the taxpayer upon notice and demand from the collector after the determination of such proceeding, and may be collected by distraint or proceeding in court within six years after termination of such proceeding. Extensions of time for such payment may be had in the same manner and subject to the same provisions and limitations as are provided in section 272 (j) and section 296 in the case of a deficiency in a tax imposed by this title.

ART. 274-1. Bankruptcy, proceedings for the relief of debtors, and receiverships. During bankruptcy proceedings, or proceedings for the relief of debtors in Federal courts under sections 74, 77, and 77B of the National Bankruptcy Act of 1898, as amended, or during equity receivership proceedings in either Federal or State courts, the court which makes the adjudication of bankruptcy, or which approves a debtor's petition or answer in a proceeding for relief of debtors, or which appoints a receiver for any taxpayer, has control over the assets of such taxpayer, and the collection of taxes due can not be made by distraining upon such assets while the bankruptcy, debtor, or receivership proceeding is pending. However, assets of a farmer who has filed a petition in a proceeding for relief of debtors under section 75 of the National Bankruptcy Act, as amended, and assets acquired by a bankrupt or debtor in a proceeding for the relief of debtors, subsequent to the adjudication or the approval of the debtor's petition or answer in a proceeding for the relief of debtors, which are not in control of the bankruptcy court may be subject to distraint.

A trustee in bankruptcy or a receiver appointed in a bankruptcy proceeding, or a person designated by order of the court as in control of the assets of a debtor in a proceeding for the relief of debtors, or a receiver in any receivership proceeding, is required to give notice in writing to the Commissioner in Washington, D. C., of the adjudication of bankruptcy, the filing of a debtor's petition or answer in a proceeding for the relief of debtors under sections 74, 75, and 77 of the National Bankruptcy Act, as amended, the approval of the debtor's petition or answer under section 77B of that Act, or the appointment of the receiver.

Collectors should, promptly after notice of outstanding liability against a taxpayer in bankruptcy, or in proceedings for the relief of debtors, or in receivership, file claim in the appropriate court whether unpaid taxes involved have been assessed or not, except in cases where departmental instructions direct otherwise; for example, where taxes of the bankrupt, debtor, or insolvent taxpayer are secured by a sufficient bond.

Under sections 3466 and 3467 of the Revised Statutes (paragraphs 40 and 41, respectively, of the Appendix to these regulations) and section 64 (a) of the National Bankruptcy Act, as amended, taxes

take priority over claims of general creditors in cases of bankruptcy, receivership, proceedings for the relief of debtors, and insolvency, and the trustee, receiver, person in control of the assets of a debtor, or assignee may be held personally liable for failure on his part to protect the priority of the Government respecting taxes of which he has notice. Bankruptcy courts have jurisdiction under the National Bankruptcy Act, as amended, to determine all disputes regarding the amount and validity of taxes of a bankrupt or of a debtor in proceedings for relief of debtors. Bankruptcy proceedings, proceedings for the relief of debtors, and receivership proceedings do not foreclose or discharge any portion of a claim of the United States for taxes which have been allowed by the court having jurisdiction over the same and which remain unsatisfied after termination of the bankruptcy, debtor, or receivership proceeding. Such unpaid portion of the claim allowed in a bankruptcy, debtor, or receivership proceeding shall be collected with interest as provided in section 298.

ART. 274-2. Immediate assessments in bankruptcy, proceedings for the relief of debtors, and receivership cases.-Where the Commissioner has determined that a deficiency is due in respect of income tax and the taxpayer has filed a petition with the Board of Tax Appeals prior to adjudication of bankruptcy, or the filing of a debtor's petition or answer for relief in a debtor proceeding in a Federal court under sections 74, 75, and 77 of the National Bankruptcy Act, as amended, or the approval of the debtor's petition or answer in a debtor's proceeding under section 77B of the National Bankruptcy Act, as amended, or the appointment of a receiver, the trustee or receiver appointed by the court or the person designated by order of the court as in control of the assets of the debtor, may prosecute the taxpayer's appeal before the Board as to that particular determination. In no case shall a petition be filed with the Board for a redetermination of the deficiency after the adjudication of bankruptcy, the filing of a debtor's petition or answer in a Federal court in proceedings for the relief of debtors under sections 74, 75, and 77 of the National Bankruptcy Act, as amended, the approval of the debtor's petition or answer in a debtor proceeding under section 77B of the National Bankruptcy Act, as amended, or the appointment of a receiver.

Claim for the amount of a deficiency, even though pending before the Board for consideration, may be filed with the bankruptcy or equity court without awaiting final decision of the Board. In case of final decision of the Board before determination of the bankruptcy, debtor, or receivership proceeding, a copy of the Board's decision may be filed by the Commissioner with the bankruptcy or equity court.

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While the Commissioner is required by section 274 to make immediate assessment of any deficiency, such assessment is not a jeopardy assessment within the meaning of section 273, and consequently the provisions of that section do not apply to any assessment made under section 274. Therefore, the notice of the deficiency provided for in section 273 (b) will not be mailed. Although such notice will not be issued, nevertheless a letter will be sent to the taxpayer, or to the - trustee or receiver in the bankruptcy proceeding, the person designated by order of court as in control of the assets of the debtor in the proceeding for the relief of debtors, or receiver in the receivership proceedings, notifying him in detail how the deficiency was computed, that the deficiency was assessed under the provisions of section 274, that he may furnish evidence showing wherein the assessment is incorrect, and that upon request he will be granted a hearing with respect to such assessment. If after such evidence is submitted and hearing held any adjustment appears necessary in the assessment, appropriate action will be taken looking to the submission of an amended claim in bankruptcy or receivership or in proceedings for the relief of debtors. A copy of the notification letter will be attached to the assessment list as the collector's authority for filing claim in a bankruptcy, debtor, or receivership proceeding for the amount represented by the assessment, plus interest at the rate of 6 per cent per annum for the period from the date of filing claim by the collector to the date of termination of the bankruptcy, debtor, or receivership proceeding, or to the date of payment if payment is made in full prior to such termination. At the same time claim is filed with the bankruptcy or receivership court, the collector will send notice and demand for payment to the taxpayer together with a copy of such claim.

If any portion of the claim allowed by the court in a bankruptcy or a receivership proceeding or proceeding for the relief of debtors remains unpaid after the termination of such proceeding, the collector will send notice and demand for payment thereof to the taxpayer. Such unpaid portion with interest as provided in section 298 may be collected from the taxpayer by distraint or proceeding in court within six years after the termination of the bankruptcy, debtor, or receivership proceeding. Extensions of time for the payment of such unpaid amount may be granted in the same manner and subject to the same provisions and limitations as provided in sections 272(j) and 297 in the case of a deficiency in respect of income tax. (See article 272-3.)

This article deals only with immediate assessments provided for in section 274 and the procedure in connection with such assessments.

SEC. 275. PERIOD OF LIMITATION UPON ASSESSMENT AND COLLECTION.

Except as provided in section 276

(a) General rule.-The amount of income taxes imposed by this title shall be assessed within three years after the return was filed, and no proceeding in court without assessment for the collection of such taxes shall be begun after the expiration of such period.

(b) Request for prompt assessment. In the case of income received during the lifetime of a decedent, or by his estate during the period of administration, or by a corporation, the tax shall be assessed, and any proceeding in court without assessment for the collection of such tax shall be begun, within eighteen months after written request therefor (filed after the return is made) by the executor, administrator, or other fiduciary representing the estate of such decedent, or by the corporation, but not after the expiration of three years after the return was filed. This subsection shall not apply in the case of a corporation unless

(1) Such written request notifies the Commissioner that the corporation contemplates dissolution at or before the expiration of such 18 months' period; and

(2) The dissolution is in good faith begun before the expiration of such 18 months' period; and

(3) The dissolution is completed.

(c) Omission from gross income. If the taxpayer omits from gross income an amount properly includible therein which is in excess of 25 per centum of the amount of gross income stated in the return, the tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, at any time within 5 years after the return was filed.

(d) For the purposes of subsections (a), (b), and (c), a return filed before the last day prescribed by law for the filing thereof shall be considered as filed on such last day.

(e) Corporation and shareholder.—If a corporation makes no return of the tax imposed by this title, but each of the shareholders includes in his return his distributive share of the net income of the corporation, then the tax of the corporation shall be assessed within four years after the last date on which any such shareholder's return was filed. SEC. 276. SAME-EXCEPTIONS.

(a) False return or no return.-In the case of a false or fraudulent return with intent to evade tax or of a failure to file a return the tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, at any time.

(b) Waivers.-Where before the expiration of the time prescribed in section 275 for the assessment of the tax, both the Commissioner and the taxpayer have consented in writing to its assessment after such time, the tax may be assessed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.

(c) Collection after assessment.-Where the assessment of any income tax imposed by this title has been made within the period of limitation properly applicable thereto, such tax may be collected by distraint or by a proceeding in court, but only if begun (1) within six years

after the assessment of the tax, or (2) prior to the expiration of any period for collection agreed upon in writing by the Commissioner and the taxpayer before the expiration of such six-year period. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon. SEC. 277. SUSPENSION OF RUNNING OF STATUTE.

The running of the statute of limitations provided in section 275 or 276 on the making of assessments and the beginning of distraint or a proceeding in court for collection, in respect of any deficiency, shall (after the mailing of a notice under section 272 (a)) be suspended for the period during which the Commissioner is prohibited from making the assessment or beginning distraint or a proceeding in court (and in any event, if a proceeding in respect of the deficiency is placed on the docket of the Board, until the decision of the Board becomes final), and for sixty days thereafter.

ART. 275-1. Period of limitation upon assessment of tax.-The amount of income tax imposed by the Revenue Act of 1934 must be assessed within three years after the return was filed. For the purposes of subsections (a), (b), and (c) of section 275 of the Act, a return filed before the last day prescribed by law for the filing thereof shall be considered as filed on such last day. Exceptions to the period of limitation stated in this paragraph are as follows:

(1) In the case of income received during the lifetime of a decedent or by his estate during the period of administration, or by a corporation contemplating dissolution, the tax shall be assessed within 18 months after written request therefor by the fiduciary or legal representative of the estate of the decedent or by the corporation, but not after the expiration of 3 years after the return was filed. The effect of this provision is to limit the period in which the Commissioner may assess the tax in such cases to a period of 18 months from the date the request is filed, even though more than 18 months still remain of the regular 3-year period in which the assessment may under ordinary circumstances be made. The request, in order to be effective, must be made after the return is filed and must be in such language as to make it clear to the Commissioner that it is desired to take advantage of the provisions of section 275 (b). In the case of a corporation the 18-month period of limitation shall not apply unless

(a) the written request notifies the Commissioner that the corporation contemplates dissolution at or before the expiration of such period,

(b) the dissolution is in good faith begun before the expiration of such period, and

(c) the dissolution so begun is completed either before or after the expiration of such 18-month period.