- 20 - the language that the Ways and Means Committee used to trigger a broadening of the fraud exception (sec. 276(a) of the House bill). In conference, the House receded and the Senate amendments were agreed to. See H. Rept. (Conference Report) 73-1385, at 25 (1934), 1939-1 C.B. (Part 2) 627, 634. None of the referenced committee reports explains the intended meaning of the phrase “the amount of gross income stated in the return”. Also, we have not found in the hearings or the floor debates any discussion of the meaning of that phrase. See Estate of Klein v. Commissioner, 63 T.C. 585, 594 (1975), affd. 537 F.2d 701 (2d Cir. 1976). The language of section 275(c) continued unchanged in the later revenue acts and through the Internal Revenue Code of 1939. Section 275(c), I.R.C. 1939, became section 6501(e)(1)(A), I.R.C. 1954, with three modifications, as follows: (1) the 5-year limitations period of former law was changed to 6 years; (2) “gross income” from a trade or business was redefined for these purposes to not include the subtraction for cost of sales or services; and (3) for purposes of the numerator of the fraction, adequate disclosure of an item will preclude that item being treated as omitted. The Ways and Means Committee report for H.R. 8300, which became the Internal Revenue Code of 1954 (H. Rept. 83-1337, p. 107 (1954)), describes these changes as follows:Page: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Next
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