[Code of Federal Regulations]
[Title 26, Volume 18]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR301.6362-2]

[Page 319-320]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 301_PROCEDURE AND ADMINISTRATION--Table of Contents
 
               Seizure of Property for Collection of Taxes
 
Sec. 301.6362-2  Qualified resident tax based on taxable income.

    (a) In general. A tax meets the requirements of section 6362(b) and 
this section only if it is imposed on the amount of the taxable income, 
as defined in section 63, of the individual, estate, or trust, 
adjusted--
    (1) By subtracting an amount equal to the amount of the taxpayer's 
interest on obligations of the United States which was included in his 
gross income for the taxable year;

    (2) By adding an amount equal to the amount of the taxpayer's net 
State income tax deduction, as defined in paragraph (a) of Sec. 
301.6362-4, for the taxable year;

    (3) By adding an amount equal to the amount of the taxpayer's net 
tax-exempt income, as defined in paragraph (b) of Sec. 301.6362-4, for 
the taxable year; and

    (4) If a credit is allowed against the tax in accordance with 
paragraph (b)(3) of this section for sales tax imposed by the State or a 
political subdivision thereof, by adding an amount equal to the amount 
of the taxpayer's deduction under section 164(a)(4) for such sales tax.


The tax may provide for either a single rate or multiple rates which 
vary with the amount of taxable income, as adjusted.

    (b) Permitted adjustments. A tax which otherwise meets the 
requirements of paragraph (a) of this section shall not be deemed to 
fail to meet such requirements solely because it provides for one or 
more of the following adjustments:

    (1) A credit meeting the requirements of paragraph (c) of Sec. 
301.6362-4 is allowed against the tax for the taxpayer's income tax 
liability to another State or a political subdivision thereof.

    (2) A tax is imposed on the amount taxed under section 56 (relating 
to the minimum tax for tax preferences).

    (3) A credit is allowed against the tax for all or a portion of any 
general sales tax imposed by the State or a political subdivision 
thereof with respect to sales either to the taxpayer or to one or more 
of his dependents.

    (c) Method of making mandatory adjustments. The mandatory 
adjustments provided in paragraph (a) of this section shall be made 
directly to taxable income. Except as provided in paragraph (c)(2) of 
Sec. 301.6362-4, no account

[[Page 320]]

shall be taken of any reduction or increase in the Federal adjusted 
gross income which would result from the exclusion from, or inclusion 
in, gross income of the items which are the subject of the adjustments. 
Thus, for example, when for purposes of the calculation the taxpayer's 
Federal taxable income is adjusted to reflect the exclusion from gross 
income of interest on obligations of the United States, no change shall 
be made in the amount of the taxpayer's deduction for medical expenses, 
or in the amount of his charitable contribution base, even though such 
amounts would ordinarily depend upon the amount of adjusted gross 
income.

[T.D. 7577, 43 FR 59366, Dec. 20, 1978]