Y~L 5TATISTICS 'OF INCOME FOR 194 4 'PART .2 COMPILED'FROM CORPORATION INCOME AND DECLARED VALUE EXCESS-PROFITS TAX- RETURNS, - CORPORATIONEXCESS PROFITS TAX RETURNS, AND. PERSONAL . HOLDING COMPANY RETURNS VN ITED , ~STATES TREASURY *' DEPARTMENT BUREAU-OF INTERNAL REVENUE - WASHINGTON .D .C . 0 U. S. TREASURY DEPARTMEN T BUREAU OF INTERNAL REVENUE STATISTICS OF INCOME & FOR 1944 PART 2 COMPILED FROM CORPORATION INCOME AND DECLARED VALUE EXCESS-PROFITS TAX RETURNS, ("ORPORATION EXCESS PROFITS TAX RETURNS, AND PERSONAL HOLDING COMPANY RETURN S PREPARED UNDER THE DIRECTION OF THE COMMISSIONER OF INTERNAL REVENUE BY THE STATISTICAL DIVISION UNITED STATES GOVERNMENT PRINTING OFFICE WASHING-rON : 194 9 For sale by the Superintendent of Documents, U . S. Government Printing Office, Washington 25 . D . C. Price $ 1 .00 LETTER OF TRANSMITTAL TREAsURY DEPARTMENT, OFFICE OF COMMISSIONER OF INTERNAL REVENUE , Washington, D . C., Alay 5, 1949 . SIR : In accordance with the provisions of section 63 of the Internal Revenue Code, requiring the publication annually of statistics with respect to the operation of the Federal income, war-profits, and excess profits tax haws, I have the honor to transnuit herewith a report en- titled "Statistics of Income for 1944, Part 2," presenting data relative to income, deductions, assets, liabilities, exemptions, credits, tax liability, and dividends paid, as reported on corporation income and declared value excess-profits tax returns, corporation excess profits tax returns, and personal holding company returns for 1944 filed during 1945 . There is also included a historical presentation of the income. and of the tax liability reported by corDOI-ations for the years 1909 through 1944, and a synopsis of corpora6on income and profits tax credits, rates, and other provisions of the Federal tgx laws affecting the comparability of historical data . in this report . Respectf Lilly, GEO . J . SCHOENEMAN , Commissioner of -Internal Revenue .- Ron . JOHN W . SNYDER , Secretary of the Treasury . Irr CONTENTS Page Introduction ------------------------------------------------------ I CORPORATION INCOME AND DECLARED VALUE EXCESS-PROFITS TAX RETURNS (FORMS 1120,1120L, AND 1120M ) Summary data ---------------------------------------------------- 1-2 Comparison with 1943 ----------------------------------------- 2 Returns included -------------------------------------------------- 2-3 Changes in law affecting corporation returns (Form 1120) --------------- 3 Classifications, text tables, and description of basic tables--------, ------- 3-2 0 Active wid inactive corporations --------------------------------- 3-4 Returns with net income and returns with no net income ----------- 4 States and Territories ------------------------------------------ 4-5 Industrial divisions and groups ---------------------------------- 5-8 Returns with balance sheets and returns with no balance sheets ----- 8-11 Total assets classes -------------------------------------------- 11-18 Type of tax liability ------------------------------------------- 13 Net income and deficit classes ----------------------------------- 13-15 Consolidated returns ------------------------------------------- 15-18 Fiscal year returns --------------------------------------------- - 18-19 Part year returns ---------------------------------------------- 20 Income and profits taxes paid to foreign countries or possessions of th e United States --------------------------------------------------- 20-21 Tax liability and collections, factors affecting comparability ------------- 21-22 Renegotiation of war contracts -------------------------------------- 22-39 G ,eneral explanations ------------------------------------------- 22-23 Adjustments resulting from renegotiation ------------------------- 23-39 CORPORATION EXCESS PROFITS TAX RETURNS (FORM 1121 ) Summary data ----------------------------------------------------- 43 Comparison with 1943 ----------------------------------------- 43 Returns included -------------------------------------------------- 43 Changes in law affecting excess profits tax returns (Form 1121) ---------- 43-44 Method of credit computation --------------------------------------- 44-45 Data from income tax returns showing adjusted excess profits net income a s a credit -------------------------------------------------------- 46-48 Unused excess profits credit adjustment ------------------------------ 48 Consolidated returns ----------------------------------------------- 48 PERSONAL HOLDING CO1%4PANY RETURNS (FORM 1120H ) Summarv data ------------------- I -------------------------------- 51 General explanations ----------------------------------------------- 51-54 Tables ----------------------------------------------------------- 54-5 5 HISTORICAL DATA-CORPORATION INCOME AND PROFITS TAX RIETURN S Description of tables ----------------------------------------------- 56-58 Comparability of historical. data ------------------------------------- 58-60 Returns included ---------------------------------------------- 58 Contents of items ---------------------------------------------- 58-59 Geographic distribution ---------------------------------------- 59 Industrial classification ----------------------------------------- 59-60 Source Book of Statistics of Income ------------------------------ --- 60-74 Description --------------------------------------------------- 60-61 Chart 1 . Data available and classifications for the years 1926-1944-- 62-65 Chart II . Industrial groups for which data are shown in the Sourc e Book, 192C-1944 -------------------------------------------- 66-7 4 V V1 C0NTE1*--%_rT S BASIC TA-IBLES CORPORATION INCOME AND DECL--!!sRED VALUE EXCESS-PROFITS TAX RETIC-IRNS Pag e 1 . States and Territories, general summary-all returns ---------------- 76-77 2 . Major and minor industrial groups, gen~ral suminarv-all . returns ----- 78-79 3. Major industrial groups (Receipts and cAeductious) --all returns ------ 90-131 4. Major industrial groups (Assets and liabilities, receipts and dedue- tions)-returns with balance sheets - -------------------------- 1-32-1-6 .5 4-A . Major industrial groups (Assets anct liabilities, receipts and deduc- tions) -consolidated returns with I.Dalance sheets ------------- 166-199 5. Total assets classes (Assets and liabili-t--ies, receipts and deductions)- returns with balance sheets --------- ------------------------- 200-20 5 5-A . Total assets classes (Assets and liabilities, receipts and deductions)- consolidated returns with balan ce s -heets - - - _ ------------------ 206-211 . 6 . Total assets cki.sses and major industrial groups k'Selected assets, lia- bilities, and receipts) -returns with b _-Alance sheets -------------- 212-297 7. Net income and deficit classes and 11-m-Ajor industrial groups (Selected items)-all returns ----------------- ------------------------- 298-326 8 . Net income and deficit cla9ses and t-vpce of tax liabilitv-all returns 327-332 9. Net income and deficit cl,asses (Diviclends received and interest re- ceived on Governinent obligations)-a-11 returns ------------------ 33 3 10. Not income and deficit classes (Dividei-tds paid)-all returns --------- 33 4 TAXABLE CORPORATION EXCES,8 PROFITS TAX RETURN S 11 . Adjusted excess profits net income classes and method of credit com- putation-all taxable returns ------- ------------------------- 340-340" 12 . Adjusted excess profits net income classes aDd method of credit com- p utation-tax able consolidated returns ------------------------ 344-34 7 SUPPLEMENTAL DATA FROM CORPOIZATION' INCOME TAX RETURNS SBOWING ADJUSTED EXCESS PROFI-V'S, NET INCOME AS A CREDI T 13 . Major industrial -groups (Assets and liabilities,- receipts and deduc- tions) ---------------------------- -------------------- ---- 348-365 14 . Total assets classes (Assets and liabilities, receipts and deductions) - - 366-367 HISTORICAL DATA-CORPORATION INCOME AND PROFITS TA X RETURNTS All returns : 15 . General sunimary, 1909-1944 ------------------------------ 372-373 16, Net income and deficit classes, 193 ;3-1,944 ------------------- 374-375 17 . Receipts and deductions, 1926-194 :4 ------------------------ 376-387 18 . Industrial groups, 1-935-1944 ------------------------------ 388-393 19 . States and Territories, 1935-1944 --------------------------- 394-405 Returns with balance sheets : 20 . Assets and liabilities, 1926-1944 ; receipts and deductions, 1931- 1944 -------------------------------------------------- 406-417 21 . Total assets classes, 1931-1944 ----------------------------- 418-421 Taxable excess profits tax returns : 22 . General summary, 1940-1944 -------------------------------- 422 Consolidated returns .: 23 . Income tax returns, surninarY, 1928-1944 --------------------- 422 24 . Taxable excess profits tax returns, sunimary, 1 .910-1944 --------- 42 2 SYNOPSIS OF FEDERAL TAX LAWS AIFFECTING THE COMPARABILITY OF HISTORICAL DATA IN STATISTICS OF INCOM E CORPORATION INCOME AND PROFITS TAX RETURN S A . Credits and tax rates, 1909-1944 ------------------------------- 430-444 B . Capital gain and loss provisions, 1932-1944 ---------------------- 445-446 C . Consolidated returns-provisions for filiric, and tax rates, 1917-1944-- 447-453 RETURN FOP .NI S Facsimiles of Forms 1120, 1120L, 1120M, 1121, and 1120H for 1944 ---- 45 .5-496 INDEX ---------------------------------------------------------- 497-518 STATISTICS OF INCOME FOR 1944-PART 2 CORPORATION INCOME AND DECLARED VALUE EXCESS-PROFITS TAX RETURNS, CORPORATION EXCESS PROFITS TAX RETURNS, AND PER- SONAL HOLDING COMPANY RETURN S INTRODUCTIO N This report, presenting data for 1944 tabulated from corporation income and declared value excess-profits tax returns, Form 1120 ; life insurance company income tax returns, Form 1120L ; mutual in- surance .company income tax returns, Form 1120M ; corporation excess profits tax returns, Form 1121 ; and personal holding company returns,, Form 1120H, is prepared in accordance with section 63 of the Internal Revenue Code, which provides for the publication annually of statis- tics with respect to the operation of the income7 war-profits, and excess profits tax laws . The amounts reported as income, deductions, assets, liabilities, exemptions, credits, Federal tax lial-)ility, and dividends paid are shown in aggregate and for v arlous cla-,sifications of corporations and of income . Facsimiles of the return forms from which the data are tabulated and to which references are made throughout this volume are also shown . Historical data pertaining to uncome and profits tax returns for 1909 through 1944 are presented, with a r6sume' of the information available for 1926-1944 in the So-urce Book, a volume of data supple- mentary to the published reports, Statistics of Income . There isalso a synopsis of corporation income and profits tax credits, rates, and other provisions of the Federal tax laws affecting the comparability of historical data in this report . Certain of the more siu-nificant data for 1944 contained herein were made public previously b in a preliminary report issued as of April 147 1947Y and in two press releases dated ~/Iarch 26 ; 1947, and October 81 1947 . CORPORATION INCOME AND DIECLARED VALUE EXCESS-PROFITS TAX RETURNS (FORMS 11.20,1120L, AND 1120M ) SUMMAIR.Y DAT A The number of corporation incoxne and declared value exce-s-profits tax returns for 1944 is 446 ,796, of which 2 1-188,904 show net income of $27,1233,740,994, while 123,563 sho-w deficit of $819,260,208 and 34Y329 have no income data (inactive corporations) . - ThenicOme tax liability reported on these returns is $4,353,619,S88 and the declared value excess-p--r-ofits tax is $98,668,048, v,,hile an excess profits tax liability of $10,4~31,762 093, a I y fter credits is reported on 55,912 corporation excess proFits tax returns for the same period . Th Li s, the to tal amount of corp ora, tion in come an d excess profi ts taxes is $14,S84,050,029, representing a decrease of 7 percent as compared I STATISTICS OF INTCOMIHI FOR 1944, PART 2 with the total for 1943 . The arraounts of income tax and excess profits tax liability do Dot tahe in-bo account any credit claimed for income and profits taxes paid to a foreign country or United States possession . A comparison of the 1944 returns. with the 1943 returns is provided in the following summary : I Corporation income and declared value exr-ess-profitts tax returns,' 1944' and 1948 : Su-innia?-y data - [Money figures in thcbusands of dollars] Increase or decrease (- ) Total number of returns ------------------------------- ----- Returns with not income: 2 Number of returns -------------------------------- ----- Not income 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tax liability : Income tax 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Declared value excess-profits tax -------------- ----- Excess profits tax 4 ---------------------------- ----- Total --------------------------------------- ----- Returns with no riet income : 2 Number of returns -------------------------------- -- Deficit 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1944 446, 79 6 288, 904 27,1213,741 4,353, 620 98, 668 10, 431, 762 14,884,050 123, 562 819, 260 1943 455,80 4 2,92, 735 28,717,966 4, 479, 1 GG 154,934 11 . 291,4,V , 15, 925, 582 136, 786 898,722 Number or amoun t -9,098 5,169 -1,594,225 -125,546 - 56, 265 -859,721 -1,041, 53 2 -1.3,223 -79,461 Per- cent - 2 - 7 Number of returns of inactive corporations ------------ - ---- For footnotes, see pp . 40-42 . 34,329 35,373 -10 - 9 -1,044 1 - 3 Allowance of the net operating loss deduction reduced the net in- come for declared value excess-profits tax computation by $148,759,845 on 34,296 returns filed for 1944 as compared w1th $224,952,476 on 44,583 returns filed for 1943 . See note 9 .9, page 41 . I- RE TURNS IlNCLUDE D The data presented in this section- are from returns for the calendar year ending December 31, 1-944, a fiscal year ending within the period July 1944 through June 1945, and a part year with the greater portiOD of the accounting period in 1944 . The data are tabulated from corporation income and declared value excess-profits tax returns, Form 1120 ; life insurance company income tax returns, Form 1120L ; and mutual insurance company income tax returns, Form 1120M . Included for this purpose in addition to re- turns filed by domestic corporations are the returns filed by foreign corporations engaged in business -vvithin the United States . The excess profits tax liability reported on corporation excess profits tax returns, Form 1121, is included where indicated . The statistics are compiled from the returns as filed, prior to revisions that may be made as a result of 'audit by the Bureau of Internal Revenue and prior to changes which may result from carry-backs, relief granted under sec- tion 722 of the Internal Revenue Code, recomputation. of amortization of emergency facilities, or from the rene-otiation of war contracts, STATISTICS OF INCWaE FOR 1 .944, PART 2 af ter the returns were filed . Chan :ges resulting from the renegotiation In of war contracts are recorded ,is settlements are reached, however, and the effect of rene(4otiation settlements reached to July 31, 1947, with respect to the tax year 1944 is shown in special tables on pages 23-39 . There are excluded from this report data pertaining to amended returns, tentative returns, and the returns of nonresident foreign cor- porations (those not enpaged in tr-ade or business within the United States andnot having aii office or place of business therein, who file on Form 1120NB) . CHANGES IN LAW AFFECTII\'G CO LIPORATION RETURNS (FORM 1120 ) The comparability of the figure~s tabulated from the 1944 returns w ith those from th~. 1943 returns is affected. bv the chan es in law 1 0 1 - 9 introduced by the Revenue Act of 1943 . Returns for the calendar year '1944 and fiscal years ending in the period January through June 1945 are filed under the provisions of the Internal Revenue Code as amended by the Revenue Act of 1943 . The amendments contained in this act apply also to the 1 .944 portion of the accounting period, in the case of returns for fiscal years beginning in 1943 and endin- in 1944 . The most significant chang es are as follows : (1) The amount of income subject to excess profits tax which is a credit against net income in arriv-ing at normal-tax net income and surtax net income is decreased by $5,000 . This is the result of a change in the excess profits tax hv~v which provides an increase in the specific exemption -from $5,000 to ' 8 10,000 for purposes of determining adjusted excess profits net income _ (2) Corporations filing returns for taxable years beginning in 1943 and ending in 1944 are required to compute two tentative taxes, one under the 1942 Acty the other uncler the 1943 Act, and prorate each on the basis of the number of days before January 1, 1944, and the number after-December 31, 1943, respectively . The prorated por- tions of the two tentative taxes aire then combined to determine the actual liability, whichis the amount tabulated in this report . Amounts tabulated from these returns for all items other than the tax liability are the amounts used in computirvo, the tentative tax for 1944 under provisions of the Revenue Act of 1943 . CLASSIFICATIONSY TEXT TABLES, AND DESCRIPTION OF BASIC TABLE S Data are shown for the 446,796 corporation returns in aggregate, and segregated by one or more of the following classifications : Active and inactive corporations ; returns with net income and returns with no net income ; States and Territo .r'ies ; industrial divisions and groups ; returns with balance sheets and returns with no balance sheets ; total assets classes type of tax liability ; net Income and deficit classes . There are also separate tabulations for consolidated returnsy fiscal year returns, and part year returras, all of Which are included in the tabulations pertaining 6o Form 11 20 throughout this report . The classifications are described- in the following paragraphs, which also enumerate the items tabulated for returns in each classification : Active and inactive corporations --Returns for active corporation s show income data ; those for inactive corporations show no data . The returns for inactive corporations are filed in accordance with the STATISTICS OF IINTCOMI- ::q' FOR 1944, PART 2 relo~ulation that a corporation ha,v L*rA-,o, an existence during any po i ZD Zn tion of a taxable year is required to make-, a return . Even tho-L'i'gh a corpora- tion has surrendered its charter, it as deenied to continue in existence until its dissolution is authorized by- the State in which it was created . The data presented in this repoi :---t are tabulated from the 4127467 returns of active corporations, exe~.ept as indicated in the following paragraph pertaining to the numb er of returns . The 34,329 returns of inactive coxporations for 1944 are se-ree-ated by the nine industrial divisions in the text ta-ble on page 6, which shows also the percent of *inactive corporations to the division total . The returns of inactive corporati(Dns are also included in the total number of returns, segregated by States and Territories ' in basic table 1, pages 76-77 ; In the total numbe--i-, by nialor and minor industrial groups in basic table 2, pa'o-es .78-89 ; and in the total number of returns In with no net income in basic table 8, Dages 327-332 . The total number of fiscal year returns in the first te _-sct table on page 19 includes 3,969 fiscal year returns of inactive corpor~-tions . For the number of returns of inactive corporations for prior years, see note 2, page 423 . Returns with net income and returris with no net income .-This classi- fication is based on the existence or nonexistence of an amount of net income for the current year . Net income, as reported for declared value excess-profits tax comp utatiori, is adj usted by eXCI Uding the net operating loss deduction and addiiig Government interest subject to surtax only and excess of net long-term capital gain over not short- term capital loss . Returns with total deductions (exclusive of net operatimy loss deduction) equal to or exceeding total income are in- I D cluded in returns with no net incorne . The returns of active corporations for 1944 are segregated . by returns 'D t7l with net income and returns with i .-io net income for all tabulations in this report except the one on page 9 . Of the 412,467 returns of active coi:porations, 288,904 are returns with net income, and 123,563 are returns with no net income . States and Territories .- This -eoc-,-rqpbic distribution covers the 48 P States, the District of Columbia, and the Territories of Alaska and Hawaii. The data, although tabulated by States and Territories in which the returns are filed, do not represent what may be called the geographic t) Zn distribution of income . Returns filed in a State may not be a complete coverage of all corporations whose principal place of business is located therein . Conversely, a tabulation for a given State may include data from returns of corporations having their principal place of business in another State . A corporation may file an income tax return either in the collection district in which it has its principal place of business or in the collection district in which it has its principal office or agency . There is no way of ascertaining from income tax returns the amount STATISTICS OF INCOJTVIE FOR 1944, PART 2 of income originating in a specific State or the amount of tax paid thereon . The 446,796 returns of active and inactive corporations are segre- gated geographically in basic table 1, pages 76-77. This table presents, lor the 288,904 returns with net income and the 123,563 returns with no net in-come, net income or deficit, and dividends paid in cash and assets other than the corporation's own stock . There a re also shown, for returns with net income, total tax, income tax, declared value excess-profits tax, excess profits tax, and adjusted excess profits net income . The number of returns of inactive corporations filed in any State or Territory may be obtained by deducting the sum of the re- turns with net income and the returns with no net income from the total number of returns . A description of the items will be found in the footnotes as indicated on table 1 . The comparability of data (Iistributed geographically is discussed on page 59, and historical . data so distributed are presented on pages 394-405 . Industrial divisions and groups .-The industrial classification con- s1sts of 9 divisions~ 74 major groups, and '233 minor groups, based on the Standard Industrial Classification, issued by the Division of Statistical Standards, Bureau of the Budget, Executive Office of the President . Since the Standard Industrial Classification is designed on an establishment basis, it was necessary to reduce greatly the num- ber of groups and to make changes in the contents of the groups in order to adapt the Standard Classification to the corporation income tax returns which are filed on an ownership basis . The industrial classification is based on the business activity re- ported on the return . When multiple businesses are. reported on a return, the classification is determined by the business activity which accounts for the largest percentage of total receipts . Therefore, the industrial groups do . not reflect pure industry classifications . There is no change in the industrial groups between 1943 and 1944 . In the following table, the 446,796 returns are classified by the nine industrial divisions, as are also the 288,904 returns with -net income, the . 123,563 returns with no net income, and the 34,329 returns of inactive corporations . The number of returns is shown for each division. For returns with net income, there are shown the number of returns, percent of clivision total, total compiled receipts, net income, total tax, income tax, declared value excess-profits tax, excess profits tax, and adjusted excess-profits net income ; for returns with no net income, the number, percent of division total, total compiled receipts, and deficit ; and for inactive corporations, the number and percent of division total . The items are described in footnotes as indicated on the table . Corporation returns,l 1944, by industrial divisions, for returns with net income and returns with no ne! inc'ovze : Number of retitrns,' percent- ages, total compiled receipts, net income or deficit ; and, for retto-iis with net inco?ne : Total tax, income tax, declared value excess-profits tax, excess profits tax, and adjusted excess profits net income ; also, for inactive corporatioas : jVun?,') .,,r of retw-,?s and percentage s [Money figures in thousands of dollars ] Returns with net income 2 Industrial divisions 5 All industrial divisions -------------------------- Mining and quarrying --------------------------- Manufacturing --- ------------------------------- Public-utilities ---------------------------------- Trade ------------------------------------------- Servic e Finance, insurance, real estate, and lessors of real property --------------------------------------- Construction ------------------------------------ Agriculture, forestry, and fishery ---------------- Nature of business not allocable ----------------- Total number o f returns 446,796 9,540 79,345 20,560 120,423 38,093 142,067 12,52 8 6,825 17,41 5 Industrial divisions 5 Number 288,904 3,796 61,044 13,067 93,166 22,098 82,83 7 7,16 0 3,912 1,824 Percent of division to tal 64 .66 39 .79 76.93 63 .56 77 .37 58 .0 1 58 .31 57 .15 57 .32 10 .47 Total compiled receipts 6 252,962,944 3,480,81 5 151,218,292 21,635,269 59,074,935 5,053,51 9 8,834,643 2,699,979 84 592 142,90 1 All ind.ustrial divisions Alining and quarrying ---------------------------------------------------------------------- MaUlfacturing ------------------------------------------------------------------------------ Public utilitie s Trade Service Finance, insurance, real estate, and lessors of real property ----------------------------- I ------ Construction Agriculture, forestry, and fishery ------------------------------------------------------------ Nature of business not allocable Net income 2 27,123,741 368,80 1 4,277,770 3,318,799 625,563 3,200,226 172,73 8 1,141 453 17,81 5 Number 123, 563 3,824 J 5, 575 6, 175 24,197 12,614 51,042 4,354 2,505 31 277 Adjusted excess profits net income 7 12,841,663 6S,208 8,851,188 1,891,259 1,602,46 7 243,820 67,755 73,544 Total tax 14,884,050 157,52 7 9,391,328 2,389,327 1,910,15 7 321,35 9 553,966 90,176 (),J, '# 13, 90 3 Returns with no net income ' Pei-cent, of division total 27 .66 40 .08 fg . 63 30-03 20 .09 :33 . 11 :35 . 93 34 .76 36 .70 18 .82, Taxe s Income tax I 4,353,621) 99,06 6 2,199,838 816,251 565,179 117, 357 493,368 29,486 01 M, 3, 775 Total coin- piled receipts 51 Deficit 2 9,237,587 546,78 1 2,997,101 862,140 2, 648, 82 7 583, 536 992,161 481, 986 107,035 18,021 819,260 51,427 156,579 136,892 65 537 46: 77 0 304,810 33 604 14 : 5330 9,111 Declared value excess- profits tax 98,668 59 7 70,492 2,892 17,890 2,07 0 2,806 98 8 .143 Excess profits tax 4 10,431,762 57,86 4 7,120,999 1,570 184 1, 327: 08 8 201,93 2 57,793 59 , 70 2 6, X 2,98 4 Returns of inactive corporation s Nuniber 34,329 1,920 2, 726 1 .318 3, wo 3 .381 8,188 1,01 4 408 12,314 ~~rcent of division tota l 7 .68 20 13 3 44 6 . 41 2.54 8 .88 5 .76 8 .09 5 .98 70 .71 01) t"D For footnotes, see pp . 40-42. STATISTICS OF !NC0 21/_rE. FOR 1944, PART 2 467 returns of active corporations are further segregated The 412, tD by major industrial groups in basic . table 3 . which shows ill Part I for all returns ', in Part,11 for returns with net income, and in Part III for returns with no net income ., itemized receipts and deductions, compiled net profit or net loss, net income or deficit, dividends paid J Ln cash and assets other'than the corporation's own stock, and divi- dends paid in the corporation's own stock . There are also shown, for returns in Parts I and IIY the net operating loss deduction, ad *usted excess profits -net income, income tax, declared value excess-profits tax, excess profits tax, total tax, and compilednet profit less .total tax . Basic table 4 presents returns with balance sheets by major indus- trial groups and shows, for the 266,615 retui-ns with net income and the 96,441 returns with no net Encome, the number of returns, items of assets and liabilities as of December 31, 1944, or close of fiscal year nearest thereto, itemized receipts and deductions, compiled net profit or net loss, net income or deficit, dividends paid in cash and assets other than the corporation's own stock, and dividends paid in the corporation's own stock . There are also shown, for returns with net income~ the net operating loss deduction, adjusted excess profits net income, income tax, declared vadue excess-profits tax, excess profits tax, total tax, and compiled net profit less total tax . In analyzing the data compiled from returns classified under the major group " Insurance carriers agents, etc . I" it should be noted that ~n Y tD life insurance, companies are required to include only interest, divi- dends, and rents in gross income . Beginning 1942, life insurance com- panies are allowed a "reserve and other policy liability credit" equal to a flat proportion of investment income less tax-exempt *interest . This credit, which is deducted after arriving at net income and is reported only on returns with net income, takes the place of the deductions for reserve earnings, deferred dividends, and interest paid, which formerly were allowed -.in computing not imcome . For-1944 the credit ratio is 0 .9261 and for normal tax purposes the aggregate amount of reserve and other policy liability credit is $991,5135,426, of which $990,865,626 is reported on ~eturiis with balaace sheets. As an off-set to this credit, adjustment for certain non-life insurance reserves is reported in total amount of $6,046,357, of which $ 6,045,216 is reported on returns with balance sheets . The latter adjustment, which is made in order to in- clude in the tax base the interest :received on non-lif e insurance reserves, applies onlv to life insurance companies deriving a portion of their income from contracts otlier th-an life insurance, annuities, or non- cancellable health and accident insurance . It should be noted also that the deduction item "Compensation of officers, Y1 in basic tables 3 and 4, excludes the amounts paid to officers of life insurance com- panies which file on Form 1120L . There is no provision on Form 1120L for reporting this item, and it is not possible to ascertain it froni the annual statement submitted with the return . STATISTICS OF INCOME FOR 19445 PART 2 Basic * table 6 presents returns wit 1 . balance sheets, by total assets classes, in aggregate, and by ma'or --industrial groups, and shows for I zD the 266,615 returns with net income-, and the 96,441 returns with no net income the number of returns, se--leeted items of assets, liabilities, and receipts, compiled net profit oi- net loss, net income or deficit, and dividends paid in cash and asse~ts other than corporation's own stock . For returns with net income, the total tax is also shown . The only table showing the returrLs segregated by minor industria -groups is basic table 2, which preser)L ts all returns by both major and minor industrial groups, and shows, for the 288,904 returns with net income and the 123,563 returns of -tetive corporations with no net income, the number of returns, total compiled receipts, net income or deficit, and dividends paid in cash arad assets other than the corpora- tion's own stoclz_. There are also sho-wn, for returns with net income, total tax, income tax, declared value excess-profits tax, excess profits tax, and adjusted excess profits net income. The total number of returns includes those of inactive cc)rporations, which number may be obtained by deducting from the t~otal number of returns the sum of the returns with net income and -the returns with no net income . The items are described in footnc)tes as indicated on each table . Historical data by industrial groups are shown on pages 388-393, and the comparability of those data is discussed on pages 59-60. Returns with balance sheets and returns with no balance sheets .- Returns with balance sheets include c)nly those with apparently com- plete balance sheet data ; returns witti no balance sheets include those on which the balance sheet data 'are entirely lacking and those witb fragmentary data . Tn the following table there are stiown, for the 412,467 returns of active corporations in ac-regate, and for the 363,056 returns with balance sheets, and the 49,411 returns with no balance sheets, items of receipts and deductions, compiled net profit or net loss, net income or deficit, net operating,, loss deduction, adjusted excess profits net income, income tax, deelared value excess-profits tax, excess profits tax, total tax, compiled . net profit less total tax, and dividends -paid in cash and assets other than the corporation's oNvn stock, and dividends paid in the corporation's own stock . The items are described in footnotes as indicated on the table . STATISTICS OF INCOME FOR 1944, PART 2 9 Corporation returns,' 1944, in aggregate, and for returns with balance sheets and returns with no balance sheets : Number of returns, comptled receipts, compiled deductions, compiled net profit or net loss, net income or deficit, net operating loss deduction, adjusted excess profits net income, income tax, declared value excess- profits tax, excess profits tax, total tax, co?npiled net profit less total tax, and dividends paid by type of dividend [Money figures in thousands of dollars] Returns with Returns Aggregate balance with n o balance sheets sheets I Number of returns 8 ------------------------------------ 412,467 363,056 49,411 1 Receipts : 2 Gross sales 9 ---------------------------------------- 209,536,338 207,008,234 2,528,103 2 3 Gross receipts from operations 10 ------------ I -------- 42,696,261 42,120,937 575,324 3 Interest on Government obligations (less arnortiz- able bond premium) : 4 Wholly taxable 11 ------------------------------- 1,100,179 1,092,289 7,890 4 5 Subject to declared value excess-profits tax and 331,598 330,136 1,46 2 surtax .1 2 6 Subject to surtax only 13 . . . . . . . . . . . . . . . . . . . . . . . . 18,521 18,428 93 6 7 Wholly tax-exempt 14 --------------------------- 242,121 241,056 1, 066 7 8 Other interest -------------------------------------- 22 .187,240 2,164,803 22,437 8 9 Rents 15 ------------------------------------- -------- 2,115,113 2,017,118 97,996 0 10 Royalties 16 --------------------------------- -------- 246,532 240,485 6,047 10 11 Excess of net short-term capital gain over net long- 25,096 23,649 1,447 1 1 term capital IOSS .1 7 12 Excess of net long-term capital gain over net short- 402,744 385,108 17,636 1 2 term capital JOSS .1 7 13 Net gain, sales other than capital assets Is --- -------- 139,678 132,143 7,535 1 3 14 Dividends, domestic corporation,,, 19 --------- -------- 1,429,382 1,407,011 22,371 1 4 15 Dividends, foreign corporations 20 . . . . . . . . . . . . . . . . . . . 145,229 144,686 543 1 5 16 Other receipts 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,584,499 1,5531,536 30,963 1 6 17 Total compiled receipts 6 ----------------- -------- 262, 200 . 531 258,879,617 3,320,914 1 7 Deductions : 18 Cost of goods sold 22 ------------------------ -------- 1161,197,624 159,192,585 2,005,040 1 8 19 Cost of operations 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,311,779 23,986,109 325,670 1 9 20 Compensation of officers 23 . . . . . . . . . . . . . . . . . . . . . . . . . . 3 i 759, 057 3, 666, 934 92 .124 20 21 Rent paid on business property ------------- -------- 2 :487,369 2,444,179 43,190 2 1 22 Repairs 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 575, 242 2, 5412 723 33, 519 22 23 Bad debts ---------------------------------- -------- 335,562 325,594 9 . 968 23 24 Interest paid ------------------------------- -------- 2,288,209 2,236.207 52,002 24 25 Taxes paid 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 964, 725 5, SS4, 547 80, 178 25 26 Contributions or gifts 26 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234,194 2312887 2,308 26 27 Depreciation -------------------------------- -------- 31950,124 3,890,715 59,409 27 28 Depletion ---------------------------------- -------- 711,742 697,582 14, 160 28 29 AmortiZation 27 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 9,81, 203 974, 107 7. 097 29 30 Net loss, sales other than capital assets Is ----- -------- 504 ' 228 434,954 69,274 3 0 31 Other dedUCtiollS 28 - - - - - - - - - --- - - - - - - - - - - - - - - - - - - - - - - 26, 352, 868 25, 918, 647 434, 221 3 1 32 Total compiled deductions --------------- -------- 235,653,929 232,425,770 3,228,159 3 2 33 Compiled net profit or net loss (17 less -3)2) ------ -------- 262 546, 602 26,453,847 92,755 3 3 34 Not income or defleit 2 (33 less 7) ---------------- -------- 26,304,481 26,212,792 91,689 34 35 Net operating loss deduction 29 - - - - - - - - - - - - - - - - - - - - - - - - - 148, 760 141 .974 6, 786 3 5 36 Adjusted excess profits not income 7 . . . . . . . . . . . - -------- 12,841,663 12, 753, 684 87,978 3 6 37 Income tax 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - . . . . . . . . 4,353 .620 4,312,4150 5 9 41,15 3 7 38 Peclared value excess-profits tax --------------- - -------- 98,668 ?' 1,667 3 8 39 Excess profits tax 4 ---------------------------- - 10, 431, 762 : 10, 3,~q 2 72,145 3 9 40 Total tax --------------------------------- -------- 14,884,050 14, 7,69,079 114,971. 40 11 Compiled not profit less total tax (33 less 40) ---- -------- 11, 662, 552 11,684,76S 31 22 217 41 Divid( - ~rids paid : 30 , 12 Cash and assets other than own stock 30 . . . . . . . . . . . . 6,057,043 5,957,051 99,992 4 2 3 Corporation's own stock -------------------- ------- 247,196 1 234, 643 12,553 4 3 4 For footnotes, see pp. 40-42 . The preceding tabulation is the -only one In this report in which the data are not shown separately fox returns with net income 'and for returns with no net income . HoiN-ever, this separation is made in the presentation of receipts and deduictIons for the 3633,056 returns of 10 STATISTICS OF INCOME_H' FOR 1944, PART 2 corporations reporting balance shee-t data, by major industrial o-roups n basic table 4, pages 132-165, and I -Ly total assets classes in basic table, 5, pages 200-205 . The total number of returns, and the, number and percent with bal- n ance sheets ', for returns with net ir-i-come and for returns with no net income, are shown by net income -Aiid deficit chmses in the, follow1110, table : Corporation returns,' 194~, with net incomo an .,.-7 with no net income, by net income or deficit classes : Mumber of returns, nu7nbc--r of balance sheets, and percent o.f returns with balance sheets I Returns with net incoule 2 Returns with 110 net illeoule 2 Net incorne. and deficit classeS 2 (Thousands of dollars) Number of Numbcr'c>f Percent o f returns Nriniber of Number of Percent o f returns returns 8 balan w sheets ith bal - W returns 8 balance she t with bal - ancesheets, e s ance shects Under I ----------------------- 60,378 49, 76 .5 82 .42 75,011 55,317 73 .7 5 1 under 2 --------------------- 29,574 26.221 88 . o ; 14, 607 11,917 81 .5 8 2 under 3 ---------------------