death, except in case of a bona fide sale for a fair consideration in money or money's worth; and

(f) To the extent of the amount receivable by the executor as insurance under policies taken out by the decedent upon his own life; and to the extent of the excess over $40,000 of the amount receivable by all other beneficiaries as insurance under policies taken out by the decedent upon his own life.

For the purpose of this Act stock in a domestic corporation owned and held by a non-resident decedent, and the amount receivable as insurance upon the life of a non-resident decedent where the insurer is a domestic corporation, shall be deemed property within the United States, and any property of which the decedent has made a transfer or with respect to which he has created a trust, within the meaning of subdivision (c) shall be deemed to be situated in the United States, if so situated either at the time of the transfer or the creation of the trust, or at the time of the decedent's death.

Net estate-how determined.

The value of the net estate shall be determined

(a) In the case of a resident, by deducting from the value of the gross estate

(1) Such amounts for funeral expenses, administration expenses, claims against the estate, unpaid mortgages, losses incurred during the settlement of the estate arising from fires, storms, shipwreck, or other casualty, or from theft, when such losses are not compensated for by insurance or otherwise, and such amounts reasonably required and actually expended for the support during the settlement of the estate of those dependent upon the decedent, as are allowed by the laws of the jurisdiction, whether within or without the United States, under which the estate is being administered, but not including any income taxes upon income received after the death of the decedent, or any estate, succession, legacy, or inheritance taxes;

(2) An amount equal to the value at the time of the decedent's death of any property, real, personal, or mixed,

which can be identified as having been received by the decedent as a share in the estate of any person who died within five years prior to the death of the decedent, or which can be identified as having been acquired by the decedent in exchange for property so received, if an estate tax under the Revenue Act of 1917 or under this Act was collected from such estate, and if such property is included in the decedent's gross estate;

(3) The amount of all bequests, legacies, devises, or gifts, to or for the use of the United States, any State, Territory, any political subdivision thereof, or the District of Columbia, for exclusively public purposes, or to or for the use of any corporation 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 part of the net earnings of which inures to the benefit of any private stockholder or individual, or to a trustee or trustees exclusively for such religious, charitable, scientific, literary, or educational purposes. This deduction shall be made in case of the estates of all decedents who have died since December 31, 1917; and

(4) An exemption of $50,000;

(b) In the case of a non-resident, by deducting from the value of that part of his gross estate which at the time of his death is situated in the United States

(1) That proportion of the deductions specified in paragraph (1) of subdivision (a) of this section which the value of such part bears to the value of his entire gross estate, wherever situated, but in no case shall the amount so deducted exceed 10 per centum of the value of that part of his gross estate which at the time of his death is situated in the United States;

(2) The same as specified in paragraph 2 of subdivision (a) above, if such property is included in that part of the decedent's gross estate which at the time of his death is situated in the United States.

(3) The same as specified in paragraph 3 of subdivision (a) above, except that the bequests to corporations are limited to bequests to domestic corporations and bequests to trustees exclusively for charitable, etc., purposes, are limited to bequests to trustees exclusively for charitable, etc., purposes within the United States.

No deductions shall be allowed in the case of a non-resident unless the executor includes in his return the value at the time of his death of that part of the gross estate of the non-resident not situated in the United States.

In the case of any estate in respect to which the tax under existing law has been paid, if necessary to allow the benefit of the deduction under paragraph (3) of subdivision (a) or (b) the tax shall be redetermined and any excess of tax paid shall be refunded to the Executor.

Executor to give notice and file return.

The Executor, within sixty days after qualifying as such, or after coming into possession of any property of the decedent, whichever event first occurs, shall give written notice thereof to the collector. The Executor shall also, at such times and in such manner as may be required by regulations made pursuant to law, file a return with the collector.

Return shall be made in all cases where the gross estate at the death of the decedent exceeds $50,000, and in the case of the estate of every non-resident any part of whose gross estate is situated in the United States. If the Executor is unable to make a complete return as to any part of the gross estate of the decedent, he shall include in his return a description of such part and the name of every person holding a legal or beneficial interest therein, and upon notice from the collector such person shall in like manner make a return as to such part of the gross estate.

If no administration is granted upon the estate of a decedent, or if no return is filed or if a return contains a false or incorrect statement of a material fact, the collector or deputy collector shall make a return and the Commissioner shall assess the tax thereon.

Payment of tax.

The tax is due one year after the decedent's death; but in any case where the Commissioner finds that payment of the tax within one year after the decedent's death would impose undue hardship upon the estate, he may grant an extension of time for the payment of the tax for a period not to exceed three years from the due date. If the tax is not paid within one year and 180 days after the decedent's death, interest at the rate of 6 per centum per annum from the expiration of one year after the decedent's death shall be added as part of the tax. Delay determining tax.

If for any reason the amount of the tax cannot be determined arrangements can be made to pay a tentative amount. Receipts for tax.

The collector shall grant to the person paying tax duplicate receipts.

Tax payable out of estate.

The purpose and intent of the Act is that so far as is practicable and unless otherwise directed by the will of the decedent the tax shall be paid out of the estate before its distribution. Definitions.

"Executor" includes Administrator, and if there is no Administrator or Executor any person who takes possession of any property of the decedent.

"Collector" means the Collector of Internal Revenue of the district in which was the domicile of the decedent at the time of his death, or if there was no such domicile in the United States, then the collector of the district in which is situated the part of the Gross estate in the United States, or if such part of the Gross estate is situated in more than one district then the Collector of Internal Revenue of such district as may be designated by the Commissioner.

Other provisions.

The Statute contains provisions relating to transfers before death, the fact of non-payment of tax, penalties and other provisions concerning administration.

SPECIAL TAXES

STAMP TAXES

APPLYING TO BONDS, STOCK, NOTES, SALES, ETC.

§§ 1100-1107 Revenue Act of 1918.

When the law took effect.

On and after April 1, 1919.

Who pays tax.

The stamp tax is imposed upon the person or concern who makes, signs, issues, sells, removes, consigns or ships the instruments or articles set forth below or for whose use or benefit the same is done.

Where to obtain stamps.

At the Post Office in your locality.

Collectors of Internal Revenue, U. S. depositaries and in some cases stationery and other stores will have a supply of stamps.

How to cancel stamps.

A person or concern using or affixing the stamp must write or stamp or cause to be written or stamped thereon his or its initials and the date.

The Commissioner of Internal Revenue is authorized to change or modify the manner of cancelling stamps.

Bonds and certificates of indebtedness.

5c. on each $100 of face value or fraction thereof of bonds, debentures or certificates of indebtedness issued by any person, and all instruments however termed issued by any corporation, with interest coupons or in registered form, known generaly. as corporate securities. Every renewal is taxable as a new isslue If given in a penal sum greater than the debt secured, the tax is based upon the amount secured.