able year closing at the same time, except as otherwise provided in §§ 29.53-1, 29.56-1 (a), 29.217-1, 29.218-1, 29.235-1, and 29.236-1. If, for taxable years beginning after December 31, 1941, and before January 1, 1944, a return is made for a fractional part of a year, except where a return is made for a period of less than 12 months by reason of a change in accounting period, the personal exemption and credit for dependents shall be reduced to that proportion of the full credit which the number of months in the period for which the return is made bears to 12 months. If, for taxable years beginning after December 31, 1943, a return is made for a fractional part of a year resulting from termination by the Commissioner under section 146 of the taxable period, the normal-tax exemption and the surtax exemptions shall be reduced to that proportion of the full normal-tax exemption (in the case of the normal tax) and the full surtax exemptions (in the case of the surtax) which the number of months in the period for which the return is made bears to 12 months, but such exemptions shall not be reduced for a fractional part of a year otherwise resulting. A return is required in the case of every taxable year which is a period of less than 12 months if the gross income for such taxable year is greater than the personal exemption or the normal-tax exemption as the case may be, for such taxable year as so reduced. In the case of a return by a corporation for a fractional part of a year, the credit provided by section 26 (e) for the income of the corporation subject to excess profits tax, for taxable years beginning prior to January 1, 1944, is considered the amount of which the excess profits tax of the corporation imposed for the taxable year computed without regard to the tax deferment under section 710 (a) (5) is 90 percent, and for taxable years beginning after December 31, 1943, the amount of which such excess profits tax so computed is 95 percent. As to the definition of tax imposed, see section 26 (e). In the case of a corporation whose excess profits tax for a taxable year of less than 12 months is computed under sections 721, 726, 731, or 736 (b), the credit provided by section 26 (e) shall be computed as provided in that section. See § 29.26-4. For the computation of such credit in case the net income of the corporation is placed on an annual basis, see § 29.47-2.

The return of a decedent for the taxable year in which falls the date of his death is a return for the period during which he was alive.

CODIFICATION: § 29.47-1 was amended during the period covered by this Supplement as follows:

1. By Treasury Decision 5373, May 23, 1944, 9 F.R. 5502: The fourth and fifth sentences were amended to read as set forth above. The sixth sentence was amended to read as follows:

If, for taxable years beginning after December 31, 1943, a return is made for a fractional part of a year resulting from the termination by the Commissioner under section 146 of the taxable period, the personal exemption and credit for dependents shall be reduced to that proportion of the full credit which the number of months in the period for which the return is made bears to 12 months, but such personal exemption and such credit shall not be reduced for a fractional part of a year otherwise resulting.

2. By Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 15: The sixth sentence was amended to read as set forth above. In the seventh sentence beginning “A return is required" the words "or the normal-tax exemption as the case may be," were inserted immediately following the word "exemption".

3. By Treasury Decision 5401, Aug. 26, 1944, 9 F.R. 10449: The next to the last sentence in the first paragraph was amended to read as set forth above.

§ 29.47-1, as amended, reads as set forth above.

§ 29.47-2 Returns for period of less than 12 months on account of a change in accounting period. (a)

If the corporation computes its excess profits tax under section 711 (a) (3) (B), the credit provided in section 26 (e) is computed for taxable years beginning prior to January 1, 1944, as the amount of which the tax of the corporation imposed for the short period and computed under section 711 (a) (3) (B) without regard to the tax deferment under section 710 (a) (5) is 9 percent, and for taxable years beginning after December 31, 1943, the amount of which such excess profits tax so computed is 95 percent. As to the definition of tax imposed, see section 26 (e). In the case of a corporation whose excess profits tax for a taxable year of less than 12 months is computed under section 721, 726, 731, or 736 (b), the credit provided by section 26 (e) shall be computed as provided in that section. See § 29.26-4.

CODIFICATION: In § 29.47-2 (a), the text set forth above was substituted for the next to the last sentence of the second paragraph, by

Treasury Decision 5401, Aug. 26, 1943, 9 F.R. 10449.

(b)

In the case of a corporation, the credit provided by section 26 (e) for the adjusted excess profits net income of the corporation is computed for taxable years beginning prior to January 1, 1944, as the amount of which the excess profits tax imposed for such 12-month period, computed without regard to the tax deferment under section 710 (a) (5), is 90 percent, and for taxable years beginning after December 31, 1943, the amount of which such excess profits tax so computed is 95 percent. In the case of a corporation whose tax is computed under sections 721, 726, 731, or 736 (b), the credit provided by section 26 (e) shall be computed as provided in that section. See § 29.26-4. The excess profits tax imposed for such 12-month period shall be computed as provided in section 26 (e), and is the excess profits tax for the short period plus, for any taxable year which includes only part of such 12-month period, such part of the excess profits tax for such taxable year as is allocable to the part of the 12-month period included in such taxable year.

CODIFICATION: In paragraph (b), the text set forth above was substituted for the fifth and sixth sentences of the second paragraph thereof by Treasury Decision 5401, Aug. 26, 1943, 9 F.R. 10449.

In computing the tax of a corporation for the short period without placing its net income on an annual basis, the adjusted excess profits net income of the corporation is, for the purpose of determining the credit under section (26) (e) for taxable years beginning prior to January 1, 1944, the amount of which the excess profits tax of the corporation imposed for the short period computed without regard to the tax deferment under section 710 (a) (5) is 90 percent, and for taxable years beginning after December 31, 1943, the amount of which such excess profits tax so computed is 95 percent. As to the definition of tax imposed, see section 26 (e). In the case of a corporation whose tax is computed under section 721, 726, 731, or 736 (b), the credit provided by section 26 (e) shall be computed as provided in that section. See

29.26-4.

CODIFICATION: In paragraph (b), the text set forth above, was substituted for the last sentence of the fourth paragraph, by Treasury Decision 5401, Aug. 26, 1943, 9 F.R. 10449. RETURNS AND PAYMENT OF TAX

[Insert following statutory quotations immediately preceding § 29.51-1; T.D. 5373, May 23, 1944, 9 F.R. 5502; T.D. 5425, Dec. 29, 1944, 10 F.R. 16]

SEC. 105. RETURNS OF INCOME. Act of 1943, Title I.)

(Revenue

(a) Individual returns. Section 51 (relating to individual returns) is amended by inserting at the end thereof the following:

(f) Determination of status. For the purposes of this section and section 142 (a), the determination of whether an individual is married and living with husband or wife shall be made as of July 1 of the taxable year, unless the taxable year does not include July 1, in which case such determination shall be made as of the last day of the taxable year.

(b) Joint returns.

Section 51 (b) (relat

ing to joint returns) is amended by inserting before the period at the end thereof "or if husband and wife have different taxable years".

SEC. 101. TAXABLE YEAR TO WHICH AMENDMENTS APPLICABLE. (Revenue Act of 1943, Title I.)

Except as otherwise expressly provided, the amendments made by this title shall be applicable only with respect to taxable years beginning after December 31, 1943.

SEC. 11. RETURNS. (Individual Income Tax Act of 1944, Part I.)

(a) In general. Section 51 (a) and (b) (relating to individual returns) is amended to read as follows:

(a) Requirement. Every individual having for the taxable year a gross income of $500 or more shall make a return, which shall contain or be verified by a written declaration that it is made under the penalties of perjury. Such return shall set forth in such cases, and to such extent, and in such detail, as the Commissioner with the approval of the Secretary may by regulations prescribe, the items of gross income and the deductions and credits allowed under this chapter and such other information for the purpose of carrying out the provisions of this chapter as may be prescribed by such regulations.

(b) Husband and wife. A husband and wife may make a single return jointly. Such a return may be made even though one of the spouses has neither gross income nor deductions. If a joint return is made the tax shall be computed on the aggregate income and the liability with respect to the tax shall be joint and several. No joint return may be made if either the husband or wife is a nonresident alien or if the husband and wife The status of have different taxable years. individuals as husband and wife shall be

determined as of the last day of the taxable year.

is

(b) Returns by wage earners. Section 51 (relating to returns by individuals) amended by striking out subsection (f) and inserting in lieu thereof the following:

(f) Tax computed by collector in case of wage earners-(1) Return requirements. An individual entitled to elect to pay the tax imposed by Supplement T whose gross income is less than $5,000 and is entirely from one or more of the following sources: Remuneration for services performed by him as an employee, dividends, or interest; and whose gross income from sources other than wages, as defined in section 1621 (a), does not exceed $100, shall at his election be relieved, by using the form prescribed as the form for the return for the purposes of this subsection, from showing on the return the tax imposed by this chapter. In such case the tax shall be computed by the collector.

(2) Result of computation. After the collector has computed the tax, he shall mail to the taxpayer a notice stating the amount determined by the collector as payable and making demand therefor.

(3) Regulations. The Commissioner with the approval of the Secretary shall prescribe regulations for carrying out this subsection, and such regulations may provide for the application of the rules of this subsection to cases where the gross income includes items other than those enumerated in paragraph (1), to cases where the gross income from sources other than wages on which the tax has been withheld at the source is more than $100 but not more than $200, and to cases where the gross income is $5,000 or more but not more than $5,200. Such regulations shall provide (A) for the application of this subsection in the case of husband and wife, including provisions determining when a joint return under this subsection may be permitted or required and what constitutes a joint return, whether the liability shall be joint and several, and whether one spouse may make return under this subsection and the other without regard to this subsection, and (B) whether and the extent to which the benefits of this subsection may be availed of, in the case of taxable years beginning in the calendar year 1944, by persons required to make or making payments of estimated tax with respect to any such taxable year. (4) Method of election. The election to have the benefits of this subsection shall be made by making return on the form prescribed as the form for the return for the purposes of this subsection. An election so made shall constitute an election to pay the tax imposed by Supplement T.

*

SEC. 2. TAXABLE YEARS TO WHICH APPLICABLE. (Individual Income Tax Act of 1944, Part 1.) Except as otherwise expressly provided, the amendments made by this part shall be applicable with respect to taxable years beginning after December 31, 1943.

§ 29.51-1 Individual returns-(a) In general—(1) Taxable years beginning before January 1, 1944. For each taxable year beginning before January 1, 1944, a return of income shall be made by each citizen of the United States, whether residing at home or abroad, and every individual residing within the United States though not a citizen thereof, whether or not such citizen or resident is the head of a family or has dependents:

(i) If single or married but not living with husband or wife for any part of the taxable year, and if having for the taxable year a gross income (as defined in sections 22 and 116) of $500 or over, or such income is equal to, or in excess of, the credit allowed by section 25 (b) (1) and (3) (computed without regard to any credit to which he may be entitled as the head of a family). §§ 29.25-7 and 29.47-1.

See

(ii) If married and living with husband or wife for the entire taxable year, if no joint return is made, and if:

(a) Having for the taxable year a gross income of $1,200 or over, and the other spouse has no gross income; or

(b) Such individual and his or her spouse each has for the taxable year a gross income and the aggregate gross income of the two is $1,200 or over; or

(c) Such taxable year is a period of less than 12 months, if such individual has for the taxable year a gross income, and if the aggregate gross income of such individual and his or her spouse is equal to, or in excess of, the credit for personal exemption allowed by section 25 (b) (1) and (3). See §§ 29.25-7 and 29.47-1.

(iii) If married and living with husband or wife for any part of the taxable year but not at the close thereof, or if married and living with husband or wife at the close of the taxable year, but not during the entire taxable year, if no joint return is made, and if:

(a) Having for the taxable year a gross income equal to, or in excess of, the credit allowed him or her by section 25 (b) (1) and (3) (computed without regard to any credit to which he or she may be entitled as the head of a family (see § 29.25-7)), and the other spouse has no gross income; or

(b) Such individual and his or her spouse each has for the taxable year a gross income, and their aggregate gross

income is $1,200 or over, or is equal to, or in excess of, the credit allowed them by section 25 (b) (1) and (3) (computed without regard to any credit to which either or both may be entitled as the head of a family (see § 29.25–7)).

(2) Taxable years beginning after December 31, 1943. For each taxable year beginning after December 31, 1943, a return of income shall be made by each citizen of the United States, whether residing at home or abroad, and every individual residing within the United States though not a citizen thereof, regardless of family or marital status, if such citizen or resident has for such taxable year a gross income of $500 or more, or a gross income in excess of the credit allowed by section 25 (a) (3), prorated as provided in section 47 (e).

(b) Joint returns. For taxable years beginning prior to January 1, 1944, a husband and wife, if living together at the close of the taxable year may elect to make a joint return (see section 51 (b)), that is, to include in a single return made by them jointly the income and deductions of each, even though one has no gross income. For taxable years beginning after December 31, 1943, a husband and wife occupying the marital status as of the last day of the taxable year may elect to make a joint return even though one of the spouses has no gross income or deductions, and even though the spouses are not living together at any time during the taxable year. If a joint return is made the tax shall be computed on the aggregate income. The liability with respect to the tax shall be joint and several. If one spouse dies prior to the last day of the taxable year, the surviving spouse may not include the income of the deceased spouse in a joint return for such taxable year. A joint return may not be made if either the husband or wife is a nonresident alien.

An

penalties provided for erroneous, false, or fraudulent returns.

For returns by fiduciaries, see section 142; by partnerships, see section 187; and by nonresident alien individuals, see section 217. For time and place for filing returns, see section 53.

CODIFICATION: § 29.51-1 was amended in the following respects by Treasury Decision 5373, May 23, 1944, 9 F.R. 5502:

1. By inserting immediately preceding the period at the end of the headnote "for taxable years beginning before January 1, 1944".

2. By inserting immediately after "For each taxable year" in paragraph (a) thereof "beginning before January 1, 1944,".

§ 29.51-1 was further amended by Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 16, as follows:

1. The headnote was amended to read as set forth above.

2. A new subparagraph (2) was inserted immediately preceding paragraph (b).

3. The first paragraph of paragraph (b) was amended as set forth above.

§ 29.51-1, as amended, reads as set forth above.

§ 29.51-2 Form of return-(a) Taxable years beginning before January 1, 1944. For taxable years beginning before January 1, 1944, the *

(b) Taxable years beginning after December 31, 1943-(1) General. For taxable years beginning after December 31, 1943, the return shall be on Form 1040, except in the case of a taxpayer entitled to elect, and who so elects, to use the Form W-2 (Rev.) in accordance with the rules prescribed in paragraph (b) ̧ (2) of this section. A taxpayer, even though entitled to use Form W-2 (Rev.) for the taxable year may, nevertheless, Such taxuse Form 1040 as his return. payer otherwise entitled to use Form W2 (Rev.) as his return for the taxable year but who does not desire to take the standard deduction provided in section 23 (aa) is required to use Form 1040 as his return for such taxable year. Use of the short Form 1040A is discontinued with respect to taxable years beginning after December 31, 1943. The provisions of paragraph (a) of this section insofar as they apply to the time and manner of making a return on Form 1040 are equally applicable to taxable years beginning after December 31, 1943.

(2) Use of optional return on Form W-2 (Rev.); in general. For taxable years beginning after December 31, 1943, an individual entitled to elect to pay the tax imposed by Supplement T (except a taxpayer making his returns on a fiscal

year basis) may at his election use as his return Form W-2 (Rev.) provided his gross income is less than $5,000, consists entirely of remuneration for personal services performed by him as an employee, dividends, or interest, and his gross income from sources other than wages, as defined in section 1621 (a), does not exceed $100. A taxpayer who makes his return on a basis other than the cash receipts and disbursements basis may not use Form W-2 (Rev.) as his return. However, in the case of married persons domiciled in a community property State, Form W-2 (Rev.) may not be used as a return by either spouse unless the aggregate gross income of husband and wife meets the tests prescribed above and they make a combined return. If they desire to file separate returns, Form 1040 must be used.

An election to make a return on Form W-2 (Rev.) shall be exercised by properly executing and filing such form, together with all other Forms W-2 or W-2 (Rev.) received for the taxable year, with the collector on or before the due date of the taxpayer's return.

Form W-2, as distinguished from Form W-2 (Rev.), may not be used as the optional return. An individual who has been furnished by his employer with Form W-2 with respect to wages paid in 1944 and who, prior to the time prescribed for the filing of the return for that year, has not been furnished Form W-2 (Rev.) by his employer, may obtain from the collector a blank Form W-2 (Rev.). Such Form W-2 (Rev.) when filled out and executed and having attached thereto all Forms W-2 received with respect to wages paid in 1944, shall, when timely filed, constitute such individual's return for 1944 if he is eligible under section 51 (f) to use the optional return.

The fact that an individual made payments of estimated tax in the calendar year 1944 does not, if such individual is otherwise entitled to use as his return for 1944 the optional return, Form W-2 (Rev.), preclude such individual from electing to file his return on Form W-2 (Rev.) for such year.

(3) Combined return of husband and wife on Form W-2 (Rev.). If during the taxable year a husband and wife derive income from wages, as defined in section 1621 (a), and are furnished one or more Forms W-2 or Forms W-2 (Rev.), and the aggregate gross income of both spouses is less than $5,000, consists solely

of remuneration for services performed as an employee, dividends, or interest, and includes a total of not more than $100 from dividends, interest, and remuneration for personal services other than such wages, the spouses may elect to file a combined return on Form W-2 (Rev.). Such election shall be exercised by the filing of one of the Forms W-2 (Rev.) signed by both spouses and the other Forms W-2 and W-2 (Rev.) should be attached thereto.

The tax computed by the collector upon the basis of a combined return on Form W-2 (Rev.) shall be the lesser of the following amounts:

(i) A tax computed as though the combined return on Form W-2 (Rev.) constituted the separate returns of the spouses, and

(ii) A tax computed as though the combined return on Form W-2 (Rev.) constituted a joint return.

If a combined return is made by husband and wife on Form W-2 (Rev.), the liability for the tax shall be joint and several.

CODIFICATION: In § 29.51-2, the existing headnote and first word of the first sentence were deleted, the text set forth above substituted therefor, and paragraph (b) was added, by Treasury Decision 5425, Dec. 29, 1944, 10 F.R. 16.

§ 29.51-3 Return of income of minor-(a) Taxable years beginning before January 1, 1944. For taxable years beginning before January 1, 1944, an

(b) Taxable years beginning after December 31, 1943. For taxable years beginning after December 31, 1943, an individual, although a minor, who is single, is required to render a return of income if he has gross income (including compensation for personal services includible in his gross income under section 22 (m) (1)) of $500 or over for the taxable year regardless of the amount of his net income. If the aggregate of the gross income of such a minor from any property which he possesses, and from any funds held in trust for him by a trustee or guardian, and from his earnings is at least $500, regardless of the amount of his net income, a return, as in the case of any other individual, must be made by him or for him by his guardian or other person charged with the care of his person or property. See § 29.142-2. If he is married see § 29.51-1.