deficiency after notice mailed.-The Board shall have jurisdiction to redetermine the correct amount of the deficiency even if the amount so redetermined is greater than the amount of the deficiency, notice of which has been mailed to the donor, and to determine whether any additional amount or addition to the tax should be assessed, if claim therefor is asserted by the Commissioner at or before the hearing or a rehearing. Sec. 1012. (f) Further deficiency letters restricted. If the Commissioner has mailed to the donor notice of a deficiency as provided in subsection (a) of this section, and the donor files a petition with the Board within the time prescribed in such subsection, the Commissioner shall have no right to determine any additional deficiency in respect of the same calendar year, except in the case of fraud, and except as provided in subsection (e) of this section, relating to assertion of greater deficiencies before the Board, or in section 1013 (c), relating to the making of jeopardy assessments. If the donor is notified that, on account of a mathematical error appearing upon the face of the return, an amount of tax in excess of that shown upon the return is due, and that an assessment of the tax has been or will be made on the basis of what would have been the correct amount of tax but for the mathematical error, such notice shall not be considered (for the purposes of this subsection, or of subsection (a) of this section, prohibiting assessment and collection until notice of deficiency has been mailed, or of section 1027 (c), prohibiting credits or refunds after petition to the Board of Tax Appeals) as a notice of a deficiency, and the donor shall have no right to file a petition with the Board based on such notice, nor shall such assessment or collection be prohibited by the provisions of subsection (a) of this section. Sec. 1012. (g) Jurisdiction over other calendar years.-The Board in redetermining a deficiency in respect of any calendar year shall consider such facts with relation to the taxes for other calendar years as may be necessary correctly to redetermine the amount of such deficiency, but in so doing shall have no jurisdiction to determine whether or not the tax for any other calendar year has been overpaid or underpaid. Sec. 1012. (h) Final decisions of Board.-For the purposes of this chapter the date on which a decision of the Board becomes final shall be determined according to the provisions of section 1140. Sec. 1012. (i) Extension of time for payment of deficiencies. Where it is shown to the satisfaction of the Commissioner that the payment of a deficiency upon the date prescribed for the payment thereof will result in undue hardship to the donor the Commissioner, under regulations prescribed by the Commissioner, with the approval of the Secretary (except where the deficiency is due to negligence, to intentional disregard of rules and regulations, or to fraud with intent to evade tax), may grant an extension for the payment of such deficiency or any part thereof for a period not in excess of eighteen months, and, in exceptional cases, for a further period not in excess of twelve months. If an extension is granted, the Commissioner may require the donor to furnish a bond in such amount, not exceeding double the amount of the deficiency, and with such sureties, as the Commissioner deems necessary, conditioned upon the payment of the deficiency in accordance with the terms of the extension. Sec. 1012. (j) Address for notice of deficiency.— In the absence of notice to the Commissioner under section 1026 (a) of the existence of a fiduciary relationship, notice of a deficiency in respect of a tax imposed by this chapter, if mailed to the donor at his last known address, shall be sufficient for the purposes of this chapter even if such donor is deceased, or is under a legal disability. Sec. 1012, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1013. Jeopardy assessments. Sec. 1013. (a) Authority for making.-If the Commissioner believes that the assessment or collection of a deficiency will be jeopardized by delay, he shall immediately assess such deficiency (together with all interest, additional amounts, or additions to the tax provided for by law) and notice and demand shall be made by the collector for the payment thereof. Sec. 1013. (b) Deficiency letters.-If the jeopardy assessment is made before any notice in respect of the tax to which the jeopardy assessment relates has been mailed under section 1012 (a), then the Commissioner shall mail a notice under such subsection within 60 days after the making of the assessment. Gifts Made During 1944 to 1949, Inclusive Sec. 1013. (c) Amount assessable before decision of Board.-The jeopardy assessment may be made in respect of a deficiency greater or less than that notice of which has been mailed to the donor, despite the provisions of section 1012 (f) prohibiting the determination of additional deficiencies, and whether or not the donor has theretofore filed a petition with the Board of Tax Appeals. The Commissioner may, at any time before the decision of the Board is rendered, abate such assessment, or any unpaid portion thereof, to the extent that he believes the assessment to be excessive in amount. The Commissioner shall notify the Board of the amount of such assessment, or abatement, if the petition is filed with the Board before the making of the assessment or is subsequently filed, and the Board shall have jurisdiction to redetermine the entire amount of the deficiency and of all amounts assessed at the same time in connection therewith. Sec. 1013. (d) Amount assessable after decision of Board.-If the jeopardy assessment is made after the decision of the Board is rendered such assessment may be made only in respect of the deficiency determined by the Board in its decision. Sec. 1013. (e) Expiration of right to assess.-A jeopardy assessment may not be made after the decision of the Board has become final or after the donor has filed a petition for review of the decision of the Board. Sec. 1013. (f) Bond to stay collection.-When a jeopardy assessment has been made the donor, within 10 days after notice and demand from the collector for the payment of the amount of the assessment, may obtain a stay of collection of the whole or any part of the amount of the assessment by filing with the collector a bond in such amount, not exceeding double the amount as to which the stay is desired, and with such sureties, as the collector deems necessary, conditioned upon the payment of so much of the amount, the collection of which is stayed by the bond, as is not abated by a decision of the Board which has become final, together with interest thereon as provided in section 1022 or 1023 (b) (4). If any portion of the jeopardy assessment is abated by the Commissioner before the decision of the Board is rendered, the bond shall, at the request of the taxpayer, be proportionately reduced. Sec. 1013. (g) Same-Further conditions.-If the bond is given before the donor has filed his petition with the Board under section 1012 (a), the bond shall contain a further condition that if a petition is not filed within the period provided in such subsection, then the amount the collection of which is stayed by the bond will be paid on notice and demand at any time after the expiration of such period, together with interest thereon at the rate of 6 per centum per annum from the date of the jeopardy notice and demand to the date of notice and demand under this subsection. Sec. 1013. (h) Waiver of stay.-Upon the filing of the bond the collection of so much of the amount assessed as is covered by the bond shall be stayed. The donor shall have the right to waive such stay at any time in respect of the whole or any part of the amount covered by the bond, and if as a result of such waiver any part of the amount covered by the bond is paid, then the bond shall, at the request of the donor, be proportionately reduced. If the Board determines that the amount assessed is greater than the amount which should have been assessed, then when the decision of the Board is rendered the bond shall, at the request of the donor, be proportionately reduced. Sec. 1013. (i) Collection of unpaid amounts.When the petition has been filed with the Board and when the amount which should have been assessed has been determined by a decision of the Board which has become final, then any unpaid portion, the collection of which has been stayed by the bond, shall be collected as part of the tax upon notice and demand from the collector, and any remaining portion of the assessment shall be abated. If the amount already collected exceeds the amount determined as the amount which should have been assessed, such excess shall be credited or refunded as provided in section 1027, without the filing of claim therefor. If the amount determined as the amount which should have been assessed is greater than the amount actually assessed, then the difference shall be assessed and shall be collected as part of the tax upon notice and demand from the collector. Sec. 1013, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Ninth Edition, p. 1100. Sec. 1014. Claims in abatement. No claim in abatement shall be filed in respect of any assessment in respect of any tax imposed by this chapter. Sec. 1014, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1015. Bankruptcy and receiverships. Sec. 1015. (a) Immediate assessment.-Upon the adjudication of bankruptcy of any donor in any bankruptcy proceeding or the appointment of a receiver for any donor in any receivership proceeding before any court of the United States or of any State or Territory or of the District of Columbia, any deficiency (together with all interest, additional amounts, or additions to the tax provided for by law) determined by the Commissioner in respect of a tax imposed by this chapter upon such donor shall, despite the restrictions imposed by section 1012 (a) upon assessments be immediately assessed if such deficiency has not theretofore been assessed in accordance with law. Claims for the deficiency and such interest, additional amounts and additions to the tax may be presented, for adjudication in accordance with law, to the court before which the bankruptcy or receivership proceeding is pending, despite Gifts Made During 1944 to 1949, Inclusive the pendency of proceedings for the redetermination of the deficiency in pursuance of a petition to the Board; but no petition for any such redetermination shall be filed with the Board after the adjudication of bankruptcy or the appointment of the receiver. Sec. 1015. (b) Unpaid claims.-Any portion of the claim allowed in such bankruptcy or receivership proceeding which is unpaid shall be paid by the donor upon notice and demand from the collector after the termination of such proceeding, and may be collected by distraint or proceeding in court within six years after termination of such proceeding. Extensions of time for such payment may be had in the same manner and subject to the same provisions and limitations as are provided in sections 1012 (i), 1020 (b), and 1023 (b) (3) in the case of a deficiency in a tax imposed by this chapter. Sec. 1015, I. R. C., supra, originated 1932 as Sec. 516, R. A. of 1932. For any amendments prior to 1944, see Eighth Edition, p. 551, Sec. 1016. Period of limitation upon assessment and collection. Sec. 1016. (a) General rule.-Except as provided in subsection (b), the amount of taxes imposed by this chapter shall be assessed within three years after the return was filed, and no proceeding in court without assessment for the collection of such taxes shall be begun after the expiration of three years after the return was filed. Sec. 1016. (b) Exceptions.— Sec. 1016. (b) (1) False return or no return.— 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 proceeding in court for the collection of such tax may be begun without assessment, at any time, Sec. 1016. (b) (2) Collection after assessment.Where the assessment of any tax imposed by this chapter has been made within the statutory period of limitation properly applicable thereto, such tax may be collected by distraint or by a proceeding in court, but only if begun (1) within six years after the assessment of the tax, or (2) prior to the expiration of any period for collection agreed upon in writing by the Commissioner and the donor. Sec. 1016, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Edition, p. 1106. Sec. 1017. Suspension of running of statute. The running of the statute of limitations provided in section 1016 on the making of assessments and the beginning of distraint or a proceeding in court for collection, in respect of any deficiency, shall (after the mailing of a notice under section 1012 (a)) be suspended for the period during which the Commissioner is prohibited from making the assessment or beginning distraint or a proceeding in court (and in any event, if a proceeding in respect of the deficiency is placed on the docket of the Board, until the decision of the Board becomes final), and for 60 days thereafter. Sec. 1017, I. R. C., supra, originated 1932 as Sec. 518, R. A. of 1932. For any amendments prior to 1944, see Eighth Edition, p. 552, Ninth Edition, p. 1108. Sec. 1018. Addition to the tax in case of delinquent return. For addition to the tax in case of failure to make and file a return required by this chapter within the time prescribed by law or prescribed by the Commissioner in pursuance of the law, see section 3612 (d) (1). Sec. 1018, I. R. C., supra, originated 1932 as Sec. For any amendments prior to 1944, see- Sec. 1019. Additions to the tax in case of deficiency. Sec. 1019. (a) Negligence.-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 section 1021, relating to interest on deficiencies, shall not be applicable. Sec. 1019. (b) (Fraud).—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 3612 (d) (2). Sec. 1019, I. R. C., supra, originated 1932 as Sec. 520, R. A. of 1932. For any amendments prior to 1944, see- Sec. 1020. Interest on extended payments. Sec. 1020. (a) Tax shown on return.-If the time for payment of the amount determined as the tax by the donor is extended under the authority of section 1008 (b), there shall be collected as a part of such amount, interest thereon at the rate of 6 per centum per annum from the date when such payment should have been made if no extension had been granted, until the expiration of the period of the extension. Sec. 1020. (b) Deficiency.-In case an extension for the payment of a deficiency is granted, as provided in section 1012 (i), there shall be collected, as a part of the tax, interest on the part of the deficiency the time for payment of which is so extended, at the rate of 6 per centum per annum for the period of the extension, and no other interest shall be collected on such part of the deficiency for such period. Sec. 1020, I. R. C., supra, originated 1932 as Sec. 521, R. A. of 1932. |