588
INTERNAL REVENUE CODE OF 1954
notes are received for discount or for sale, shall be regarded as a bank or as a banker. SEC. 4883. EXEMPTIONS. ~ (a)
CIRCULATION REDUCED TO N O T OVER 5 P E R C E N T OF C A P I T A L. —
Whenever the outstanding circulation of any bank, association, corporation, company, or person is reduced to an amount not exceeding 5 percent of the chartered or declared capital existing at the time the same was issued, said circulation shall be free from taxation. (b)
CIRCULATION U N D E R REDEMPTION IN WHOLE.—Whenever any
bank which has ceased to issue notes for circulation deposits in the Treasury of the United States, in lawful money, the amount of its outstanding circulation, to be redeemed at par, under such regulations as the Secretary or his delegate shall prescribe, it shall be exempt from any tax upon such circulation. (c) NATIONAL B A N K S. — The provisions of this subchapter, relating to the tax on the circulation of banks, and to their returns, except as contained in sections 4881(b)(2), 4883 (a) and (b), 4884 (a)(3), and such parts of sections 4884(a)(1) and (2) and (b), 4885, and 4886, as relate to the tax of 10 percent on certain notes, shall not apply to associations which are taxed as national banks. (d)
CIRCULATION OF INSOLVENT B A N K S. —
For exemption in case of insolvent banks, see subtitle F. SEC. 4884. RETURNS AND PAYMENT OF TAX.
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(a) C I R C U L A T I O N O U T S T A N D I N G. — ' (1) T I M E FOR MAKING RETURN.—A true and complete return of
the monthly amount of circulation as aforesaid for the previous six months shall be made and rendered in duplicate on the first day of December, and the first day of June, by each of such banks, associations, corporations, companies, or persons. (2) CALCULATION OF TAX.—The tax imposed by section 4881(a) shall be calculated at the rate per month prescribed by said section, so that the tax for six months shall not be less than the aggregate would be if such taxes were collected monthly. (3) R E T U R N AND PAYMENT WHEN STATE BANK CONVERTED INTO NATIONAL BANK.—Whenever any State bank or banking associa-
tion has been converted into a national banking association, and such national banking association has assumed the liabilities of such State bank or banking association, including the redemption of its bills, by any agreement or understanding whatever with the representatives of such State bank or banking association, such national banking association shall be held to make the required return and payment on the circulation outstanding, so long as such circulation shall exceed 5 per centum of the capital before such conversion of such State bank or banking association. (b) CIRCULATION PAID O U T. — The amount of circulating notes referred to in section 4881(b), and of the tax due thereon, shall be returned, and the tax paid at the same time, and in the same manner, and with like penalties for failure to return and pay the same, as provided by law for the return and payment of taxes on circulation imposed by section 4881(a).
§4882
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