§126 — Certain cost-sharing payments
45 cases·10 followed·4 distinguished·1 criticized·30 cited—22% support
Statute Text — 26 U.S.C. §126
Gross income does not include the excludable portion of payments received under—
The rural clean water program authorized by section 208(j) of the Federal Water Pollution Control Act (
33 U.S.C. 1288(j)
).
The rural abandoned mine program authorized by section 406 of the Surface Mining Control and Reclamation Act of 1977 (
30 U.S.C. 1236
).
The water bank program authorized by the Water Bank Act (
16 U.S.C. 1301
et seq.).
The emergency conservation measures program authorized by title IV of the Agricultural Credit Act of 1978.
The agricultural conservation program authorized by the Soil Conservation and Domestic Allotment Act (
16 U.S.C. 590a
).
The resource conservation and development program authorized by the Bankhead-Jones Farm Tenant Act and by the Soil Conservation and Domestic Allotment Act (
7 U.S.C. 1010
;
16 U.S.C. 590a
et seq.).
Any small watershed program administered by the Secretary of Agriculture which is determined by the Secretary of the Treasury or his delegate to be substantially similar to the type of programs described in paragraphs (1) through (8).
Any program of a State, possession of the United States, a political subdivision of any of the foregoing, or the District of Columbia under which payments are made to individuals primarily for the purpose of conserving soil, protecting or restoring the environment, improving forests, or providing a habitat for wildlife.
For purposes of this section—
The term “excludable portion” means that portion (or all) of a payment made to any person under any program described in subsection (a) which—
is determined by the Secretary of Agriculture to be made primarily for the purpose of conserving soil and water resources, protecting or restoring the environment, improving forests, or providing a habitat for wildlife, and
is determined by the Secretary of the Treasury or his delegate as not increasing substantially the annual income derived from the property.
The term “excludable portion” does not include that portion of any payment which is properly associated with an amount which is allowable as a deduction for the taxable year in which such amount is paid or incurred.
The taxpayer may elect not to have this section (and section 1255) apply to any excludable portion (or portion thereof).
Any election under paragraph (1) shall be made in the manner prescribed by the Secretary by regulations and shall be made not later than the due date prescribed by law (including extensions) for filing the return of tax under this chapter for the taxable year in which the payment was received or accrued.
No deduction or credit shall be allowed with respect to any expenditure which is properly associated with any amount excluded from gross income under subsection (a).
Notwithstanding any provision of section 1016 to the contrary, no adjustment to basis shall be made with respect to property acquired or improved through the use of any payment, to the extent that such adjustment would reflect any amount which is excluded from gross income under subsection (a).
45 Citing Cases
126 (1999); Fla. Stat. Ann. sec. 741.241 (West 2005). In Delaware, the presumption of marriage arising from marital cohabitation is not conclusive but rather subject to rebuttal, which may be made by proof of facts showing that no marriage ever existed between the parties, or proof that at its commencement either party had a prior spouse livin
in the record indicates 7 Petitioner did not proffer evidence or argument that disaster payments would be excludable from Cheyenne’s income as disaster relief, cf. Bannon v. Commissioner, 99 T.C. 59, 62-63 (1992), or as Federal subsidies covered by sec. 126. - 15 - that Cheyenne did not conduct any farming activities in 1989. Petitioner has presented no evidence to explain or substantiate the $11,503 loss. In the absence of any evidence substantiating or explaining petitioner’s entitlement to t
period * * * shall be included in the gross income, for the taxable year when received, of: (A) the estate of the decedent, if the right to receive the amount is acquired by the decedent's estate from the decedent; Section 691 and its predecessor, section 126 of the Internal Revenue Code of 1939, were enacted to accomplish the general purpose of the Internal Revenue Code that a tax should be paid on all income and “that death should not rob the United States of the revenue which otherwise it wo