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72d CONG RESS . SESS.I. CH. 209. JUNE 6,1932 . (c) TA XES GE NERA LLY .-Taxe s paid or accrue d within the ta xable year, except- (1) income, war-profits, and excess-profits taxes imposed-by the authority of the United States ; ( 2) income, war-pr ofits, and excess -profits taxes i mposed by the a uthority of any foreign countr y or possession of the United States ; but this deduction shall be allowed in the case of a tax- payer who does not signify in his return his desire to have to any exte nt the benefits o f section 131 (r elating to credit for taxes of foreign countries and possessions o the United States) ; and (3) taxes assessed against local benefits of a kind tending to increase the value of the property assessed ; but this paragraph shall not exclude the allowance as a deduction of so much of such taxes as is properly allocable to maintenance or interest char es . For the purpose of this subsection, estate, inheritance, legacy, and succession taxes accrue on the due date thereof, except as otherwise provided by the law of the jurisdiction imposing such taxes, and shall be allowed as a deduction only to the estate . (d) TAXES OF SHARFHoLDER PAm BY CORPORATION.-The deduction for taxes allo wed by subsecti on (c) shall be allowed to a cor pora- tion in the case of taxes imposed upon a shareholder of the corpora- tion upon his interest as shareholder which are paid by the corpora- tion without reimbursement from the shareholder but in such cases no deduction shall be allowed the shareholder for the amount of such taxes . (e) LOSSES BY INDIvmIIALS .-Subject to the limitations provided in subsection (r) of this section, i n the case of an individual, losses sus- tained during the taxable year and not compensated for by insurance or otherwise- 1 if incurred in trade or business ; or 2) if incurred in any transaction entered into for profit, though not connected with the trade or business ; or (3) of property not connected with the trade or business if the l oss arises from fires, storms, s hipwreck, or ot her casualty, or from theft . No loss shall be allowed as a deduction under this paragraph if at the time of the filing of the return such loss has been claimed as a deduction for estate tax purposes in the estate tax return . corpora. (f) LOSSES BY CORPORATIONS .-Subject to the limitations provided in subsection (r) of this section, in the case of a corporation, losses sustained during the taxable year and not compensated for by insur- ance or otherwise . to Basis for determining (g) BA SIS FOR DETERMINING Loss.-The basis for determining the amount of d eduction for los ses sustained, to be allowed un der sub- Po st,p .2014 section (e) or (f), shall be the adjusted basis provided in section 113 (b) for determining the gain or loss from the sale or other dis- po sit ion of pie rty . Disal lowance of los s (h) Loss ON W ASH SALES OF STOCK OR SECURITIES .-For disallow- on
sales of stock, a nte of loss deduct ion in the case of sales of stock o r securities where within thirty days before or after the date of the sale the taxpayer Post, P. M.
has acquire d substantially i dentical property , see section 11 8. Net losses of prior
(i) NET LossES .-The, special deduction for net losses of a prior ye t, p. 207.
year to the extent provid ed in section 117 . Worthless debts. (j5 BAD D EB T S : Debts a scertained to be worthless' and charged o ff w it h in .the taxable year (or, in the discretion of t he Commis- sioner, a reasonable addi tion to a reserve for bad debts) ; and wh en satisfied that a debt is recoverable only in part, the C9mmissioner INCOME TAX Taxes paid within taxable year . Exceptions . Pod, p . 211, Accruement of estate, etc., taxes. Limitation . Taxes of sh areh old er paid by corporation . Losses by individ. uals. Business . Not connected with trade or business. Ca sua lty los ses not co nnec ted with busi- ness. Di sal lowe d if de. ducted for estate-tax purposes . Losses by tions .
