Any person authorized by law to make, render, sign or verify any return who makes false or fraudulent return, or statement, with intent to defeat or evade the assessment required by this section to be made, shall be guilty of a misdemeanor, and shall be fined not exceeding one thousand dollars or be imprisoned not exceeding one year, or both, at the discretion of the court, with the costs of prosecution.

All laws relating to the collection, remission and refund of internal-revenue taxes, so far as applicable to and not inconsistent with the provisions of this section, are hereby extended and made applicable to the tax imposed by this section.

Jurisdiction is hereby conferred upon the circuit and district courts of the United States for the district within which any person summoned under this section to appear to testify or to produce books, as aforesaid, shall reside, to compel such attendance, production of books, and testimony by appropriate process.

Synopsis of decisions relating to the tax. (T. D. 1060, 1675.)

Suit to recover back taxes collected can not be maintained against the successor of collector to whom the taxes were paid, except in his individual capacity; remedy either lies in an action against the collector who actually received the taxes or in an action against the United States; act of February 8, 1899, was to enable proceedings pending against public officials in their official capacity to be continued when necessary to obtain settlement of questions involved. (Roberts v. Lowe, 236 Fed., 604; T. D. 2394.)

Remedy by suit against collector where taxes have been wrongfully collected is not made exclusive by provisions that all laws relating to collection, remission, and refund of taxes, so far as applicable, are extended to the corporation excise tax. (United States v. Emery, Bird, Thayer Realty Co., 237 U. S. 28.)

Suit to recover taxes erroneously or illegally assessed can only be brought against collector who collected taxes, and not his successor, (Philadelphia, Harrisburg & Pittsburgh R. C. v. Lederer, 242 Fed., 492. T. D. 2507.)

Penalty for failure to make prescribed returns. (T. D. 1692.)

Penalty prescribed is constitutional; acceptance of return by Commissioner is not a waiver of the penalty. (T. D. 1864.)

Where corporations have gone out of business, leaving no assets, no proceedings to be instituted for penalty for failure to make return; assets distributed among stockholders available for collection of tax but not for penalty. (T. D. 1852.),

Appropriation for expenses of collecting tax; returns open to inspection by order of President.

[Extract from the legislative, executive and judicial appropriation act for the fiscal year ending June 30, 1911, approved June 17, 1910.

(36 Stat., 494.)]

For expenses of collecting the corporation tax authorized by the Act approved August 5, 1909: "To provide revenue, equalize duties and encourage the industries of the United States, and for other purposes, one hundred thousand dollars.

For classifying, indexing, exhibiting and properly caring for the returns of all corporations, required by section 38 of an Act entitled "An Act to provide revenue, equalize duties, encourage the industries of the United States, and for other purposes," approved August 5, 1909, including the employment, in the District of Columbia, of such clerical and other personal services and for rent of such quarters as may be necessary, twenty-five thousand dollars: Provided, That any and all such returns shall be open to inspection only upon. the order of the President under rules and regulations to be prescribed by the Secretary of the Treasury and approved by the President.

See also the legislative, executive, and judicial appropriation act approved March 4, 1911, which appropriated the same amount for the year ended June 30, 1912, repeating the proviso. (36 Stat., 1197.)

Deficiency appropriation act of March 4, 1911 (36 Stat., 1291), appropriated $5,000 for the purposes above specified, repeating the proviso.

Executive order and regulations governing the publicity of returns, November 25, 1910. (T. D. 1665.)

[Extract from the deficiency appropriation act for 1910 (act of June 25, 1910, 36 Stat., 780).]

The Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, is authorized out of the appropriation made for the purpose of carrying into effect section 38 of the tariff Act of August 5, 1909, for the fiscal year 1911, and out of the balance of the appropriation for that purpose for the fiscal year 1910, which balance is hereby reappropriated and made available for the fiscal year 1911, to employ such additional force of internal revenue agents, inspectors, deputy collectors, clerks, laborers and other assistants as he may deem proper and necessary to the prompt operation and enforcement of said section 38.

See also the deficiency appropriation act of March 4, 1911 (36 Stat., 1291), which reenacted authority to employ additional force.

Refund or abatement of penalty taxes.

An act to provide for refund or abatement under certain conditions of penalty taxes imposed by section 38 of the act of August 5, 1909, known as the special excise corporation tax law, approved March 3, 1913 (37 Stat., 734.) Be it enacted, etc., That any corporation, joint stock company, association, or any insurance company subject to the special excise tax provided by section 38 of the act of August 5, 1909, known as the special excise corporation tax law, which has been or may be compelled to pay or become liable for any additional tax within the provisions of subsection 5 of said section 38, which additional tax has been or may hereafter be imposed for a neglect to file a return as provided in said corporation tax law on or before the first of March of any year, may, within one year after the passage of this act or within one year after the date of notice of assessment where such notice is given after the passage of this act, make application to the Commissioner of Internal Revenue for a refund of such additional tax. And the Commissioner of Internal Revenue, with the advice and consent of the Solicitor of Internal Revenue, is hereby directed to remit, abate, or pay back all such additional taxes in excess of $100 for any single year whenever in any case it appears to his satisfaction that the additional tax was assessed or imposed solely because of a neglect to make a return at the time or times specified in said act, and without any intention or design on the part of any officer of such corporation, joint stock company, association or insurance company to hinder or delay the United States in the collection of the tax originally assessed.

Claim for abatement or refund required to be made on Form 47 or 46, respectively; claims required to be accompanied by affidavit of corporation's president, vice president, or other principal officer, and its treasurer or assistant treasurer, stating that neglect to make return was without intent or design to hinder or delay the United States in collection of tax, etc. (T. D. 1838.)

INCOME TAX LAW OF OCTOBER 3, 1913.

This law was repealed by the Act of September 8, 1916 (page 232), and is included here only for purposes of reference.

INCOME TAX.

AN ACT To reduce tariff duties and to provide revenue for the Government,

and for other purposes. Approved October 3, 1913 (38 Stat., 114, 166.)

A. Subdivision 1. That there shall be levied, assessed, collected, and paid annually upon the entire net income arising or accruing from all sources in the preceding calendar year to every citizen of the United States, whether residing at home or abroad, and to every person residing in the United States, though not a citizen thereof, a tax of 1 per centum per annum upon such income, except as hereinafter provided; and a like tax shall be assessed, levied, collected, and paid annually upon the entire net income from all property owned, and of every business, trade, or profession carried on in the United States by persons residing elsewhere.

Act is not unconstitutional. (Brushaber v. Union Pacific Co., 240 U. S., 1, T. D. 2290; Dodge v. Brady, 240 U. S., 123, T. D. 2302; Tyee Realty Co. v. Anderson, 240 U. S., 115, T. D. 2300; Stanton v. Baltic Mining Co., 240 U. S., 103, T. D. 2303.)

Where an income tax law is doubtful, doubt should be resolved in favor of the taxpayer against the Government. (Miller v. Gearin, 258 Fed., 225.)

Commissions of general life insurance agent from renewal premiums on policies obtained by him and accepted in some year prior to "preceding calendar year" mentioned are taxablė. (Woods v. Lewellyn, 252 Fed., 106.)

Statute can not be changed by regulations. Fed., 110.)

(Edwards v. Keith, 231

Tax is not laid on articles in course of exportation or on anything which inherently or by usages of commerce is embraced in exportation, but on the contrary is a general tax. (Wm. E. Peck & Co. v. Lowe, 247 U. S., 165; T. D. 2726.)

Section does not lay tax upon interest accruing on bonds executed by resident or citizen of United States when held and owned by nonresident foreigner. (30 Op. Atty. Gen., 230.)

Dividends accruing from stock of domestic corporation owned by nonresident aliens are not subject to tax. (30 Op. Atty. Gen., 273.)

Income received by nonresident alien from stocks and bonds of corporations organized under United States laws and mortgages and bonds secured upon property in United States, certificates representing same being held by domestic trust company, is property owned in United States. (De Ganay v. Lederer, 250 U. S., 376; T. D. 2876.)