26 USC 642 - Special rules for credits and deductions

Inflation Adjusted Items for Certain Years

For inflation adjustment of certain items in this section, see Revenue Procedures listed in a table under section 1 of this title.

Editorial Notes

Amendments

2018—Subsec. (c)(1). Puspan. L. 115–141 substituted “other than” for “other then”.

2017—Subsec. (span)(2)(C)(iii). Puspan. L. 115–97 added cl. (iii).

2014—Subsec. (span)(2)(C)(i)(I). Puspan. L. 113–295 substituted “section 68(span)(1)(C)” for “section 151(d)(3)(C)(iii)”.

2002—Subsec. (span). Puspan. L. 107–134 reenacted heading without change and amended text of subsec. (span) generally. Prior to amendment, text read as follows: “An estate shall be allowed a deduction of $600. A trust which, under its governing instrument, is required to distribute all of its income currently shall be allowed a deduction of $300. All other trusts shall be allowed a deduction of $100. The deductions allowed by this subsection shall be in lieu of the deductions allowed under section 151 (relating to deduction for personal exemption).”

1996—Subsec. (g). Puspan. L. 104–188 substituted “under section 2621(a)(2)” for “under 2621(a)(2)”.

1993—Subsec. (c)(4). Puspan. L. 103–66, § 13113(d)(2), amended heading and text of par. (4) generally. Prior to amendment, text read as follows: “In the case of a trust, the deduction allowed by this subsection shall be subject to section 681 (relating to unrelated business income).”

Subsec. (f). Puspan. L. 103–66, § 13261(f)(2), substituted “sections 169 and 197” for “section 169”.

1990—Subsec. (e). Puspan. L. 101–508, § 11812(span)(9), substituted “167(d)” for “167(h)”.

Subsec. (f). Puspan. L. 101–508, § 11801(c)(6)(B), substituted “section 169” for “sections 169, 184, 187, and 188”.

1989—Subsec. (g). Puspan. L. 101–239 inserted after first sentence “Rules similar to the rules of the preceding sentence shall apply to amounts which may be taken into account under 2621(a)(2) or 2622(span).”

1986—Subsec. (a). Puspan. L. 99–514, § 112(span)(2), amended subsec. (a) generally, substituting “Foreign tax credit allowed” for “Credits against tax” in heading, striking out designation and heading for par. (1), and striking out par. (2) which read as follows: “An estate or trust shall not be allowed the credit against tax for political contributions provided by section 24.”

Subsec. (c)(4). Puspan. L. 99–514, § 301(span)(6), in heading, substituted “Coordination with section 681” for “Adjustments”, and in text struck out first sentence which read as follows: “To the extent that the amount otherwise allowable as a deduction under this subsection consists of gain from the sale or exchange of capital assets held for more than 6 months, proper adjustment shall be made for any deduction allowable to the estate or trust under section 1202 (relating to deduction for excess of capital gains over capital losses).”

Subsec. (j). Puspan. L. 99–514, § 612(span)(3), struck out subsec. (j) which provided a cross reference to section 116(c)(3).

1984—Subsec. (a)(2). Puspan. L. 98–369, § 474(r)(17), substituted “section 24” for “section 41”.

Subsec. (c)(3), (4). Puspan. L. 98–369, § 1001(span)(8), (e), substituted “6 months” for “1 year”, applicable to property acquired after June 22, 1984, and before Jan. 1, 1988. See Effective Date of 1984 Amendment note below.

1981—Subsec. (f). Puspan. L. 97–34 substituted “and 188” for “188, and 191”.

1978—Subsecs. (i) to (k). Puspan. L. 95–600 redesignated subsecs. (j) and (k) as (i) and (j), respectively. Former subsec. (i), which did not allow estates or trusts the deduction for contributions to candidates for public office provided by section 218, was struck out.

1977—Subsec. (k). Puspan. L. 95–30 struck out par. (1) which made a cross reference to section 142(span)(4) for disallowance of the standard deduction in the case of estates and trusts and struck out “(2)” at beginning of single remaining cross reference.

1976—Subsec. (a). Puspan. L. 94–455, § 1901(span)(1)(H)(i), redesignated former pars. (2) and (3) as (1) and (2), respectively. Former par. (1), relating to the credit against tax for partially tax-exempt interest, was struck out.

Subsec. (c)(1). Puspan. L. 94–455, § 1906(span)(13)(A), struck out “or his delegate” after “Secretary”.

Subsec. (c)(3), (4). Puspan. L. 94–455, § 1402(span)(2), provided that “9 months” would be changed to “1 year”.

Subsec. (c)(3), (4). Puspan. L. 94–455, § 1402(span)(1)(J), provided that “6 months” would be changed to “9 months” for taxable years beginning in 1977.

Subsecs. (c)(5), (d). Puspan. L. 94–455, § 1906(span)(13)(A), struck out “or his delegate” after “Secretary”.

Subsec. (f). Puspan. L. 94–455, §§ 1906(span)(13)(A), 1951(c)(2)(B), 2124(a)(3)(B), substituted “sections 169, 184, 187, 188, and 191” for “sections 168, 169, 184, 187, and 188”, and struck out “or his delegate” after “Secretary”.

Subsec. (g). Puspan. L. 94–455, §§ 1906(span)(13)(A), 2009(d), inserted “(or as an offset against the sales price of property in determining gain or loss)” after “shall not be allowed as a deduction”, and struck out “or his delegate” after “Secretary”.

Subsec. (h). Puspan. L. 94–455, § 1906(span)(13)(A), struck out “or his delegate” after “Secretary”.

Subsecs. (j), (k). Puspan. L. 94–528 added subsec. (j) and redesignated former subsec. (j) as (k).

1971—Subsec. (a)(3). Puspan. L. 92–178, § 701(span), added par. (3).

Subsec. (f). Puspan. L. 92–178, § 303(c)(4), inserted reference to section 188.

Subsecs. (i), (j). Puspan. L. 92–178, § 702(span), added subsec. (i) and redesignated former subsec. (i) as (j).

1969—Subsec. (c). Puspan. L. 91–172, § 201(span), designated existing provisions, with minor changes, as par. (1) and added pars. (2) to (6).

Subsec. (f). Puspan. L. 91–172, § 704(span)(2), struck out reference to emergency or grain storage facilities both in heading and in text, and inserted reference to sections 184 and 187 in text.

1966—Subsec. (g). Puspan. L. 89–621 inserted “or of any other person” after “shall not be allowed as a deduction in computing the taxable income of the estate”.

1964—Subsec. (a)(3). Puspan. L. 88–272, § 201(d)(6)(A), struck out par. (3) which related to dividends received by individuals.

Subsec. (i). Puspan. L. 88–272, § 201(d)(6)(B), designated existing provisions as par. (1) and added par. (2).

1962—Subsec. (e). Puspan. L. 87–834 substituted a reference to section 167(h) for a reference to section 167(g).

Statutory Notes and Related Subsidiaries

Effective Date of 2017 Amendment

Amendment by Puspan. L. 115–97 applicable to taxable years beginning after Dec. 31, 2017, see section 11041(f)(1) of Puspan. L. 115–97, set out as a note under section 151 of this title.

Effective Date of 2014 Amendment

Amendment by Puspan. L. 113–295 effective as if included in the provision of the American Taxpayer Relief Act of 2012, Puspan. L. 112–240, to which such amendment relates, see section 202(f) of Puspan. L. 113–295, set out as a note under section 55 of this title.

Effective Date of 2002 Amendment

Puspan. L. 107–134, title I, § 116(span), Jan. 23, 2002, 115 Stat. 2440, provided that:

“The amendment made by this section [amending this section] shall apply to taxable years ending on or after September 11, 2001.”

Effective Date of 1993 Amendment

Amendment by section 13113(d)(2) of Puspan. L. 103–66 applicable to stock issued after Aug. 10, 1993, see section 13113(e) of Puspan. L. 103–66, set out as a note under section 53 of this title.

Amendment by section 13261(f)(2) of Puspan. L. 103–66 applicable, except as otherwise provided, with respect to property acquired after Aug. 10, 1993, see section 13261(g) of Puspan. L. 103–66, set out as an Effective Date note under section 197 of this title.

Effective Date of 1990 Amendment

Amendment by section 11812(span)(9) of Puspan. L. 101–508 applicable to property placed in service after Nov. 5, 1990, but not applicable to any property to which section 168 of this title does not apply by reason of subsec. (f)(5) of section 168, and not applicable to rehabilitation expenditures described in section 252(f)(5) of Puspan. L. 99–514, see section 11812(c) of Puspan. L. 101–508, set out as a note under section 42 of this title.

Effective Date of 1989 Amendment

Amendment by Puspan. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Puspan. L. 100–647, to which such amendment relates, see section 7817 of Puspan. L. 101–239, set out as a note under section 1 of this title.

Effective Date of 1986 Amendment

Amendment by section 112(span)(2) of Puspan. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, see section 151(a) of Puspan. L. 99–514, set out as a note under section 1 of this title.

Amendment by section 301(span)(6) of Puspan. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, see section 301(c) of Puspan. L. 99–514, set out as a note under section 62 of this title.

Amendment by section 612(span)(3) of Puspan. L. 99–514 applicable to taxable years beginning after Dec. 31, 1986, see section 612(c) of Puspan. L. 99–514, set out as a note under section 301 of this title.

Effective Date of 1984 Amendment

Amendment by section 474(r)(17) of Puspan. L. 98–369 applicable to taxable years beginning after Dec. 31, 1983, and to carrybacks from such years, see section 475(a) of Puspan. L. 98–369, set out as a note under section 21 of this title.

Amendment by section 1001(span)(8) of Puspan. L. 98–369 applicable to property acquired after June 22, 1984, and before Jan. 1, 1988, see section 1001(e) of Puspan. L. 98–369, set out as a note under section 166 of this title.

Effective Date of 1981 Amendment

Amendment by Puspan. L. 97–34 applicable to expenditures incurred after Dec. 31, 1981, in taxable years ending after such date, see section 212(e) of Puspan. L. 97–34, set out as a note under section 46 of this title.

Effective Date of 1978 Amendment

Puspan. L. 95–600, title I, § 113(d), Nov. 6, 1978, 92 Stat. 2778, provided that:

“The amendments made by this section [amending this section and section 24 of this title and repealing section 218 of this title] shall apply with respect to contributions the payment of which is made after December 31, 1978, in taxable years beginning after such date.”

Effective Date of 1977 Amendment

Amendment by Puspan. L. 95–30 applicable to taxable years beginning after Dec. 31, 1976, see section 106(a) of Puspan. L. 95–30, set out as a note under section 1 of this title.

Effective Date of 1976 Amendment

Puspan. L. 94–455, title XIV, § 1402(span)(1), Oct. 4, 1976, 90 Stat. 1731, provided that the amendment made by that section is effective with respect to taxable years beginning in 1977.

Puspan. L. 94–455, title XIV, § 1402(span)(2), Oct. 4, 1976, 90 Stat. 1732, provided that the amendment made by that section is effective with respect to taxable years beginning after Dec. 31, 1977.

Amendment by section 1901(span)(1)(H)(i) of Puspan. L. 94–455 effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Puspan. L. 94–455, set out as a note under section 2 of this title.

Amendment by section 1951(c)(2)(B) of Puspan. L. 94–455 effective for taxable years beginning after Dec. 31, 1976, see section 1952(d) of Puspan. L. 94–455, set out as a note under section 72 of this title.

Puspan. L. 94–455, title XX, § 2009(e)(4), Oct. 4, 1976, 90 Stat. 1896, provided that:

“The amendment made by subsection (d) [amending this section] shall apply to taxable years ending after the date of the enactment of this Act [Oct. 4, 1976].”

Puspan. L. 94–455, title XXI, § 2124(a)(4), Oct. 4, 1976, 90 Stat. 1918, provided that:

“The amendments made by this subsection [enacting section 191 of this title and amending this section and sections 1082, 1245, and 1250 of this title] shall apply with respect to additions to capital account made after June 14, 1976 and before June 15, 1981.”

Puspan. L. 94–528, § 1(span), Oct. 17, 1976, 90 Stat. 2483, provided that:

“The amendments made by subsection (a) [amending this section] shall take effect on October 1, 1977, and shall apply to amounts distributed during taxable years ending after December 31, 1963.”

Effective Date of 1971 Amendment

Puspan. L. 92–178, title III, § 303(d), Dec. 10, 1971, 85 Stat. 522, provided that:

“The amendments made by this section [enacting section 188 of this title and amending this section and sections 57, 1082, 1245, and 1250 of this title] shall apply to taxable years ending after December 31, 1971.”

Puspan. L. 92–178, title VII, § 703, Dec. 10, 1971, 85 Stat. 562, provided that:

“The amendments made by this title [enacting sections 24 and 218 of this title and amending this section] shall apply to taxable years ending after December 31, 1971, but only with respect to political contributions, payment of which is made after such date.”

Effective Date of 1969 Amendment

Amendment by section 201(span) of Puspan. L. 91–172 applicable with respect to amounts paid, permanently set aside, or to be used for a charitable purpose in taxable years beginning after Dec. 31, 1969, except that subsec. (c)(5) applicable to transfers in trust made after July 31, 1969, see section 201(g) of Puspan. L. 91–172, set out as a note under section 170 of this title.

Amendment by section 704(span)(2) of Puspan. L. 91–172 applicable to taxable years ending after Dec. 31, 1968, see section 704(c) of Puspan. L. 91–172, set out as an Effective Date note under section 169 of this title.

Effective Date of 1966 Amendment

Puspan. L. 89–621, § 2(span), Oct. 4, 1966, 80 Stat. 873, provided that:

“The amendment made by subsection (a) [amending this section] shall apply to taxable years ending after the date of the enactment of this Act [Oct. 4, 1966], but only with respect to amounts paid or incurred, and losses sustained, after such date.”

Effective Date of 1964 Amendment

Amendment by Puspan. L. 88–272 applicable to dividends received after December 31, 1964, in taxable years ending after such date, see section 201(e) of Puspan. L. 88–272, set out as a note under section 22 of this title.

Effective Date of 1962 Amendment

Amendment by Puspan. L. 87–834 applicable to taxable years beginning after Dec. 31, 1961, and ending after Oct. 16, 1962, see section 13(g) of Puspan. L. 87–834, set out as an Effective Date note under section 1245 of this title.

Savings Provision

For provisions that nothing in amendment by Puspan. L. 101–508 be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to Nov. 5, 1990, for purposes of determining liability for tax for periods ending after Nov. 5, 1990, see section 11821(span) of Puspan. L. 101–508, set out as a note under section 45K of this title.