The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-02-07
DIVIDENDS.

Sec. 2o1. ta) That the term "dvi-
dend' when used In this title Except
IN paragraph I0) Of subdivision ta)
81 section 234) means % any distribu-
zion made by corporation. other than
personal service corporation, to its
shareholders or members. whether IN
casn or in other property or in stock
OF the corporation. out OF its earnings
or profits accumulated since February
IS. 1918, or ca any such distribution
made by personal service corporation
OUT OF its earnings or profits accumu-
iated since February IS. 1918. and prior
% January l, 1918.
90 Any distribution shall be deemed
20 have been made from earnings or
profits unless all earnings and profits
have first been distributed. Any distri-
nr'ion made in the year 1913 or any
year thereafter shall be deemed TO have
Been made from earnings or profits ac-
crnu'ated since February IS. 1913, or
an the case OF personal service cor
Pofation, from the most recently accu
nulated earnings or profits: but any
earnings or profits accumulated prior to
March I, 1919, may be distributed in
stock dividends or otherwise. exempt
from the tax, after the earnings and
profits accumulated since February 2s.
1918. have been distributed
fc) y dividend paid in stock OF the
corporation shall be considered income
70 the amount OF the earnings or profits
distributed Amounts distributed in the
liquidation Of a corporation shall be
treated as payments in exchange for
stock or shares, and any gain or profit
realized thereby shall be taxed to the
Distribute as other gains or profits.
fd) II any stock dividend % Is re-
ce!ved by a taxpayer between January
4. 49,
elusive. or (2) Is during such period
bona ide authorized or declared. and en-
tered on the books of the corporation.
ard is received hy tavrayer after No
vember /. 1918. and before the expira-
ton of thirty days after the passage OF
this act, then such dividend shall, in
the manner provided in section 2o6, be
taxed 10 the recipient at the rates pre-
scrihed by law for the years in which
the corporation accumulated the earn
Inss or profits from which such dividend
was paid. but the dividend shall be
deemed to have been paid from the mos,
recently accumulated earnings or profits
teJ Any distribution made during the
nrst sixty days of any taxable year shall
he deemed to have been made from
earnings or prohts accumulated during
preceding taxable yearS: but any dis
tribution made during the remainder OF
the taxable year shall be deemed &c
have been made from earnings or profits
accumulated between tho close OF the
preceding taxable year and the date OF
distribution, 10 the extent OF such earn.
ings or profits, and II the books OF the
CORPORATION do not show the amount oil
srch earnings or profits. the earnings OF
DrcGts for the accounting period within
which the distribution was made shall
be deemed TO have been accumulated
ratably during such period.
DNsfS ToR rErERMISGNG GAIN OR LOSS
Sec. 90? 'a) That for the purpose Of
asrertaininc the gain derived or los:
sustained from tho sale or other dispo
sition of property. real, personal OF
mixed, the basis shall be-
% In the case Of property acquired
before March /, 1873 the fair marke
price or value OF such property as o.
thai date and
go In tho cas-" Of property acquired
an or after that dat" tho cost thereof
NJ tho inventory value. II the INVENTOR
- made In accordance with section 203.
~ When property ~ exchanged fo
other property the property received II
rNchang" shall for the purpose of do
i-rruining gain or loss be treated as tn.
equivalent OF cash to the amount Of ~
iair market value, II any hut when II
correction with the reorganization. mer
ror, or consolidation OF a corporation
person receives In place OF stock or sc
cur,ties owned by him new stock o.
securities OF no greater aggregate pa
or face value no gain or loss shall b.
deemed 10 occur from the exchange, an,
the new stock or securities received shall
be treated AZ taking the place OF tn
stock. securities or property EXCHANGED
When In the case Of any such reor
ganizhnon, merger or consolidation tn
aggregate par or face value Of the new
stock or securities received Is in cxces
Of the aggregate par or face value Of tn
stock or securities exchanged, a Tx
amount in par or face value OF the new
stock Or securities received Saal b