An Act to allow a deduction, for Federal estate tax purposes, in the case of certain transfers to charities which are subjected to foreign death taxes
PL 86-175 (H.R.137), enacted 08/21/1959

396 
PUBLIC LAW 86-175-AUG. 21, 1959 
[73 ST A T . 
70A Stat. 285. 
(2) Sectioii 5133 is amended by striking out in the second sentence 
of subsection (a) the words "Bureau of Aeronautics" and inserting 
in lieu thereof the words "Bureau of Naval Weapons". 
289?^ Stat. 286, 
^3) Sectlous 5136 and 5144 are repealed. 
Repeal. 
(4) xiie aualysis is amended by striking out the following items: 
"5136. Bureau of Aeronautics : Chief; Deputy Chief. 
"5144. Bureau of Ordnance: Chief; Deputy Chief." 
SEC. 3. The unexpended balances of appropriations and funds avail-
able for use in connection with the exercise of any function transferred 
to the Bureau of Naval Weapons shall be transferred in the manner 
provided by section 407 of the National Security Act of 1947, as 
amended (5 U.S.C. I72f), for use in connection with the transferred 
functions. 
Approved August 18, 1959. 
T r a n s f e r of 
funds. 
63 Stat. 585. 
August 21, 1959 
[H. R. 137] 
Public Law 86-175 
AN ACT 
To allow a deduction, for Federal estate tax purposes, in the case of certain 
transfers to charities which are subjected to foreign death taxes. 
Taxes. 
Estate t a x de-
duction. 
70 Stat. 23. 
26 u s e 2053. 
68A Stat. 373. 
68A Stat. 803. 
68A 
398. 
S t a t . 390, 
68A 
400. 
S t a t . 397-
Be it enacted hy the Senate and House of Representatives 
of the 
United 
States 
of America 
in Congress assembled., That section 
2053(d) of the Internal Revenue Code of 1954 (relating to deductions 
from the gross estate for certain State death taxes) is amended to 
read as follows: 
"(d) CERTAIN STATE AND FOREIGN DEATH TAXES.— 
"(1) GENERAL RULE.—Notwithstanding the provisions of sub-
section (c) (1) (B) of this section, for purposes of the tax imposed 
by section 2001 the value of the taxable estate may be determined, 
if the executor so elects before the expiration of the period of 
limitation for assessment provided in section 6501, by deducting 
from the value of the gross estate the amount (as determined in 
accordance with regulations prescribed by the Secretary or his 
delegate) of— 
" (A) any estate, succession, legacy, or inheritance tax im-
posed by a State or Territory or the District of Columbia 
upon a transfer by the decedent for public, charitable, or 
religious uses described in section 2055 or 2106(a) (2), and 
"(B) any estate, succession, legacy, or inheritance tax im-
posed by and actually paid to any foreign country, in respect 
of any property situated within such foreign country and 
included in the gross estate of a citizen or resident of the 
United States, upon a transfer by the decedent for public, 
charitable, or religious uses described in sectioii 2055. 
The determination under subparagraph (B) of the country within 
which property is situated shall be made in accordance with the 
rules applicable under subchapter B (sec. 2101 and following) in 
determining whether property is situated within or without the 
United States. Any election under this paragraph shall be exer-
cised in accordance with regulations prescribed by the Secretary 
or his delegate. 
73 S T A T . ] 
PUBLIC LAW 86-175-AUG. 21, 1959 
397 
"(2) 
CONDITION FOR ALLOWANCE OF DEDUCTION.—No deduction 
shall be allowed under paragraph (1) for a State death tax or 
a foreign death tax specified therein unless the decrease in the 
tax imposed by section 2001 which results from the deduction 
esAstat. 373. 
provided in paragraph (1) will inure solely for the benefit of 
the public, charitable, or religious transferees described in section 
2055 or section 2106(a) (2). In any case where the tax imposed ^^^^A stat. 390, 
by section 2001 is equitably apportioned among all the transferees 
of property included in the gross estate, including those described 
in sections 2055 and 2106(a) (2) (taking into account any exemp-
tions, credits, or deductions allowed by this chapter), in deter-
mining such decrease, there shall be disregarded any decrease in 
the Federal estate tax which any transferees other than those 
described in sections 2055 and 2106(a) (2) are required to pay. 
"(3) 
EFFECT ON CREDITS FOR STATE AND FOREIGN DEATH TAXES OF 
DEDUCTION UNDER THIS SUBSECTION.— 
"(A) ELECTION.—An election under this subsection shall 
be deemed a waiver of the right to claim a credit, against the 
Federal estate tax, under a death tax convention with any 
foreign country for any tax or portion thereof in respect of 
which a deduction is taken under this subsection. 
"(B) 
CROSS REFERENCES.— 
"See section 2011(e) for the effect of a deduction taken under 
this subsection on the credit for State death taxes, and see section 
2014(f) for the effect of a deduction taken under this subsection 
on the credit for foreign death taxes." 
SEC. 2. Section 2014 of the Internal Eevenue Code of 1954 (relating _ 68A stat. 378; 
to credit for foreign death taxes) is amended by relettering subsec- '" " 
tion (f) as subsection (g) and by inserting after subsection (e) the 
following new subsection: 
"(f) 
ADDITIONAL LIMITATION IN CASES INVOLVING A DEDUCTION 
UNDER SECTION 2053(d).—In any case where a deduction is allowed 
under section 2053(d) for an estate, succession, legacy, or inheritance 
tax imposed by and actually paid to any foreign country upon a 
transfer by the decedent for public, charitable, or religious uses 
described in section 2055, the property described in subparagraphs 
(A), (B), and (C) of paragraphs (1) and (2) of subsection (b) of 
'° ^tat. 1075. 
this section shall not include any property in respect of which such 
deduction is allowed under section 2053 (d)." 
SEC. 3. Section 2011 (e) of the Internal Eevenue Code of 1954 (relat- 
'° ^*^*- ^'^• 
ing to limitation on credit for State death taxes) is amended— 
(1) by striking out "imposed upon a transfer" and inserting 
in lieu thereof "imposed by a State or Territory or the District 
of Columbia upon a transfer"; 
(2) by striking out "for which a deduction" in paragraph (1) 
and inserting in lieu thereof "for which such deduction"; 
(3) by striking out "the deduction authorized by" each place 
it appears in paragraph (2) and inserting in lieu thereof "such 
deduction authorized by". 
SEC. 4. The amendments made by the preceding sections of this 
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Act shall apply with respect to the estates of decedents dying on or 
after July 1, 1955. 
Approved August 21, 1959. 
72 Stat. 1674. 
70 Stat. 23.