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SEC 122.-Continued

ANCILLARY PROVISIONS (P.L. 86-780, § 5)-Continued ment, by an authorized officer, employee, or agent of such corporation that the amount of such reimbursement would not be includible in gross income. If refund or credit of any overpayment resulting from the application of this section is prevented on the date of enactment of this Act, or within six months after such date, by the operation of any law or rule of law (other than chapter 74 of the Internal Revenue Code of 1954, relating to closing agreements and compromises, and the corresponding provisions of prior law), refund or credit of such overpayment may, nevertheless, be made or allowed if claim therefor is filed within six months after such date. No interest shall be paid or allowed on any overpayment resulting from the application of the preceding sentence."

See also Sec. 6511, "ANCILLARY PROVISIONS," P.L. 86-780, § 5, p. 1109 below. Oct. 16, 1962, H.R. 10650, P.L. 87-834, § 27, 76 Stat. 1067-1068:

"SEC. 27. EXCLUSION FROM GROSS INCOME OF CERTAIN AWARDS MADE PURSUANT TO EVACUATION CLAIMS OF JAPANESE-AMERICAN PERSONS.

"(a) IN GENERAL.-No amount received as an award under the Act entitled "An Act to authorize the Attorney General to adjudicate certain claims resulting from evacuation of certain persons of Japanese ancestry under military orders", approved July 2, 1948, as amended by Public Law 116, Eighty-second Congress, and Public Law 673, Eighty-fourth Congress (50 U.S.C. App., secs. 1981-1987), shall be included in gross income for purposes of chapter 1 of the Internal Revenue Code of 1939 or chapter 1 of the Internal Revenue Code of 1954.

"(b) EFFECTIVE DATE, ETC.-Subsection (a) shall apply with respect to taxable years ending after July 2, 1948. If refund or credit of any overpayment of Federal income tax resulting from the application of subsection (a) (including interest, additions to the tax, additional amounts, and penalties) 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, the refund or credit of such overpayment may nevertheless be made or allowed if claim therefor is filed within one year after the date of enactment of this Act. In the case of a claim to which the preceding sentence applies, the amount to be refunded or credited as an overpayment shall not be diminished by any credit or setoff based upon any item other than the amount of the award referred to in subsection (a). No interest shall be allowed or paid on any overpayment resulting from the application of this section."

CH. 1, SUBCH. B, PART IV-STANDARD DEDUCTION FOR INDIVIDUALS (68A Stat. 40, ff):

NOTE: The table of sections for Part IV of Subchapter B of Chapter 1 reads as follows (68A Stat. 40):

"Sec. 141. Standard deduction.

"Sec. 142. Individuals not eligible for standard deduction.

"Sec. 143. Determination of marital status.

"Sec. 144. Election of standard deduction.

"Sec. 145. Cross reference."

This table has not been amended.

SEC. 141. STANDARD DEDUCTION (Revised 1964-78 Stat. 23): In full...... Feb. 26, 1964, H.R. 8363, P.L. 88-272, § 112(a), 78 Stat. 23: Amended Sec. 141 33 to read as follows:

33 Section 141 originally read as follows (68A Stat. 40):

"SEC. 141. STANDARD DEDUCTION.

"The standard deduction referred to in section 63(b) (defining taxable income in case of individual electing standard deduction) shall be an amount equal to 10 percent of the adjusted gross income or $1,000, whichever is the lesser, except that in the case of a separate return by a married individual the standard deduction shall not exceed $500."

SEC. 141 (revised 1964)—Continued

"SEC. 141. STANDARD DEDUCTION.

"(a) STANDARD DEDUCTION.-Except as otherwise provided in this section, the standard deduction referred to in this title is the larger of the 10-percent standard deduction or the minimum standard deduction. The standard deduction shall not exceed $1,000, except that in the case of a separate return by a married individual the standard deduction shall not exceed $500.

"(b) TEN-PERCENT STANDARD DEDUCTION.-The 10-percent standard deduction is an amount equal to 10 percent of the adjusted gross income.

"(c) MIMINUM STANDARD DEDUCTION.-The minimum standard deduction is the amount equal to the sum of

"(1) $100, multiplied by the number of exemptions allowed for the taxable year as a deduction under section 151, plus

“(2)(A) $200, in the case of a joint return of a husband and wife under section 6013,

"(B) $200, in the case of a return of an individual who is not married, or

"(C) $100, in the case of a separate return by a married individual.

"(d) MARRIED INDIVIDUALS FILING SEPARATE RETURNS.Notwithstanding subsection (a)—

"(1) The minimum standard deduction shall not apply in the case of a separate return by a married individual if the tax of the other spouse is determined with regard to the 10-percent standard deduction.

"(2) A married individual filing a separate return may, if the minimum standard deduction is less than the 10-percent standard deduction, and if the minimum standard deduction of his spouse is greater than the 10-percent standard deduction of such spouse, elect (under regulations prescribed by the Secretary or his delegate) to have his tax determined with regard to the minimum standard deduction in lieu of being determined with regard to the 10-percent standard deduction."

Applicability:

Taxable years beginning after December 31, 1963.
(Id., § 131, 78 Stat. 30.)

SEC. 144. ELECTION OF STANDARD DEDUCTION (68A Stat. 41

(b)... ... (1st sen.)

42):

Feb. 26, 1964, H.R. 8363, P.L. 88-272, § 112(c)(1), 78 Stat. 24:
Amended the first sentence of Sec. 144 (b) 34 to read as follows:
"Under regulations prescribed by the Secretary or his delegate, a
change of election with respect to the standard deduction for any
taxable year may be made after the filing of the return for such
year."

Applicability:

Taxable years beginning after December 31, 1963.
(Id., § 131, 78 Stat. 30.)

4 The heading and first sentence of subsection (b) of section 144 originally read as follows (68A Stat. 41):

"(b) CHANGE OF ELECTION.-Under regulations prescribed by the Secretary or his delegate, a change of an election for any taxable year to take, or not to take, the standard deduction, or to pay, or not to pay, the tax under section 3, may be made after the filing of the return for such year."

SEC. 144-Continued

(c) ---(added)

(d).
(added)

Feb. 26, 1964, H.R. 8363, P.L. 88-272, § 112(c) (2), 78 Stat. 24: Amended Sec. 144 by adding at the end thereof, after subsection (b) (as amended by P.L. 88-272 § 112(c)(1)), the following new subsection (c):

"(c) CHANGE OF ELECTION DEFINED.-For purposes of this title, the term 'change of election with respect to the standard deduction'

means

"(1) a change of an election to take (or not to take) the standard deduction;

"(2) a change of an election to pay (or not to pay) the tax under section 3; or

"(3) a change of an election under section 141(d) (2).”

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Feb. 26, 1964, H.R. 8363, P.L. 88-272, § 232(c), 78 Stat. 110: Amended Sec. 144 by adding after subsection (c) (as added by P.L. 88-272, § 112(c) (2)) the following new subsection (d):

"(d) INDIVIDUALS ELECTING INCOME AVERAGING.-In the case of a taxpayer who chooses to have the benefits of part I of subchapter Q (relating to income averaging) for the taxable year

"(1) subsection (a) shall not apply for such taxable year, and "(2) the standard deduction shall be allowed if the taxpayer so elects in his return for such taxable year.

The Secretary or his delegate shall by regulations prescribe the manner of signifying such election in the return. If the taxpayer on making his return fails to signify, in the manner so prescribed, his election to take the standard deduction, such failure shall be considered his election not to take the standard deduction."

Applicability:

Taxable years beginning after December 31, 1963.

(Id., § 232(g) (1), 78 Stat. 112.)

See also "Applicability" under amendment of Part I of Subchapter Q, p. 486 below.

CH. 1, SUBCH. B, PART V-DEDUCTIONS FOR PERSONAL EXEMPTIONS (68A Stat. 42, ff.):

NOTE: The table of sections for Part V of Subchapter B of Chapter 1 reads as follows (68A Stat. 42):

"Sec. 151. Allowance of deductions for personal exemptions.

"Sec. 152. Dependent defined.

"Sec. 153. Determination of marital status.

"Sec. 154. Cross references."

This table has not been amended.

SEC. 152. DEPENDENT DEFINED (68A Stat. 43-45):

(a) (9) ------ Sept. 2, 1958, H.R. 8381, P.L. 85-866, § 4(a), 72 Stat. 1607:
(revised)
Amended paragraph (9) of Sec. 152(a)35 to read as follows:

(b) (2)

(in part)

"(9) An individual (other than an individual who at any time during the taxable year was the spouse, determined without regard to section 153, of the taxpayer) who, for the taxable year of the taxpayer, has as his principal place of abode the home of the taxpayer and is a member of the taxpayer's household, or".

Applicability:

Taxable years beginning after December 31, 1953, and ending after August 16, 1954.

(Id., § 1(c)(1), 72 Stat. 1606.) 36

Sept. 23, 1959, H.R. 47, P.L. 86-376, § 1(a), 73 Stat. 699:

Amended paragraph (2)37 of Sec. 152(b) (rules relating to general definition) by striking out

"a legally adopted child of an individual"

and inserting in lieu thereof

"a legally adopted child of an individual (and a child who is a member of an individual's household, if placed with such individual by an authorized placement agency for legal adoption by such individual)".

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* Subsection (a) of section 152 originally read as follows (68A Stat. 43-44):

"(a) GENERAL DEFINITION.-For purposes of this subtitle, the term dependent means any of the following individuals over half of whose support, for the calendar year in which the taxable year of the taxpayer begins, was received from the taxpayer (or is treated under subsection (c) as received from the taxpayer):

"(1) A son or daughter of the taxpayer, or a descendant of either,

"(2) A stepson or stepdaughter of the taxpayer,

"(3) A brother, sister, stepbrother, or stepsister of the taxpayer,

"(4) The father or mother of the taxpayer, or an ancestor of either,

"(5) A stepfather or stepmother of the taxpayer,

"(6) A son or daughter of a brother or sister of the taxpayer,

"(7) A brother or sister of the father or mother of the taxpayer,

'(8) A son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-inlaw of the taxpayer,

"(9) An individual who, for the taxable year of the taxpayer, has as his principal place of abode the home of the taxpayer and is a member of the taxpayer's household, or

**(10) An individual who

"(A) is a descendant of a brother or sister of the father or mother of the taxpayer,

"(B) for the taxable year of the taxpayer receives institutional care required by reason of a physical or mental disability, and

"(C) before receiving such institutional care, was a member of the same household as the taxpayer."

Subsection (c) of section 1 of P.L. 85-866 read as follows (72 Stat. 1606):

"(c) EFFECTIVE DATE.-Except as otherwise expressly provided

"(1) amendments made by this title to subtitle A of the Internal Revenue Code of 1954 (relating to income taxes) shall apply to taxable years beginning after December 31, 1953, and ending after August 16, 1954; and

"(2) amendments made by this title to subtitle F of such Code (relating to procedure and administration) shall take effect as of August 17, 1954, and such subtitle, as so amended, shall apply as provided in section 7851 of the Internal Revenue Code of 1954." Amendments made by Title I of P.L. 85-866 which became effective in accordance with the provisions of the above section 1 (c) (1) were as follows:

(5),

Sections amended: 152(a) (9), (b)(5), 165(g)(3)(B), 166(d) (2) (A), 168(e) (2) (C) and 170(b)(3), 172(f) (3) and (4), (g) (3) and (4), 213(d)(2)(A), 337 (d), 404 (a), 421(a), 535(b) (2) and (6) (B), 545(b)(2), 556(b)(2), 558, 582(c), 611(b)(4), 613(d), 851(e) (1) and (2), 1015(d), 1031(d), 1033(a)(2), (g) and (h), 1034(i) (2) and (3), 1053, 1232(c), 1233 (a) and (g), 1234, 1237(a)(1), [Footnote 36 continued on following page]

SEC. 152-Continued

(b) (3) _ _

(date changed)

Do....

(last sen❜ce)

(b) (5) _ _ (added)

Aug. 9, 1955, H.R. 7148, P.L. 84-333, § 2, 69 Stat. 626:
Amended Sec. 152(b) (3) 38 by striking out-

"July 5, 1946"

and inserting in lieu thereof

"January 1, 1956".

Applicability:

Taxable years beginning after December 31, 1953, and ending after August 16, 1954.

(Id., § 3(b), 69 Stat. 626.)

Sept. 2, 1958, H.R. 8381, P.L. 85-866, § 4(b), 72 Stat. 1607:

Amended the last sentence of Sec. 152(b) (3) to read as follows:
"The preceding sentence shall not exclude from the definition of
'dependent' any child of the taxpayer-

"(A) born to him, or legally adopted by him, in the Philippine Islands before January 1, 1956, if the child is a resident of the Republic of the Philippines, and if the taxpayer was a member of of the Armed Forces of the United States at the time the child was born to him or legally adopted by him, or

"(B) legally adopted by him, if, for the taxable year of the taxpayer, the child has as his principal place of abode the home of the taxpayer and is a member of the taxpayer's household, and if the taxpayer is a citizen of the United States."

Applicability:

Taxable years beginning after December 31, 1957.
(Id., § 4(d), 72 Stat. 1607.)

Sept. 2, 1958, H.R. 8381, P.L. 85–866, § 4(c) 72 Stat. 1607:

Amended Sec. 152(b) by adding at the end thereof, after paragraph (4), the following new paragraph (5):

"(5) An individual is not a member of the taxpayer's household if at any time during the taxable year of the taxpayer the relationship between such individual and the taxpayer is in violation of local law."

Applicability:

Taxable years beginning after December 31, 1953, and ending after August 16, 1954.

(Id., § 1(c)(1), 72 Stat. 1606. See n. 36, p. 79 above.)

Footnote 36—Continued

1341 (a) and (b) (2) (last sentence), and (b)(3), 1347 (last sentence), 2055(e), 2106(a)(2) (E), 2501(b), 2522(c), and 3121(1)(3).

Section added: 558.

With respect to the amendments made to Subtitle F, see section 6013, n. 703, p. 972. below.

37 Paragraph (2) of Sec. 152(b) originally read as follows (68A Stat. 44):

"(2) In determining whether any of the relationships specified in subsection (a) or paragraph (1) of this subsection exists, a legally adopted child of an individual shall be treated as a child of such individual by blood."

38 Paragraph (3) of section 152(b) originally read as follows (68A Stat. 44):

"(3) The term 'dependent' does not include any individual who is not a citizen of the United States unless such individual is a resident of the United States, of a country contiguous to the United States, of the Canal Zone, or of the Republic of Panama. The preceding sentence shall not exclude from the definition of 'dependent' any child of the taxpayer born to him, or legally adopted by him, in the Philippine Islands before July 5, 1946, if the child is a resident of the Republic of the Philippines, and if the taxpayer was a member of the Armed Forces of the United States at the time the child was born to him or legally adopted by him."

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