SCHEDULE D (Form 1120)
. 8. Ti
Internal’ Revenue. Service 1952

SCHEDULE OF GAINS AND LOSSES FROM SALES OR EXCHANGES OF PROPERTY

For Calendar Year 1952

or taxable year beginning . 1952, and ending ___

Name and address

(4) CAPITAL ASSETS

| swt |
i iy i oan ace oat sot | crs sales rice | Duran Alone (w_|6 Cont x Ot Bass and Cast 1 Gain o Loss (column 4 plus
1. Deseroton of Property ‘Since Acquistion or | ot Improvements Subsequent | 7. Expense of Sale csiuma 5 less the sum af cols
ope ‘Mo. Day me Day ver ‘(Contract Price) | March 1, ‘Nainiron deta) ‘Aquisition or Marth 1, 1813 | “TM tai) “
Hi

SHORT-TERM CAPITAL GAINS AND LOSSES—ASSETS HELD FOR NOT MORE THAN 6 MONTHS

2. Unused net capital loss carry-over from five preceding taxable years (attach statement). _ |
3. Total of short-term capital gains or losses or difference between short-term capital gains and losses....... cence |B i

LONG-TERM CAPITAL GAINS AND LOSSES—ASSETS HELD FOR MORE THAN 6 MONTHS

5. Total of long-term capital gains or losses or difference between long-term capital gains and losses.................. I$
SUMMARY OF CAPITAL GAINS AND LOSSES
~~ {an or Loss To Be Taken Into Accaunt ~
Classietion
(@) Gaia (@) Less _
6. Net short-term capital gain or loss from line 3....................04. eres $.
7. Net long-term capital gain or loss from line 5........... 0.022220 cece cece teens $. $.

8. Net short-term capital gain (line 6, col. (a)) reduced by any net long-term cai
Cline 7, col. (b)). Enter here and as item 13 (a), page 1, Form 1120.

9. Net long-term capital Bain (line 7, col. (a)) reduced by any net short-term . capital
loss Cline 6, col. (b)). Enter here and as item 13 (@), page 1, Form 1120........... $. xxxxxxx | xx

10. Excess of losses over gains in lines 6 and 7. This excess is not allowable. .... ceeesees | ¥XXxxxx | xx [§

xxxxxxx | xx

COMPUTATION OF ALTERNATIVE TAX

11. Surtax net income (line 5, page 3, Form 1120). . .
12. Less: Net long-term capital gain reduced by any net ‘short-term capital loss Cline 9 of summary) .
13. Surtax net income for purpose of alternative tax... .. 20... . ee
14. Combined normal tax and surtax. If amount of line 13 is:

Not over $25,000; enter 30 percent of line 13 (32 percent if a consolidated return)...................0..

Over $25,000. Compute 52 percent of line 13 (54 percent if a consolidated return). Subtract $5.500. Enter
Co 0 on

15. Less: Normal tax adjustment for partially tax-exempt interest; enter 30 percent of the sum of items 10 (a) and
10 (4), page 1, Form 1120, but not in excess of 30 Pefeent of line 13.

16. Partial tax .
17. 26 percent of line 12..
18. Alternative tax (line 16 plus line 17).
19. Normal tax and surtax (line 8, page 3, Form 1120)
20. Tax liability (line 18 or 19, whichever is lesser). Enter here and as line 9, page 3, Form 1120.

(2) PROPERTY OTHER THAN CAPITAL ASSETS

2 Date acquired | 3. Date sold A Gress Sales Price 5 De Allowed (or & Gaat or Saher Ras and Cost ‘8 Gain or Loss (Conn 4
1, Dessition of property Hae Bay Year| Ma. Day Year (Contact pea) iegte Se legtnn | of norms Scoment io | 7, Exe Sl ong Sea
L 6.
2. Toral net gain (or loss). Enter here and as item 13 (¢), page 1, Form 1120... i$ _

State with respect to each item of property reported in Schedule D (1) and (2): (1) how property was acquired _.
- - (2) whether at time of sale or exchange (a) purchaser owned directly or indirectly more than 50
percent in value of your ur outstanding stock, (6) where purchaser was a corporation, more than 50 percent in value of its capital stock and 50
percent in value of your capital stock was owned directly or indirectly by or for the same individual or his family, and (¢) where purchaser
was a corporation, whether more than 50 percent in value of its capital stock was owned directly or indirectly by you
If so, state name and address of purchaser

h For i Com Using This ule

Companies taxable under section 204 and having losses from capital assets sold or exchanged in order to obtain funds to meet abnormal insurance losses, etc., shall attach a
schedule corresponding to Schedule D, Form 1120M.
For companies taxable under section 204 or section 207 (a) (1) or (3), “‘net capital loss’” means the amount by which the losses for the taxable year from sales or exchanges of
ral assets excced the sum of the gains from such sales or exchanges and the lesser of (1) the corporation surtax net income (computed without regard to gains or losses from
tales or exchanges of capital assets) of (2) losses from the sale or exchange of capital assets sold or exchanged to obtain funds to meet abnormal insurance losses and to provide for
the payment of dividends and similar distributions to policyholders.
For companies taxable under section 207 (a) (1) or (3), all references to “‘item"’ or “‘line’’ numbers, Form 1120, shall be considered as references to the appropriate “‘item"*
or “line’" in Form 1120M. Ie will be necessary for such companies to substieute for lines 14, 15, and 16 of the above alceroative tax computation, a computation conforming co that
on page 2 of Form 1120M.

to—e7ai7-1


INSTRUCTIONS

(References are ta the Internal Revenue Cade)

Gains and losses from sales or exchanges of capital assets and
other property. -Report sales or exchanges of capital assets and
sales or exchanges of property other than capital assets in Sched-
ule D on other side. Every sale or exchange of property; even
though no gain or loss may be indicated, must be reported in detail.

Losses from sales or exchanges of capital asscts shall be allowed
only to the extent of gains from such sales or exchanges. How-
ever, the amount of a net capital loss sustained in any taxable
year may be carried over wo each of the five succeeding taxable
years and treated in cach such five succeeding taxable ycars as
a short-term capital loss to the extent not allowed as a deduction
against any net capital gains of any taxable year intervening be-
tween the taxable year in which the net capital loss was sustained
and the taxable year to which carried.

Definition of capital assets.—The term “capital assets” means
property held by the taxpayer (whether or not connected with his
trade or business), but does not inciude (a) stock in trade of the
taxpayer or other property of a kind which would properly be
included in the inventory of the taxpayer if on hand at the close
of the taxable year, or property held by the taxpayer primarily for
sale to customers in the ordinary course of his trade or business, or
(b) property used in the trade or business, of a character which is
subject to the allowances for depreciation, provided in section 23
(1), or real property used in the trade or business of the tax-
payer: or (¢) a copyright; a literary, musical, or artistic composi-
tion, or similar property; or (d) an obligation of the United States
or any of its possessions, or of a State or Territory, or any political
subdivision thereof, or of the District of lumbia issued on or alter
March 1, 1941, on a discount basis and payable without interest at a
fixed maturity date not exceeding 1 year from the date of issue

Classification of capital gains and losses—Vhe phrase “short-
term” applies to the category of gains and losses arising from the
sale or exchange of capital assets held for 6 months or less, the
phrase “long-term” to the category of gains and losses arising
from the sale or exchange of capital assets held for more than 6
months

Enter full description of cach item of property sold or ex-
changed, even though no gain or loss may be indicated. Such
description should include the following facts: (a) For real estate,
location and description of land, description of improvements,
details explaining depreciation (column 5 of Schedule D); (b)
for bonds or other evidences of indebtedness, name of issuing
corporation, description of the particular issuc, denomination,
and amount; (c) for stocks, name of issuing corporation, class of
stock, number of shares, and capital changes affecting basis (non-
taxable stock dividends, other nontaxable distributions, stock
rights, etc.)

‘The “basis” for the property is not subject to the same rule for
reporting gains as for losses, if the property wes acquired before
March 1, 1913. If the property sold or exchanged was acquired
prior to March 1, 1913, the basis of determining GAIN is the
cost or the fair market value as of March 1, 1913, adjusted as
provided in section 113 (b), whichever is greater, but in determin-
ing LOSS the basis is cost so adjusted. If property was acquired
after February 28, 1913, basis for both gain and loss is the cost
of such property, except as otherwise provided by section 113.
The exceptions arise chiefly where property was acquired by gift,
bequest, tax-free exchange, invaluntary conversion, or wash sale of
stock; and in such cases section 113 provides the basis that shall
be used. If the amount shown as the basis is other than actual
cash cost of the property sold or exchanged, full details must be
furnished regarding the acquisition of the property.

Enter in column 5 of separate Schedule D the amount of depre-
ciation, exhaustion, wear and tear, obsolescence, and depletion in
respect of the property. This amount shall be the sum of the
following:

(a) The amount of depreciation, exhaustion, wear and tear,
obsolescence, and depletion which has been allowed (but not less
than the amount allowable) in respect of such property since date
of acquisition, or since February 28, 1913, if the property was
acquired before that date. For any period after December 31, 1951,
the amount of depreciation, etc., allowed (and which is in excess
of the amount allowable) shall be disregarded to the extent that
such excess does not result in a reduction for any taxable year of
the taxpayer's income or excess profits taxes. In respect of any
period after February 28, 1913, and before January 1, 1952, the
taxpayer may disregard depreciation, ctc., which was in excess
of the amount allowable and which did not result in reduction
of income or excess profits taxes only if an clection is made in
accordance with regulations. See section 113(b) (1) (B)

(6) The amount of depreciation, exhaustion, wear and tear,
obsolescence, and depletion actually sustained prior to March 1,
1913, if the property was acquired before that date.

Subsequent improvements include expenditures for additions,
improvements, renewals, and replacements made to restore the
property or prolong its ‘useful life, Do not deduct ordinary re-
pairs, interest, or taxes in computing gain or loss.

Losses on securities becoming worthless.—If any securities (as
defined below) become worthless within the taxable year and are
capital assets, the loss resulting therefrom shall, in the case of a
taxpayer other than a bank, as defined in section 104, be consid.
ered as a loss from the sale or exchange, on the last day of such
taxable year, of capital assets. (See section 23 (k) (2

Definition of securities.—As used for the purpose of determin-
ing capital losses under section 23 (k}, the term “securities”
means bonds, debentures, notes, or certificates, or other evidences
of indebtedness, issued by any corporation (including those issued
by a government or political subdivision therrof), with interest
coupons or in registered form. However, securities issued by any
corporation affiliated with the taxpayer shall not be deemed capi-
tal assets. (See section 23 (k) (3) and (5).)

Losses on stocks or stock rights becoming worthless. —If any
shares of stock in a corporation (except stock in a corporation
affiliated with the taxpayer), or rights to subscribe for or to re-
ceive such shares, become worthless during the taxable year and
are capital assets, the loss resulting therefrom shall be considered
as a loss from the sale or exchange, on the last day of such taxable
year, of capital assets. (See section 23 (g) (2) and (4).)

Losses not allowable.—No loss shall be recognized in any sale
or othcr disposition of shares of stock or sccuritics where there
has been acquired substantially identical stock or securities or there
has been entered into a contract or option to acquire substantially
identical stock or securities within 30 days before or after the date
of such sale or disposition, except in cascs of dealers in stocks and
securities and with respect to transactions made in the ordinary
course of such business.

No deduction shall be allowed in respect of losses from sales or
exchanges of property, directly or indirectly (except in the case
of distributions in liquidation), between an individual and a cor-
poration in which such individual owns, directly or indirectly, more
than 50 percent in value of the outstanding stock; or (except in

the case of distributions in liquidation) between two corporations
more than 50 percent in value of the outstanding stock of each
of which is owned, directly or indirectly, by or for the same indi-
vidual, if either one of such corporations, with respect to the tax-
able year of the corporation preceding the date of the sale or
exchange was, under the laws applicable to such taxable year,
(1) a personal holding company, as defined in section 501, or (2)
a foreign personal holding company, as defined in section 331.
(See paragraph (1) (B) and (C) of section 24 (b).) (For the
purpose of determining the ownership of stock, in applying this
paragraph, see section 24 (b) (2).)

Gain on sales by a “controlled” corporation.—If (1) property
is sold or exchanged ‘after May 3, 1951, by a corporation to one
or more of its shareholders, and (2) the property in the hands of
such shareholders is depreciable property, and (3) such shure-
holders, their spouses, and their munor children and minor grand-
children own more than 80 percent in value of the outstanding
stock of the corporation, then any gain on such sale or exchange
shall not be treated as gain from the sale or exchange of property
which is a capital asset or of property which is described in section
117 (j).

Gains and losses from involuntary conversion and from the sale
or exchange of certain property used in the trade or business.—
‘The term “property used in the trade or business” as used in sec-
tion 117 (j) means property used in the trade or business, of a
character which is subject to the allowance for depreciation pro-
vided in section 23 (1), held for more than 6 months, and real
property used in the trade or business, held for more than 6
months, which is not (a) property of a kind which would properly
be includible in the inventory of the taxpayer if on hand at the
close of the taxable year or (b) property held by the taxpayer
primarily for sale to customers in the ordinary course of his trade
or business. Such term also includes timber or coal with respect
to which section 117 (k) (1) or (2) is applicable as well as un-
harvested crops sold with the land to which section 117 (j) (3)
applies. Such term also includes livestock (but not poultry) held
for draft, brceding, or dairy purposcs and held for 12 months or
more from the date of acquisition.

Section 117 (j) provides special treatment for the gains and
losses upon the sale or exchange of depreciable property and of
land, held for more than 6 months, and for the gains and losses
upon the compulsory or involuntary conversion of such depreci-
able property and land and of capital assets held for more than 6
months.

The method prescribed in section 117 (j) (2) is to treat such
gains and losses during the taxable year as gains and losses from
the sale or exchange of capital assets held for more than 6 months,
if the aggregate of such gains exceeds the aggregate of such losses.
If, however, the aggregate of such gains does not exceed the
aggregate of such losses, such gains and losses shall not be treated
as gains and losscs from the sale or exchange of capital assets held
for more than 6 months.

In deterinining whether gains do or do not exceed losses, it is
necessary to include the gains and losses to the extent that they
would be included if they were all ordinary gains and losses. The
limitations of section 117 (d) on the deductibility of capital losses
do not operate to exclude any such losses from the computation
as to the excess of gains over losses, but all such losses are included
in full.

For special treatment of gain or loss upon the cutting of timber,
or upon the disposal of timber or coal under a contract by which
the owner retains an economic interest in such timber or coal, see
section 117 (k).

Alternative tax.—Ii for any taxable year the net long-term capi-
tal gain exceeds the net short-term capital loss, or in case of only a
net long-term capital gain, section 117 (c) imposes an alternative
tax in lieu of the normal tax and surtax imposed upon net income,
if and only if such tax is less than the tax itnposed by sections 13
and 15 (relating to normal tax and surtax on corporations), sec-
tions 204 and 207 (a) (1) or (3) (relating to normal tax and sur-
tax on insurance companies, other than life insurance companies),
section 421 (relating to taxation of business income of certain sec-
tion 101 organizations), and section 5U0 (relating to surtax on
pevronal holding companies). ‘The alternative tax is the sum of

(1) a partial tax, computed at the normal tax and surtax rates on
the net income decreased by the amount of the excess of the net
long-term capital gain over the net short-term capital loss, and (2)
26 percent of such excess.

If the total dividends received credit (line 2, page 3, Form
1120) is limited to an amount not in excess of 85 percent of the
adjusted net income, such credit, for the purpose of the alternative
tax, should be recomputed by using an amount equal to 85 percent
of the adjusted net income computed without taking into account
the excess of the net long-term capital gain over the net short-term
capital loss. The surtax net income to be entered on line 11 on
other side should reflect any change in the total dividends received
credit.

Bonds, etc., losses of banks.—In the case of a bank, as defined
in section 104, if the losses of the taxable year from sales or ex-
changes of bonds, debentures, notes, or certificates, or other evi-
dence of indebiedness, issued by any corporation (including one
issued by a government or political subdivision thereof) with in-
terest coupons or in registered form, exceed the gains from such
sales or exchanges, such excess shall be considered as an ordinary
loss and deductible in full against other income.

Dealers in securities. Capital gains and ordinary losses—Under
the provisions of section 117 (n), gain by a dealer in securities from
the sale or exchange of a security, as defined in section 117 (n) (3)
shall in no event be considered as gain from the sale or exchange of
a capital asset unless (a) the security is, prior to the expiration of
the thirtieth day after its acquisition or after October 20, 1951,
whichever is later, clearly identified in the dealer's records as a
security held for investment; and (b) the security is not, at any
time alter the expiration of such thirtieth day, held by the dealer
primarily for sale to customers in the ordinary course of the trade
or pai A loss from the sale or exchange of a security shall, if
section 117 (i) is not applicable, be considered a capital loss if at
any time after the thirticth day following the date of enactment of
such act the security was clearly identified in the dealer's record as.
a security held for investment,

Short sales of capital asses.—For specific rules relating to the
tax consequences of certain short siles of stock or other securities,
transacnions in stock or securities on a “when issued’’ basis, and
transactions in commodity futures, sce section 117 (g) and (1)
and the regulations issued thereunder

Collapsible cor porations.-Gain from the sale or exchange of
stock of a collapsible corporation as defined in section 117 (m)
(2), which otherwise would be treated as a long-term capital gain,
will be treated under the provisions of section 117 (im) as gain
from the sale or exchange of property which is net a capital asset.

U, 8, GOVERNMENT PRINTING OFFICE : 1982 0 - 297861