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Sec. 7(c), Act of October 25, 1949, in footnote 18, Tenth Edition, p. 747, was amended by Pub. Law 761, approved September 6, 1950, to read as follows:

"(c) If refund or credit of any overpayment resulting from the application of subsections (a) and (b) is prevented on the date of the enactment of this Act, or within one year from such date, by the operation of any law or rule of law (other than section 3760 of the Internal Revenue Code, relating to closing agreements, and other than section 3761 of such code, relating to compromises), refund or credit of such overpayment may, nevertheless, be made or allowed if claim therefor is filed within one year from the date of the enactment of this Act. This subsection shall not apply with respect to a transfer of property in case (1) the decedent retained for his life or for any period not ascertainable without reference to his death or for any period which did not in fact end before his death (A) the possession or enjoyment of, or the right to the income from, the property, or (B) the right, either alone or in conjunction with any person, to designate the persons who should possess or enjoy the property or the income therefrom, and (2) refund or credit of any overpayment resulting from the application of subsections (a) and (b) was prevented on or before January 16, 1949, by the operation of any law or rule of law."

SECTION 811 (c) (1) (A)- AMENDED.

Sec. 501 (b) (1), RA of 1950, amended Sec. 811(c) (1) (A), IRC, to read as follows:

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Sec. 501 (b)(2), RA of 1950, amended Sec. 811(d), IRC, by striking out paragraph (4) thereof.

Sec. 501(c), RA of 1950, makes amendment applicable to estates of decedents dying after Sept. 23, 1950.

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Sec. 403(d)(3), RA of 1942, in footnote 21a, Tenth Edition, p. 749, was amended by Pub. Law 578, 81st Cong., extending time of release of power of appointment to July 1, 1951.

SECTION 811(g).

Sec. 503, RA of 1950, reads as follows:

SEC. 503. REVERSIONARY INTERESTS IN CASE OF LIFE INSURANCE.

(a) AMENDMENT OF SECTION 404 (c) OF REVENUE ACT OF 1942.— Effective with respect to estates of decedents dying after October 21, 1942, section 404 (c) of the Revenue Act of 1942 is hereby amended by adding at the end thereof the following: "For the purposes of the preceding sentence, the term 'incident of ownership' includes a reversionary interest only if (1) at some time after January 10, 1941, the value of such reversionary interest exceeded 5 per centum of the value of the policy, and (2) the reversionary interest arose by the express terms of the policy or other instrument and not by operation of law. As used in this subsection, the term 'reversionary interest' includes a possibility that the policy, or the proceeds of the policy, (A) may return to the decedent or his estate, or (B) may be subject to a power of disposition by him. The value of a reversionary interest at any time shall be determined (without regard to the fact of the decedent's death) by usual methods of valuation, including the use of tables of mortality and actuarial principles, pursuant to regulations prescribed by the Secretary. In determining the value of a possibility that the policy or proceeds thereof may be subject to a power of disposition by the decedent, such possibility shall be valued as if it were a possibility that such policy or proceeds may return to the decedent or his estate.

(b) NO INTEREST ON REFUNDS.-No interest shall be allowed or paid on any overpayment resulting from the application of subsection (a) with respect to any payment made prior to the date of the enactment of this Act.

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Sec. 501(a), RA of 1950, amended Sec. 811 by striking out "(1)" at the beginning of subsection (1) and inserting "(m)" in lieu thereof, and by inserting after subsection (k) the following:

"(1) CONTEMPLATION OF DEATH.-If the decedent within a period of three years ending with the date of his death (except in case of a bona fide sale for an adequate and full consideration in money or money's worth) transferred an interest in property, relinquished a power, or exercised or released a power of appointment, such transfer, relinquishment, exercise, or release shall, unless shown to the contrary, be deemed to have been made in contemplation of death within the meaning of subsections (c), (d), and (f); but no such transfer, relinquishment, exercise, or release made prior to such three-year period shall be deemed or held to have been inade in contemplation of death."

Sec. 501(c), RA of 1950, makes amendment applicable to estates of decedents. dying after Sept. 23, 1950.

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SECTION 812(b) - AMENDED.

Sec. 502, RA of 1950, amended Sec. 812(b), IRC, as follows:

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"For disallowance of certain charitable, etc., deductions otherwise allowable under this subsection, see sections 3813 and 162(g)(2)."

SECTION 861(a)(3) - AMENDED.

Sec. 332(f), RA of 1950, amended Sec. 861(a)(3), IRC, by adding at the end thereof the following:

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Sec. 1, Pub. Law 749, approved September 1, 1950, added to Sec. 863, IRC, subsection (c), which reads as follows:

"(c) WORKS OF ART ON LOAN FOR EXHIBITION.-Works of art owned by a nonresident not a citizen of the United States imported into the United States solely for exhibition purposes, loaned to the Trustees of the National Gallery of Art for such purpose, and, at the time of the death of the owner, on exhibition, or en route to or from exhibition, either in the National Gallery of Art or in such other public gallery or museum as the Trustees of the National Gallery of Art may have designated."

Sec. 4, Pub. Law 749, makes amendment applicable to estates of decedents dying after Sept. 1, 1950.

SECTION 1000(c).

Sec. 452(c), RA of 1942, was amended by Pub. Law 578, 81st Cong., extending time of release of powers of appointment to July 1, 1951.

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Sec. 332(g), RA of 1950, amended Sec. 1004(a)(2) (B), IRC, by striking out "legislation;" and inserting in lieu thereof the following:

"legislation. For disallowance of certain charitable, etc., deductions otherwise allowable under this subparagraph, see sections 3813 and 162(g)(2);".

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Sec. 332(h), RA of 1950, amended Sec. 1004(b), IRC, by adding at the end thereof the following:

"For disallowance of certain charitable, etc., deductions otherwise allowable under paragraphs (2) and (3), see sections 3813 and 162(g)(2)."

SECTION 1621 (a) - AMENDED.

Sec. 202(b), RA of 1950, amended Sec. 1621(a), IRC, by inserting before paragraph (2) thereof the following, and makes amendment effective with respect to wages paid after October 31, 1950:

"(1) for active service as a member of the armed forces of the United States performed prior to January 1, 1952, in a month during any part of which such member performed service in a combat zone as determined under section 22 (b) (13), or".

SECTION 1621(a) (6) - AMENDED.

Sec. 221(f)(1), RA of 1950, amended Sec. 1621(a) (6), IRC, to read as follows:

"(6) for services performed by a nonresident alien individual, other than (A) a resident of a contiguous country who enters and leaves the United States at frequent intervals, or (B) a resident of Puerto Rico if such services are performed as an employee of the United States or any agency thereof, or".

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