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(C) any cooperative bank without capital
stock organized and operated for mutual
purposes and without profit,
there shall be allowed a deduction for a
reasonable addition to a reserve for bad debts.
Such deduction shall be in lieu of any deduction
under section 166(a).
(2) Organization must meet 60-percent asset
test of section 7701(a)(19).-–This section shall
apply to an association or bank referred to in
paragraph (1) only if it meets the requirements of
section 7701(a)(19)(C).
Section 7701 provides:
SEC. 7701. DEFINITIONS.
(a) When used in this title, where not otherwise
distinctly expressed or manifestly incompatible with
the intent thereof–-
* * * * * * *
(19)Domestic building and loan association.--
The term “domestic building and loan association”
means a domestic building and loan association, a
domestic savings and loan association, and a
Federal savings and loan association–-
Section 301.7701-13A, Proced. & Admin Regs., provides:
SEC. 301.7701-13A. Post-1969 domestic building and
loan association.--(a) In general. For taxable years
beginning after July 11, 1969, the term “domestic
building and loan association” means a domestic
building and loan association, a domestic savings and
loan association, a Federal savings and loan
association, and any other savings institution
chartered and supervised as a savings and loan or
similar association under Federal or State law which
meets the supervisory test (described in paragraph (b)
of this section), the business operations test
(described in paragraph (c) of this section), and the
assets test (described in paragraph (d) of this
section). * * *
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