Internal Revenue Code · 26 U.S.C.
§ 441. Period for computation of taxable income
Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).
Cite as 26 U.S.C. § 441
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Enacted
- February 26, 1964 by Pub. L. 88–272
- Last amended
- December 29, 2007 by Pub. L. 110–172
- Amendments
- 6 dated changes in the source credit
- Length
- 9 subsections · 1,296 words · about 6 min to read
- Defines
- 5 terms
- Cross-references
- cites 4; cited by 5 Code sections and 43 other regulations
- Regulations
- 5 issued under this section
Taxable income shall be computed on the basis of the taxpayer’s taxable year.
For purposes of this subtitle, the term “annual accounting period” means the annual period on the basis of which the taxpayer regularly computes his income in keeping his books.
For purposes of this subtitle, the term “calendar year” means a period of 12 months ending on December 31.
For purposes of this subtitle, the term “fiscal year” means a period of 12 months ending on the last day of any month other than December. In the case of any taxpayer who has made the election provided by subsection (f) the term means the annual period (varying from 52 to 53 weeks) so elected.
The Secretary may by regulation provide terms and conditions for the application of this subsection to a partnership, S corporation, or personal service corporation (within the meaning of section 441(i)(2)).
The Secretary shall prescribe such regulations as he deems necessary for the application of this subsection.
For purposes of this subtitle, the taxable year of any DISC shall be the taxable year of that shareholder (or group of shareholders with the same 12-month taxable year) who has the highest percentage of voting power.
If 2 or more shareholders (or groups) have the highest percentage of voting power under paragraph (1), the taxable year of the DISC shall be the same 12-month period as that of any such shareholder (or group).
The Secretary shall prescribe regulations under which paragraphs (1) and (2) shall apply to a change of ownership of a corporation after the taxable year of the corporation has been determined under paragraph (1) or (2) only if such change is a substantial change of ownership.
For purposes of this subsection, voting power shall be determined on the basis of total combined voting power of all classes of stock of the corporation entitled to vote.
For purposes of this subtitle, the taxable year of any personal service corporation shall be the calendar year unless the corporation establishes, to the satisfaction of the Secretary, a business purpose for having a different period for its taxable year. For purposes of this paragraph, any deferral of income to shareholders shall not be treated as a business purpose.
(Aug. 16, 1954, ch. 736, 68A Stat. 148; Pub. L. 88–272, title II, § 235(c)(3), Feb. 26, 1964, 78 Stat. 127; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 95–30, title I, § 102(b)(5), May 23, 1977, 91 Stat. 137; Pub. L. 98–369, div. A, title IV, § 474(b)(2), title VIII, § 803, July 18, 1984, 98 Stat. 830, 1000; Pub. L. 99–514, title I, § 104(b)(6), title VIII, § 806(c)(1), (d), Oct. 22, 1986, 100 Stat. 2105, 2364; Pub. L. 100–647, title I, § 1008(e)(4), Nov. 10, 1988, 102 Stat. 3440; Pub. L. 110–172, § 11(g)(7), Dec. 29, 2007, 121 Stat. 2490.)
Terms defined here
Where the text says “the term … means”. Select a term to jump to its definition.
Regulations under this section
Treasury regulations (26 CFR) issued under § 441
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 4 other sections
- § 15 Effect of changes
- § 443 Returns for a period of less than 12 months
- § 269A(b)(1) Personal service corporations formed or availed of to avoid or evade income tax
- § 318(a)(2)(C) Constructive ownership of stock
Cited by 5 Code sections
- § 267(a)(2)(B) Losses, expenses, and interest with respect to transactions between related taxpayers
- § 280H(f)(2) Limitation on certain amounts paid to employee-owners by personal service corporations electing alternative taxable years
- § 442 Change of annual accounting period
- § 444(e) Election of taxable year other than required taxable year
- § 706(b)(5) Taxable years of partner and partnership
Cited in 43 regulations not issued under it
- § 1.15-1 Changes in rate during a taxable year.
- § 1.46-1 Determination of amount.
- § 1.46-2 Carryback and carryover of unused credit.
- § 1.48-3 Used section 38 property.
- § 1.48D-6 Elective payment election.
- § 1.50A-1 Determination of amount.
- § 1.50A-2 Carryback and carryover of unused credit.
- § 1.72-11 Amounts not received as annuity payments.
- § 1.172-4 Net operating loss carrybacks and net operating loss carryovers.
- § 1.338-1 General principles; status of old target and new target.
- § 1.415(j)-1 Limitation year.
- § 1.442-1 Change of annual accounting period.
- § 1.443-1 Returns for periods of less than 12 months.
- § 1.511-3 Provisions generally applicable to the tax on unrelated business income.
- § 1.527-8 Effective date; filing requirements; and miscellaneous provisions.
- § 1.652(c)-1 Different taxable years.
- § 1.662(c)-1 Different taxable years.
- § 1.664-1 Charitable remainder trusts.
- § 1.702-3T 4-Year spread (temporary).
- § 1.706-1 Taxable years of partner and partnership.
- § 1.812-4 Operations loss carrybacks and operations loss carryovers.
- § 1.871-7 Taxation of nonresident alien individuals not engaged in U.S. business.
- § 1.879-1 Treatment of community income.
- § 1.902-1 Credit for domestic corporate shareholder of a foreign corporation for foreign income taxes paid by the foreign corporation.
Show 19 more
- § 1.902-3 Credit for domestic corporate shareholder of a foreign corporation for foreign income taxes paid with respect to accumulated profits of taxable years of the foreign corporation beginning before January 1, 1987.
- § 1.904-2 Carryback and carryover of unused foreign tax.
- § 1.905-1 When credit for foreign income taxes may be taken.
- § 1.921-1T Temporary regulations providing transition rules for DISCs and FSCs.
- § 1.921-2 Foreign Sales Corporation—general rules.
- § 1.964-1 Determination of the earnings and profits of a foreign corporation.
- § 1.981-2 Foreign law community income for taxable years beginning before January 1, 1967.
- § 1.981-3 Definitions and other special rules.
- § 1.1348-2 Computation of the fifty-percent maximum tax on earned income.
- § 1.1348-3 Definitions.
- § 1.1561-1 General rules regarding certain tax benefits available to the component members of a controlled group of corporations.
- § 1.6016-4 Short taxable year.
- § 1.6038-4 Information returns required of certain United States persons with respect to such person's U.S. multinational enterprise group.
- § 1.6418-4 Additional information and registration.
- § 1.6654-2 Exceptions to imposition of the addition to the tax in the case of individuals.
- § 1.6655-2 Annualized income installment method.
- § 1.6655-5 Short taxable year.
- § 25.2522(c)-2 Disallowance of charitable, etc., deductions in the case of gifts made after December 31, 1969.
- § 301.7701(b)-6 Taxable year.
Amendment history
From the source credit and the official notes, newest first.
- Amended by Pub. L. 110–172Parts changed in 2007: (b)(4) (h)
- Amended by Pub. L. 100–647Parts changed in 1988: (i)(2)
- Amended by Pub. L. 99–514Parts changed in 1986: (f)(2)(B)(iii) (f)(3) (i)
- Amended by Pub. L. 98–369Parts changed in 1984: (b)(4) (f)(2)(A) (h)
- Amended by Pub. L. 95–30Parts changed in 1977: (f)(2)(B)(iii)
- Amended by Pub. L. 94–455Parts changed in 1976: (f)(3)
- Enacted by Pub. L. 88–272Parts changed in 1964: (f)(2)(A)
Where it sits in the Code
- Subtitle A Income Taxes
- Chapter 1 NORMAL TAXES AND SURTAXES
- Subchapter E Accounting Periods and Methods of Accounting
- Part I ACCOUNTING PERIODS
Nearby sections
- § 441 Period for computation of taxable income
- § 442 Change of annual accounting period
- § 443 Returns for a period of less than 12 months
- § 444 Election of taxable year other than required taxable year
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
Amendments
2007—Subsec. (b)(4). Pub. L. 110–172, § 11(g)(7)(A), struck out “FSC or” before “DISC filing”.
Subsec. (h). Pub. L. 110–172, § 11(g)(7)(B), struck out “FSC’s and” before “DISC’s” in heading and “FSC or” before “DISC” in pars. (1) and (2).
1988—Subsec. (i)(2). Pub. L. 100–647 inserted at end “A corporation shall not be treated as a personal service corporation unless more than 10 percent of the stock (by value) in such corporation is held by employee-owners (within the meaning of section 269A(b)(2), as modified by the preceding sentence). If a corporation is a member of an affiliated group filing a consolidated return, all members of such group shall be taken into account in determining whether such corporation is a personal service corporation.”
1986—Subsec. (f)(2)(B)(iii). Pub. L. 99–514, § 104(b)(6), struck out “and by adding the zero bracket amount,” after “in the short period,”.
Subsec. (f)(3), (4). Pub. L. 99–514, § 806(d), added par. (3) and redesignated former par. (3) as (4).
Subsec. (i). Pub. L. 99–514, § 806(c)(1), added subsec. (i).
1984—Subsec. (b)(4). Pub. L. 98–369, § 803(a), added par. (4).
Subsec. (f)(2)(A). Pub. L. 98–369, § 474(b)(2), substituted “section 15” for “section 21” in provisions preceding cl. (i).
Subsec. (h). Pub. L. 98–369, § 803(b), added subsec. (h).
1977—Subsec. (f)(2)(B)(iii). Pub. L. 95–30 substituted “multiplying the gross income for such short period (minus the deductions allowed by this chapter for the short period, but only the adjusted amount of the deductions for personal exemptions as described in section 443(c)) by 365, by dividing the result by the number of days in the short period, and by adding the zero bracket amount” for “multiplying such income by 365 and dividing the result by the number of days in the short period”.
1976—Subsec. (f)(3). Pub. L. 94–455 struck out “or his delegate” after “Secretary”.
1964—Subsec. (f)(2)(A). Pub. L. 88–272 inserted “, including,” before “or ending with reference to”.
Statutory Notes and Related Subsidiaries
Effective Date of 1988 Amendment
Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.
Effective Date of 1986 Amendment
Amendment by section 104(b)(6) of Pub. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, see section 151(a) of Pub. L. 99–514, set out as a note under section 1 of this title.
Amendment by section 806(c)(1), (d) of Pub. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, with special provisions applicable to taxpayers who are required to change their accounting periods, see section 806(e) of Pub. L. 99–514, set out as a note under section 1378 of this title.
Effective Date of 1984 Amendment
Amendment by section 474(b)(2) of Pub. L. 98–369 applicable to taxable years beginning after Dec. 31, 1983, and to carrybacks from such years, see section 475(a) of Pub. L. 98–369, set out as a note under section 21 of this title.
Amendment by section 803 of Pub. L. 98–369 applicable to taxable years beginning after Dec. 31, 1984, see section 805(a)(4) of Pub. L. 98–369, as amended, set out as a note under section 245 of this title.
Effective Date of 1977 Amendment
Amendment by Pub. L. 95–30 applicable to taxable years beginning after Dec. 31, 1976, see section 106(a) of Pub. L. 95–30, set out as a note under section 1 of this title.
Effective Date of 1964 Amendment
Amendment by Pub. L. 88–272 applicable to taxable years ending after Dec. 31, 1963, see section 235(d) of Pub. L. 88–272, set out as a note under section 269 of this title.
Construction of Section 806 of Pub. L. 99–514
Nothing in section 806 of Pub. L. 99–514 or in any legislative history relating thereto to be construed as requiring the Secretary of the Treasury or his delegate to permit an automatic change of a taxable year, see section 1008(e)(9) of Pub. L. 100–647, set out as a note under section 1378 of this title.