Volume 75 · 65
Public Law 87–29
To amend the Internal Revenue Code of 1954 to exempt from tax income derived by a foreign central bank of issue from obligations of the United States, and for other purposes.
Approved May 4, 1961
Statutory text
AN ACT
To amend the Internal Revenue Code of 1954 to exempt from tax income derived by a foreign central bank of issue from obligations of the United States, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
That
subpart C of part II of subchapter N of chapter 1 of the Internal Revenue Code
of 1954 (relating to nonresident aliens and foreign corporations) is amended by adding at the end thereof the following new section:
“Sec. 895. INCOME DERIVED BY A FOREIGN CENTRAL BANK OF ISSUE FROM OBLIGATIONS OF THE UNITED STATES.
“Income derived by a foreign central bank of issue from obligations of the United States owned by such foreign central bank of issue shall not be included in gross income and shall be exempt from taxation under this subtitle unless such obligations are held for, or used in connection with, the conduct of commercial banking functions or other commercial activities.”
The table of sections for such subpart C is amended by adding at the end thereof the following:
The amendments made by subsections (a) and (b) shall be effective with respect to income received in taxable years beginning after December 31, 1960.
Sec. 2.
Section 1372 of the Internal Revenue Code of 1954 (relating to elections by small business corporations) is amended by adding at the end thereof the following new subsection:
“(g) Consent to Election by Certain Shareholders or Stock Held as Community Property.—
If a husband and wife owned stock which was community property (or the income from which was community income) under the applicable community property law of a State, and if either spouse filed a timely consent to an election under subsection (a) for a taxable year beginning before January 1, 1961, the time for filing the consent of the other spouse to such election shall not expire prior to May 15, 1961.”
Approved May 4, 1961.