
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC4402]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                 Subtitle D--Miscellaneous Excise Taxes
 
                      CHAPTER 35--TAXES ON WAGERING
 
                       Subchapter A--Tax on Wagers
 
Sec. 4402. Exemptions

    No tax shall be imposed by this subchapter--

                           (1) Parimutuels

        On any wager placed with, or on any wager placed in a wagering 
    pool conducted by, a parimutuel wagering enterprise licensed under 
    State law,

                      (2) Coin-operated devices

        On any wager placed in a coin-operated device (as defined in 
    section 4462 as in effect for years beginning before July 1, 1980), 
    or on any amount paid, in lieu of inserting a coin, token, or 
    similar object, to operate a device described in section 4462(a)(2) 
    (as so in effect), or

                 (3) State-conducted lotteries, etc.

        On any wager placed in a sweepstakes, wagering pool, or lottery 
    which is conducted by an agency of a State acting under authority of 
    State law, but only if such wager is placed with the State agency 
    conducting such sweepstakes, wagering pool, or lottery, or with its 
    authorized employees or agents.

(Aug. 16, 1954, ch. 736, 68A Stat. 525; Pub. L. 85-859, title I, 
Sec. 152(b), Sept. 2, 1958, 72 Stat. 1305; Pub. L. 89-44, title IV, 
Sec. 405(a), title VIII, Sec. 813(a), June 21, 1965, 79 Stat. 149, 170; 
Pub. L. 94-455, title XII, Sec. 1208(a), Oct. 4, 1976, 90 Stat. 1709; 
Pub. L. 95-600, title V, Sec. 521(c)(1), Nov. 6, 1978, 92 Stat. 2884.)

                       References in Text

    Section 4462, referred to in par. (2), was repealed by Pub. L. 95-
600, title V, Sec. 521(b), Nov. 6, 1978, 92 Stat. 2884.


                               Amendments

    1978--Par. (2). Pub. L. 95-600 substituted ``(as defined in section 
4462 as in effect for years beginning before July 1, 1980)'' for ``with 
respect to which an occupational tax is imposed by section 4461'' and 
``(as so in effect), or'' for ``if an occupational tax is imposed with 
respect to such device by section 4461, or''.
    1976--Par. (3). Pub. L. 94-455, among other changes, substituted in 
heading ``State-conducted lotteries, etc.'' for ``State-conducted 
sweepstakes.'', and struck out provision that no tax be imposed on any 
wager placed in a sweepstakes, wagering pool, or lottery in which the 
ultimate winners are determined by the results of a horse race.
    1965--Par. (2). Pub. L. 89-44, Sec. 405(a), substituted ``section 
4462(a)(2),'' for ``section 4462(a)(2)(B),''.
    Par. (3). Pub. L. 89-44, Sec. 813(a), added par. (3).
    1958--Par. (2). Pub. L. 85-859 inserted provisions exempting from 
the tax amounts paid to operate a device described in section 
4462(a)(2)(B), if an occupational tax is imposed with respect to such 
device by section 4461 of this title.


                    Effective Date of 1978 Amendment

    Pub. L. 95-600, title V, Sec. 521(d)(2), Nov. 6, 1978, 92 Stat. 
2885, provided that: ``The amendments made by subsections (b) [repealing 
sections 4461 to 4464 of this title] and (c) [amending this section and 
section 4901 of this title] shall apply with respect to years beginning 
after June 30, 1980.''


                    Effective Date of 1976 Amendment

    Section 1208(c)(1) of Pub. L. 94-455 provided that: ``The amendment 
made by subsection (a) [amending this section)] shall apply with respect 
to wagers placed after March 10, 1964''.


                    Effective Date of 1965 Amendment

    Section 701(c)(2) of Pub. L. 89-44 provided in part that: ``The 
amendments made by sections 403 [amending sections 4461 and 4462 of this 
title] (relating to occupational tax on coin-operated devices) and 404 
[repealing sections 4471 to 4474] (relating to occupational tax on 
bowling alleys, billiard and pool tables), and by subsections (a) 
[amending this section], (b) [amending section 4901 of this title] and 
(d) [amending section 4914 of this title] of section 405 (relating to 
technical and conforming changes) shall apply on and after July 1, 
1965.''
    Section 813(b) of Pub. L. 89-44 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply with respect to 
wagers placed after March 10, 1964.''


                    Effective Date of 1958 Amendment

    Section 152(c) of Pub. L. 85-859, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``The amendments 
made by subsections (a) and (b) [amending this section and section 4462 
of this title] shall take effect on the effective date specified in 
section 1(c) of this Act [the first day of the first calendar quarter 
beginning more than 60 days after Sept. 2, 1958]. In the case of the 
year beginning July 1, 1958, where the trade or business on which the 
tax is imposed under section 4461 of the Internal Revenue Code of 1986 
[formerly I.R.C. 1954] was commenced before such effective date, the tax 
imposed for such year solely by reason of the amendment made by 
subsection (a)--
        ``(1) shall be the amount reckoned proportionately from such 
    effective date through June 30, 1959, and
        ``(2) shall be due on, and payable on or before, the last day of 
    the month the first day of which is such effective date.''
