-47-
B. 1957 Regulations
On October 23, 1957, the Secretary filed in the Federal
Register the 1957 regulations interpreting section 882 of the
1954 Code. See sec. 1.882-4, Income Tax Regs., 22 Fed. Reg. 8362
(Oct. 23, 1957). According to those regulations, section 882 of
the 1954 Code pertained to “resident corporations”; i.e.,
corporations with a trade or business in the United States, and
such a corporation could deduct its expenses only if it filed a
true and accurate Federal income tax return in accordance with
section 6012 and the regulations thereunder. The 1957
regulations stated that a foreign corporation would be taxed on
its gross income, without the benefit of any deductions, if it
did not so file such a return. The 1957 regulations did not
require that the required return be filed by a set time. Nor did
the 1957 regulations state that the relevant text included a
timely filing requirement. The 1957 regulations stated in
relevant part:
� 1.882-4 Allowance of Deductions to Foreign
Corporations.--* * *
(b) Resident foreign corporations.--(1) Return
necessary. A resident foreign corporation shall
receive the benefit of the deductions allowed to it
with respect to the income tax, only if it files or
causes to be filed with the district director, in
accordance with section 6012 and the regulations
thereunder, a true and accurate return of its total
income received from all sources within the United
States.
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