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history for the 1951 Act indicates: “This amendment is of a
clarifying nature and is not intended to change the existing
meaning of a domestic building and loan association”. S. Rept.
781, 82d Cong., 1st Sess. (1951), 1951-2 C.B. 563-564.
Petitioner cites this report in support of its position that,
although the definition of a domestic building and loan
association has expanded, the law has never required a specific
type of charter, thereby excluding those institutions whose
substantial business would otherwise qualify for the benefits of
the bad debt reserve calculation.
Congress again altered the rules for calculating bad debt
reserves for building and loan associations by deleting the
reference to “loans to members” and replacing it with the
supervisory test, business operations test, and assets test,
codified in section 7701(a)(19). Revenue Act of 1962, Pub. L.
87-834, sec. 6(c), 76 Stat. 977.
Respondent asserts that, throughout the evolution of the
definition of a domestic building and loan association, the
introductory language quoted supra p. 12 has remained in the
statute, demonstrating congressional intent to distinguish
between entities classified as domestic building and loan
associations and banks.
The introductory language of section 7701(a)(19) is also
found in section 301.7701-13A(a), Proced. & Admin. Regs. That
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