8 per centum of the amount by which the net income exceeds $18,00 and does not exceed $20,000; 9 per centum of the amount by which the net income exceeds $20,000 and does not exceed $22,000; 10 per centum of the amount by which the net income exceeds $22,000 and does not exceed $24,000; 11 per centum of the amount by which the net income exceeds $24,000 and does not exceed $26,000; 12 per centum of the amount by which the net income exceeds $26,000 and does not exceed $28,000; 13 per centum of the amount by which the net income exceeds $28,000 and does not exceed $30,000; 14 per centum of the amount by which the net income exceeds $30,000 and does not exceed $32,000; 15 per centum of the amount by which the net inco1ne exceeds $32,000 and does not exceed $34,000; 16 per centum of the amount by which the net income exceeds $34,000 and does not exceed $36,000; 17 per centum of the amount by which the net income exceeds $36,000 and does not exceed $38,000; 18 per centum of the amount by which the net income exceeds $38,000 and does not exceed $40,000; 19 per centum of the amount by which the net income exceeds $40,000 and does not exceed $42,000; 20 per centum of the amount by which the net income exceeds $42,000 and does not exceed $44,000; 21 per centum of the amount by which the net income exceeds $44,000 and does not exceed $46,000; 22 per centum of the amount by which the net income exceeds $46,000 and does not exceed $48,000; 23 per centum of the amount by which the net income exceeds $48,000 and does not exceed $50,000; 24 per centum of the amount by which the net income exceeds $50,000 and does not exceed $52,000; 25 per centum of the amount by which the net income exceeds $52,000 and does not exceed $54,000; 26 per centum of the amount by which the net income exceeds $54,000 and does not exceed $56,000; 27 per centum of the amount by which the net income exceeds $56,000 nd does not exceed $58,000; 28 per centum of the amount by which the net income exceeds $58,000 nd does not exceed $60,000; 29 per centum of the amount by which the net income exceeds $60,000 nd does not exceed $62,000; 30 per centum of the amount by which the net income exceeds $62,000 nd does not exceed $64,000; 31 per centum of the amount by which the net income exceeds $64,000 nd does not exceed $66,000; 32 per centum of the amount by which the net income exceeds $66,000 nd does not exceed $68,000; 33 per centum of the amount by which the net income exceeds $68,000 nd does not exceed $70,000; 34 per centum of the amount by which the net income exceeds $70,000 and does not exceed $72,000; 35 per centum of the amount by which the net income exceeds $72,000 and does not exceed $74,000; 36 per centum of the amount by which the net income exceeds $74,000 and does not exceed $76,000; 37 per centum of the amount by which the net income exceeds $76,000 and does not exceed $78,000; 38 per centum of the amount by which the net income exceeds $78,000 and does not exceed $80,000; 39 per centum of the amount by which the net income exceeds $80,000 and does not exceed $82,000; 40 per centum of the amount by which the net income exceeds $82,000 and does not exceed $84,000; 41 per centum of the amount by which the net income exceeds $84,000 and does not exceed $86,000; 42 per centum of the amount by which the net income exceeds $86,000 and does not exceed $88,000; 43 per centum of the amount by which the net income exceeds $88,000 and does not exceed $90,000; 44 per centum of the amount by which the net income exceeds $90,000 and does not exceed $92,000; 45 per centum of the amount by which the net income exceeds $92,000 and does not exceed $94,000; Rate on Sale of Mines, etc. Net Income Computed on 46 per centum of the amount by which the net income exceeds $94,00 and does not exceed $96,000; 47 per centum of the amount by which the net income exceeds $96,00 and does not exceed $98,000; 48 per centum of the amount by which the net income exceeds $98,00 and does not exceed $100,000; 52 per centum of the amount by which the net income exceed $100,000 and does not exceed $150,000; 56 per centum of the amount by which the net income exceed $150,000 and does not exceed $200,000; 60 per centum of the amount by which the net income exceed $200,000 and does not exceed $300,000; 63 per centum of the amount by which the net income exceed $300,000 and does not exceed $500,000; 64 per centum of the amount by which the net income exceed $500,000 and does not exceed $1,000,000; 65 per centum of the amount by which the net income exceed $1,000,000. (b) In the case of a bona fide sale of mines, oil or gas wells, o any interest therein, where the principal value of the property has bee demonstrated by prospecting or exploration and discovery work done b the taxpayer, the portion of the tax imposed by this section attributabl to such sale shall not exceed 20 per centum of the selling price of suc property or interest. Net Income Defined. Sec. 212. (a) That in the case of an individual the term "net in come" means the gross income as defined in section 213, less the deduc tions allowed by section 214. L (b) The net income shall be computed upon the basis of the tax payer's annual accounting period (fiscal year or calendar year, as the case may be) in accordance with the method of accounting regularl employed in keeping the books of such taxpayer; but if no such metho of accounting has been so employed, or if the method employed does no clearly reflect the income, the computation shall be made upon such basi and in such manner as in the opinion of the Commissioner does clearl reflect the income. If the taxpayer's annual accounting period is othe than a fiscal year as defined in section 200 or if the taxpayer has n annual accounting period or does not keep books, the net income shal be computed on the basis of the calendar year. If a taxpayer changes his accounting period from fiscal year to calendar year, from calendar year to fiscal year, or from one fiscal yea another, the net income shall, with the approval of the Commissioner, computed on the basis of such new accounting period, subject to the rovisions of section 226. Gross Income Defined. Sec. 213. That for the purposes of this title (except as otherwise rovided in section 233) the term "gross income❞— (a) Includes gains, profits, and income derived from salaries, wages, compensation for personal service (including in the case of the Presient of the United States, the judges of the Supreme and inferior courts f the United States, and all other officers and employees, whether elected r appointed, of the United States, Alaska, Hawaii, or any political subivision thereof, or the District of Columbia, the compensation received s such), of whatever kind and in whatever form paid, or from profesions, vocations, trades, businesses, commerce, or sales, or dealings in roperty, whether real or personal, growing out of the ownership or use f or interest in such property; also from interest, rent, dividends, ecurities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever. The amount of all such items shall be included in the gross income for he taxable year in which received by the taxpayer, unless, under methods of accounting permitted under subdivision (b) of section 212, any such amounts are to be propertly accounted for as of a different period; but (b) Does not include the following items, which shall be exempt Items Not from taxation under this title: (1) The proceeds of life insurance policies paid upon the death of the insured to individual beneficiaries or to the estate of the insured; (2) The amount received by the insured as a return of premium or premiums paid by him under life insurance, endowment, or annuity contracts, either during the term or at the maturity of the term mentioned in the contract or upon surrender of the contract; (3) The value of property acquired by gift, bequest, devise, or descent (but the income from such property shall be included in gross income); (4) Interest upon (a) the obligations of a State, Territory, or any political subdivision thereof, or the District of Columbia; or (b) securities issued under the provisions of the Federal Farm Loan Act of July 17, 1916; or (c) the obligations of the United States or its possessions; or (d) bonds issued by the War Finance Corporation: Provided, That every person owning any of the obligations, securities or bonds enumerated in clauses (a), (b), (c) and (d) shall, in the return required by this title, submit a statement showing the number and amount of such obligations, securities and bonds owned by him and the income received therefrom, in such form and with such information Included in Gross Income Taxpayer Shall Make Return of Bonds Income from Public Utility as the Commissioner may require. In the case of obligations of th United States issued after September 1, 1917, and in the case of bond issued by the War Finance Corporation, the interest shall be exempt onl if and to the extent provided in the respective Acts authorizing the issue thereof as amended and supplemented, and shall be excluded from gross income only if and to the extent it is wholly exempt from taxation the taxpayer both under this title and under Title III; (5) The income of foreign governments received from investments in the United States in stocks, bonds, or other domestic securities, owned by such foreign governments, or from interest on deposits in banks the United States of moneys belonging to such foreign governments, or from any other source within the United States; (6) Amounts received, through accident or health insurance of under workmen's compensation acts, as compensation for personal injuries or sickness, plus the amount of any damages received whether by suit or agreement on account of such injuries or sickness; (7) Income derived from any public utility or the exercise of any essential governmental function and accruing to any State, Territory, or the District of Columbia, or any political subdivision of a State or Territory, or income accruing to the government of any possession of the United States, or any political subdivision thereof. Whenever any State, Territory, or the District of Columbia, or any political subdivision of a State or Territory, prior to September 8, 1916, entered in good faith into a contract with any person, the object and purpose of which is to acquire, construct, operate, or maintain a public utility, no tax shall be levied under the provisions of this title upon the income derived from the operation of such public utility, so far as the payment thereof will impose a loss or burden upon such State, Territory, District of Columbia, or political subdivision; but this provision is not intended to confer upon such person any financial gain or exemption or to relieve such person from the payment of a tax as provided for in this title upon the part or portion of such income to which such person is entitled under such contract; (8) So much of the amount received during the present war by a person in the military or naval forces of the United States as salary or compensation in any form from the United States for active services in such forces, as does not exceed $3,500. (c) In the case of non-resident alien individuals, gross income Gross Income includes only the gross income from sources within the United States Non-resident Aliens including interest on bonds, notes, or other interest-bearing obligations of residents, corporate or otherwise, dividends from resident corporations, and including all amounts received (although paid under a contract for the sale of goods or otherwise) representing profits on the manufacture and disposition of goods within the United States. |