Internal Revenue Code or Title 26 of US Code

For a new person interested in knowing about the taxation laws of United States , first complexitie will arise to understand the terms Internal Revenue Code and Title 26 of US Code . Are they different laws ? Which one should I follow : Internal Revenue Code ( IRC ) or the US Code 26 ?

The good news is that both are same . The Internal Revenue Code (IRC) is the  federal statutory tax law in the United States. The, Internal Revenue Code is the only volume that has been published in the form of a separate code of the 50 enacted titles of United States Statutes at Large.

History of IRC

The Internal Revenue Code of 1954 was enacted in the form of a separate code by act of August 16, 1954, ch. 736, 68A Stat. 1. However , the name of  IRC 1954 Code was changed  to the “Internal Revenue Code of 1986” by the The Tax Reform Act of 1986 . The text of the Internal Revenue Code as published in title 26 of the U.S. Code is virtually identical to the Internal Revenue Code as published in the various volumes of the United States Statutes at Large.

The various provision of tax laws under the the Internal Revenue Code is provided under various  section which runs from sections 1 through 9834. The table below is summary of the topics of the IRC.

Sections of Internal Revenue Code

Sections Function
1–15 Tax rates
21–54 Credits (refundable and nonrefundable)
55–59A Alternative Minimum Tax & environmental tax
61–90 Definition of gross income (before deductions), including items specifically taxable
101–140 Specific exclusions from gross income
141–149 Private activity bonds
151–153 Personal exemptions; dependent defined
161–199 Deductions, including interest, taxes, losses, and business related items
211–224 Itemized deductions for individuals
241–250 Deductions unique to corporations
261–291 Nondeductible items, including special rules limiting or deferring deductions
301–386 Corporate transactions, including formation, distributions, reorganizations, liquidations (Subchapter C)
401–436 Pension and benefit plans: treatment of plans, employers, & beneficiaries
441–483 Accounting methods & tax years
501–530 Exempt organizations (charitable and other)
531–565 Accumulated earnings tax and personal holding companies
581–597 Banks: special rules for certain items
611–638 Natural resources provisions: depletion, etc.
641–692 Trusts & estates: definitions, income tax on same & beneficiaries
701–777 Partnerships: definitions, treatment of entities and members, special rules (Subchapter K)
801–858 Insurance companies: special rules, definitions
851–860 Regulated investment companies (mutual funds) and Real Estate Investment Trusts
861–865 Source of income (for international tax)
871–898 Tax on foreign persons/corporations; inbound international rules
901–908 Foreign tax credit
911–943 Exclusions of foreign income (mostly repealed)
951–965 Taxation of U.S. shareholders of controlled foreign corporations (Subpart F)
971–999 Other international tax provisions
1001–1092 Gains: definitions, characterization, and recognition; special rules
1201–1298 Capital gains: separate taxation and special rules
1301–1359 Interperiod adjustments; certain special rules
1361–1388 S Corporations and cooperative associations: flow-through rules
1391–1400T Empowerment, enterprise, and other special zones
1401–1403 Self-employment tax (like social security, below)
1441–1465 Withholding of tax on nonresidents
1501–1564 Consolidated returns and affiliated groups (corporations)
2001–2210 Estate tax on transfers at death
2501–2704 Gift tax and tax on generation skipping transfers
3101–3241 Social security and railroad retirement taxes
3301–3322 Unemployment taxes
3401–3510 Income tax withholding; payment of employment taxes
4001–5000 Excise taxes on specific goods, transactions, and industries
5001–5891 Alcohol, tobacco and firearms taxes and special excise tax rules
6001–6167 Tax returns: requirements, procedural rules, payments, settlements, extensions
6201–6533 Assessment, collection, and abatement; limitations on collection & refund
6601–6751 Interest and non-criminal penalties on underpayments or failures
6801–7124 Other procedural rules
7201–7344 Crimes, other offences, forfeitures, tax evasion
7401–7493 Judicial proceedings
7501–8023 Miscellaneous rules
9001–9834 Special taxes & funds (presidential election, highway, black lung, etc.)

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