26Title 26The US tax code, read & explained

26 U.S.C. § 26

§ 26. Limitation based on tax liability; definition of tax liability

524 words · amended 27 times · cited by 13 other sections

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History

Added in 1984 by the Deficit Reduction Act of 1984. Last changed March 11, 2021 by the American Rescue Plan Act of 2021.

Every change, newest first (28)
  1. March 11, 2021American Rescue Plan Act of 2021
  2. March 23, 2018Consolidated Appropriations Act, 2018
  3. December 22, 2017Tax Cuts and Jobs Act (2017)
  4. December 19, 2014Tax Increase Prevention Act of 2014
  5. January 2, 2013American Taxpayer Relief Act of 2012
  6. December 17, 2010Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010
  7. March 23, 2010Patient Protection and Affordable Care Act (2010)
  8. February 17, 2009Public Law 111-5
  9. October 3, 2008Emergency Economic Stabilization Act of 2008
  10. July 30, 2008Public Law 110-289
  11. December 29, 2007Public Law 110-172
  12. December 26, 2007Public Law 110-166
  13. May 17, 2006Public Law 109-222
  14. December 21, 2005Gulf Opportunity Zone Act of 2005
  15. October 4, 2004Public Law 108-311
  16. March 9, 2002Public Law 107-147
  17. July 26, 2001Public Law 107-22
  18. June 7, 2001Economic Growth and Tax Relief Reconciliation Act of 2001
  19. December 21, 2000Public Law 106-554
  20. December 17, 1999Public Law 106-170
  21. October 21, 1998Public Law 105-277
  22. August 5, 1997Taxpayer Relief Act of 1997
  23. August 20, 1996Small Business Job Protection Act of 1996
  24. December 19, 1989Omnibus Budget Reconciliation Act of 1989
  25. November 10, 1988Technical and Miscellaneous Revenue Act of 1988
  26. October 22, 1986Tax Reform Act of 1986
  27. October 17, 1986Public Law 99-499
  28. July 18, 1984Deficit Reduction Act of 1984 · added this section

The law as written

Current through Public Law 119-102. Amendment notes omitted.

Structure

  1. (a) Limitation based on amount of tax
  2. (b) Regular tax liability
  3. (c) Tentative minimum tax
(a) Limitation based on amount of tax

The aggregate amount of credits allowed by this subpart for the taxable year shall not exceed the sum of—

(1)

the taxpayer’s regular tax liability for the taxable year reduced by the foreign tax credit allowable under section 27, and

(2)

the tax imposed by section 55(a) for the taxable year.

(b) Regular tax liability

For purposes of this part—

(1) In general

The term “regular tax liability” means the tax imposed by this chapter for the taxable year.

(2) Exception for certain taxes

For purposes of paragraph (1), any tax imposed by any of the following provisions shall not be treated as tax imposed by this chapter:

(A)

section 55 (relating to minimum tax),

(B)

section 59A (relating to base erosion and anti-abuse tax),

(C)

subsection (m)(5)(B), (q), (t), or (v) of section 72 (relating to additional taxes on certain distributions),

(D)

section 143(m) (relating to recapture of proration of Federal subsidy from use of mortgage bonds and mortgage credit certificates),

(E)

section 530(d)(4) (relating to additional tax on certain distributions from Coverdell education savings accounts),

(F)

section 531 (relating to accumulated earnings tax),

(G)

section 541 (relating to personal holding company tax),

(H)

section 1351(d)(1) (relating to recoveries of foreign expropriation losses),

(I)

section 1374 (relating to tax on certain built-in gains of S corporations),

(J)

section 1375 (relating to tax imposed when passive investment income of corporation having subchapter C earnings and profits exceeds 25 percent of gross receipts),

(K)

subparagraph (A) of section 7518(g)(6) (relating to nonqualified withdrawals from capital construction funds taxed at highest marginal rate),

(L)

sections 871(a) and 881 (relating to certain income of nonresident aliens and foreign corporations),

(M)

section 860E(e) (relating to taxes with respect to certain residual interests),

(N)

section 884 (relating to branch profits tax),

(O)

sections 453(l)(3) and 453A(c) (relating to interest on certain deferred tax liabilities),

[(P) repealed

Repealed. Pub. L. 115–141, div. U, title IV, § 401(b)(2), Mar. 23, 2018, 132 Stat. 1201.]

(Q)

section 220(f)(4) (relating to additional tax on Archer MSA distributions not used for qualified medical expenses),

(R)

section 138(c)(2) (relating to penalty for distributions from Medicare Advantage MSA not used for qualified medical expenses if minimum balance not maintained),

(S)

sections 106(e)(3)(A)(ii), 223(b)(8)(B)(i)(II), and 408(d)(9)(D)(i)(II) (relating to certain failures to maintain high deductible health plan coverage),

(T)

section 170(o)(3)(B) (relating to recapture of certain deductions for fractional gifts),

(U)

section 223(f)(4) (relating to additional tax on health savings account distributions not used for qualified medical expenses),

(V)

subsections (a)(1)(B)(i) and (b)(4)(A) of section 409A (relating to interest and additional tax with respect to certain deferred compensation),

(W)

section 36(f) (relating to recapture of homebuyer credit),

(X)

section 457A(c)(1)(B) (relating to determinability of amounts of compensation),

(Y)

section 529A(c)(3)(A) (relating to additional tax on ABLE account distributions not used for qualified disability expenses), and

(Z)

section 24(j)(2) (relating to excess advance payments).

(c) Tentative minimum tax

For purposes of this part, the term “tentative minimum tax” means the amount determined under section 55(b)(1).