Code of Federal Regulations, Title 26

* Results are from year 2009. Note, One section may have several matches.

Source: ecfr - "Simple Search" - Government Printing Office http://ecfr.gpoaccess.gov

1. taxable income (6203 matches)



2. excluded income (13 matches, 7 sections) - see Sec. 861-8 and 861-8T



3. computation of taxable income (66 matches)



4. computation of taxable income from sources within the united states (2 matches, 2 sections ) - Sec. 861-8 and 861-8T



5. determine taxable income (15 matches, 9 sections)



6. determining taxable income (68 matches)



7. items AND excluded income (3 matches) - Sec. 861-8 and 861-8T - use Boolean



8. "exempt income means" (8 hits, but only 2 sections) - Sec. 861-8T - include quotes, but search CFR for this one



9. nonexempt income (5 matches, 1 section) - use ecfr Simple Search



10. exempt income (162 matches)



11. exempt income AND defined (40 matches) - use Boolean



12. income exempt (20 matches) - Use ecfr Simple Search, shows 20 matches, including 861-8T, even though term doesn't exist in this section.



13. exempt asset (4 matches, 2 sections) - Sec. 861-8T



14. excluded (2303 matches)



15. determination of taxable income (35 matches) - see Sec. 861-8, 863-0, 863-1, and 863-2



16. determination of gross income (19 matches) - see 863-0, 863-1, and 863-3



17. determination of source of taxable income (5 matches, 3 sections) - Sec. 863-0, 863-2, and 863-3



18. sources AND excluded income (5 matches) - Sec. 861-8 and 861-8T



19. sections AND excluded income (5 matches) - Sec. 861-8 and 861-8T



20. detemining taxable income AND sources (12 matches) - see Sec. 861-8 and 861-8T



21. applying AND rules AND determining taxable income (14 matches) - see Sec. 861-8 and 861-8T



22. how to (57 matches)



23. income that is exempt (8 matches) - see Sec. 861-8T



24. deduction (9561 matches)



25. required to file (526 matches)



26. in the case of a citizen (now 7 matches) - used to include Sec. 931-1



27. gross income (7961 matches)



28. gross income means (4 matches)



29. allocation of gross income (14 matches) - see Sec. 863-1(c), which refers to Sec. 861-8



30. allocated to gross income (5 matches)



31. allocating deductions (15 matches)



32. computation of income (18 matches)



33. categories of income (36 matches)



34. taxable income from sources within the United States (44 matches)
    - Notice, it's all about foriegn income.



35. determine income (6 matches)



36. scope AND taxable income (329 matches) - use Boolean



37. operative section (11 matches)



38. sources (2067 matches)



39. determine the source (29 matches) - Notice it's all foreign



40. source of income (98 matches)



41. income derived from (466 matches)



42. allocating expenses (6 matches)



43. allocation and apportionment of taxes (4 matches) - see Sec. 904-6

Basic search terms found in CFR Title 26
(Possible items for Boolean searches)

1. computing income tax (1match)



2. tax (40918 matches)



3. the tax (7480 matches)



4. the tax is determined (7 matches)



5. taxable (46646 matches)



6. is taxable (173 matches)



7. is taxable income (8 matches)



8. item (3670 matches)



9. items (4699 matches)



10. common items (2 matches, 1 section)
    - see "more common items... are... excluded from gross income entirely"



11. items of gross (92 matches)



12. items of gross income (73 matches)



13. item of income (285 matches)



14. items of income (569 matches)



15. taxable item (No Matches)



16. taxable items (No Matches)



17. allocated (4920 matches)



18. allocation (4369 matches)



19. liable to (88 matches)



20. liable for (737 matches)



21. liable to the tax (1 match) - Sec. 11-1
    - "Every corporation, foreign or domestic, is liable to the tax imposed"



22. liable for the tax (147 matches)



23. income tax (6502 matches)



24. determine income tax (1 match)



25. determining tax (22 matches)



26. determining taxable (71 matches)



27. rule (8642 matches)



28. rules (15262 matches)



29. the rules (5056 matches)



30. this section provides rules for (148 matches)



31. for determining (1083 matches)



32. source (2233 matches) - sources above



33. includes taxable income (1 match)



34. including taxable income (No Matches)



35. exempt (4736 matches)



36. list (551 matches)



37. lists (218 matches)


list of exemptions (4 matches)


38. deductible income (No Matches)



39. list of deductions (No Matches)



40. non taxable income (No Matches)



41. non-taxable income (1 match) "from non-taxable income of the trust"



42. nontaxable income (3 matches)



43. definition of gross income (6 matches)



44. gross income defined (6 matches)



45. defining gross income (No Matches)



46. deductable (1 match)



47. deductions (4746 matches)



48. imposed (4581 matches)



49. imposes (321 matches)

For information on Text Data Mining search the internet. An introductory discussion can be found at:
http://www.sims.berkeley.edu/~hearst/papers/acl99/acl99-tdm.html

Results: 1 through ... N (Use the links above)

taxable income (6203 matches)

26CFR1.1-1
(a)(1)...The tax imposed is upon taxable income (determined by subtracting the allowable deductions from gross income)...

[ This is rule #1 in the Code of Federal Regulations (CFR, the rules), which is based on a similar statement in the United States Code (USC, the law). ]

exempt asset (4 matches, 2 sections)

26CFR1.1-1
(ii) Exempt income and exempt asset defined--(A) In general. For purposes of this section, the term exempt income means any income that s, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes. The term exempt asset means any asset the income from which is, in whole or in part, exempt, excluded, or eliminated for federal tax purposes.

[ This is rule #1 in the Code of Federal Regulations (CFR, the rules), which is based on a similar statement in the United States Code (USC, the law). ]

excluded (2303 matches)

CFR Sec. 61
(b) "Cross references to other provisions of the Code are to be found throughout the regulations under section 61. The purpose of these cross references is to direct attention to the more common items which are included in or excluded from gross income entirely, or treated in some special manner. To the extent that another section of the Code or of the regulations thereunder, provides specific treatment for any item of income, such other provision shall apply notwithstanding section 61... "

[ Incredible! More common items... are... excluded from gross income entirely? Like items listed in USC Sec. 61? Does the specific treatment for any item include these items also... notwithstanding section 61? If so, "such other provision shall apply". Cross refences are found in USC Sec. 61, but they are being removed from it. See Cross References ]

nonexempt income (5 matches, 1 section)

26CFR1.265-1(b)
Exempt income and nonexempt income. (1) As used in this section, the term class of exempt income means any class of income (whether or not any amount of income of such class is received or accrued) wholly exempt from the taxes imposed by Subtitle A of the Code. For purposes of this section, a class of income which is considered as wholly exempt from the taxes imposed by subtitle A includes any class of income which is:
(i) Wholly excluded from gross income under any provision of Subtitle A, or
(ii) Wholly exempt from the taxes imposed by Subtitle A under the provisions of any other law.
(2) As used in this section the term nonexempt income means any income which is required to be included in gross income.

Sec. 265 has the definition of "nonexempt income", and Sec. 861 has the definition of "exempt income and exempt asset".

26CFR1.861-8T(d)(2)(ii)
Exempt income and exempt asset defined--(A) In general. For purposes of this section, the term exempt income means any income that is, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes.

[ Notice Sec. 265-1(b) says "nonexempt income... is required to be included in gross." And, after the definition of exempt income is prescribed, the very next paragraph is the list of nonexempt income ...or Income That Is Taxable. Why isn't the income of most Americans listed in Sec. 861-8T(d)(2)(iii)? This shows such income is not required to be included in gross. ]

26CFR1.861-8T(d)(2)(iii)
Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable] may have expenses, losses, or other deductions allocated and apportioned to them:
(A)... [ ...all foreign concerns ]
(B)...
(C)...
(D)...

["Income that is not considered tax exempt" is a double negative, which also means "Income That Is Taxable"]

exempt income (162 matches)

26CFR1.265-1(b)
Exempt income and nonexempt income. (1) As used in this section, the term class of exempt income means any class of income (whether or not any amount of income of such class is received or accrued) wholly exempt from the taxes imposed by Subtitle A of the Code. For purposes of this section, a class of income which is considered as wholly exempt from the taxes imposed by subtitle A includes any class of income which is:
(i) Wholly excluded from gross income under any provision of Subtitle A, or
(ii) Wholly exempt from the taxes imposed by Subtitle A under the provisions of any other law.
(2) As used in this section the term nonexempt income means any income which is required to be included in gross income.

26CFR1.861-8T(d)(2)(ii)
Exempt income and exempt asset defined--(A) In general. For purposes of this section, the term exempt income means any income that is, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes.

[ Notice Sec. 265-1(b) says "nonexempt income... is required to be included in gross." After the definition of exempt income is prescribed, the very next paragraph is the list of nonexempt income ...or Income That Is Taxable. Why isn't the income of most Americans listed in Sec. 861-8T(d)(2)(iii)? It shows such income is not required to be included in gross. ]

26CFR1.861-8T(d)(2)(iii)
Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable and] may have expenses, losses, or other deductions allocated and apportioned to them:
(A)... [ ...all foreign concerns ]
(B)...
(C)...
(D)...

["Income that is not considered tax exempt" is a double negative, which also means "Income That Is Taxable"]

exempt income means (8 hits, 2 sections) - use CFR

26CFR1.265-1(b)
Exempt income and nonexempt income. (1) As used in this section, the term class of exempt income means any class of income (whether or not any amount of income of such class is received or accrued) wholly exempt from the taxes imposed by Subtitle A of the Code. For purposes of this section, a class of income which is considered as wholly exempt from the taxes imposed by subtitle A includes any class of income which is:
(i) Wholly excluded from gross income under any provision of Subtitle A, or
(ii) Wholly exempt from the taxes imposed by Subtitle A under the provisions of any other law.
(2) As used in this section the term nonexempt income means any income which is required to be included in gross income.

26CFR1.861-8T(d)(2)(ii)
Exempt income and exempt asset defined--(A) In general. For purposes of this section, the term exempt income means any income that is, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes.

[ Again, the same results from "exempt income." Sec. 265-1(b) says "nonexempt income... is required to be included in gross." After the definition of exempt income is prescribed, the very next paragraph is the list of nonexempt income ...or Income That Is Taxable. Why isn't the income of most Americans listed in Sec. 861-8T(d)(2)(iii)? It shows such income is not required to be included in gross. ]

26CFR1.861-8T(d)(2)(iii)
Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable and] may have expenses, losses, or other deductions allocated and apportioned to them:
(A)... [ ...all foreign concerns ]
(B)...
(C)...
(D)...

["Income that is not considered tax exempt" is a double negative, which also means "Income That Is Taxable"]

excluded income (13 matches in 7 sections)

26CFR1.861-8(a)(4)
...the term ``statutory grouping of gross income'' or ``statutory grouping'' means the gross income from a specific source or activity which must first be determined in order to arrive at ``taxable income'' from which specific source or activity under an operative section. (See paragraph (f)(1) of this section.)...
...In some instances, where the operative section so requires, the statutory grouping or the residual grouping may include, or consist entirely of, excluded income. See paragraph (d)(2) of this section with respect to the allocation and apportionment of deductions to excluded income.

26CFR1.861-8(b)
Allocation--(1) In general. For purposes of this section, the gross income to which a specific deduction is definitely related is referred to as a ``class of gross income'' and may consist of one or more items of gross income. The rules emphasize the factual relationship between the deduction and a class of gross income. See paragraph (d)(1) of this section which provides that in a taxable year there may be no item of gross income in a class or less gross income than deductions allocated to the class, and paragraph (d)(2) of this section which provides that a class of gross income may include excluded income.

26CFR1.861-8T(d)(2)(iii)
Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable and] may have expenses, losses, or other deductions allocated and apportioned to them:
(A)... [ ...all foreign concerns ]
(B)...
(C)...
(D)...

[ "Income that is not considered tax exempt" is a double negative, which simply means "Income that is taxable income". In other words, this list is telling us what is taxed, and it's the only list of items to do so. ]

income that is exempt (8 matches)

CFR Sec. 861-8T(d)(2)
Allocation and apportionment to exempt, excluded or eliminated income--(i) In general. In the case of taxable years beginning after December 31, 1986, except to the extent otherwise permitted by Sec. 1.861-13T, the following rules shall apply to take account of income that is exempt or excluded, or assets generating such income, with respect to allocation and apportionment of deductions.
(A) Allocation of deductions. In allocating deductions that are definitely related to one or more classes of gross income, exempt income (as defined in paragraph (d)(2)(ii) of this section) shall be taken into account.

(ii) Exempt income and exempt asset defined--(A) In general. For purposes of this section, the term exempt income means any income that is, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes. The term exempt asset means any asset the income from which is, in whole or in part, exempt, excluded, or eliminated for federal tax purposes.

[ If income is exempt income, it is eliminated for federal income tax purposes. In the very next subparagraph we see the only list of Income that is Not exempt. ]

(iii) Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable and] may have expenses, losses, or other deductions allocated and apportioned to them:
(A) In the case of a foreign taxpayer
(B) the gross income of a DISC or a FSC;
(C) the gross income of a possessions corporation; and
(D) Foreign earned income

deduction (9561 matches)

26CFR1.863-3(d)
Determination of source of taxable income. Once the source of gross income has been determined under paragraph (c) of this section, the taxpayer must properly allocate and apportion separately under Secs. 1.861-8 through 1.861-14T the amounts of its expenses, losses, and other deductions to its respective amounts of gross income...

26CFR1.861-1(a)(1)
Within the United States.
The taxable income from sources within the United States, in the case of such income, shall be determined by deducting therefrom, in accordance with sections 861(b) and 863(a), the expenses, losses, and other deductions properly apportioned or allocated thereto and a ratable part of any other expenses, losses, or deductions which cannot definitely be allocated to some item or class of gross income. See Secs. 1.861-8 and 1.863-1.

26CFR1.861-8(a)(1)
Computation of taxable income from sources within the United States and from other sources and activities.
...This section provides specific guidance for applying the cited Code sections by prescribing rules for the allocation and apportionment of expenses, losses, and other deductions (referred to collectively in this section as ``deductions'') of the taxpayer. The rules contained in this section apply in determining taxable income of the taxpayer from specific sources and activities under other sections of the Code, referred to in this section as operative sections. See paragraph (f)(1) of this section for a list and description of operative sections.

CFR Sec. 861-8(a)(4)
... ``statutory grouping'' means the gross income from a specific source or activity which must first be determined in order to arrive at ``taxable income'' from which specific source or activity under an operative section. (See paragraph (f)(1) of this section.) Gross income from other sources or activities is referred to as the ``residual grouping of gross income'' or ``residual grouping.''
... In some instances, where the operative section so requires, the statutory grouping or the residual grouping may include, or consist entirely of, excluded income. See paragraph (d)(2) of this section with respect to the allocation and apportionment of deductions to excluded income.

[Paragraph (d)(2) directs us to -8T(d)(2).]

861-8T(d)(2)
(i)...the following rules shall apply to take account of income that is exempt or excluded, ...with respect to allocation and apportionment of deductions.
(A) Allocation of deductions. In allocating deductions that are definitely related to one or more classes of gross income, exempt income (as defined in paragraph (d)(2)(ii) of this section) shall be taken into account.

26CFR1.861-8(b)
Class of gross income. ...the gross income to which a specific deduction is definitely related ...is referred to as a ``class of gross income'' and may consist of one or more items of gross income. The rules emphasize the factual relationship between the deduction and a class of gross income. See paragraph (d)(1) of this section which provides that in a taxable year there may be no item of gross income in a class or less gross income than deductions allocated to the class, and paragraph (d)(2) of this section which provides that a class of gross income may include excluded income.

861-8T(d)(2)(ii)
(A)...the term exempt income means ANY INCOME that is, in whole or in part, exempt, excluded, or eliminated for federal income tax purposes.

[Immediately after the Secretary prescribes that exempt income is ANY INCOME eliminated for federal income tax purposes, 861-8T(d)(2)(iii) then tells us what is "Income that is not considered tax exempt", which also means "Income that Is Taxable", or in other words it is telling us What Is Taxed.]

861-8T(d)(2) Allocation and apportionment to exempt, excluded or eliminated income

(iii) Income that is not considered tax exempt. The following items are not considered to be exempt, eliminated, or excluded income and, thus, [are taxable and] may have expenses, losses, or other deductions allocated and apportioned to them:
(A) In the case of a foreign taxpayer (including a foreign sales corporation (FSC)) computing its effectively connected income, gross income (whether domestic or foreign source) which is not effectively connected to the conduct of a United States trade or business;
(B) In computing the combined taxable income of a DISC or FSC and its related supplier, the gross income of a DISC or a FSC;
(C) For all purposes under subchapter N of the Code, including the computation of combined taxable income of a possessions corporation and its affiliates under section 936(h), the gross income of a possessions corporation for which a credit is allowed under section 936(a); and
(D) Foreign earned income as defined in section 911 and the regulations thereunder (however, the rules of Sec. 1.911-6 do not require the allocation and apportionment of certain deductions, including home mortgage interest, to foreign earned income for purposes of determining the deductions disallowed under section 911(d)(6)).

[Why is the income of most Americans not listed as being taxable in "Income that is not considered tax exempt?" How do we find out exactly to what extent this rule, 861-8T(d)(2)(iii), covers? To find out, we must determine it's Scope. In addition, CFR Sec. 861-8(f)(1), states "sections of the Code which require the determination of taxable income" is also excluding the income of most Americans from it's own list. It actually makes perfect sense - if something is not included in a list, then by default, it has been excluded from the list. Can this be true? Yes, according to Principles of Statutory Construction, but also according to CFR Sec. 61(b), which says if there is another section of Code or regulations that treats any item of income more specifically than Sec. 61 does, then it shall apply.]

required to file (526 matches)

* Notice, "required to file" disappeared from Sec. 931 in 2006. This is how it used to look in 2005

CFR Sec. 931-1(b)(4)
Returns. A citizen entitled to the benefits of section 931 is required to file with his individual return Form 1040 the schedule on Form 1040E. If a citizen entitled to the benefits of section 931 has no income from sources within the United States and does not receive within the United States any income derived from sources without the United States he is not required to file a return or the schedule on Form 1040E.

in the case of a citizen (now 7 matches) - used to include 931-1 but it was basically erased

26CFR1.931-1
(b)General rule--(1) Qualifications. In the case of a citizen of the United States or a domestic corporation satisfying the following conditions, gross income means only gross income from sources within the United States--
(i) If 80 percent or more of the gross income of such citizen or domestic corporation (computed without the benefit of section 931) for the 3-year period immediately preceding the close of the taxable year (or for such part of such period immediately preceding the close of such taxable year as may be applicable) was derived from sources within a possession of the United States, and
(ii) If 50 percent or more of the gross income of such citizen or domestic corporation (computed without the benefit of section 931) for such period or such part thereof was derived from the active conduct of a trade or business within a possession of the United States. ... For a determination of income from sources within the United States, see part I (section 861 and following), subchapter N, chapter 1 of the Code, and section 931(i), and the regulations thereunder.

[ So, "Gross income means all income from whatever source...", BUT "In the case of a citizen of the United States... gross income means only gross income.. within the United States-- If 80 percent or more" of it comes from possessions. The term ``possession of the United States'' includes American Samoa, Guam, Johnston Island, Midway Islands, the Panama Canal Zone, Puerto Rico, and Wake Island. Apparently if you work enough in a possession you can claim all the income was gained from within the United States. According to the rules, this is the most desirable condition for a taxpayer needing to reduce taxable income. But, notice we are also pointed to Sec. 861, "the rules... for determining taxable income" in order to determine the sources of income. Don't be confused by individual Section titles, such as the title to Sec. 861, and pay little attention to what the titles say. USC Sec. 7806(b) shows that the individual titles of sections, i.e. descriptive matter relating to the contents, or table of contents, and cross references, outlines, etc. are only tools for the location of a subject. The laws (and rules) are only found on the inside of these labeled sections. ]

gross income (7961 matches)

26CFR1.861-8(a)(3)
...gross income ...is referred to as a ``class of gross income'' and may consist of one or more items of gross income enumerated in section 61, namely:
(i) Compensation for services, including fees, commissions, and similar items;
(ii) Gross income derived from business;
(iii) Gains derived from dealings in property;
(iv) Interest;
(v) Rents;
...(and more items)

26CFR1.861-8 (a)(4)
the term... ``statutory grouping'' means the gross income from a specific source or activity which must first be determined in order to arrive at ``taxable income'' (See paragraph (f)(1) of this section.)...
...the statutory grouping ...may include, or consist entirely of, excluded income. See paragraph (d)(2) of this section with respect to ...excluded income.

26CFR1.861-8(b)
...gross income to which a specific deduction is definitely related ...is referred to as a ``class of gross income'' and may consist of one or more items of gross income. The rules emphasize the factual relationship between the deduction and a class of gross income. See paragraph (d)(1) of this section which provides that in a taxable year there may be no item of gross income in a class or less gross income than deductions allocated to the class, and paragraph (d)(2) of this section which provides that a class of gross income may include excluded income.

gross income means (4 matches)

26CFR1.61-1
(a) General definition. Gross income means all income from whatever source derived, unless excluded by law.

[This is the rule, which is supposed to authorize a tax on "all income from whatever source." But, rule #1 says the "Tax imposed is upon taxable income", not "imposed upon gross income." This rule, Sec. 61-1, is not a part of "the rules... for determining taxable income." It is only a "General definition" of Gross. However, even it says "unless excluded", and immediately after this in Sec. 61-1(b), says if other sections of the Code provide specific treatment for "any item", the other sections shall apply, regardless of what Gross means here.]

[For some reason, this next result is not available on the eCFR, only the CFR.]

* The Treasury Dept. changed this section in Jan. 31, 2006. You can see the earlier version at http://www.access.gpo.gov/nara/cfr/cfr-table-search.html#page1

26CFR1.931-1
(b)General rule--(1) Qualifications. In the case of a citizen of the United States or a domestic corporation satisfying the following conditions, gross income means only gross income from sources within the United States--
(i) If 80 percent or more of the gross income of such citizen or domestic corporation (computed without the benefit of section 931) for the 3-year period immediately preceding the close of the taxable year (or for such part of such period immediately preceding the close of such taxable year as may be applicable) was derived from sources within a possession of the United States, and
(ii) If 50 percent or more of the gross income of such citizen or domestic corporation (computed without the benefit of section 931) for such period or such part thereof was derived from the active conduct of a trade or business within a possession of the United States. ... For a determination of income from sources within the United States, see part I (section 861 and following), subchapter N, chapter 1 of the Code, and section 931(i), and the regulations thereunder.

[ So, "Gross income means all income from whatever source, unless excluded by law", BUT "In the case of a citizen of the United States... gross income means only gross income... within the United States -- If 80 percent or more" of it comes from possessions. The term ``possession of the United States'' includes American Samoa, Guam, Johnston Island, Midway Islands, the Panama Canal Zone, Puerto Rico, and Wake Island. Apparently if you work enough in a possession you can claim all the income was gained from within the United States. According to the rules, this is the most desirable condition for a taxpayer needing to reduce taxable income. But, notice this rule points us to Sec. 861, "the rules... for determining taxable income" to determine the sources of income. Don't be confused by individual Section titles. USC Sec. 7806(b) shows that the individual titles of sections, i.e. descriptive matter relating to the contents, or table of contents, and cross references, outlines, etc. are only tools for the location of a subject. The laws (and rules) are only found on the inside of these labeled sections. ]

Computation of taxable income from sources within the United States (2 matches, 2 sections)

26CFR1.861-8
Sec. 1.861-8 Computation of taxable income from sources within the United States and from other sources and activities.

(a) In general--(1) Scope. Sections 861(b) and 863(a) state in general terms how to determine taxable income of a taxpayer from sources within the United States after gross income from sources within the United States has been determined. Sections 862(b) and 863(a) state in general terms how to determine taxable income of a taxpayer from sources without the United States...
... See paragraph (f)(1) of this section for a list and description of operative sections.

26CFR1.861-8T
Sec. 1.861-8T Computation of taxable income from sources within the United States and from other sources and activities (temporary).

computation of taxable income (66 matches)

26cfr1.861-8
Sec. 1.861-8 Computation of taxable income from sources within the United States and from other sources and activities.

(a) In general--(1) Scope. Sections 861(b) and 863(a) state in general terms how to determine taxable income of a taxpayer from sources within the United States after gross income from sources within the United States has been determined. Sections 862(b) and 863(a) state in general terms how to determine taxable income ...
...The rules contained in this section apply in determining taxable income of the taxpayer from specific sources and activities under other sections of the Code, referred to in this section as operative sections. See paragraph (f)(1) of this section for a list and description of operative sections.

(a)(4) ...In some instances, where the operative section so requires, the statutory grouping or the residual grouping may include, or consist entirely of, excluded income. See paragraph (d)(2) of this section with respect to the allocation and apportionment of deductions to excluded income.

computation of income (18 matches)

26cfr1.861-1
(c) Computation of income. If a taxpayer has gross income from sources within or without the United States, together with gross income derived partly from sources within and partly from sources without the United States, the amounts thereof, together with the expenses and investment applicable thereto, shall be segregated; and the taxable income from sources within the United States shall be separately computed therefrom.

categories of income (36 matches)

26cfr1.861-1
(a) Categories of income. Part I (section 861 and following), subchapter N, chapter 1 of the Code, and the regulations thereunder determine the sources of income for purposes of the income tax. These sections explicitly allocate certain important sources of income to the United States or to areas outside the United States, as the case may be; and, with respect to the remaining income (particularly that derived partly from sources within and partly from sources without the United States), authorize the Secretary or his delegate to determine the income derived from sources within the United States, either by rules of separate allocation or by processes or formulas of general apportionment. The statute provides for the following three categories of income:
(1) Within the United States.
(2) Without the United States.
(3) Partly within and partly without the United States.

taxable income from sources within the United States (44 matches)

26CFR1.863-1
(c) Determination of taxable income. The taxpayer's taxable income from sources within or without the United States will be determined under the rules of Secs. 1.861-8 through 1.861-14T for determining taxable income from sources within the United States."

26CFR1.861-1
(b) Taxable income from sources within the United States. The taxable income from sources within the United States shall consist of the taxable income described in paragraph (a)(1) of this section plus the taxable income allocated or apportioned to such sources, as indicated in paragraph (a)(3) of this section.

26CFR1.861-8
Sec. 1.861-8 Computation of taxable income from sources within the United States and from other sources and activities.

(a) In general--(1) Scope. Sections 861(b) and 863(a) state in general terms how to determine taxable income of a taxpayer from sources within the United States after gross income from sources within the United States has been determined.

26CFR1.861-8T
Sec. 1.861-8T Computation of taxable income from sources within the United States and from other sources and activities (temporary).

determine income (6 matches)

26CFR1.863-0
Sec. 1.863-0 Table of contents.
This section lists captions contained in Secs. 1.863-1, 1.863-2, and 1.863-3.

Sec. 1.863-3 Allocation and apportionment of income from certain sales of inventory.
(a) In general.
(1) Scope.
(2) Special rules.
(b) Methods to determine income attributable to production activity and sales activity.

26CFR1.863-3
(b) Methods to determine income attributable to production activity and sales activity--(1) 50/50 method--(i) Determination of gross income. Generally, gross income from Section 863 Sales will be apportioned between production activity and sales activity under the 50/50 method as described in this paragraph (b)(1). Under the 50/50 method, one-half of the taxpayer's gross income will be considered income attributable to production activity and the source of that income will be determined under the rules of paragraph (c)(1) of this section. The remaining one- half of such gross income will be considered income attributable to sales activity and the source of that income will be determined under the rules of paragraph (c)(2) of this section. In lieu of the 50/50 method, the taxpayer may elect to determine the source of income from Section 863 Sales under the IFP method described in paragraph (b)(2) of this section or, with the consent of the District Director, the books and records method described in paragraph (b)(3) of this section.

26CFR1.863-3 (c)(1)
(c) Determination of the source of gross income from production activity and sales activity--(1) Income attributable to production activity--(i) Production only within the United States or only within foreign countries--(A) Source of income. For purposes of this section, production activity means an activity that creates, fabricates, manufactures, extracts, processes, cures, or ages inventory. See Sec. 1.864-1. Subject to the provisions in Sec. 1.1502-13 or paragraph (g)(2)(ii) of this section, the only production activities that are taken into account for purposes of Secs. 1.863-1, 1.863-2, and this section are those conducted directly by the taxpayer. Wherethe taxpayer's production assets are located only within the United States or only outside the United States, the income attributable to production activity is sourced where the taxpayer's production assets are located. For rules regarding the source of income when production assets are located both within the United States and without the United States, see paragraph (c)(1)(ii) of this section.

26CFR1.863-3(c)(2) and (d), and(e).

(c)(2) Income attributable to sales activity. The source of the taxpayer's income that is attributable to sales activity will be determined under the provisions of Sec. 1.861-7(c). However, notwithstanding any other provision, for purposes of section 863, the place of sale will be presumed to be the United States if personal property is wholly produced in the United States and the property is sold for use, consumption, or disposition in the United States...

(d) Determination of source of taxable income. Once the source of gross income has been determined under paragraph (c) of this section, the taxpayer must properly allocate and apportion separately under Secs. 1.861-8 through 1.861-14T the amounts of its expenses, losses, and other deductions to its respective amounts of gross income from Section 863 Sales determined separately under each method described in paragraph (b) of this section.
... In the case of gross income from Section 863 Sales determined under the IFP method or the books and records method, the rules of Secs. 1.861-8 through 1.861-14T must apply to properly allocate or apportion amounts of expenses, losses and other deductions allocated and apportioned to such gross income between gross income from sources within and without the United States.

(e) Election and reporting rules--(1) Elections under paragraph (b) of this section. If a taxpayer does not elect a method specified in paragraph (b) (2) or (3) of this section, the taxpayer must apply the method specified in paragraph (b)(1) of this section. The taxpayer may elect to apply the method specified in paragraph (b)(2) of this section by using the method on a timely filed original return (including extensions). A taxpayer may elect to apply the method specified in paragraph (b)(3) of this section by using the method on a timely filed original return (including extensions), but only if the taxpayer has received permission from the District Director to apply that method. Once a method under paragraph (b) of this section has been used, that method must be used in later taxable years unless the Commissioner consents to a change.

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What is the Scope:

1. Who = "the taxpayer"
2. Where = "under other sections of the Code"
3. What = "determining taxable income of the taxpayer", and "specific guidance", AND "how to determine taxable income"

Notice:

• "specific guidance" occurs only once
• "determining taxable income of the taxpayer" and "how to determine taxable income" also only occur once
• they all occur together - on just one page in the Code of Federal Regulations, Title 26.

26cfr1.861-8
Sec. 1.861-8 Computation of taxable income...

(a) In general--(1) Scope. Sections 861(b) and 863(a) state in general terms how to determine taxable income of a taxpayer from sources within the United States after gross income from sources within the United States has been determined. ... This section provides specific guidance ...by prescribing rules for the allocation... of... other deductions (referred to collectively... as ``deductions'') of the taxpayer. The rules contained in this section apply in determining taxable income of the taxpayer from specific sources and activities under other sections of the Code, referred to in this section as operative sections. See paragraph (f)(1) of this section for a list and description of operative sections.

[The "Scope" includes the "taxable income of the taxpayer... under other Sections of the Code." Then it says we must "See paragraph (f)(1)... for a list" of sources, and sections where they are located. These are the specific sources and sections in the CFR, which require the determination of taxable income; shown both by the Scope of this rule, and as specifically stated within the rule of Paragraph (f)(1). However, this is only the statutory grouping. There is also a residual grouping which is considered taxable, unless excluded (exempt). By following instructions in 861-8, titled "Computation of taxable income...", that tell us "how to determine taxable income," while giving us "specifice guidance," we eventually come to Sec. 861-8T(d)(2)(iii), the exact list of what is taxed. If you sell inventory, you may want to read the Scope of the rule below. But, again we are directed to Sec. 861-8.]

26CFR1.863-3
(a) In general--(1) Scope. Paragraphs (a) through (e) of this section apply to determine the source of income derived from the sale of inventory property (inventory)... A taxpayer must divide gross income between production activity and sales activity... The source of gross income... must then be determined under paragraph (c) of this section. Taxable income... is determined under paragraph (d) of this section.

(c) (1) Income attributable to production activity--(i)(A) Source of income.
...production activity means an activity that creates ...inventory...
Where the taxpayer's production assets are located only within the United States or only outside the United States, the income attributable to production activity is sourced where the taxpayer's production assets are located...

(d) Determination of source of taxable income. Once the source of gross income has been determined under paragraph (c) of this section, the taxpayer must properly allocate and apportion separately under Secs. 1.861-8 through 1.861-14T the amounts of its expenses, losses, and other deductions to its respective amounts of gross income...