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LOS 'HG3L33, April 2, 1952 go-u Mr, W* I. Rouse: (4) (ee - Mr, Calvin M, Gory) Please refer to your letter of March 2G, 1952, re­questing my opinion on the question asked by Mr• Sutton in his letter to Mr, Stoddard dated March 19# 1952,wheth­er Las Vegas, Water District is a political subdivision within the meaning of the pertinent provisions of the In­ternal Revenue Code, 1 have given the problem a ,substan­tial amount of research and thought and have reached some conclusions which may be of assistance, I understand the pertinent provisions of the Inter­nal Revenue Code to be Section 23(q)(I)# which provides: (23} "In computing net income there shall be allowed as deductions: - (q) "in the case of a corporation, contri­butions or gifts, ^payment of which is made with­in the taxable year to or for the use of (1) "the United States, any state, terri­tory or any political subdivision thereof, or the District of Columbia, or any possession of the United States, for exclusively public pur­poses, * . fhe regulations under this section found in Title 26, Code of Federal Regulations, Section 29,23(d)(1) do not de fine political subdivision”, but refer to the regulations under Section 22(b)(4) of the Internal Revenue Code for such definition, Section -22(b)(4) of the Internal Revenue Code provides in part as follows: (22) "The following items shall not be in­cluded in gross income and shall be exempt from taxation under this chapter: (b)(4) "interest upon it the obligations of a state, territory or any political subdivi­sion thereof, or the District of Columbia,"