§53505 — Title 46 Shipping | U.S. Code

Summary

It limits how much can be put into a capital construction fund each tax year. The limit is the total of: the part of the owner’s or lessee’s taxable income that comes from operating agreement vessels in U.S. trade or fisheries (using regular tax rules but ignoring certain loss carrybacks); the tax depreciation allowed for those vessels; any net money from selling a vessel or from insurance for it if that money wasn’t already counted; and earnings from investing the fund. If a vessel is leased, the lessee’s allowed deposit for the vessel’s depreciation is reduced by any depreciation deposit the owner makes for the same period under the fund agreement.

Title 46, §53505

Shipping — Source: USLM XML via OLRC

(a)The amount deposited in a capital construction fund for a taxable year may not exceed the sum of—

(1)that portion of the taxable income of the owner or lessee for the taxable year (computed under chapter 1 of the Internal Revenue Code of 1986 (26 U.S.C. ch. 1) but without regard to the carryback of net operating loss or net capital loss or this chapter) that is attributable to the operation of agreement vessels in the foreign or domestic trade of the United States or in the fisheries of the United States;

(2)the amount allowable as a deduction under section 167 of such Code (26 U.S.C. 167) for the taxable year for agreement vessels;

(3)if the transaction is not taken into account for purposes of paragraph (1), the net proceeds (as defined in joint regulations) from the disposition of an agreement vessel or from insurance or indemnity attributable to an agreement vessel; and

(4)the receipts from the investment or reinvestment of amounts held in the fund.

(b)For a lessee, the maximum amount that may be deposited for an agreement vessel under subsection (a)(2) for any period shall be reduced by any amount the owner is required or permitted, under the capital construction fund agreement, to deposit for that period for the vessel under subsection (a)(2).

Notes & Related Subsidiaries

Historical and Revision Notes

Revised SectionSource (U.S. Code)Source (Statutes at Large) 5350546 App.:1177(b)(1), (2).June 29, 1936, ch. 858, title VI, § 607(b)(1), (2), 49 Stat. 2005; June 23, 1938, ch. 600, §§ 23–28, 52 Stat. 960; Aug. 4, 1939, ch. 417, § 10, 53 Stat. 1185; July 17, 1952, ch. 939, §§ 17–19, 66 Stat. 764; Pub. L. 85–637, Aug. 14, 1958, 72 Stat. 216; Pub. L. 86–518, § 1, June 12, 1960, 74 Stat. 216; Pub. L. 87–45, § 6, May 27, 1961, 75 Stat. 91; Pub. L. 87–271, Sept. 21, 1961, 75 Stat. 570; restated Pub. L. 91–469, § 21(a), Oct. 21, 1970, 84 Stat. 1027. In subsection (a)(1), the word “trade” is substituted for “commerce” for consistency in the chapter.

§53505 Ceiling on deposits

Summary

Title 46, §53505

Notes & Related Subsidiaries

Historical and Revision Notes

Citations & Metadata