222 INCOME TAX Ante, p. 191. Not losses . Allowance of special ded ucti on . Ante, p . 207. Taxes of foreign coun- tries, etc. Allowance against tax of beneficiary . Ante, p. 211 . Partnerships. Ind ivi dua l lia bil ity for tax . Tax of partners. Distributive share Included in net i ncome . Com puta tion . Partnership year em- bracin g calenda r years with different laws . Rates for year in which fiscal year be- gins. Rates for year in which fi scal year ends . Computation of rates. Partnership Income . Comp utat ion . Exc epti on . Charitable contribu- tion deduction not al- lowed . Ante. p. 181 . 72d CONGR ESS . SESS. I. CH . 209. JU NE 6, 1932 . provided in this Supplement, but at the rates and in the manner provided in section 101 (a) and (b), relating to capital net gains and losses . SEC. 169. NET LOSSES . The benefit of the special deduction for net losses allowed by section 117 shall be allowed to an estate or trust under regulations prescribed by the Commissioner with the approval of the Secretary . SEC. 170. T AXES OF FOR EIG N CO UNTR IES AND POS SES SION S OF UNITED STATES . The amount of income, war-profits, and excess-profits taxes im- posed by foreign countries or possessions of the United States shall be allowed as credit against the tax of the beneficiary of an estate or trust to the extent provided in section 131 . Supplem ent F-- Partner ships SEC . 181. PARTNERSHIP NOT TAXABLE . Individ uals carrying on bus iness in partnership shall be liable for income tax only in th eir individual capac ity . SEC . 182. TAX OF PARTNERS . (a) GEN ERA L RULE.-There shall be incl uded in com putin g the net income of each partner his distributive share, whether distributed or not, of the net income of the partnership for the taxable year . If the taxable year of a partner is different from that of the part- nership, the amount so included shall be based upon the income of the pa rtner ship for any taxable year of the part nershi p end ing within his taxable year . (b) PARTNERSHIP YEAR EMBRACING CALENDAR YEARS WITH DIFFER- ENT LAWS .-If a fiscal year of a partnership begins in one calendar year and ends in another calendar year, and the law applicable to the second calendar year is different from the law applicable to the first calendar year, then (1) the rates for the calendar year during which such fiscal year begins shall apply to an amount of each partner's share of such partnership net income (determined under the law applicable to such calendar year) equal to the proportion which the part of such fiscal year falling within such calendar year bears to the full fisca l year, an d (2) the rates for the calendar year during which such fiscal year ends shall apply to an amount of each partner's share of suc h par tnersh ip ne t inc ome (d eterm ined under the law appli- cable to such calendar year) equal to the proportion which the part of suc h fiscal year fallin g within such calend ar year bears to the full fiscal year . In such cases the part of such income subject to the rates in effect for the most recent calendar year shall be added to the other income of the taxpayer subject to such rates and the resulting amount shall be placed in the lower brackets of the rate schedule applicable to . such year, and the part of such income subject to the rates in effect, for the next preceding calendar year shall be placed in the next higher brackets of the rate schedule applicable to such year . SEC. 183. CO MPUT ATI ON OF PA RTN ERSH IP INCOME . The net income of the partnership shall he computed in the same manner and on the same basis as in the case of an individual, except that the so-called " charitable contribution " deduction provided in section 23(n) shall not be allowed .
