SEVENTIETH CONGRESS . SESS . I. Cu. 852 . 1928.
811 SEC. 64. SHORT TITLE . This title may be cited as the " Income Tax Act of 1928 ." SEC. 65 . EFFECTIVE DATE OF TITLE . This title shall take effect as of January 1, 1928, except that sections 146 and 15 1, and thi s sec ti on, shall tak e effect on the enactment of this Act . SUBTITLE SUPP LE MENTAL PROVISIONS Supplement A-Rates of Tax [Supplementary to Subtitle B, Part I] INCOME TAX Snort title . "Income Tax Act of 1928." Effec tive date . January 1, 1928 . Ex cept ions . Post, pp . 835, 838. Supplemental provi. sion . Rates of tax . Capital net gains and losse s. Computation of of net gain. SEC. 101. CAPITAL NET GAINS AND LOSSES . (a) Tax in case of capital net gain .-In the case of any tax- payer, other than a corporation, who for any taxable year derives a capital net gain (as hereinafter defined in this section), there shall, at the election of the taxpayer, be le vied, collected, and paid, in li eu of all other taxes imposed by this title, a tax determined as follows
a p artial t ax shall first b e comput ed upon the basi s of the ordinar y net income at the rates and in the manner as if this section had not been enacted and the total tax shall be this amount plus 121/2 per centum of the capital net gain . (b) Tax in case of capital net loss .-In the cas e of any tax - payer, other than a corporation, who for any taxable year sustains a capi tal net loss (as hereinafter def ined in this sec tion), there sha ll be levied, collected, and paid, in lieu of all other taxes imposed by this title, a tax determined as follows : a partial tax shall first be computed upon the basis of the ordinary net income at the rates and in the manner as if this section had not been enacted, and the total tax shall be this amount minus 121/2 per centum of the capital net loss ; but in no case shall the tax of a taxpayer who has sustained a capi tal net loss be less tha n the ta x comput ed withou t regard to the provisions of this section . (c) Defi niti ons .-F or the purposes of t his title- (1) "Capital gain" means taxable gain from the sale or e xcha nge of c apit al assets co nsum mate d af ter Dece mber 31, 1921 . (2) " Capital loss " means deductible loss resulting from the sale or exchange of capital assets . (3) "Capital deductions" means such deductions as are "Capital deduc- allowed by section 23 for the purpose of computing net income, tions ." and are properly allocable to or chargeable against capital assets sold or exchanged during the taxable year . (4) "Ordinary deductions" me ans the de duc ti ons allowed by tionOr dinary ded uc- section 23 other than capital losses and capital deductions . (5) "Capital net gain" means the excess of the total amount of capital gain over the sum of (A) the capital deductions and capital losses, plus (B) the amount, if any, by which the ordi- nary deductions exceed the gross income computed without in cluding capital gains . (6) " Capital net loss " means the excess of the sum of the ca pital lo sses plu s the ca pital de ductions over th e total amount of capital gain . (7) " Ordinary net income " means the net inc om e, computed "Ordinary net in accordance with the provisions of this title, after excluding e°me .° all items of capital gain, capital loss, and capital deductions . (8) "Capital assets" means property held by the taxpayer for more than two years (wh ether or not connected with his 54535°-29-PT 1
55 Computation of of net loss. Meaning of terms . "Capita l gain ." "Capital loss ." tax tax "Capital net gain." "Capital net loss ." in- "Capital assets ."
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