PUBLIC LAWS-CH. 10-MAR . 7 , 1941 "(B) Income constituting an amount payable under a contract the performance of which required more than 12 months; or "(C) Income resulting from exploration, discovery, pros- pecting, research, or development of tangible property, pat- ents, formulae, or processes, or any combination of the fore- going, extending over a period of more than 12 months; or "(D) Income includible in gross income for the taxable year rather than for a different taxable year by reason of a change in the taxpayer's accounting period or method of accounting; or "(E) In the case of a lessor of real property, income included in gross income for the taxable year by reason of the termination of the lease; or "(F) Income consisting of dividends on stock of foreign corporations, except foreign personal holding companies. All the income which is classifiable in more than one of such subparagraphs shall be classified under the one which the tax- payer irrevocably elects. The classification of income of any class not described in subparagraphs (A) to (F), inclusive, shall be subject to regulations prescribed by the Commissioner with the approval of the Secretary. "(3) NET ABNORMAL INCOME.-T he term-'net abnormal income' means the amount of the abnormal income less, under regula- tions prescribed by the Commissioner with the approval of the Secretary, (A) 125 per centum of the average amount of the gross income of the same class determined under paragraph (1), and (B) an amount which bears the same ratio to the amount of any direct costs or expenses, deductible in determin- ing the normal-tax net income of the taxable year, through the expenditure of which such abnormal income was in whole or in part derived as the excess of the amount of such abnormal income over 125 per centum of such average amount bears to the amount of such abnormal income. "(b) AMOUNT ATTRIBUTABLE TO OTHER YEARS.- The amount of the net abnormal income that is attributable to any previous or future taxable year or years shall be determined under regulations prescribed by the Commissioner with the approval of the Secretary. In the case of amounts otherwise attributable to future taxable years, if the taxpayer either transfers substantially all its properties or distributes any property in complete liquidation, then there shall be attributable to the first taxable year in which such transfer or dis- tribution occurs (or if such year is previous to the taxable year in which the abnormal income is includible in gross income, to such latter taxable year) all amounts so attributable to future taxable years not included in the gross income of a previous taxable year. (c) COMPUTATION OF TAX FOR CURRENT TAXABLE YEAR. -The tax under this subchapter for the taxable year, in which the whole of such abnormal income would without regard to this section be includible, shall not exceed the sum of: "(1) The tax under this subchapter for such taxable year computed without the inclusion in gross income of the portion of the net abnormal income which is attributable to any other taxable year, and "(2) The aggregate of the increase in the tax under this subchapter which would have resulted for each previous taxable year to which any portion of such net abnormal income is attribu- table, computed as if an amount equal to such portion had been included in the gross income for such previous taxable year. 22 [55 STAT.
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