Tax Law Origination (How a tax law is created!)
Tax bill is introduced on the
Floor of the House of
New tax law
Tax bill dies
Tax bill is debated,
This chapter discusses exclusions from income specifically created by Congress. Most of these
exclusions can be found in Sections: 101-150.
Many of the topics from prior chapters are revisited in this chapter.
1. Generally, gifts are excl
Concepts of Income:
1. Economic income - the amount that an individual could consume during a
period and be as well off at the end of the period as he/she was at the beginning of
The economic definition of income would include unreal
Refer to Figure 1-2 for the formula for the Federal Income tax for individuals.
Income (Broadly conceived): includes all of the taxpayer's income.
a. Includes both taxable and nontaxable income.
b. Similar to gross receipts, but does not include