Internal Revenue Code · 26 U.S.C.
§ 873. Deductions
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. § 873
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Enacted
- November 13, 1966 by Pub. L. 89–809
- Last amended
- October 21, 1998 by Pub. L. 105–277
- Amendments
- 5 dated changes in the source credit
- Length
- 3 subsections · 318 words · about 1 min to read
- Cross-references
- cites 5; cited by 4 Code sections and 15 other regulations
- Regulations
- 1 issued under this section
In the case of a nonresident alien individual, the deductions shall be allowed only for purposes of section 871(b) and (except as provided by subsection (b)) only if and to the extent that they are connected with income which is effectively connected with the conduct of a trade or business within the United States; and the proper apportionment and allocation of the deductions for this purpose shall be determined as provided in regulations prescribed by the Secretary.
The deduction allowed by section 165 for casualty or theft losses described in paragraph (2) or (3) of section 165(c), but only if the loss is of property located within the United States.
The deduction for charitable contributions and gifts allowed by section 170.
The deduction for personal exemptions allowed by section 151, except that only one exemption shall be allowed under section 151 unless the taxpayer is a resident of a contiguous country or is a national of the United States.
For rule that certain foreign taxes are not to be taken into account in determining deduction or credit, see section 906(b)(1).
(Aug. 16, 1954, ch. 736, 68A Stat. 280; Pub. L. 89–809, title I, § 103(c)(1), Nov. 13, 1966, 80 Stat. 1550; Pub. L. 92–580, § 1(b), Oct. 27, 1972, 86 Stat. 1276; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 95–30, title I, § 101(d)(11), May 23, 1977, 91 Stat. 134; Pub. L. 98–369, div. A, title VII, § 711(c)(2)(A)(iv), July 18, 1984, 98 Stat. 945; Pub. L. 105–277, div. J, title IV, § 4004(b)(3), Oct. 21, 1998, 112 Stat. 2681–911.)
Regulations under this section
Treasury regulations (26 CFR) issued under § 873
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 5 other sections
- § 871(b) Tax on nonresident alien individuals
- § 165 Losses
- § 170 Charitable, etc., contributions and gifts
- § 151 Allowance of deductions for personal exemptions
- § 906(b)(1) Nonresident alien individuals and foreign corporations
Cited by 4 Code sections
- § 153(2) Cross references
- § 170(q)(5) Charitable, etc., contributions and gifts
- § 877(b)(2) Expatriation to avoid tax
- § 906(b)(1) Nonresident alien individuals and foreign corporations
Cited in 15 regulations not issued under it
- § 1.154 Statutory provisions; cross references.
- § 1.170A-1 Charitable, etc., contributions and gifts; allowance of deduction.
- § 1.199A-10 Allocation of cost of goods sold (COGS) and other deductions to domestic production gross receipts (DPGR), and other rules.
- § 1.267A-5 Definitions and special rules.
- § 1.404(a)-11 Trusts created or organized outside the United States; application of section 404(a)(4).
- § 1.861-8 Computation of taxable income from sources within the United States and from other sources and activities.
- § 1.865-3 Source of gross income from sales of personal property (including inventory property) by a nonresident attributable to an office or other fixed place of business in the United States.
- § 1.871-8 Taxation of nonresident alien individuals engaged in U.S. business or treated as having effectively connected income.
- § 1.871-10 Election to treat real property income as effectively connected with U.S. business.
- § 1.871-13 Taxation of individuals for taxable year of change of U.S. citizenship or residence.
- § 1.874-1 Allowance of deductions and credits to nonresident alien individuals.
- § 1.1441-4 Exemptions from withholding for certain effectively connected income and other amounts.
- § 1.1446-2 Determining a partnership's effectively connected taxable income allocable to foreign partners under section 704.
- § 31.3402(f)(6)-1 Withholding exemptions for nonresident alien individuals.
- § 301.7701(b)-7 Coordination with income tax treaties.
Amendment history
From the source credit and the official notes, newest first.
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
Amendments
1998—Subsec. (b)(1). Pub. L. 105–277 amended heading and text of par. (1) generally. Prior to amendment, text read as follows: “The deduction for losses allowed by section 165(c)(3), but only if the loss is of property located within the United States.”
1984—Subsec. (b)(1). Pub. L. 98–369 substituted “for losses” for “, for losses of property not connected with the trade or business if arising from certain casualties or theft,”.
1977—Subsec. (c). Pub. L. 95–30 struck out par. (1) which made a cross reference to section 142(b)(1) for disallowance of the standard deduction and struck out “(2)” at beginning of single remaining cross reference.
1976—Subsec. (a). Pub. L. 94–455 struck out “or his delegate” after “Secretary”.
1972—Subsec. (b)(3). Pub. L. 92–580 substituted exception that only one exemption be allowed under section 151 unless the taxpayer is a resident of a contiguous country or is a national of the United States, for exception that in the case of a non-resident alien individual who is not a resident of a contiguous country only one exception be allowed under section 151.
1966—Pub. L. 89–809 amended section generally, substituting “connected with income which is effectively connected with the conduct of a trade or business within the United States” for “connected with income from sources within the United States” in subsec. (a), striking out provisions relating to the deduction of losses not connected with a trade or business but incurred in transactions entered into for profit in subsec. (b), making the casualty loss deduction available even if the property giving rise to the loss is not effectively connected with the conduct of a trade or business in the United States if the property is located in this country, making the charitable contribution deduction available even though not related to the trade or business, and adding subsec. (c)(2) making a cross reference to section 906(b)(1) for rule that certain foreign taxes are not to be taken into account in determining deduction or credit.
Statutory Notes and Related Subsidiaries
Effective Date of 1998 Amendment
Amendment by Pub. L. 105–277 applicable to taxable years beginning after Dec. 31, 1983, see section 4004(c)(1) of Pub. L. 105–277, set out as a note under section 172 of this title.
Effective Date of 1984 Amendment
Amendment by Pub. L. 98–369 applicable to taxable years beginning after Dec. 31, 1983, see section 711(c)(2)(A)(v) of Pub. L. 98–369, set out as a note under section 165 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 1972 Amendment
Amendment by Pub. L. 92–580 applicable to taxable years beginning after Dec. 31, 1971, see section 1(c) of Pub. L. 92–580, set out as a note under section 152 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.