Internal Revenue Code · 26 U.S.C.
§ 872. Gross 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. § 872
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Enacted
- September 21, 1961 by Pub. L. 87–256
- Last amended
- October 22, 2004 by Pub. L. 108–357
- Amendments
- 6 dated changes in the source credit
- Length
- 2 subsections · 581 words · about 3 min to read
- Defines
- 1 term
- Cross-references
- cites 0; cited by 3 Code sections and 9 other regulations
- Regulations
- 2 issued under this section
Gross income derived by an individual resident of a foreign country from the international operation of a ship or ships if such foreign country grants an equivalent exemption to individual residents of the United States.
Gross income derived by an individual resident of a foreign country from the international operation of aircraft if such foreign country grants an equivalent exemption to individual residents of the United States.
Income derived by a nonresident alien individual from a series E or series H United States savings bond, if such individual acquired such bond while a resident of the Ryukyu Islands or the Trust Territory of the Pacific Islands.
Gross income derived by a nonresident alien individual from a legal wagering transaction initiated outside the United States in a parimutuel pool with respect to a live horse race or dog race in the United States.
Income to which paragraphs (1) and (2) apply shall include income which is derived from the rental on a full or bareboat basis of a ship or ships or aircraft, as the case may be.
The Secretary may provide that this subsection be applied separately with respect to income from different types of transportation.
To the extent provided in regulations, a possession of the United States shall be treated as a foreign country for purposes of this subsection.
(Aug. 16, 1954, ch. 736, 68A Stat. 280; Pub. L. 87–256, § 110(c), Sept. 21, 1961, 75 Stat. 536; Pub. L. 89–809, title I, § 103(b), Nov. 13, 1966, 80 Stat. 1550; Pub. L. 99–514, title XII, § 1212(c)(1), (2), Oct. 22, 1986, 100 Stat. 2538; Pub. L. 100–647, title I, § 1012(e)(2)(B), (5), (s)(2)(A), Nov. 10, 1988, 102 Stat. 3500, 3527; Pub. L. 101–239, title VII, § 7811(i)(8)(C), Dec. 19, 1989, 103 Stat. 2411; Pub. L. 103–296, title III, § 320(a)(2), Aug. 15, 1994, 108 Stat. 1535; Pub. L. 108–357, title IV, § 419(a), Oct. 22, 2004, 118 Stat. 1513.)
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 § 872
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
Cited by 3 Code sections
- § 877(b)(1) Expatriation to avoid tax
- § 883(a)(4) Exclusions from gross income
- § 7701(b)(5)(E)(i) Definitions
Cited in 9 regulations not issued under it
- § 1.163-12 Deduction of original issue discount on instrument held by related foreign person.
- § 1.267(a)-3 Deduction of amounts owed to related foreign persons.
- § 1.415(c)-2 Compensation.
- § 1.871-8 Taxation of nonresident alien individuals engaged in U.S. business or treated as having effectively connected income.
- § 1.871-12 Determination of tax on treaty income.
- § 1.6654-6 Nonresident alien individuals.
- § 31.3401(a)(6)-1A Remuneration for services of certain nonresident alien individuals paid before January 1, 1967.
- § 301.7701(b)-0 Outline of regulation provision for section 7701(b)-1 through (b)-9.
- § 301.7701(b)-3 Days of presence in the United States that are excluded for purposes of section 7701(b).
Amendment history
From the source credit and the official notes, newest first.
- Amended by Pub. L. 108–357Parts changed in 2004: (b)(5)
- Amended by Pub. L. 103–296Parts changed in 1994: (b)(3)
- Amended by Pub. L. 101–239Parts changed in 1989: (b)(7)
- Amended by Pub. L. 100–647Parts changed in 1988: (a) (b)(1)
- Amended by Pub. L. 99–514Parts changed in 1986: (b)(1) (b)(2) (b)(5)
- Amended by Pub. L. 89–809Parts changed in 1966: (a) (b)(3)(B) (b)(4)
- Enacted by Pub. L. 87–256Parts changed in 1961: (b)(3)
Where it sits in the Code
- Subtitle A Income Taxes
- Chapter 1 NORMAL TAXES AND SURTAXES
- Subchapter N Tax Based on Income From Sources Within or Without the United States
- Part II NONRESIDENT ALIENS AND FOREIGN CORPORATIONS
- Subpart A Nonresident Alien Individuals
Nearby sections
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
References in Text
Section 101 of the Immigration and Nationality Act, referred to in subsec. (b)(3), is classified to section 1101 of Title 8, Aliens and Nationality.
Amendments
2004—Subsec. (b)(5) to (8). Pub. L. 108–357 added par. (5) and redesignated former pars. (5) to (7) as (6) to (8), respectively.
1994—Subsec. (b)(3). Pub. L. 103–296 substituted “(F), (J), or (Q)” for “(F) or (J)”.
1989—Subsec. (b)(7). Pub. L. 101–239 added par. (7).
1988—Subsec. (a). Pub. L. 100–647, § 1012(s)(2)(A), inserted “, except where the context clearly indicates otherwise” after “individual”.
Subsec. (b)(1), (2). Pub. L. 100–647, § 1012(e)(2)(B), (5), substituted “to individual residents of the United States” for “to citizens of the United States and to corporations organized in the United States” and “international operation” for “operation”.
1986—Subsec. (b)(1). Pub. L. 99–514, § 1212(c)(1), added par. (1) and struck out former par. (1), ships under foreign flag, which read as follows: “Earnings derived from the operation of a ship or ships documented under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.”
Subsec. (b)(2). Pub. L. 99–514, § 1212(c)(1), added par. (2) and struck out former par. (2), aircraft of foreign registry, which read as follows: “Earnings derived from the operation of aircraft registered under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.”
Subsec. (b)(5), (6). Pub. L. 99–514, § 1212(c)(2), added pars. (5) and (6).
1966—Subsec. (a). Pub. L. 89–809, § 103(b)(1), limited the inclusion of gross income which is derived from sources within the United States to such income which is not effectively connected with the conduct of a trade or business within the United States and inserted provision including gross income without the limitation as to source which is effectively connected with the conduct of a trade or business within the United States.
Subsec. (b)(3)(B). Pub. L. 89–809, § 103(b)(2), substituted “by a domestic corporation, a domestic partnership, or an individual who is a citizen or resident of the United States” for “by a domestic corporation”.
Subsec. (b)(4). Pub. L. 89–809, § 102(b)(3), added par. (4).
1961—Subsec. (b)(3). Pub. L. 87–256 added par. (3).
Statutory Notes and Related Subsidiaries
Effective Date of 2004 Amendment
Pub. L. 108–357, title IV, § 419(c), Oct. 22, 2004, 118 Stat. 1513, provided that: “The amendments made by this section [amending this section and section 883 of this title] shall apply to wagers made after the date of the enactment of this Act [Oct. 22, 2004].”
Effective Date of 1994 Amendment
Amendment by Pub. L. 103–296 effective with calendar quarter following Aug. 15, 1994, see section 320(c) of Pub. L. 103–296, set out as a note under section 871 of this title.
Effective Date of 1989 Amendment
Amendment by Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title.
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 Pub. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, see section 1212(f) of Pub. L. 99–514, set out as a note under section 863 of this title.
Effective Date of 1966 Amendment
Amendment by Pub. L. 89–809 applicable with respect to taxable years beginning after Dec. 31, 1966, see section 103(n)(1) of Pub. L. 89–809, set out as a note under section 871 of this title.
Effective Date of 1961 Amendment
Amendment by Pub. L. 87–256 applicable to taxable years beginning after Dec. 31, 1961, see section 110(h)(1) of Pub. L. 87–256, set out as a note under section 117 of this title.
Applicability of Certain Amendments by Pub. L. 99–514 in Relation to Treaty Obligations of United States
For nonapplication of amendment by section 1212(c)(1), (2) of Pub. L. 99–514 to the extent application of such amendment would be contrary to any treaty obligation of the United States in effect on Oct. 22, 1986, with provision that for such purposes any amendment by title I of Pub. L. 100–647 be treated as if it had been included in the provision of Pub. L. 99–514 to which such amendment relates, see section 1012(aa)(3), (4) of Pub. L. 100–647, set out as a note under section 861 of this title.
Executive Documents
Termination of Trust Territory of the Pacific Islands
For termination of Trust Territory of the Pacific Islands, see note set out preceding section 1681 of Title 48, Territories and Insular Possessions.